On more than one occasion over recent months I’ve heard or read something actually defending inequality. After a lifetime of hearing about the idea of “liberty, equality and fraternity”, I was hearing educated people saying inequality is what keeps the system going – a motive force propelling our society to ever new heights. At first, I found it hard to believe what I was hearing. Then, I thought perversely, if a little inequity is good for us, a lot of it must be better.
After all, that seems to be the operating principle of the people currently in power in the nation’s capital. They keep pushing in that direction.
“The accepted view in social science is that inequalities are an inevitable condition of economic success,” economic professor, Jacques Mistral, a senior fellow at Harvard’s Kennedy School of Government, commented back in July. He went on to note that the number of people in the U.S. without health insurance is growing and poverty rates here are “the highest among all Organization for Economic Co-operation and Development countries, in particular for children and seniors.”
Earlier this summer, belittling those it says “who would discredit American capitalism,” the editors of The Economist magazine wrote: “Any system in which the spoils are distributed so unevenly is morally wrong, they say. This newspaper disagrees. Inequality is not inherently wrong.” The editors went on to say inequality is not wrong if the society as a whole is getting richer; there is a safety net for the “very poor” and everybody has the chance to climb up through the system. Of course, that’s not saying much positive about the economic situation today – at least in this country. The safety net is being shredded, and the most tattered parts are those designed to help the very poor. As far as everybody – “regardless of class, race, creed or sex” – having the ability to move upward, well, there’s ample evidence it just ain’t happening.
In June, The Economist did a special issue on “Inequality and the American Dream.” It described the U.S. as a country “that tolerates inequality” and concluded that “… every measure shows that, over the past quarter century, those at the top have done better that those at the bottom” and “the gains of productivity growth have become increasingly skewed.” Simply put, the editors acknowledge that while more and more wealth is being created, those who already have are having more and those who have little are having to make do with less.
But here we are – in the richest country on the planet where one in five children lives in poverty. Where a worker who earns the minimum wage takes in $10,700 which $6,000 below the federal poverty level for a family of three. Sixty-one percent of minimum wage earners are women, many of them single.
While corporate profits have soared, inflation-adjusted wage growth has stagnated and the wages of the lowest paid workers amongst us have not kept up with inflation. From 2001 to 2003, inflation-adjusted income among households in the lowest 20 percent of the population decreased 5.1 percent.
Much is being made by some commentators about the income differences between workers at the lower end of so-called middle class and those employed at the higher level, more-skilled jobs. Much of this is statistical mirage. Income inequality is growing for the 80 percent of American workers who are characterized as “production and non-supervisory.” – that is, the working class.
Between 2002 and 2003 the number of Americans in poverty increased by 1.3 million and poverty rates for African American and Latino workers stood at over 20 percent. At the same time, real income for the bottom 40 percent of African-American households fell by nearly 6 percent
The income disparity of African American families as compared to whites actually increased over the past decade.
As New York Times columnist Paul Krugman recently observed, “economic disparities in New York, as in the United States as a whole, are wider than they have been since the 1920’s.”
Enter the “Bell Curve.” That’s the title of the 1994 book by early neo-conservatives Charles Murray and Richard Herrnstein’s that asserts intelligence is largely a matter of birth, that there is little chance of altering that fact, and that poor people and African Americans in particular, are thus overrepresented among the unintelligent. Their screed was widely denounced for its racism and sloppy scholarship. Reactionary commentator Pat Buchanan, however welcomed it as shooting “a hole straight through the heart of egalitarian socialism which tried to create equality of result by coercive government programs.”
Those who would have us believe that inequality is not only inevitable naturally return to this discredited view over and over because its thesis advances their idea of the inevitable rise to dominance of the “cognitive elite” under conditions of advanced technology and globalization. They maintain that the U.S. is becoming a genetic “meritocracy.”
On October 5, The Economist returned to the subject of inequality in a special edition titled: “The Search for Talent.” In it, the term “Bell Curve” appears twice. In an editorial comment, ominously titled “the Dark Side,” the magazine said:
Competition for talent offers many benefits–from boosting productivity to increasing opportunities, from promoting job satisfaction to supercharging scientific advances. The more countries and companies compete for talent, the better the chances that geniuses will be raked up from obscurity.
