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Shorter Fortune: “The Poor: BORING!!!”

[ 284 ] June 5, 2014 |

Geoff Colvin at Fortune has precisely the reaction to the income inequality debate as you’d expect: “BORING!!!!”

I suspect I’m not the only one suffering from severe inequality fatigue.

The debate over income inequality is now officially the most boring debate in America, and that’s because it’s scarcely a “debate” at all. Here’s the thrilling state of play. Liberals think inequality is a really big problem—“the defining challenge of our time,” as President Obama said last December. Conservatives think it’s a problem, but not all that serious. As House Speaker John Boehner said grudgingly in March, “We do have an issue of income inequality in America.”

So we see furrowed brows across the political spectrum, with the “debate” focused on exactly how energetically we should be wringing our hands.

Wake me when it’s over.

Now, Colvin says there is an income inequality debate he wants to have, but it’s a fakeout. He doesn’t want to talk about income inequality at all. He just wants to find ways to blame the poor for their own poverty. He poses three questions. First,

If today’s degree of inequality is too great, then what degree would be just right?

This is a self-serving question because the answer for Colvin is that inequality is good and by forcing people to admit that, the rich win. Obviously we are never going to achieve full and absolute income equality. But it is a noble aim to strive for and I’m certainly not going to answer Colvin’s question in any other way than “None.”

2. If everyone’s real income were multiplied by 100, would inequality still be a problem?

A stupid question and irrelevant since it is never going to happen and we are heading in the opposite direction.

3. Is education the real reason for what’s happening?

Here we go. Because some of our young people go to Harvard (like Colvin) and others go to the University of Rhode Island and still others don’t go to college at all and because some of our young people were born rich, white men (like Colvin) and others were born in the ghetto or a West Virginia hollow or were raped by their fathers, we can blame those who have failed. If only they had gone to Harvard, they would be writing for Fortune too!

The idea that everyone is responsible for constantly “acquiring new skills” in order to have a house and eat properly and raise a family is totally absurd and ignores the reality of how people actually live in the world. Moreover, it does exactly what the plutocrats and their hack writers have done for 150 years–blame the poor for their own poverty.

I guess this is what one should expect from Fortune. Why read it if not for laughable defenses of the plutocracy?

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  1. Coming soon in Fortune:

    ‘I suspect I’m not the only one suffering from the terror of the coming tumbrel ride to the guillotine.’

  2. Aimai says:

    Apparently it doesn’t occur to him that the other meaning of Fortune is: chance. Its chance that has enabled him to be paid for writing about how boring it is for other people to care about suffering and inequality. Guess he slept through, or never took, any course on Rawls at Harvard.

    Also: not to be pedantic but you have one use of “inequality” where you really mean “equality” in the sentence on how it is a noble cause.

    • Or, maybe by reading Fortune, Erik was turned!

      The horror…

    • SFAW says:

      Oh, aimai, that Rawls guy is soooo bo-o-o-o-o-o-ring. It’s not as if the points he tried to make had any practical meaning for our betters, e.g., the Kochs, Trump. Because, after all, if they’re rich, it’s because they deserve it, and that whole “social justice” thing is just SO overrated.

    • LFC says:

      Aimai: “Guess he slept through, or never took, any course on Rawls at Harvard.”

      +1

      OTOH, and a bit off-topic — but this is LGM, after all — M. Yglesias’ senior thesis at same institution had something to do w Rawls (or such is my impression from once having looked up the title of M.Y.’s thesis). Yet the consensus in progressive circles seems to be that nothing esp. Rawlsian stuck to M.Y. (I myself don’t read him.)

      Also, and not to be pedantic: E. Loomis’ post mushes together (“conflates” wd be the fancy word) poverty and inequality. The two are related, but not the same.

      OK, /pedantic. [Back to the usual LGM activity of witticisms and insults, mixed in w a serious comment now and then.]

  3. Chris J says:

    In all these people it’s the smugness that I find most irritating — the old “born on third base and think you hit a triple” thing.

    • I’m actually kinda ok with those people.

      It’s the ones born on third, and think that if only the umpires (government regulations) would get and stay out of the way, that they’d have hit a homerun.

      • somethingblue says:

        It’s the ones born on third, and think that if only the umpires (government regulations) would get and stay out of the way, that they’d have hit a homerun their triple would be recognized as the home run it actually is and then the proles would throw them a tickertape parade and Cooperstown would schedule their induction ceremony, which they totally deserve, BTW, because they earned it, unlike Hank Aaron who basically had everything handed to him on a silver platter because he was blah.

        FTFY.

    • Shakezula says:

      More like carried to third base on the backs of thousands, calls the people toting him a bunch of losers and pisses on their heads.

  4. Turkle says:

    Wow, that article is pretty bad! I’ll just note that the smugness of the tone is something also found in Forbes, my personal least-favorite right-wing butt-trumpet.

  5. Malaclypse says:

    Obviously we are never going to achieve full and absolute income inequality.

    Give the Republicans time. They’ve made great strides just in my lifetime.

    • Erik Loomis says:

      I might want to edit that one.

    • Sev says:

      Well, they’ve cut extended unemployment, cut food stamps; I suspect there are a growing number whose income at present is 0.

    • GFW says:

      On the “how much inequality is OK” question, I suspect that with enough data it might be answerable. We know that economies with high inequality stagnate as human potential is wasted. We know *some* inequality of outcome does motivate strivers. It may be possible to plot several measures of economic *and* social well-being against Gini coefficient across many countries and years and find a best value.

      If we could determine an ideal Gini, I have this impractical fantasy of a progressive tax system in which the progressiveness is indexed to the Gini.

      • parsec says:

        Not too long ago someone did a study on U.S. income distribution and public beliefs about it. People were asked to rank, in quintiles, what they thought the distribution was and what it should be. Nearly everyone underestimated how much the top quintile took. And the ideal distribution was remarkably consistent, even among Republicans. It closely approximated one real world country — Sweden.

  6. Mudge says:

    Richard Mayhew over at Balloon Juice notes, when discussing some recently released research, that ” Increased income or more accurately, an increased consumption budget that is tied to current resources without indebting the future usually means a better ability to plan for the future.” He is focused on Medicaid, but other stresses apply. The article discusses the degree by which the future is affected in people who are stressed financially at the present, i.e. those affected by income and asset inequality.

    And hats off to the homeless kid who was #1 in his high school and was accepted at Florida State. There is one of not so many examples of someone overcoming that stress to carve a future. I saw that an internet campaign raised $60,000 or so to help him pay for college. I saw no mention of a scholarship from FSU. Gotta pay the football coach.

    • Kurzleg says:

      Mudge, you beat me to it. Here’s a link to Mayhew.

      In particular, the book reviewed in The Economist (“Scarcity: Why Having Too Little Means So Much”) to which Mayhew links sounds particularly fascinating. From the review:

      This scarcity mindset can also be debilitating. It shortens a person’s horizons and narrows his perspective, creating a dangerous tunnel vision. Anxiety also saps brainpower and willpower, reducing mental “bandwidth”, as the authors call it. Indian sugarcane farmers score worse on intelligence tests before the harvest (when they are short of cash) than after. Feeling poor lowers a person’s IQ by as much as a night without sleep. Anxieties about friendlessness have a similar effect. In one experiment a random group of people were told that their results on a personality test suggested a life of loneliness. This random subset subsequently performed worse on intelligence tests and found it harder to resist the chocolate-chip cookies provided for them.

      By making people slower witted and weaker willed, scarcity creates a mindset that perpetuates scarcity, the authors argue. In developing countries too many of the poor neglect to weed their crops, vaccinate their children, wash their hands, treat their water, take their pills or eat properly when pregnant. Ingenious schemes to better the lot of the poor fail because the poor themselves often fail to stick to them. The authors describe these shortcomings as the “elephant in the room”—which poverty researchers ignore because it is disrespectful to the people they are trying to help. But if these so-called character flaws are a consequence of poverty, and not just a cause of it, then perhaps they can be faced and redressed.

      • cpinva says:

        I don’t think it’s been any great secret, for a long time, that stress, regardless of the cause, itself produces debilitating results in people. the constant stress of not knowing if you’re going to be able to feed your kids tomorrow, is going to sap your energy, and constantly tired people don’t always make the best decisions.

        • Kurzleg says:

          The book I mentioned above argues that the phenomena goes beyond physiological to the psychological and emotional as impacting a cognitive performance negatively.

