A common libertarian and conservative response to questions about how beneficiaries of government programs will carry on after the removal of their subsidies is that charity should take care of them. This answer is often overly glib, even when combined with the observation that a lower burden of taxation might foster more giving (charity is already tax-deductible after all). Charity will always be insufficient to meet basic human needs, and in the absence of government programs, some people will fall through the cracks. (In the presence of government programs, some people will fall through the cracks.)
This aspect of charity is a feature, not a bug. Charity suffers from the same problem that government welfare programs do: the Samaritan’s Dilemma, as economists call it. The more you help those in need, the more need there will be, because people’s behaviors will change as they come to expect assistance. To the extent that libertarians and conservatives oppose welfare programs because of “dependency” issues, they must also oppose charity for the same reason. Of course, charity is superior to government programs in at least two respects: lower administrative expenditures and, more importantly, greater respect for the moral autonomy of the donor. To the extent that we can reduce extreme human deprivation, many of us will think it worthwhile to do so even if it somewhat reduces the productive efforts of those less deprived, whether through charity or through government assistance. Nevertheless, it is possible for charity to be excessive.
To see the point, consider the argument I made that libertarianism does not preclude mandatory health insurance for children. One response I got here and on Facebook was that such a mandate is unnecessary because charity should be there to cover the health care expenses of children that parents cannot afford. Therefore, parents should be under no obligation, moral or legal, to buy health insurance for their children.
But consider what would happen if parents knew that charity would cover whatever they could not afford. Fewer and fewer parents would actually purchase health insurance for their children. Those responsible parents who would rather buy health insurance for their children than rely on charity would be embittered by the prospect of irresponsible parents’ successfully mooching off charity. Incredible pressure would soon develop for parents to stop taking care of their own family and let society do it. The “need” for charity would balloon to the point that those truly deserving might not be able to get help after all.
Thus, if we believe that it is irresponsible for parents not to buy insurance to cover the remote but nonzero probability of their children’s incurring health care expenses that they cannot afford, we should be wary of any charity or government programs designed to subsidize children’s health care in general (as opposed to targeted, ad hoc assistance in cases of the most extreme need). Instead, we should put moral and, possibly, legal pressure on parents to fulfill their responsibilities, and possibly help them with the costs of insurance (rather than care).