But the subject is strewn with landmines. Think of the furor that greeted Charles Murray’s and Richard Herrnstein’s book “The Bell Curve,” which argued that there are differences in the average intelligence of different racial groups; or the ejection of Lawrence Summers as president of Harvard University because he had speculated publicly about why there are so few women in the upper ranks of science. It would be wonderful if talent were distributed equally across races, classes and genders. But what if a free market shows it not to be, raising all sorts of political problems? And what happens to talented Western workers when they have to compete with millions of clever Indians who are willing to do the job for a small fraction of the price?
Notice that the Indians are not described as smarter, only more “clever” than the “talented Western workers.”
Then, in the main article, titled “The Revenge of the Bell Curve,” the magazine continues:
The second factor that links talent and inequality is that members of the talent elite are good at hogging “human capital.” They marry people like themselves. In the heyday of “company man,” bankers married their secretaries; now they marry other bankers. They work in jobs that add to their intellectual capital. They live in “talent enclaves,” away from ordinary middle-class suburbs, let alone inner-city ghettos. Above all, they pass on their advantages to their children. Students from the top income quartile increased their share of places in elite American universities from 39% in 1976 to 50% in 1995.
None of this is peculiar to America or other rich countries; the same thing is happening in the developing world in even starker form. Members of the talent elite there live in gated communities, some of them with American names such as Palm Springs, Napa Valley or Park Avenue, that boast international schools, world-class hospitals, luxury housing and splendid gyms.
“… The talent war is producing a global meritocracy–a group of people nicknamed “Davos men” or “cosmocrats”
who are reaping handsome rewards from globalization.
These people inhabit a socio-cultural bubble full of other super-achievers like themselves. They attend world-class universities and business schools, work for global organizations and speak the global language of business.
Countries that still insist on clinging to egalitarianism are paying a heavy price. Sweden, for instance, finds it hard to attract foreign talent. And across Europe, egalitarian universities are losing out to their more elitist American rivals.
The answer, then, to rising inequality is to cease “clinging to egalitarianism.”
Most of the world’s main problems today are inseparable from the dynamics of rapacious globalization and the so-called market economy. Without some fundamental changes, the future under this system will see increased poverty, more environmental degradation, and what writer Ronald Aaronson has termed “ever more uneven distribution of resources and the undermining of traditional societies and ways of life, for a culture dominated by marketing, advertising and uneven global development.”
The market economy – in all its aspects: production, service, education, housing, etc.) is driven by the pursuit of profit. It is that drive, and not some exorable drive toward a mythical “meritocracy” arising from technological change. One might think that in a world of expanding production and wealth creation there ought to be more not less job security and prosperity. Instead under the present setup, the already well-to-do and their progeny get more security and prosperity and working men and women and their families get less. That may be how the system works but it ain’t right and it doesn’t have to be.
There is no reason why the United States with its great wealth and resources cannot decide to launch major redevelopment of our crumbling physical infrastructure, rebuild and retrofitting highway bridges and railroads thus providing jobs for the unemployed; come up with a massive plan to overhaul and upgrade the nation’s school systems, with emphasis starting with inner-city schools that are failing our young people so miserably today; create a single-payer system. It should be clear that the reasons such projects are not undertaken is because they are not at the service of “market forces,”
that they do not produce vast profits for the profiteers, and that they would spread the wealth around.
We are not faced with scarcity, limited resources and declining production but growing wealth and productivity. Under these circumstances, every working woman and man should earn the right to never be afraid of not having quality medical care, never being afraid of having no security in retirement, never being afraid of being rendered homeless and never being afraid that their children will not have the best education the society is able to provide. Without such pre-conditions, talk of a level playing field or an earth made “flat” by internet technology is just so much foolishness.
Oh, they try to scare us with threats like foreign competition, immigration and an aging population. But that’s all so much bunk. Sure, adjustments must be made but they don’t have to involve ever-increasing institutionalized economic and social inequality.
The Economist editors concluded their survey speaking of “the risks of a backlash against the talented elite.” Yes, there must be, and surely will be, a backlash. It is already underway across the globe. But it is not, nor should it be, against those who have, through their efforts and talents, legitimately reaped success. Simply put: it’s the system that’s at fault. We should not turn our backs on that idea just because the rich and powerful and their theorists say it is misplaced altruism and that the reality is that inequality is good for us.
Left Margin appears in BC every other week.
BC Editorial Board member Carl Bloice is a writer in San Francisco, a member of the National Coordinating Committee of the Committees of Correspondence for Democracy and Socialism and formerly worked for a healthcare union.