        • Shakezula says:

          There is also a growing body of work that shows the stress of poverty alone screws with your physical health like you wouldn’t believe. Then you get to add the impact of things like unhealthy environment and malnutrition.

        • Karen says:

          My older son had all a’s and one B two weeks ago. Then he had appendicitis. This week he has finals and complete tanked two of the six he’s finished. So yeah, anyone who’s ever looked out at the world can see where stupid luck causes bad results even among privileged people.

          Actually this moron makes me long for the Old Money idea of noblesse oblige. At least they thought they had to pretend to think luck played a role in their privilege

          • Shakezula says:

            Just FYI – If he had surgery, anesthesia can screw with the memory and other cognitive functions something fierce for long periods of time. A doctor’s note may straighten this out and earn him a chance to take those again.

            • Autonomous Coward says:

              Yeah, seriously. No reason to fuck his admissions chances like that. Sic the doctor on the school.

            • Karen says:

              Thanks. We will see the surgeon next week for the follow-up. The school was Not Helpful about this. Make-up finals are designed to be twice as arduous as the regular ones. As it is, he turned a couple A’s into B+’s, which might not be bad enough for the school to consider alternatives.

              • Aimai says:

                I’m very sorry to hear this, Karen. Schools are very unforgiving about illness/absences. The son of a good friend of ours got a concussion at a school outing last year and has really been suffering a severe mental deficit as a result but the school has never made any accomodations for him and basically is trying to force the kid out of the school rather than find a way to work with him. I’d go in loaded for bear if I were you–the doctor’s stuff is good but I’d also let them know you are planning to go to a lawyer to get whatever accomodation you think necessary. Its really the only way to get any attention.

                • Barry Freed says:

                  I’d also let them know you are planning to go to a lawyer

                  Why not go beyond planning? You might want to get an initial consultation just so you can drop a reference somewhere to “my lawyer.” Can’t hurt.

                • Tristan says:

                  Schools are very unforgiving about illness/absences.

                  It’s part of getting kids ready for ‘the real world’, that wonderful dialectic construct for ‘yes, we’re handling this thing in a way that’s cruel, stupid, and ultimately against both our interests, but everyone else does it like that, so getting angry or upset over it is proof you’re a bad person who should feel bad’. If a kid gets a pass in school because of a trauma like surgery or concussion he might go into adulthood thinking he’s entitled (ENTITLED!!!) to do something crazy like taking a sick day instead of ‘manning up’ and giving a contagious disease to twenty other people.

              • Shakezula says:

                That’s crazy stuff. He’s temporarily disabled. Get a note from his anesthesiologist about the effects of anesthesia.

              • Karen says:

                Thanks. We will take all necessary steps. Fair is fair, and this bloody well isn’t.

                • Shakezula says:

                  Sorry to examplify your situation, but you and your husband have the resources (including time) to take care of this sort of thing.

                  Lots of parents don’t, so the school is guaranteeing that students who are already at a disadvantage will be even worse off if they have some sort of emergency.

                • Karen says:

                  EXACTLY!!! I AM a lawyer, so I know how to be a pain in the most effective way. Most other parents don’t have that advantage.

          • BoredJD says:

            It’s the Cult of Meritocracy. You have a lot of Very Successful People who grew up middle to upper-middle class who are running the country. They were valedictorian of their high school and went to Harvard and did all the right internships and entry-level jobs to get where they are. And I’m sure that they didn’t get all their success through how people picture it worked in the old days (some rich WASP makes a call for another rich WASP), so they get blinded to the role sheer luck plays in determining how successful a person is.

            • Karen says:

              The calls from one rich WASP to another are still a huge part of the system. They now apply a fig leaf by admitting the odd valedictorian of color.

            • Lurking Canadian says:

              Exactly. To extend a useful metaphor, they can’t see that they were born on third base, but they damn well know how hard it was to steal home.

          • Origami Isopod, Commisar [sic] of Ideology for the Bolsheviks says:

            Noblesse oblige worked better when there was no serious worry about the peasants overturning the Great Chain of Being.

          • Bruce Baugh says:

            Karen, in addition to what the others have said, tell the school that you hope you can settle this without having to get additional resources via the community-help people at the local TV station and newspaper. Also, if there’s a university in town, talk to their disabled services office – those folks were hugely helpful to my parents when I needed help in high school after a weird illness.

      • Pat says:

        This ties in to Frum’s argument about reparations, where he argued that African Americans shouldn’t receive anything because they let their kids watch too much television.

        • Linnaeus says:

          I usually disagree with Frum, but I consider him better than most conservative pundits (although I admit that’s a low bar). That argument, though, was absolutely silly.

      • Rob in CT says:

        Realizing this, bit by bit, has been one of the two primary drivers of my leftward drift over the past ~15 years (the other being the insanity of RWers).

        I’ve come to understand that “willpower” is a finite resource that is drained by having to Deal With Things ™. I recognize this in myself. I have to Deal With some insurance stuff, some tax stuff, put my kids to bed, do the dishes, etc. Pile enough of my upper middle class people problems up and my discipline suffers (I was a Good Boy and Dealt With all that Stuff, so I’m opening this bottle of wine on a Monday night thankyouverymuch!). My brain starts to turn to mush. And so forth.

        It’s nice to have this laid out via a proper study, but really if you just sit down and think it through and imagine adding things like poverty, violent surroundings and such to the things that grind you down, it really doesn’t take an advanced degree in empathy to realize that being poor sucks and has all sorts of positive feedback loops.

        • Bill Murray says:

          I was a Good Boy and Dealt With all that Stuff, so I’m opening this bottle of wine on a Monday night thankyouverymuch!. My brain starts to turn to mush.

          the obvious solution is more and better wine

      • LFC says:

        Thks for the BJ/Economist link, sounds interesting.

  7. howard says:

    I’d like colvin to answer the question if today’s income inequality is just right, what would be too great?

    I’d also like colvin to explain how free market theory justifies today’s .1%.

  8. NewishLawyer says:

    He is making an interesting point in the worst way possible and it is a point that someone else talked about on LGM a while ago. One of you guys posted a Monica Potts article where she quoted Dwight Macdonald on the poor. The gist of the Macdonald quote was that it was tiring to talk about the poor because it was the same story over and over again and they never seem to win.

    Geoff Colvin is just vocalizing this from a right-wing jerk perspective.

    • Shakezula says:

      But you do understand that there’s a difference between – for example – acknowledging that homophobia is a persistent problem, and saying “Fags need to stop complaining about the bashings because it bores me.”

    • Kurzleg says:

      The gist of the Macdonald quote was that it was tiring to talk about the poor because it was the same story over and over again and they never seem to win.

      But that doesn’t appear to be the case. There DOES seem to be new studies that lend insight to the plight of poor people. See the Mayhew link above.

  9. Shakezula says:

    Mmm. I love me some privsplaination in the morning.

  10. Matthew Stevens says:

    It is a boring debate, because only one side has anything to say about the topic.

  11. Matt says:

    Wake me when it’s over.

    Don’t worry, yo. The National Razor is one hell of an alarm clock. For about twenty seconds, anyways…

    • cpinva says:

      from the time you’re locked in, to the time your severed head falls in the basket, is maybe 3 seconds, most of which is the blade sliding down. from first-hand accounts that I’ve read, it happens so quickly, most of the people watching didn’t even realize it had happened, until it was over.

      • Brad Nailer says:

        “Am I dead?”

        “YES, I’M AFRAID SO.”

        “Wow, I didn’t even notice it, it happened so fast.”

        “THAT’S EFFICIENCY. WHY STRETCH IT OUT WHEN THERE ARE SO MANY IN LINE? AND YOU CAN’T ARGUE WITH PAINLESS.”

        “I guess not. So, what comes next?”

        “HARD TO SAY. THAT’S NOT MY DEPARTMENT.”

    • Ahuitzotl says:

      I believe the popular term at the time was, The Republican Razor. Simply too appropriate, really

  12. LeftWingFox says:

    If today’s degree of inequality is too great, then what degree would be just right?

    When no-one faces malnutrition or starvation. When all have a safe place to live, access to the basic necessities of modern society, and do not fear destitution from medical emergencies, disability or retirement…

    …then the rich can have as much as they damn well please.

    • LeftWingFox says:

      As much as these guys talk about rewarding success, that’s not the argument. The real issue is punishing “failure”. These guys need a secular Hell to terrify people into behaving the way they want.

