A prominent school of thought in political philosophy is utilitarianism. The founders of utilitarianism are the English philosophers Jeremy Bentham (1748-1832) and John Stuart. Mill (1806-1873) To a large extent, the goal ‘of utilitarians is to apply the logic of individual decision making to questions concerning morality and public policy
The starting point of utilitarianism is the notion of utility-the level of happiness or satisfaction that a person receives from his or her circumstances. Utility is a measure of well-being and, according to utilitarians, is the ultimate objective of all public and private actions. The proper goal of the government they claim, is to maximize the sum of utility of everyone in society The utilitarian case for redistributing income is based on the assumption of diminishing marginal utility. It seems reasonable that an extra dollar of income to a poor person provides that person with more I additional utility than does an extra dollar to a rich person. In other words, as a person’s income rises the extra well-being derived from an additional dollar of income falls. This plausible assumption, together with the utilitarian goal of maximizing total utility, implies that the government should try to achieve a more equal distribution of income The Adventists simple Imagine that Peter and Paul are the same, except that Peter earns $80,000 and Paul earns $20,000. In this.case, taking a dollar from Peter to pay Paul will reduce Peter’s utility and raise Paul’s utility But because of diminishing marginal utility, Peter’s utility falls by less than Paul’s utility rises Thus, this redistribution of income raises total utility, which is the utilitarian’s objective At first, this utilitarian argument might seem to imply that ,the government should continue to redistribute income Until everyone In”society has exactly the same income. Indeed, that would be the case if the total amount of income-$IOO,OOO in our example-s-were fixed. But in fact, it is not Utilitarians reject complete equalization of incomes because they accept one of the Ten Principles of Economics presented in Chapter I: People respond to incentives To take from Peter to pay Paul, the government must pursue policies that redistribute income. The u.s. federal income tax and welfare system are examples. Under these policies, people with high incomes pay high taxes, and people with low incomes receive income transfers. Yet if the government takes away additional income a person might earn through higher income taxes or reduced transfers, both Peter and Paul have less incentive to work hard. As they work less, society’s income falls, and so does total utility The utilitarian government has to balance the gains from greater equality against the losses from distorted incentives To maximize the government stops short of making society fully egalitarian A famous parable s ht on utilitarian’ logic . Imagine that Peter and Paul are thirsty travelers trapped at different place Pete’ oasis has much water; Paul’s has little. If the government could transfer water fro to er the out cost, it would maximize total utility from water by equalizing the amount in the two But suppose that the government has only a leaky bucket. As it tries to move water from one place to the other, some of the water is lost in transit. In this case, a utilitarian government might still try to some water from Peter to Paul, depending on how thirsty Paul is and how leaky the bucket is. But With only a leaky bucket at its disposal, a utilitarian government will not try to reach complete equality.
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