Branko Milanović – What are the Primary Goods?

From its beginning, the UN’s Human Development Index consisted of three “goods”: income , education and health. Now I’m not so sure – plenty of room for discussion!

Branko Milanović is an economist specialised in development and inequality. His newest  book is “Capitalism, Alone: The Future of the System That Rules the World”

Cross-posted from Branko’s blog Global Inequality

My recent blog and the discussion that followed had to do with the definitions of the goods that may be included in the UN’s Human Development Index  (HDI). As is well-known the index from its very beginning consisted of three “goods”: income (measured by GDP per capita), education (number of years of schooling) and heath (life expectancy). (Different versions of these three measures were also used). The key issue of interest here is that the three components implicitly are treated as the primary goods, that is, goods that are desirable in themselves, not as tools toward the achievement of other things.

Income as a primary good comes naturally to economists. It is, for economists, the most generic primary good because it can be transformed into many other goods: a rich person can, for example, buy a better health care. The other two “goods”, education and health, were included simply based on common sense: both are often publicly-funded, may move differently than GDP per capita, and both have large externalities. Better health or education outcomes for myself also make positive health, education or income outcomes for others more likely. (If I get vaccinated, others are less likely to get sick; if I get more educated, working with me would also raise productivity of others.)

Recently, in his new book Leandro Prados argued for the inclusion of political goods as primary goods into the HDI. As I wrote in my Substack I agreed that the human freedoms/rights may be considered a primary good, but not one particular form in which these freedoms are aggregated, namely democracy as commonly defined and measured today.

But the issue is obviously much broader than this. The issue is, what goods are really the primary goods? In Prados’ view there are four, in the current HDI, there are three. Even these three can be questioned. I mentioned that Nuno Palma last Summer at a conference in Groningen very strongly objected to the inclusion of education.  I could definitely see Palma’s point: we acquire education as a means to getting a higher income, not necessarily for its own sake. In other words, 90% or more people study math or a foreign language not because they like it but because they find it useful in order to solve a problem or to find a good job. We may be thus left with only two primary goods: income and health.

But is income truly a primary good? Rawls might disagree. In his lexicographical ordering of principles of a just society, the first two principles require that institutions maintain political liberty for all and equality such that everyone has roughly the same chance to influence political decisions, and that they maintain equality of opportunity. Income occupies an ambivalent position. In several instances, it is listed among the social primary goods in A Theory of Justice, but in The Law of Peoples, whose topic is much more germane to the Human Development Index,  Rawls thought that higher income may be useful only when poverty prevents societies from creating just institutions, viz., when generalized destitution does not allow a society to become, in Rawls’ terminology, just or “decent”. Beyond that point income does not matter. Nay, it may become a nuisance, even a negative good.

What men want is meaningful work in free associations with others, these associations regulating their relations to one another within a framework of just basic institutions. To achieve this state of things great wealth is not necessary. In fact, beyond some point it is more likely to be a positive hindrance, a meaningless distraction at best if not a temptation to indulgence and emptiness. (ToJ, Chapter V, §44, pp. 257-8).

Thus Rawls, in opposition to economists, holds that income can be considered a useful tool only in special conditions, and even then income is not viewed as a primary good but just as a means needed for the achievement of a “decent” society. By including political liberty, Rawls thus comes close to Prados’ view of what are the primary goods, but would exclude income (after a certain threshold).

We can go even further. For Marx it is only the free time that is a real “wealth”, a real primary good. He writes:

But free time, disposable time is wealth itself, partly for the enjoyment of the product, partly for free activity which –unlike labor—is not determined by a compelling extraneous purpose which must be fulfilled, and the fulfillment of which is regarded as a natural necessity or a social duty. (Theories of Surplus Value, Collected Works, vol.  32, p. 391.)

The free time for Marx is not the same thing that goes under the title of “leisure “ today. For Marx free time meant freedom from wage-slavery, that is the ability of each individual to spend his/her time as he/she wishes. It may include what is traditionally considered  “work” but only if such work represents the need for self-realization, that is, is desired. Leisure, as we define it, can exist only in class-based or non-affluent societies where work –the opposite of leisure—is undertaken not because people like to work but because people work in order to survive. In such societies, as Marx in several chapters in Capital documents, work is a drudgery, a pain, degradation.

While working conditions in developed countries are much better today than they were at the time when Marx was writing, the ontological character of wage labor has not changed: work is not a necessity, we do not do it in search of self-realization. On the contrary, for most it is a drudgery, an activity that they  would like to escape from, to bring to a minimum. In support of this perception of work as a pain, witness the innumerable “Thanks God, it’s Friday” restaurants, and greetings of “Happy Friday” (which have now become “Happy Thursday”) and other expressions showing that ending work, not working, or going on vacation are desirable activities—activities that, unlike work, we enjoy.

Leisure is a good only because we hate our work. In the communist society of Marx’s imagination leisure ceases to be a good; it is indistinguishable from what we today deem “work.” Whether such a society could ever be achieved is not obvious, but surely the idea that the real, and seemingly, the only primary good is freedom to do as we please is quite attractive

If we then, following Rawls, eliminate income from the list of primary goods, and drop the self-realization (freedom to do as one likes) as an impossibility in all class-based societies where work is not free, we are left with only one primary good. And perhaps it makes sense.

For in the end, the only primary good may be life itself.

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