      Too often when talking with conservatives about McDonalds wages, they seem to treat workers as “failures” who aren’t deserving of a living wage, for the crime of insufficient education or motivation.

      • gman says:

        Somebody has to do that job..should they just be treated as slaves?

        • Nobdy says:

          Sub-human.

          I once saw a woman waiting on line at McDonalds point to a counter worker and tell her child “If you don’t do your homework you’ll end up like him.”

          I wanted to say “B____ that woman is about to serve your kid a happy meal and smile when she does it for $5.15 an hour.” (this was some time ago) “You can’t show even the slightest politeness?”

          They can’t. They really can’t. They don’t see the poor as human beings worthy of empathy and respect.

          • JoyfulA says:

            You should have said what you were thinking. I do all the time (to my husband’s intense embarrassment).

            • LFC says:

              I once saw a woman waiting on line at McDonalds point to a counter worker and tell her child “If you don’t do your homework you’ll end up like him.”

              To say something this insulting, mean, and stupid (and to say it audibly, to boot) is just astonishing.

          • Guggenheim Swirly says:

            In my first job out of college, I was working in a shoe store at the mall. One Saturday afternoon I was waiting on a couple who didn’t seem to be too terribly obnoxious; they wanted to try on several pairs of shoes which meant I had to keep going into the back to get their sizes, but that’s the job so it didn’t bother me.

            Then, while I’m trying to get a shoe laced up properly, the guy says “See, if you’d finished school you wouldn’t have to be doing this.”

            I said, “um, yeah, I did finish school actually – just a few months ago, in fact – but thanks for the unsolicited career advice.”

            He said nothing, not even an apology (of course), and they left without buying anything, which I knew they would and which actually took money out of my pocket because so much of my paycheck was commission-based. 20 years later and that memory still pisses me off.

        • Lee Rudolph says:

          Certainly not. Slaves are a capital investment and therefore require at least a minimum of maintenance if you want to keep those pesky accountants off your back. Disposable workers are … disposable.

      • Nobdy says:

        And of course the failures of the plutocrats are rewarded. If people really wanted to punish failure they would rail against corporate golden parachutes and against Bill Kristol ever speaking again in a room where someone can hear him. They’re perfectly fine with people being rewarded for failure as long as those people were already rich.

        In the end it’s heirarchy all the way down with them. I regard heirarchy as a sometimes necessary evil. They regard it as the end goal of human society.

    • Karen says:

      And when people aren’t forced to accept bad working conditions or smother their natural but I unremunerative talents in order to keep eating. When we give everyone a real chance to follow their dreams, even the somewhat absurd ones. In that world I wouldn’t care if Warren Buffett had ten platinum castles with padparajah sapphire windows.

    • Shakezula says:

      No, you don’t understand the nature of this question.

      If you say inequality isn’t acceptable, Colon gets to scream “COMMIE LIBERALS WANT TO TAKE OUR MONEY!” If you try to come up with an acceptable amount of inequality, he gets to scream “OOOO! COMMIE LIBERALS WANT THE POORS TO BE POOR!”

      The correct answer to the question is “Rot in hell, you chupacabra fucking twerp.”

  13. Whiskers says:

    Colvin is under the mistaken impression that these problems and “debates” exist to entertain us.

    • bspencer says:

      This is a major feature of many Libertarians and other JAQ-offs. Debates like this are fun for them because they know that they are above the fray–there’s nothing at stake for them. It’s fun to do “thought experiments” when the experiment won’t affect you in any way.

      • bspencer says:

        Just in case you can’t tell, I think his charge of “boring” is disingenuous. He obviously doesn’t find it *that* boring or he wouldn’t have bothered to chime with what he thought were clever conversation-stoppers.

  14. gman says:

    “2. If everyone’s real income were multiplied by 100, would inequality still be a problem?”

    Curious hypothetical? Maybe not a problem if that were true.

    Considering that native born high school educated males have had their real wage fall by 40% over the past 40 years why would anyone serious use a hypothetical like that..hmmm.

    • howard says:

      this was a hypothetical so stupid that i didn’t even want to talk about it, but since someone does: it makes no sense at all.

      it doesn’t have anything approximating a logical foundation, it’s just a stupid thing colvin said to demonstrate that he didn’t have any real arguments.

      • Ahuitzotl says:

        Well it convincingly demonstrated his failure to grasp even Econ 101 – increase the money supply by 100 and prices will simply rise by (at least) 100. If he means, by ‘real’ income, that no such price rise would occur, then where will 100x the current level of goods and services suddenly emerge from. Really he’s falling into the too stupid to breathe camp.

    • tt says:

      Considering that native born high school educated males have had their real wage fall by 40% over the past 40 years why would anyone serious use a hypothetical like that..hmmm.

      Where are you getting this data? I usually see estimates closer to 10%.

      • gman says:

        economix.blogs.nytimes.com/2012/10/22/the-uncomfortable-truth-about-american-wages/?_php=true&_type=blogs&_r=0

        This is just “men in general” ..I think it must be median not mean…not broken down by non college degree.

        Still shows a decline from 40k to 30k in real terms from 1970 up to today.

    • L2P says:

      Yes, I think we can all agree that inequality is less of a problem when your average burger flipper can buy a new Ferrari every other year and owns a house in Beverly Hills.

      Wake me up when THAT happens.

    • Rob in CT says:

      Also, too: it’s almost as if there’s no such thing as positional goods…

  15. actor212 says:

    Interestingly, Through the Wormhole studied this exact thing last night.

    It turns out that, in any society, there will be income inequality because, primarily, people cheat to raise their incomes.

    Capitalism, you see, is the privatization of profits but the socialization of costs (there’s socialism for you…if my neighbor allows fracking on his land, I have to suffer the groundquakes but do not share in his bounty).

    There is actually an effective antidote to limiting the amount of inequality any society can have: it’s called “shame”

    Problem is, in America, the uberwealthy don’t have to deal with it. And that’s why we can’t have nice things.

    • Vance Maverick says:

      There is actually an effective antidote to limiting the amount of inequality any society can have: it’s called “shame”

      Hm, sounds like a poor foundation for policy.

      • actor212 says:

        It worked pretty much until the 1980s, if you think about it. It’s not policy, no, but let’s be honest.

        Any policy will be co-opted by the money.

        • Vance Maverick says:

          I don’t think I know what you mean about its working. Yes, income inequality was less for a while. During that period, was shame greater? Says who?

          • actor212 says:

            Says the folks who lived near the wealthy. It was a social ostracism that became a societal meme.

            After all, even the wealthy had to walk the same streets as the poor. They saw the blight of society. Now? Not so much.

            • Vance Maverick says:

              To the extent that I buy this at all, it sounds like the arrow of causality is running the other way. What made the wealthy walk the same streets as the poor (to the extent that they did)? Not shame, but reduced inequality.

              • actor212 says:

                Imma just leave this here as my final word:

                http://nymag.com/nymetro/news/culture/features/11721/

                There was a shame factor, induced in folks like the Astors and the Vanderbilts, that they were major players in the charitable organizations of the time.

                Now, the rich will build a hospital wing not for sick or indigent kids but for the same cancer they have just been diagnosed with. That’s shameless.

                • JoyfulA says:

                  And the hospital wing will have the rich guy’s name on the wall, big enough to be conspicuous from the far end of the parking lot.

                  And as has happened around here, the new hospital wing will be for the treatment of a disease for which there’s already an overcapacity in the area.

        • Kurzleg says:

          It certainly doesn’t hurt for people to have internal controls that limit what is an acceptable level of wealth accumulation and what the acceptable means by which to accumulate that wealth are. And when you encourage people to ignore that internal control – even argue that it’s good and proper to do so – then you end up with wage stagnation and Gilded Age income inequality.

    • Hogan says:

      There is actually an effective antidote to limiting the amount of inequality any society can have: it’s called “shame” “progressive taxation, including estates”

      Fixed.

      • Vance Maverick says:

        Exactly. And it doesn’t matter what emotion the well-to-do feel as they pay those taxes, or vote them in. Fear, noblesse oblige, contempt, resentment, it’s all good.

      • Aimai says:

        Yeah. I’m with Hogan on this one. A little pudeur in the wealthy is a great thing but progressive taxation and a confiscatory approach to estates would do everyone a lot of good. Such policies probably result more from rage, lust, and envy on the part of the poor than it does on shame on the part of the wealthy.

