What Is "Fair"?

Jan 13, 2020

“Fairness” has become a Progressive obsession. The childhood lament, “it’s not fair!” is now a common refrain among many adults. No political discussion seems complete without someone insisting that the wealthy pay "their fair share.” But what does anybody mean by “fair”? In this video, social commentator Daniel Hannan attempts to answer this critically important question.

Study Guide

The word “fair” can be used to denote a number of concepts that are not only different, but fundamentally opposed.: The word “fair” has a conveniently vague definition, meaning “marked by impartiality and honest, free from self-interest, prejudice, or favoritism.”
View source; In the political world, the increasingly popular word is frequently used in a deliberately ambiguous ways. “The beauty of the word, from the point of view of pundits and campaigners, is its elasticity,” explains Daniel Hannan, President of the Initiative for Free Trade. “It can be used to denote a number of concepts that are not only different, but fundamentally opposed. Fairness can mean [equality, entitlement, or need]. Politicians use it to mean all three of these things, sometimes deliberately eliding them.” When politicians say the rich should pay their “fair share,” for example, they really mean they want them to pay extra.
View source; Related reading: “Inventing Freedom” – Daniel Hannan
View source
The word “fair” has become a popular statement of moral superiority, tinged, paradoxically, with victimhood.: Talk of “fairness” has grown in popularity in recent decades, particularly among left-wing politicians. A recent Google study shows the usage of the word “fairness” in British books since 1900 shot up in the last quarter of the century.
View source; The term, as the Initiative for Free Trade’s Daniel Hannan puts it, “isn’t really being used, these days, to signify proportionality, merit, equity, desert or even redistribution. It is used, rather, as a way to signal the speaker’s virtue.” And when the term is used economically, Hannan argues, it is often used to mean the opposite of “fair.” When politicians and activists say the rich should pay their “fair share,” for example, they really mean they want them to pay extra.
View source; Related reading: "The New Road to Serfdom: A Letter of Warning to America" – Daniel Hannan
View source
The rich already pay more than their fair share. Having them pay more would hurt them a little bit, but it would hurt the poor a lot.: America already has the most progressive tax system in the developed world, in which the rich pay far more than the percent of the wealth they bring in.
View source; Expanding this already heavily progressive tax system would have a significant negative impact on economic growth.
View source; The most negatively impacted are the very people progressive income taxes are supposed to help: the poor.
View source; Read UCLA economist Dr. Lee Ohanian and tax expert Kip Hagopian on income inequality and fair taxation.
View source; Related reading: “Brexit and Free Trade: An Interview with Daniel Hannan” – Austrian Economic Center
View source
The alternative to a free market-based, wealthy, unequal economy is a socialistic, poor, equal economy.: Income inequality motivates people who want more money to create profitable companies (i.e. companies that provide something people want). As economist John Tamny argues, “[I]t is gaps in wealth that drive creativity among the citizenry … their innovations redounding to individuals of all income classes.”
View source; Capitalism naturally drives entrepreneurs to create increasingly affordable products and services in order to increase their customer base. Consequently, capitalism improves the lifestyle equality of society.
View source; Related reading: “Equal Is Unfair: America's Misguided Fight Against Income Inequality” – Don Watkins
View source
Countries with the most economic freedom earn 6 times more than countries with the lowest level of economic freedom.: Countries with the most economic freedom earn more than six times the annual earnings of countries with the lowest level of economic freedom.
View source; Read Arthur Brooks on the significance of free enterprise.
View source
The free market caters more to the masses than the economic elite, making things increasingly more affordable for more people.: Economist Joseph Schumpeter on how free market capitalism caters to the masses, not the wealthy: "The capitalist engine is first and last an engine of mass production which unavoidably also means production for the masses. ... It is the cheap cloth, the cheap cotton and rayon fabric, boots, motorcars and so on that are the typical achievements of capitalist production, and not as a rule improvements that would mean much to the rich man. Queen Elizabeth owned silk stockings. The capitalist achievement does not typically consist in providing more silk stockings for queens but in bringing them within reach of factory girls in return for steadily decreasing amounts of effort."
View source; Related video: "Myths, Lies and Capitalism" – Arthur Brooks
View source
Curbing the free market in the name of “fairness” isn't standing up for poor people, it's standing in the way of the best way to attain a better lifestyle.: Opposing capitalism and market liberalization doesn't help poor people in the long run, it hurts them. Capitalism creates better goods for cheaper prices. According to economist Milton Friedman: “The great achievements of Western capitalism have redounded primarily to the benefit of the ordinary person.”
View source; Socialism is dogmatic, capitalism is pragmatic.
View source; The Left often focuses on the loss of traditional jobs while ignoring the productivity and prosperity gained through innovation.
View source; Related video: “If You Hate Poverty, You Should Love Capitalism” – Arthur Brooks
View source
The expansion of free trade, property rights, and entrepreneurship around the world helped millions pull themselves out of poverty.: The expansion of free trade, property rights, and entrepreneurship around the world has helped millions pull themselves out of poverty. Even jobs that have changed very little over the years, such as a barmaid, are enriched by increases in technology.
View source; Achievements like GPS and Uber have helped the average American the most.
View source; Meanwhile, socialist states like North Korea, Zimbabwe, and Cuba have remained stagnant.
View source; Related video: “Capitalism vs. Socialism” – Andy Puzder
View source

