Equality is of intrinsic value only to the extent that it is equality in respect of something that is of intrinsic value like well-being. The relation of equality itself is not intrinsically valuable, so there is nothing intrinsically valuable valuable about equality in respect of something which is not of intrinsic value; for example, there is nothing intrinsically valuable about our equal distance to some faraway planet.

- Persson and Savalescu, Unfit for the Future

Why might we want to reduce inequality?

[There is an] assumption, generally taken as decisive by the commentariat, TV interviews and the like, that if [a high income] tax would raise little or no money then that should count against it decisively. On this view taxes are an unfortunate necessity, required to finance state expenditure and to be minimized whereever possible: a tax that raises no money is therefore pointless, imposing needless pain for no benefit.

But this view is just plain wrong, for several reasons. First, in a complex society structured by all kinds of institutional rules, the idea that people have full liberal property rights in their pre-tax income is unwarranted. They participate in a co-operative venture with others in society subject to certain conditions, and those conditions include one that part of “their income” already belongs to the wider society, via the state. This point, hated by libertarians, defeats the widespread view that people are having “their money” take off them: it wasn’t theirs to start with. Though I think such an argument, with some caveats, is correct, it is a second and third consideration that I’d want to rely on here.

The second consideration is that inequality is deadly for democracy, and for the equal political status of citizens. Because the power and influence high earners derive from their income threatens such status equality, there is a strong public interest in constraining it, even if doing so raises no money at all. It isn’t just that the rich come to own media outlets or that politicians are swayed by their donations to parties, it is also that the prominence their cash gives them gets them listened to and taken seriously by opinion formers. Their experience matters and shapes public policy, that of an unemployed teenager in the North East doesn’t: we need to shift the balance of voice in favour of the unemployed teenager and against the City trader.

Third, income inequality makes life worse for the rest of us in real terms. Economists are supposed to believe that utility (whatever that is) matters intrinsically and money only matters instrumentally. But right-wing economists often seem to forget this as soon as they are asked to comment on tax policy and inequality, arguing as if their theorems apply to cash and not to utility. If we’re dealing in cash terms, then a tax that makes some people worse off and nobody better off looks bad, and looks Pareto inferior. But it isn’t necessarily Pareto inferior if we focus on well-being: making some cash poorer may make some others better off, a Pareto incomparable outcome. Here’s one way how: if those on high incomes have too much, they can outbid the rest of us for goods that are intrinsically in limited supply or where supply can’t be quickly increased. If I’m further away from being able to buy a house near to where I work, because house prices are raised in an auction I can’t compete in, then I’m worse off even if my income stays flat. Reducing the purchasing power of the wealthy is therefore good for me (unless I got hold of a house early and can earn windfall gains from the auction). And similarly for many other goods. Unrestrained income for the wealthy also means that they can commit more of their resources to ensuring that their offspring make it to the top in the next generation, thereby harming the opportunities for the rest of society.

Squeezing the rich is good: even when it raises no money — Crooked Timber

Progress vs equality

It seems to me that the human species has, in general, progressed from our beginnings until the present day. And it seems to me that we can continue making progress. But. The thing about progress is that it's not evenly distributed. We don't progress consistently through time (there are occasional setbacks) nor is progress consistent across people and groups of people.

In fact, some would say progress is not possible without inequality. I think there's some truth to this, but I don't think the relationship between them is linear. We can't increase progress by increasing inequality (that is, some amount of inequality may be necessary for progress, but inequality is not sufficient for progress). An artificially equal society might very well stifle progress, but so might an artificially unequal one. If inequality is a necessary evil (as I believe it is), liberals should not forget that it's necessary, and conservatives should not forget that it's an evil. There's a sweet spot where we can and should balance progress and equality, and my sense is that we have some work to do, to move to that sweet spot. (Hint: inequality is too high.)

Most people would agree, I think. During a recent period in American history (say, about 1945 to about 1970), pretty much everybody's standard of living was rising. People's concern with equality was somewhat dampened by the fact that things were getting better. A rising tide really does raise all boats. But since about 1970, the tide is no longer rising, which is why we're seeing increasing concern about inequality.

"A rising tide raises all boats"

Well first we might ask: is it true and does it matter?

Is capitalism really the best way to "raise all boats"?

I am not suggesting, of course, that there's no evidence of capitalism's ability to produce material bounty. That has been amply proven. What I am questioning is the contention that we are all better off as a result, even on a material level. Certainly if we include the whole world—which seems appropriate in the age of the global economy—the case becomes tenuous.We will return to this subject in chapter two, but it is important to briefly note now that roughly 2.8 billion people—almost half the world's population—are living on less than$2 (U.S.) a day, a situation that leaves them in conditions of serious deprivation. Furthermore,the problems seem to be getting worse with the advent of the new capitalism. The latest numbers from the World Bank show that roughly 75 per cent of the world's people actually experienced a decline in their real incomes between 1988 and 1993, with the biggest decline in the bottom 5 per cent—the poorest 300 million people, who lost almost one-quarter of their real incomes.

- Linda McQuaig, All You Can Eat

If capitalism really does "raise all boats," is that the end of the story?

The real potential created by unleashing the economic appetites is not that a few people will get rich, but that everyone will end up better off. John Locke, for instance, argued that adopting capitalist modes for agriculture would increase the overall yield of the land. Adam Smith similarly argued that by unleashing individual self-interest, nations would generate more total material wealth. So the community, rather than suffering as a result of the release of individual economic appetites, ends up collectively better off. In other words, by making greed the master, not the servant of civilization…we all win. It should be noted that this was a stunningly clever argument, and it had the effect of undermining much of the moral objection to greed. In fact, the argument didn't really deal with capitalism's potential impact on social relations, but it did present a compelling counter-position. Certainly, if greed would lead to improved material conditions for all, this amounted to a positive argument in its favour. Whatever damage it might do to the social fabric, at least it could be said to contribute to the general good in some significant, tangible way. In fact, this was the somewhat hesitant spirit in which the new system was promoted by its early advocates—as a mixed bag of good and bad whose benefits ultimately outweighed its bad points. Unlike capitalism's more gung-ho advocates today, the early enthusiasts were at least willing to concede some potential problems with the new system. For all his enthusiasm, for instance, Adam Smith had some concerns about capitalism's impact on society.

- Linda McQuaig, All You Can Eat


These look promising

  • Nielsen, Kai: Equality and Liberty (I skimmed, looks really good. "Radical egalitarianism has often been thought to be at best hopelessly utopian and at worst incoherent. I seek to provide an account of radical egalitarianism that is not subject to any of those alleged defects and that is indeed a plausible and attractive theory which, if such terms are appropriate to normative theories at all, might very well be true.")
Unless otherwise stated, the content of this page is licensed under Creative Commons Attribution-ShareAlike 3.0 License