        • Bill Murray says:

          progressive taxation and a confiscatory approach to estates would do everyone a lot of good.

          assuming the money generated is not just directly transferred back to rich people. It gets to the rich eventually, but that’s not a big problem if it takes a few transfers before getting there.

      • actor212 says:

        See my response above: policy changes won’t work because money has too much influence on policy.

        We’d like to think they might, and they do to an extent, but the story of the 20th Century plays out along the lines of a long-term crusade to change the policies that made taxes high in the first place.

        And there’s a subtler effect involved, as well. Time once was, the board of directors was an independent entity with fealty and a fiduciary duty to the stakeholders at large. In the past thirty or forty years, this has changed dramatically. The executives of the corporation now end up with board seats. This means there will be much more focus on short term income enhancements to the stock price, and much less long term planning for the company as a whole.

        Workers tend to benefit more from the planned growth of a company’s underlying operations: it means there’s a plan to keep jobs in place, rather than sacrifice them for a artificial boost in profits.

        No tax policy is going to change that dynamic. It might restrain it slightly, until a friendly Congress gets its hands on it, but at best, we’re looking at a temporary patch.

        • Hogan says:

          Whereas getting Warren Buffett and Bill Gates to stop inviting the Kochs to their dinner parties is guaranteed to work, and we can probably finish that off over the weekend.

    • Brad Nailer says:

      “Shame” doesn’t work on the “Who the fuck are you?” class. The alternative is “taxes.” Which is one reason conservatives don’t talk much about Eisenhower and his 90 percent marginal tax rates on individuals. Funny how historically low inequality and high prosperity followed immediately thereon.

  16. Malaclypse says:

    “2. If everyone’s real income were multiplied by 100, would inequality still be a problem?”

    I’m curious* to see what he thinks would happen to the carrying capacity of the planet if everybody was able to consume at 100X their current levels.

    * This is a lie. I have no interest at all in reading about how the magic of the marketplace means unlimited resources and disposal capacity.

    • the dog says:

      If everyone’s income were multiplied by 100, then the same percentage of disparity would still apply, wouldn’t it? I thought that was simple inflation. Then prices would just change to reflect this, wouldn’t it, and the problem would be identical, but with more zeroes?

      • Malaclypse says:

        He specified real income.

      • howard says:

        no, he said “real income,” meaning after inflation. the whole concept makes no sense at all and isn’t worth the time of day to even sneer at (except, here i am doing just that).

        • Manju says:

          I think he’s making an absolute v relative poverty argument.

          In other words, if everyone, including the world’s poor, made 100X what they did now, in real dollars so we are controlling for cost of living, we would have presumably eradicated world poverty.

          But since the rich also saw their income multiply, inequality would be the same. He’s saying; what’s wrong with that?

          • DF says:

            The rich would still have unfairly gained those wages, if they didn’t outright steal them. The wealthy do not deserve their fortunes. And they use those fortunes to rig the game against others, and control the lives and destinies of other people. They should not be permitted to have that power.

          • DrDick says:

            But since the rich also saw their income multiply, inequality would be the same. He’s saying; what’s wrong with that?

            Because it will never happen (indeed, it cannot happen).

            • howard says:

              this is the point: this is a ridiculous hypothetical that has no meaning at all. there are no circumstances under which real income is going to rise 100x for everyone.

              we get that the idiot colvin is trying to get us to say that if someone getting by on $20K a year suddenly had 20,000,000/year, would we still complain about inequality?

              but it’s a phony argument: it has no meaningful basis in reality and is merely a diversion by a paid propagandist.

              • Manju says:

                I don’t think his argument hinges on “100X for everyone”. He’s just being stupid with the numbers and his argument would be even stronger is he assumed the rich see their income increase more than the poor.

                In other words, you see a widening wealth gap while simultaneously seeing a decrease in absolute poverty measured in real dollars. I mean, that’s what we are witnessing in India and China: great poverty eradication coupled with an increase in inequality.

                • howard says:

                  if you want to help colvin improve his column, you’re welcome to take it up with him: after all, he’s a complete idiot, so you probably can help him.

                  but you don’t get to rewrite his column in this discussion: you’re stuck with what he said.

                  which was idiotic.

                • Manju says:

                  he’s a complete idiot, so you probably can help him.

                  ouch!

                • howard says:

                  ha! i actually meant it the other way: you actually could improve his arguments….

      • Denverite says:

        The “real” in “real income” is doing the work here.

        • DF says:

          I’m not sure it is. Or at least, I think Colvin thinks it is, but I don’t think this works. The real income can’t be multiplied by 100 for everyone, for the reason that Malaclypse specified earlier.

          • Denverite says:

            No, I get that. It’s nonsensical.

          • tt says:

            Sure it can. Technology (including social technology) can improve efficiency, allowing us to produce more wealth from the same resource input. Nor are we limited, ultimately, by the carrying capacity of Earth or the energy output of the sun. You can say it’s implausible or unrealistic in the near term or irrelevant to contemporary debates about inequality, and all of that is perfectly true, but it’s not literally impossible.

      • DF says:

        Right, Colvin seems not to have thought this little argument through (shocking, I know). Multiplying everyone’s income by 100 wouldn’t do anything to change how things are. The price of everything would quite quickly just get multiplied by 100 and the world would carry on exactly as it does now.

        This seems to be capitalism’s biggest problem. Everyone can’t get ahead, by definition, because as soon as the great mass of people start making more money, the prices will rise to match.

        • Nobdy says:

          I think it’s a magic wand type situation where we as a society have 100 times as much material goods overall as we do now. It is, of course, impossible (especially regarding land) but it is a prelude to the real argument which is that since poor people now have cellphones and TVs they are much richer than even the richest people in 1900 so they should STFU and be happy.

          That’s the argument behind the curtain.

          • DF says:

            Yes, I think you have a point there.

            A good response might be: Inequality would still be a problem. Because the vast economy that would support such a 100x lifestyle is entirely created, maintained, and dependent on the millions of people who live and work in it. The huge percentage of money going to the uber-rich is the product of theft. Stealing would still be wrong, even if people had 100x what they do now.

  17. Davis says:

    “…ignores the reality of how people actually live in the world.”

    This can be said after reading literally anything written by libertarians.

  18. Dr Ronnie James, DO says:

    Capitalist Tool isn’t the motto, it’s the masthead.

  19. Anonymous says:

    It’s funny because it’s true. They aren’t, aren’t they.

    The poor are all like “WAAAAH! I can’t feed my kids! WAAAH! I can’t afford their medical treatment!”.

    Whatever. Go make an entertaining viral video and maybe I’ll kick you a few bucks or something, but just stop BOORING me.

  20. JustRuss says:

    Can we please not say stupid shit like this:

    Obviously we are never going to achieve full and absolute income equality. But it is a noble aim to strive for

    So a brain surgeon should make the same as a fry cook? Really? That’s a noble aim? Christ, in any discussion of inequality that’s the favorite conservative straw man, let’s not go propping it up for them.

    • Erik Loomis says:

      Ah yes, let’s defend the principle that jobs our society has chosen for various reasons (often gendered or racial) are less desirable should be paid less because we wouldn’t want those people to have the same kind of quality life as those in privileged jobs. Thank god someone is defending this principle.

      • Denverite says:

        I think/hope the argument he’s getting at (and I don’t subscribe to it) is that we want some jobs to be reserved for the absolute most skilled people at those jobs. The best way to do that is to set up a tournament. But because most of the participants will fall by the wayside, we need to incentivize them to compete by awarding a big prize to the winner.

        This, of course, ignores the fact that “falling by the wayside” in the MD context generally means that you opt for a less competitive specialty that only puts you in the upper-upper middle class. Nice “failure” if you ask me.

      • Rhino says:

        How about I defend the principle that an iron worker sweating his bag off for 60 hours a week deserves to earn more than an academic sitting in a cushioned chair then?

        Financial inequality, within reason can and does exist to reward people who work harder. The problem is degree, not the very concept of inequality.

        • Rand Paul says:

          And the academic sitting in a cushioned chair didn’t work hard to get where he was? How absurd.

        • Erik Loomis says:

          I would argue the contributions of myself and an iron worker are roughly comparable. I am good at one thing, the iron worker is good at something else. Should I receive vastly more money because I am educated or should he receive vastly more money because he sweats? I’d generally say not.

