Savage Inequality As No Big Deal


Paul Street


For those who
read leading journals of “elite” opinion, there is little hidden about the
real values of the ruling-class. Forthright discussion commonly occurs in
those select venues, encouraged by editors’ confidence that the masses are not
paying attention and are incapable anyway of understanding the sophisticated
discourse of the privileged. Take, for example, a recent thought-piece titled
“Does Inequality Matter?” in the Economist (June 14, 2001), that
venerable font of Anglo-American neo-liberal wisdom (its answer, by the way,
is “Not Really”). Known for its combination of candor, conceit, and contempt
for those who do not grasp the eternal beneficence of “free market”
capitalism, the Economist tackles controversial topics but only in a
way that leaves rich folks smug and satisfied. As in all ideological
productions composed by and for society’s opulent minority, the truthfulness
of its claims regarding inequality are secondary to the needs of wealth and
power.

Inequality?
Certain facts of socioeconomic disparity in a world ruled by capital are too
obvious and important not to be acknowledged in the Economist. “There
are,” the journal notes, “more rich people than ever before, including some 7
million millionaires and over 400 billionaires.” Meanwhile, it adds, the gap
between rich and poor “is rising, even in the industrialized countries where
for much of the 20th century the gap had narrowed. In America, between 1979
and 1997 the average income of the richest fifth of the population jumped from
nine times the income of the poorest fifth to around 15 times. In 1999,
British income inequality reached its widest level in 40 years.” There’s much
more that could be presented (starting with data from the annual United
Nations Human Development Report) on widening inequality but the Economist
cannot be accused of denying the phenomenon’s existence.


But does it all
“matter?” For those who believe in fairness and justice between and among
human beings, the facts of global socioeconomic disparity are deeply
disturbing in and of themselves because they violate basic principles of human
decency. At the same time, egalitarians know, inequality deeply disables
democracy. Core democratic ideals—“one person, one vote” and an equal
distribution of policy-making influence —cannot flourish side by side with
significant wealth inequality and poverty. Now we are learning that inequality
is a significant cause of disease. Public health professor and MD Stephen
Bezruchka and other researchers have shown that peoples’ physical well being
and life spans are negatively related to the extent of the “hierarchical
structure of their society; that is the size of the gap between rich and
poor.”

These are
clearly not the Economist’s concerns regarding inequality. The
journal’s main apprehension is that during “bad economic times,” when “the
rich may lose the most money, but the poor lose their jobs, their houses, even
their families,” anger over inequality can cause the poor to also lose “their
acceptance of the way the system works.” When enough people lose their
allegiance to “the system” (that is, to hierarchy), the magazine warns,
society falls prey to “backlashes” that lead to such outrages as “trade
protectionism, job guarantee schemes, extending welfare benefits even to the
middle classes, and most notoriously, Draconian taxes on the wealthy. All such
measures,” the Economist intones, without evidence, “sap an economy’s
strength and make everyone worse off.” With its possible negative policy
impact on the fortunes of the few, the potential for lost consent to hierarchy
on the part of the most downtrodden and not the admitted destruction of poor
folks’ lives is what the Economist identifies as the true “danger”
posed by inequality.

But lest this
“danger” cause undue alarm and thereby feed economic slowdown, the
Economist
gives three reasons why rich people can relax about inequality.
First, anger over inequality is absent during periods of expansion, since a
rising tide lifts all boats and “even the poor feel better off during good
economic times.” Second, since past periods of widening socioeconomic
disparity coincided with the extension of “the franchise” to “the
discontented,” the magazine argues, the angriest victims of hierarchy possess
a safe “channel through which to express their ire.” Because it is “no longer
necessary to create such channels” to “defuse” the threat of
counter-productive popular resistance, the rich can relax. Third, the rich can
be comforted by the fact that most of the arguments against inequality are
“unjustified.” According to The Economist, there are only two “ways in
which anger about inequality could be justified.” The first is when
socioeconomic disparity is a result of barriers to equal opportunity—unjust
obstacles of “class, race, creed or sex.” The second is inequality that
results from “power, even power initially gained in a meritocratic way,” being
“abused to raise prices or exclude competitors.” Fortunately, the Economist
finds, the leaders of our “liberal democracies” and “well-run companies” deal
quite well with the “justified grievances about inequality” and “win the
argument against unjustified ones.” The real threat, the editors conclude, is
not “injustice” but poverty, whose victims do not have grievances that can be
“readily channeled and defused by democracy.” “Helping the poor, the truly
poor, is a much worthier goal than merely narrowing inequalities,” concludes
the Economist. This is a goal that can be accomplished to everyone’s
benefit, without taking wealth from its mostly rightful owners.


The argument is
highly flawed. It wrongly assumes:

  • The existence of
    effective democratic channels for popular discontent: the mere right of the
    non-rich to vote has long been significantly trumped by the power of big
    political money and the related thought-control machinery of the corporate
    media
  • The absence of positive
    societal outcomes (past and present) from progressive taxation, welfare,
    trade protection, and social-democratic regulation
  • The existence of anything
    approaching equal opportunity for all, regardless of class, race, sex,
    language, and creed
  • The absence of any core
    and inseparable causal relation between inequality and extreme wealth at the
    top and poverty at the bottom
  • The existence of social
    norms and agencies strong enough to keep the inequity-enhancing abuse of
    private power in reasonable check

But the
Economists’
biggest failure, mandated by its mission of serving “elite”
interests, is its assumption that there is no justifiable criticism of unequal
outcomes in and of themselves. Would the contrast between Bill Gates’s
net-worth ($58.7 billion at latest count) and that of a homeless, second
generation welfare mother (zero) be any less grotesque and outrageous if Bill
Gates (unimaginable as this scenario may be) had grown up in poverty and then
somehow (miraculously in fact) faced no particular unjust barriers to equal
opportunity? As Noam Chomsky has argued, “There’s nothing remotely like
equality of opportunity [in really existing society], but even if there were,
the system would still be intolerable. Suppose you have two runners who
start at exactly the same point, have the same sneakers, and so on. One
finishes first and gets everything he wants; the other finishes second and
starves to death.” Even if it existed, equal opportunity would provide no
justification for today’s “winner-take-all” global society, in which a rising
number of millionaires and billionaires co-exist and profit from the existence
of a majority that “lives in shantytowns on the outskirts of the global
village,” to quote Chicago Tribune correspondent R.C. Longworth. The
attempt to construct such a justification is exactly what we would expect from
a journal that caters to the leading feeders at the trough of socioeconomic
excess.                       Z


Paul
Street writes and lives in Chicago, Illinois.