How to argue for public goods

Note: I use “public goods” in a general sense here as goods provided by the public, whether non-excludable or not.

Arguments about public goods tend to be very sloppy. Advocates for such goods often conflate distributive issues with public provisioning issues, even though the two are conceptually distinct. This is partly what I was getting at in my recent post about transit fares. As Murphy and Nagel point out in “The Myth of Ownership,” there is no necessary connection between favoring egalitarian distributions and public provisioning:

One might favor a strongly egalitarian distributive policy of money transfers or cash subsidies while being against all but a minimal level of public provision — leaving individuals as free as possible to determine how their share of the social product is to be expended. On the other hand, one might be in favor of a high level of public provision […] while not being in favor of any redistribution, except that which occurs as an inevitable side-effect of the financing of these goods by the unequal taxation of persons with unequal resources.

It is possible to have an egalitarian distribution with very minimal public provisioning, and it is possible to have substantial amounts of public provisioning without any egalitarian distributive institutions. So to make a clean argument for public subsidies or provisioning, one should not really mention its distributive impacts at all. Or as Murphy and Nagel say “what we want, ideally, is to be able to compare public with private expenditure under a distribution that can be assumed to be just among individuals.”

For instance, go back to the transit fare issue. The dominant argument provided by some for subsidizing this transit is that it creates a more egalitarian distribution. It gives more stuff to poor people relative to their incomes than it gives to rich people. Needless to say, this is a wildly inefficient method of reordering the distribution. But more than that, the argument becomes totally irrelevant if we have a just distribution already. We could just move cash around to satisfy our distributive goals without subsidizing transit. If we did that, the distributive point would evaporate.

Because distribution is conceptually and practically distinct from public provisioning, arguments for provisioning really shouldn’t mention distribution at all, not when we are talking on the pure policy level at least. If a certain kind of public provisioning can only be justified by mentioning its distributive consequences, then in an ideal world, that public provisioning should not exist at all. Instead, cash should be moved around and the public good should be cancelled.

None of this is to say that there are not robust arguments for public provisioning separate from distribution. Of course there are. The grievance is just that those non-distributive arguments seem to take a backseat, if they are mentioned at all. But those are the real arguments. Those are the arguments that actually explain why we should do the program you are advocating instead of just directly altering the distribution and calling it a day. The non-distributive arguments should be out in front.

To be sure, in on-the-ground practice, this can get reasonably muddled. As I said in my transit fare post, we live in this nonsensical political climate where people are cool with altering the distribution if the alteration looks like it is baked into the cake, but not if the alteration seems too after-the-fact. Up against this non-ideal reality, it might make sense to use public provisioning purely as an instrument of egalitarianism. But that should be understood for the conceptually bizarre policy that it actually is.