          • Aimai says:

            If the Iron worker were still receiving union wages wouldn’t he be making more than the professor does these days? The idea that professors make a ton of money or are even close to being among the financial winners in this society at this point is laughable. An adjunct just died, homeless, in her car for fuck’s sake.

            I don’t like to pit the educated working class against the uneducated but skilled working class. That seems to be the wrong argument to be having.

            • Denverite says:

              Yeah, in a lot of places, humanities-type tenure track professors start around $50k, which isn’t bad by any stretch, but it’s hardly rich-level income. And keep in mind that these are the winners in the field.

            • Brad Nailer says:

              I look at the union iron worker making $30-$40 an hour, with benefits, and I say, “This will not stand! Damn all greedy unions!” Which is exactly what the plutocracy wants me to say, rather than, “Hey, if he can have it, why can’t I?”

              As far as the One Percent is concerned, as long as the working class (including university profs, apparently) is at each other’s throats, we’re not at theirs.

              • Aimai says:

                Right. This. Who should make more the effete liberal professor who doesn’t like to hold office hours or the lazy ironworker who insists on breaks and an 8 hour day? That seems like the wrong question to be asking. Why can’t both forms of labor be respected and well remunerated, buy roughly the same market basket of goods and health and security?

              • Tristan says:

                There’s some alternate universe where everything is basically the same but people are way more direct about what they actually mean, and in that universe there’s a version of that crappy Will Smith movie about the homeless guy who is inspired to stop being homeless when he meets a broker with a really nice car and decides he wants a nice car, only in that universe’s version he just sets the car on fire and goes back to being homeless.

          • Lee Rudolph says:

            People who work the absolute worst jobs—industrial scale chicken slaughtering, for example—should be compensated for that by getting correspondingly high wages and benefits (like much more time off). And, of course, the badness of the jobs, to the extent possible, should be ameliorated.

            It’s the opposite (and much more justifiable) side of the “Do what you love (and accept less money for doing it, just because you love it)” slogan that was dissected here a month or so ago: if you do really hateful work, you should get really lovely compensation for it.

      • JustRuss says:

        *sigh* Thanks for ignoring my point. Yes income inequality is a huge problem, and thank you Erik for continuing to bring it up for discussion. Yes there are significant gender and racial issues. But that has nothing to do with the point I raised.

        My issue is with the words “full and absolute income equality”. Those aren’t words I pulled out of my ass, it’s a direct quote. Are you seriously arguing that everyone should make exactly the same income? I didn’t think I had to spell this out, but here goes:
        A burger flipper can drop out of high school at 16 and start working full time
        A surgeon has to go through years of college and training before they start working. It’s highly stressful and competitive. And after all that they should make exactly the same as the guy behind the counter at Wendy’s? In fact, due to the income they deferred while going to school, they’ll be making less. Is that really what we’re striving for?

        Look, I value the work of the people who cook the food I eat, and fully subscribe to the idea that they should have the benefits and wages required to lead a decent life. I also value the work of the surgeons who saved the lives of my wife and daughter, and have no problem with the fact that they make a hell of a lot more than I do. Would I cry in my beer if they made a little–or even a lot– less so the burger flippers could make more? No.

        I fully agree that that our society should be far more equal in terms of income. But you can argue for decreased inequality without calling for “full and absolute income equality”. Unless of course, you really think that should be the goal. But if not, let’s not give our opponents more talking points.

        • JustRuss says:

          I should also apologize to Erik for referring to full income equality as “stupid shit”. I personally don’t know anyone who advocates for it, and have only seen it used as a straw man by conservatives in discussions regarding inequality. I felt Erik was being unserious or sloppy by calling for it and that was myopic of me.

        • Col Bat Guano says:

          Obviously we are never going to achieve full and absolute income equality. But it is a noble aim to strive for and I’m certainly not going to answer Colvin’s question in any other way than “None.”

          Maybe using the full quote rather than selectively editing it would help you.

        • Tristan says:

          Look, I value the work of the people who cook the food I eat

          Yeah, your comments positively glow with respect for the “burger flippers” who “drop(ped) out of high school”.

          Hey, more direct quotes!

    • KmCO says:

      Won’t someone think of the One Percent????!!

    • DF says:

      It seems our society wants fry cooks and brain surgeons. Why should we punish the fry cook for doing a job our society wants done?

      You could make every income for every job equal, and there would still be ways of “sorting” people, if that’s what you’re concerned about. The brain surgeon is always going to have a higher prestige job. And he doesn’t have to work in a tedious, soul-crushingly boring job every day.

      • DF says:

        To be clear, I don’t like the sorting by job habit our society has. I’m just pointing out that people who object to the fry cook making as much money as the brain surgeon seem really to be complaining that, without unequal salaries, we won’t know who the winners or losers are.

        • Erik Loomis says:

          I got into this very debate at a family function a few weeks ago, with my sister-in-law’s brother slamming on unions and saying that San Francisco tree trimmers get paid more than I do as a college professor so I should be outraged. I said that why would I want to tear someone down rather than demand what the tree trimmers organized to make? He looked at me like I was from another planet and didn’t attempt another conversation with me the rest of the day.

          • DF says:

            I’ve had that same experience recently. Got into a stupid Facebook argument with someone who was outraged that union drywall hangers (or something like that) were making $45/hour.

            I suspect that figure was inflated, but if it wasn’t, good for those drywall hangers!

            • Erik Loomis says:

              I really try to avoid talking politics to random people, largely for this reason.

            • wjts says:

              A few years back, I overheard some guys at a bar discussing unions. They conceded that yes, at one point unions had a purpose, but that time has long since passed. Now, unions encourage freeloading and entitlement. “Why,” said one of them, “last week I had to work sixty hours. Did I get overtime pay? I sure didn’t. So why should they?”

              In the interest of maintaining barroom comity, I did not interrupt and say, “Sixty hours and no overtime pay? Shit, man – sounds like you guys need to unionize.”

              • Linnaeus says:

                They conceded that yes, at one point unions had a purpose, but that time has long since passed.

                I also hear this a fair amount, but no one as of yet has been able to tell me why this is true.

          • Tristan says:

            When my sister owned a small business she was constantly harassed by some d-bags from the temple of mammon chamber of commerce to sign some petition to eliminate public sector pensions or something like that. They could not for the life of them wrap their heads around the idea that a business owner would not be actively interested in punishing a group of total strangers for the sin of working for the government.

        • KmCO says:

          Precisely. Income stratification of such an extreme degree has been defended by weighing the importance of the role of brain surgeon in society relative to that of a fry cook, which IMO does not take into account the fact that just as there is market demand for fry cooks there is surely demand (and need) for brain surgeons. On some level it appears to be an entreaty for stratification for stratification’s sake.

          • Aimai says:

            Well, its also an argument that no one would do either job without remuneration, and if you gave the fry cook the same money as the surgeon they’d work for a year and then retire and not work again. Ditto the mine worker or the iron worker. The latter are dangerous jobs. If they paid enormously well people wouldn’t take the risk for very long and you’d have high turnover. Its only by holding people’s lives hostage, in a sense, and eliminating the choice/chance to do other, safer, work that you can force people into difficult/dangerous and repetitive work.

            We don’t pay surgeons a whole lot because that is what they are “worth” it in the sense that they deserve it compared to other jobs. We pay them a whole lot because they have to study long and hard, have big financial debts, and run a cartel that keeps other people out of the pathway to competition with them and we can’t easily substitute for their expertise. If we could? They’d go the way of the Pilots who are now being forced to accept busman’s wages for piloting aircraft.

            • Denverite says:

              We pay them a whole lot because they have to study long and hard, have big financial debts, and run a cartel that keeps other people out of the pathway to competition with them and we can’t easily substitute for their expertise.

              I’d argue that runaway medical inflation has more to do with it.

          • JL says:

            It also doesn’t take into account the fact that there are jobs that have the power to help or hurt a lot of people, and that require a lot of education and skill (I would presume that these are the arguments for paying brain surgeons a lot of money), that are not compensated nearly as well as brain surgeons. According to Glassdoor, a bilingual therapist at my local rape crisis center – someone with a graduate degree, skills that most people do not have and are not going to learn, and a difficult job that can do a whole lot of good or harm – makes between $35K and $38K per year.

