Co-blogger Bryan Caplan made a good point yesterday about the alleged efficiency/equity tradeoff. He's right to emphasize it. Many economists smuggle in their "equality" value by equivocating between equity as equality and equity as some other value. I pointed this out in the Wall Street Journal in 1996 when Stanford University health economist Victor Fuchs did it in an op/ed. The irony was--well, you'll see the irony.
Fuchs' op/ed on January 26, 1996, was titled "The Tofu Triangle." Here is my letter in response. The Journal published it on February 22, 1996, titling it "Equal Justice:"
In his otherwise excellent editorial-page article ("The Tofu Triangle," Jan. 26) stating that economists should make their values explicit and not mix them with their analysis, my fellow health economist Victor Fuchs smuggles in his own value. In so doing, he does the very thing that he castigates other economists for.
Specifically, in discussing the Republicans' plans to reform Medicare, Mr. Fuchs posits a tradeoff between efficiency and justice. His bottom line is that the Republicans' plan is efficient but unjust. Why? He never says. But he seems to equate justice and equality of wealth. His is the same kind of value judgment that says it's unfair that Bill Gates has umpteen billion dollars, not a dime of which he stole. Had Mr. Fuchs followed the advice he gives other economists, he would have written that the tradeoff on health policy is between efficiency and equality, and then have said that he thinks inequality is unjust. But had he done so, his slam on the Republican plan would have lost much of its impact.