Life isn’t fair.

And you know what? It can’t be.

Here’s the problem: The word “fair” doesn’t mean “justice” or “equity” or, indeed, anything very specific. Instead, it’s become a sort of all-purpose statement of moral superiority—superiority tinged, paradoxically, with victimhood.

Now, fairness does have an exact meaning in certain contexts. For example, if we’re playing a game, fairness means that the rules should be applied impartially. When we are kids and our parents and teachers set the rules, the word still has that essential meaning: it’s a young person’s way of demanding what we might call “equality before the law.” But as we get older, the word becomes more of a whine. In the mouth of a teenager—trust me on this—“it’s not fair” means, more often than not, “You won’t let me do something I want!”

In recent years, though, something odd has happened. Adults have started using the word in much the same way that teenagers do. More than in any previous generation, people today retain their teenage sense of self-centeredness. They use “it’s not fair” as a catch-all complaint, as an assertion of wounded entitlement.

Look at a Google graph of the use of the word “fairness.” From around 1965 it looks like the proverbial hockey stick—flat and then it suddenly shoots up.

We’ve developed a “fairness” obsession.

But what do we mean when we use that word? Do we mean “justice”? Do we mean “equality”? Do we mean “need”? Or do we mean something else?

Suppose you and Jane buy a cake together. You pay $6, and Jane pays $4. What would be the “fair” way to split it up? You could do it on the basis of proportionality—in other words, you get 60 percent of the cake and Jane gets 40 percent. Or you could do it on the basis of strict egalitarianism—half each, regardless of who paid what. Or you could do it on the basis of wealth. Jane has much less money than you for non-essentials like cake, so maybe she should get the larger share.

A case can be made for each approach. But the beauty of the word “fair” is that it doesn’t require you to come down clearly in favor of any of them. It gives you the cover of ambiguity.

So, for example, when a politician says, “We want the rich to pay their fair share,” he doesn’t usually mean that he wants the rich to pay taxes at the same rate as everyone else. He means that he wants them to pay extra. The word “fair” lets him present higher rates of taxation as a form of justice. But only if we don’t think about it too hard.

That’s the beauty of it. “Fair” doesn’t ultimately mean “proportionate” or “impartial” or “equal.” You can use it to mean almost any positive thing you like.

“I want fairness” generally means “Look at me—I’m a nice person.” Demanding fairness lets you tell the world how decent you are without your actually having to contribute a penny. It’s a kind of vanity: “Mirror, Mirror, on the wall, who’s the fairest of them all?”

Let’s get real. The only just way to distribute the cake is to see how much people are prepared to pay for their slice.

Sure, that could leave a banker with a bigger slice than a baker. Sure, we might not like that distribution. We might feel that the baker is doing something more valuable than the banker. He is making delicious pastries, while the money man doesn’t seem to be making anything—except money for himself.

But how can we judge someone else’s economic worth? You might want bakers to be paid more than bankers. I might want teachers to be paid more than movie stars. Since we all have our own preferences, the only way to measure the economic value of a service is to see how much others are prepared to pay for it.

That’s what the market does: it aggregates our preferences. It doesn’t ask us, in the abstract, what we think someone else deserves. It tests, in reality, how many hours of our own labor we are prepared to put in in exchange for a product or a service.

Under every other economic system, our relations are mediated by accidents of birth and social caste; financial rewards are determined by favoritism. The free market alone gives everyone the same rights. My money is as good as yours.

You can’t get fairer than that.

I’m Daniel Hannan, president of the Initiative for Free Trade and author of Inventing Freedom, for Prager University.

Download Transcript