    • Nobdy says:

      Inequality is a (possibly) necessary tool to get people to do things they might not otherwise do. So if we want a janitor to work for 50 hours instead of 40 it might make sense to pay him more to work the extra 10 to incentivize him (thus creating inequality between him and the 40 hour guy.) It also (in theory) allows us to channel exceptional workers into socially useful functions.

      The only reason to pay a brain surgeon more than a janitor would be if absent the extra pay the surgeon would be a janitor instead and we would lose a valuable doctor. In that case there is a decent reason for inequality, but if the brain surgeon would be a surgeon anyway why SHOULD he earn more than a fry cook.

      I’m serious. What’s the justification?

      • DF says:

        As I said in my comment above, I think it’s about sorting. People want to know who the winners and losers are. That the entire game is rigged seems not to be relevant to them.

        Also, if we don’t pay the brain surgeon more, the fry cook might start to think he’s just as valuable a person. And we can’t have that, can we?

        • Nobdy says:

          It’s a terrible justification (I am not saying I think you endorse it, just that it sucks.) AND…

          What’s the justification for inheritance then?

          And why should the brain surgeon’s kids get better material goods and opportunities than the fry cook’s?

          • DF says:

            Right. It ignores that people don’t all start from the same place. The fry cook’s kids might go on to be fry cooks because they don’t get exposed to the same kinds of education (and unfortunately, networking) that the brain surgeon’s kids do. And they will then be punished by society for that, in this unequal regime, which manages to be both cruel AND capricious.

        • Lurking Canadian says:

          I think there’s also an incentive effect do with training and stress. We put the neurosurgeon through four years of med school then six years of residency during which time she’s expected to work three 48 hour shifts a week or some shit. Then we put our heads in her hands and impose upon her the pressure to keep us and our loved ones alive.

          I think even in the most egalitarian society, we can justify giving her something extra as a reason to go through all that instead of saying, “Fuck this, nothing but eggs and hash from now on”.

          Note that this does not imply the fry cook needs to live in misery, unable to see his children, go on vacation or retire.

      • Denverite says:

        See above for the purported justification.

      • gmack says:

        Let me play Hayek for a second. His core idea, at least as he articulates it in “Equality, Value, and Merit” (which also appears in the Constitution of Liberty), is that any effort to use some set of moral values to determine what someone deserves amounts to a loss of individual freedom. If we try to allocate benefits in accordance with virtue or some person or group’s conception of what is genuinely beneficial to society, then we are effectively trying to impose one system of moral value on every individual. Thus he concludes that rewards should not be based on merit. Instead, they should be based on the value that a person contributes. And that value, of course, should be understood to be function of what some other person wants. So if I have an extraordinary singing voice–one that lots of other people like and are willing to pay for–then I get lots of money. Do I “deserve” this, morally speaking? Not really. I got my singing voice by accident. But society would be wrong to try to deny me this money or give it to someone else deemed to be more virtuous, because such an effort, Hayek argues, would place an unacceptable restriction on human liberty. As he puts it: “The mark of the free man is to be dependent for his livelihood not other people’s views of his merit but solely on what he has to offer them.”

        Of course, what this means is that “freedom” becomes reduced to the freedom to buy and sell labor power. One’s “value” becomes a function of whatever another person, who often has a lot more power than others, is able to get away with paying you. And this produces a situation that seems to me to be pretty much the opposite of freedom. However, my point here is that for libertarians the whole point is to get away from having the distribution of benefits be a function of collective and moral decision-making. Inequality isn’t a “tool” to do anything; it is, for Hayek and his followers, simply a spontaneous result of individual freedom. So in effect, they reject your question of which professions “deserve” which amounts of money. And this rejection of the question, I think, is partly why the participants in these debates often do not seem to understand on another very well.

        And with this little dip into the pool of libertarian thought, I now have to go take a shower…

        • Brad Nailer says:

          “Thus he concludes that rewards should not be based on merit. Instead, they should be based on the value that a person contributes. And that value, of course, should be understood to be function of what some other person wants.”

          A neurosurgeon contributes life-saving medical techniques and makes $500 thousand a year; a baseball player contributes a .290 batting average and makes 10 times that much. What these two people get paid is less a function of “what some other person wants” than it is of “how much money is available to pay them” and, in the case of the ballplayer, “how good his agent is.”

          • Bill Murray says:

            how are “what some other person wants” and the amount of “money available to pay them” not heavily interrelated

            • Brad Nailer says:

              They are related, of course. My point is that if you ask your average citizen (who might also be a baseball fan) which is more important–i.e., which he “wants” more–I’m guessing he or she would say the neurosurgeon, whose job is to materially improve the health and therefore the quality of life for his patients. Baseball players, on the other hand, are entertainers who give us pleasure and diversion; life enhancing, yes, but hardly the same thing. Unfortunately, neurosurgeons don’t have enormous TV contracts and revenues from stadium sell-outs to fund their profession like ballplayers do.

    • actor212 says:

      Oh please! Where the hell do you see anyone suggesting that? What we ought to have is a more objective measure of the worth of a person’s work to the world at large. So if a brain surgeon makes more than a fry cook, let’s be certain he’s earned the right to do that.

      But I can tell you this damned much: I know hedge fund managers who make ten, a hundred, even a thousand times as much as a brain surgeon. Even you’d have to agree, even pursuing this strawman logic, that’s ludicrous.

      • Aimai says:

        Yes–I agree with actor212. The whole brain surgeons vs. fry cook thing is another absurd analogy. At least the brain surgeon is performing skilled work that very few people (for whatever reason) can perform. The real issue is CEO pay or financial-banker pay. There can be no justification for that given that a) many people can do the job as well or better, b) the pay is related more to gaming the system than benefits to stakeholders.

        • JustRuss says:

          Why is that an absurd analogy? Erik called for “full and absolute income equality”. He didn’t exempt brain surgeons, the comparison is totally valid. If you want to play the “that’s not what he meant game”, fuck that. I’m not a mind reader.

          • Aimai says:

            I’m not saying we should exempt Brain Surgeons just that its not a good analogy because skilled vs unskilled work is not a good analogy.

            • JustRuss says:

              Just to be clear, you’re saying that in a society with ““full and absolute income equality”, skilled work should pay more than unskilled work?

              I’m not trying to be a dick, I just can’t square that circle.

              • LFC says:

                A Rawlsian-style argument wd be that the brain surgeon might have to earn somewhat more b.c it’s the sort of job that requires yrs of specialized, presumably rather arduous training, and some such monetary incentive might be necessary to get enough people to become neurosurgeons. Assuming this is empirically sound — that is, there wd be a shortage of certain kinds of skilled workers absent some extra incentive — it is a defensible (if not necessarily obvs. correct) position. The position has nothing to do w desert — the highly skilled surgeon is not morally more deserving than the unskilled worker — rather, it has to do w the assumption that some incentives may be required to get enough people to undertake certain kinds of long-term specialized training.

          • Col Bat Guano says:

            Erik called for “full and absolute income equality”.

            Except that he didn’t. He said it was a noble goal that would never be achieved. So maybe we can let this strawman lie down and resutff himself?

          • actor212 says:

            Reading, how does it work?

            Obviously we are never going to achieve full and absolute income equality.

  21. KmCO says:

    Nothing says you’re bored of a topic by penning a spittle-specked column in denunciation of said topic.

  22. Nobdy says:

    Everything he says is completely disingenuous and deflecting.

    Here’s what I want to ask conservatives.

    Let’s say someone makes all the wrong decisions and spends their youth and young adulthood in riotous living and petty crime until they get sober at 35 never having graduated from high school, with a felony record, and no real skills. Are you willing to condemn this person to poverty and misery for the next 45 years of their life?

    I am not.

    Now in the society we live in today people can make all the right decisions and show discipline and grit and all that, and if they get unlucky or if they live in the wrong place, or they aren’t exceptionally gifted they can still end up screwed.

    Are you comfortable with having that person (Who, say, had the bad fortune to be born to a poor family in an economically depressed area and had to drop out of school to support said family) have no realistic hope for socioeconomic advancement to a place of comfort and security?

    • KmCO says:

      There is a certain class of conservative with an especially Calvinistic orientation that I suspect would be positively gleeful about the prospect of your hypothetical person leading a life of desperation.

      • muddy says:

        Yeah, remember the cheering in the Republican debates when they were asked if people should just be left to die? Talk about your objectively despicable.

