Column : Cash and carry on

Radical ideas used to be a monopoly of the Left. Indeed, the words ‘radical’ or ‘progressive’ and Left used to be interchangeable. The Left was egalitarian and dynamic. The Right was old-fashioned and believed to be a defender of privilege. Then things changed some time in the 1960s. The radical ideas began to come from the Right as the Left became part of the conventional wisdom.

One such idea was regarding the mechanics of redistribution. If you had to redistribute, how was it best done? The Left is paternalistic on this issue. It does not trust the recipients to know what they want. ‘They’ have to be given things—food, housing, clothing in measured doses directly as physical things. Giving them money is dangerous because you ‘know’ they will dissipate the money on drink and other vices.

It was Milton Friedman who challenged this idea. Economists may be guilty of many things but they have never been paternalistic or patronising. They assume everyone is rational. Many people believe this is absurd but it treats everyone as capable of knowing their self interest, rather than saying that some people are too culturally trapped to be rational so they need the guidance of the very visible hand of bureaucracy. Once you trust the people to know what is good for them, then a cash transfer dominates the strategy of distributing goods directly.

My own ideas on this changed around

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