      • Mike G says:

        And they’re happy to spend ten times as much on cops and prison guards to crack their skulls than they would be to spend a little on education or support services for said person.
        Because some people just enjoy the thrill of punishing others.

    • Whiskers says:

      When I read your sentence about someone spending their youth and adulthood in riotous living and petty crime until 35, I thought you were going to be talking about George W. Bush, but he didn’t straighten out until about 40.

    • Vance Maverick says:

      We know that these people value the fear of bad consequences as a motivator for others (see Frum and “Donner Party Conservatism”). I don’t think most of them are quite willing to look the mechanism in the eye, and admit that they want bad things to happen to real people.

      • Nobdy says:

        Fear of bad consequences is sometimes a useful motivating tool, but it requires opportunity for good consequences as the flipside of the coin.

        • Aimai says:

          I hate to disagree with you, Nobdy, because you’ve made a lot of great points in this thread but since “fear of bad consequences” is an end in itself for some people it does not require an “opportunity for good consequences at all.” As you pointed out upthread the ability to use other people as object lessons is a sufficient reason for some people to support the system. Meanwhile the entire thing is more like a gambling den where showing the mark that someone sometimes wins is important, but the mark himself never has to win to join in and accept the system.

      • Hogan says:

        And let’s bring in the source:

        “The great, overwhelming fact of a capitalist economy is risk. Everyone is at constant risk of the loss of his job, or of the destruction of his business by a competitor, or of the crash of his investment portfolio. Risk makes people circumspect. It disciplines them and teaches them self-control. Without a safety net, people won’t try to vault across the big top. Social security, student loans, and other government programs make it far less catastrophic than it used to be for middle-class people to dissolve their families. Without welfare and food stamps, poor people would cling harder to working-class respectability than they do not.”

        The thing that makes capitalism good, apparently, is not that it generates wealth more efficiently than other known economic engines. No, the thing that makes capitalism good is that, by forcing people to live precarious lives, it causes them to live in fear of losing everything and therefore to adopt – as fearful people will – a cowed and subservient posture: in a word, they behave ‘conservatively’. Of course, crouching to protect themselves and their loved ones from the eternal lash of risk precisely won’t preserve these workers from risk. But the point isn’t to induce a society-wide conformist crouch by way of making the workers safe and happy. The point is to induce a society-wide conformist crouch. Period. A solid foundaton is hereby laid for a desirable social order.

        Let’s call this position (what would be an evocative name?) ‘dark satanic millian liberalism’: the ethico-political theory that says laissez faire capitalism is good if and only if under capitalism the masses are forced to work in environments that break their will to want to ‘jump across the big top’, i.e. behave in a self-assertive, celebratorily individualist manner.

      • Chocolate Covered Cotton says:

        We know that these people value the fear of bad consequences as a motivator for others

        The key word here is “others.”

    • actor212 says:

      Let’s say someone makes all the wrong decisions and spends their youth and young adulthood in riotous living and petty crime until they get sober at 35 never having graduated from high school, with a felony record, and no real skills. Are you willing to condemn this person to poverty and misery for the next 45 years of their life?

      I am not.

      I assume that by “sober up” you mean they grab a hold of themselves and try to make it work.

      I’d want some assurance they’re being honest about that (and for the purposes of your example, I’ll assume they are) before I start handing money over to them. After all, the news is rife with stories of 50, 60 and older folks who still can’t seem to get it.

      But to your hypothetical, no, I want them to have a chance to start over again

    • Karen says:

      And it’s not limited to Prodigals. What about women who have kids at a young age but want to do something once the kids are in school or grown? People whose careers have been eliminated by technology?

      • Col Bat Guano says:

        Or how about someone who gets cancer at age 18 and spends 5 years battling it successfully, but misses out on that top notch education that will propel them into the 1%? Off to the salt mines?

    • Malaclypse says:

      Let’s say someone makes all the wrong decisions and spends their youth and young adulthood in riotous living and petty crime until they get sober at 35 never having graduated from high school, with a felony record, and no real skills. Are you willing to condemn this person to poverty and misery for the next 45 years of their life?

      “Being poor is having to live with choices you didn’t know you made when you were 14 years old.” – John Scalzi, Being Poor.

      • Lurking Canadian says:

        Or with choices your grandparents made years before your parents were born. Or with choices some racist asshole made on your grandparents’ behalf.

        Conservatives like to say they’re for “equality of opportunity not equality of outcomes”. One more point on which they are full of shit.

  23. Manju says:

    This is a self-serving question because the answer for Colvin is that inequality is good and by forcing people to admit that, the rich win. Obviously we are never going to achieve full and absolute income equality. But it is a noble aim to strive for and I’m certainly not going to answer Colvin’s question in any other way than “None.”

    “None” may be the answer he wants you to give.

    You can’t have complete equality without the economy falling apart. You need incentives for it to work. That’s why folks who have thought the deepest about these problems, Lane Kenworthy for example, talk of extreme inequality. The economic consequences of complete income inequality are such that it is not a noble aim at all.

    • Nobdy says:

      Then the answer would be “As close to none as possible while still maintaining the economy in good working order.”

      • DF says:

        That answer accepts the self-justifying logic of people who have benefited from the system as it is. The best answer is “None,” and we shouldn’t shrink from it.

    • Bill Murray says:

      You can’t have complete equality without the economy falling apart.

      You can’t have complete equality without the economy changing a very large amount which will likely lead to some near term disruption particularly for those at the top of the inequality pyramid. That may result in the economy falling apart, but there is no guarantee of this and IMO, the pyramid toppers are far more likely to be able to withstand the changes than, for instance, the working people whose lives have been destroyed by the outsourcing epidemic

    • wengler says:

      It’s a good thing extreme income inequality won’t also destroy the economy.

  24. joe from Lowell says:

    2. If everyone’s real income were multiplied by 100, would inequality still be a problem?

    A stupid question and irrelevant since it is never going to happen and we are heading in the opposite direction.

    This is the best answer for #1 as well.

    There is absolutely no point to putting any effort towards answering, or debating the answers to, the question of whether absolute income equality is a good thing. The only thing that would accomplish is to set people who want to do something about the current inequality problem against each other.

    • Manju says:

      “Absolutely no point?” Economist look into this question (“what degree would be just right?”) all the time.

      Didn’t Emmanuel Saez argue that the optimal income tax rate would be somewhere close to 70% at the highest margin? Doesn’t Joseph Stiglitz argue that extreme inequality dampers growth?

      They base these arguments on data. At some point, there is an inflection. The curve bends. These scholars are indeed searching for the right degree.

      • GFW says:

        I really should have read down this far before posting above about the idea of a progressive tax system indexed to the Gini, and the idea that there may well be an ideal (non-zero) Gini that results in the best combination of economic and social well-being.

        Also too, I second Manju’s plug for Lane Kenworthy.

      • joe from Lowell says:

        OK, my bad. I was thinking of the question in terms of Eric’s reply, which was about absolute equality.

        There is absolutely no point to talking about whether absolute income equality is a good thing. The degree of inequality, sure.

      • low-tech cyclist says:

        If today’s degree of inequality is too great, then what degree would be just right?

        We lefties should embrace rather than avoid this question.

        Even if we look at it through the uncaring lens of maximizing the wealth creation of our society as a whole, the answer is some inequality is good, but way less than we have now.

        You don’t have to be an economist to get there. If a lot of people have less money to buy stuff, then nobody can sell much to them, so nobody can employ people to make things or provide services to sell to them.

        We’re living in an experiment of what happens when there’s too much inequality, and we’ve demonstrated that the economy as a whole sucks as a result. We need a lot less inequality than we have now in order to maximize our economy’s potential.

        If you don’t think inequality should be reduced, then why do you hate America? (And I’m only half joking. It’s a good question.)

        But claiming that the right amount of inequality is zero is also bullshit. That experiment has been done as well, thanks to the former Soviet Union and its vassals. When everyone gets the same share, why should anyone work harder or take more responsibility than anyone else? There’s a reason “we pretend to work, and they pretend to pay us” was a catchphrase in the Soviet Union before its collapse.

        So you need some inequality. That’s not a successful critique of liberalism, only of communism. We need way less inequality than now even from a hardhearted central banker’s perspective, let alone from the perspective of someone who actually gives a damn about the lives of real people.

        • low-tech cyclist says:

          But questions 2 and 3 are bullshit questions.

          2. If everyone’s real income were multiplied by 100, would inequality still be a problem?

          And if each of us had a magic lantern with a genie who would give us three wishes, would inequality still be a problem?

          This question deserves the derision it’s getting.

          3. Is education the real reason for what’s happening?

          No.
          This one’s been answered over and over and over again. And the answer is No.

          The guy who’s asking this question must have gotten bored by the debate over inequality before he’d learned the first thing about it.

        • JustRuss says:

          +1. That’t the point I was trying to make above…apparently I did it wrong.

        • When everyone gets the same share, why should anyone work harder or take more responsibility than anyone else? There’s a reason “we pretend to work, and they pretend to pay us” was a catchphrase in the Soviet Union before its collapse.

          Not seeing what the argument is there. If there’s an inefficient way to get everyone a job and an education and a place to live and medicine, inefficiency is fine by me.

        • Bill Murray says:

          why should maximizing the wealth creation of our society be the primary goal of the nation’s economy? By asking the question in this way you have already given in to the way Fortune wants you to approach the problem and are fighting on ground of their choosing.

          It is not clear that even some inequality is good under say the lens of FDR’s Four Freedoms. Inequality may be unavoidable under current standards, but accepting the bad assumptions of neo-classical economics will never allow the consideration of these standards changing

        • mds says:

          That experiment has been done as well, thanks to the former Soviet Union and its vassals.

          Seriously? You actually think that the Soviet Union and its vassals had zero inequality? You even used the word “vassals,” for fuck’s sake. Sheesh, don’t people quote the takeaway line from Animal Farm any more?

  25. Shakezula says:

    If only they had gone to Harvard, they would be writing for Fortune too!

    True, part of the schtick is to say – Oh, look at this special thing that I have that you don’t have that is making my life so much better.

    But here’s a dirty little secret people like Colvin don’t want to admit – People who go to the top schools can and do get shivved by The Lady. The only difference is whether the person who has lost their job, mind or a limb has additional resources that they can access and those resources don’t run out.

  26. The idea that everyone is responsible for constantly “acquiring new skills” in order to have a house and eat properly and raise a family is totally absurd

    I am sure Colvin upgraded to the latest version of Office. New skill!

  27. Haystack says:

    Child of wealth attends top university and goes on to well-paid job defending the interests of the wealthy, then makes arguments that would embarrass an internet troll.

    • LFC says:

      My only caveat here is that, from his linked (by E. Loomis) online bio, there’s no way to tell whether Colvin is “a child of wealth.” It says, iirc, he was born and raised in Vermillion, S.D. That’s all there is about his childhood there.

  28. liberal says:

    JustRuss wrote,

    So a brain surgeon should make the same as a fry cook? Really? That’s a noble aim? Christ, in any discussion of inequality that’s the favorite conservative straw man, let’s not go propping it up for them.

    Mostly agree.

    The focus should be on economic rents, which is where most of the truly filthy rich got their assets.

    Thus, we should tax rents first. The right turn of phrase is that those upper incomes are legalized theft—this is both economically accurate, and finesses the “envy” argument.

    OTOH, a progressive income tax isn’t so bad, because at the upper tail, almost all income is rent of one form or another. (The problem is that the current tax code does lots of dumb things, like preferring capital income to wage income, and having a tax bracket that hits a hard-working upper-middle/lower-upper working person the same amount (per dollar) as someone who’s truly rich.)

    Finally, apart from rents, while punitively taxing large fortunes isn’t a great idea economically (as long as those fortunes were made by true contributions to production—which is very rare), the problem is that if we don’t, the holders of those fortunes will buy themselves rent collection privileges.

    It’s hard to make any of these arguments though, since most people are split between the royalist camp (who, while not admitting it, like the fact that government actually does distribute wealth…upwards!) and the leftwing camp (leftwing = Marx = unwilllingness to distinguish between creating/owning capital and owning rent-collecting privileges).

    Of course, since most high-income is rent collection anyway, the Marxist version is much closer to the truth, but the theoretical framework is too coarse. Henry George got it right; Marx got it wrong.

    • Rob in CT says:

      I’m in favor of a serious inheritance tax (ours is an absolute joke), taxing inflation-adjusted capital gains as income and having more marginal rates for the income tax (as it stands, the highest rate kicks in at a few hundred thousand in AGI. Especially if you fold in capital gains, that’s an absurdly low point at which to place your highest marginal rate).

      I don’t think too many lefties are in the Loomis camp with regard to equalized income. If you polled self-described liberals in the US about it, I strongly suspect you’d get a large majority approving of moderate income inequality. Most of the left, I think, still wants to strive for meritocracy. LGM is not exactly representative (and here, we have a split on this).

      • GFW says:

        There was a poll on this. A very illuminating one, showing that almost everyone thinks inequality should be lower than they think it is, and that what they think it is is far lower than what it really is!

        http://www.slate.com/articles/news_and_politics/politics/2010/09/theoretical_egalitarians.html

        I posted above about the idea that there may well be an ideal non-zero Gini, determined empirically. I wouldn’t be surprised if it was close to the “what it should be” results in this poll.

        • Rob in CT says:

          Yes, I remember that one.

        • Rob in CT says:

          Btw, thanks for that link, because while I had seen the aggregate data, I had not seen that particular chart with the data broken down by income, gender and political affiliation (or rather voting in the ’04 election). Not that any of it surprised me. Men favor more inequality than women, rich people more than poor people (who are still on board with inequality). Everybody underestimated how bad it was.

      • Vance Maverick says:

        Most of the left, I think, still wants to strive for meritocracy.

        People mean different things by this. “Merit is rewarded” — “factors other than merit are not rewarded” — “merit according to certain narrow measures decides drastic differences in life outcomes”.

      • Malaclypse says:

        Most of the left, I think, still wants to strive for meritocracy.

        I really wish people remembered the origin of this term. It might help with the valuation of the idea.

  29. Amit Joshi says:

    This is a self-serving question because the answer for Colvin is that inequality is good and by forcing people to admit that, the rich win. Obviously we are never going to achieve full and absolute income equality. But it is a noble aim to strive for and I’m certainly not going to answer Colvin’s question in any other way than “None.”

    Actually, even this plays the game somewhat. Wouldn’t it be the best to say that it’s not income inequality that matters, it’s the opportunity inequality. Opportunity for safe childcare, quality education (school and college both), healthcare, political representation, equal treatment before the law, etc.

    The job of a democratic government is to deliver equality of opportunity. If that necessitates high marginal taxes on the rich, that’s incidental. The goal is not punitive taxes or envy, the goal is to deliver equality of opportunity.

    • Bill Murray says:

      except in a market-based economy opportunity is, to a first approximation, proportional to income

      • Brad Nailer says:

        Wouldn’t that be part of the idea behind progressive taxation? Increasing government revenues by imposing high taxes on high incomes enables improved social services which, as I understand it, increase opportunities for people at the low end of the economic spectrum. Not to mention that progressive taxation (along with increased estate taxes and a clampdown on offshore tax sheltering) would, in theory at least, slow the concentration of enormous wealth and the maintenance of the American aristocracy–which apparently considers itself separate and distinct from the rest of the population.

  30. oaguabonita says:

    No, Geoff, no need to “suspect” you’re “not the only one suffering from severe inequality fatigue.” That much is certain. I’ll posit that it’s an eminently safe assumption that those holding the short end of the inequality stick were “suffering from severe inequality fatigue” long before it ever crossed your privileged mind that “inequality” might be an issue.

  31. billthelurker says:

    well, if we can pose questions by imagining impossible things?…

    Door A: Absolute inequality. One person on the planet owns everything. Everyone else owns nothing.

    Hey Colvin, would you grant that this would be too much inequality?

    Door B: Absolute equality. Everyone has the same amount of income, wealth, and consumption. Men In Black would enforce this.

    I, and presumably even Eric, will grant that this would be too much equality.

    So the question becomes, where on the spectrum between these hypothetical extremes is the optimal spot for truth, justice and the American way?

  32. bob says:

    Interesting how far Fortune has sunk since the early days when it published interesting writers with social concerns

  33. bob says:

    Link for my comment

  34. wengler says:

    There’s a very simple thought experiment anyone can engage in here. Consider a small village with 100 adults, each representing a point on the US income scale. Would this village last long as a workable political and economic entity?

    You have to remember that nearly everyone in this village can read and write, and the first amendment still protects their freedom of speech.

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