Posts Tagged ‘inequality’
“In a country well governed, poverty is something to be ashamed of. In a country badly governed, wealth is something to be ashamed of.”*…
The image above captures the received wisdom about extreme poverty and the way that it has declined over the last couple of centuries. But Dylan Sullivan and Jason Hickel would have us take a longer view, suggesting that the story is neither so simple nor so laudatory as we might assume…
Highlights:
• The common notion that extreme poverty is the “natural” condition of humanity and only declined with the rise of capitalism rests on income data that do not adequately capture access to essential goods.
•Data on real wages suggests that, historically, extreme poverty was uncommon and arose primarily during periods of severe social and economic dislocation, particularly under colonialism.
• The rise of capitalism from the long 16th century onward is associated with a decline in wages to below subsistence, a deterioration in human stature, and an upturn in premature mortality.
• In parts of South Asia, sub-Saharan Africa and Latin America, wages and/or height have still not recovered.
• Where progress has occurred, significant improvements in human welfare began only around the 20th century. These gains coincide with the rise of anti-colonial and socialist political movements.
“Capitalism and extreme poverty: A global analysis of real wages, human height, and mortality since the long 16th century.” By way of context, Hickel is a “degrowth” advocate. In any case, the data is arresting– and surely worth pondering.
* Confucius
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As we dig deeper, and lest we think pre-capitalist life was Edenic, we might recall that it was on this date in 1381 that “boy-King” Richard II met with the leaders of the Peasants’ Revolt (AKA Wat Tyler‘s Rebellion or the Great Rising), which had arisen for a variety of reasons, including the socio-economic and political tensions generated by the Black Death in the 1340s and the high taxes resulting from the conflict with France during the Hundred Years’ War.
At the meeting, Richard acceded to some of their demands– most notably, the abolition of serfdom. But after he had the opportunity to gather his forces, he put the rebellion down, rounded up the leaders (some of whom were executed; others imprisoned)… and re-instituted serfdom.
“Mounting a campaign against plutocracy makes as much sense to the typical Washington liberal as would circulating a petition against gravity”*…
Brad DeLong elaborates on Jonathan Kirshner‘s bracing review of Martin Wolf‘s important new book…
Jonathan Kirshner: Rigged Capitalism and the Rise of Pluto-populism: On Martin Wolf’s The Crisis of Democratic Capitalism: ‘The middle third of this book, “What Went Wrong,” should be required reading…. When it comes to solutions, unfortunately, The Crisis of Democratic Capitalism comes up short. Wolf, ever measured, is convincing in making the case for reform over revolution…. Yet it is disheartening that the sensible, reformist agenda of reasonable, practical measures that Wolf outlines already seems beyond the capacity of our politics…. Massive concentrations of wealth for a sliver of largely-above-the-law plutocrats, combined with stagnation and declining opportunities for the majority—leads to a basic political problem: “How, after all, does a political party dedicated to the material interests of the top 0.1 percent of the income distribution win and hold power in a universal suffrage democracy? The answer is pluto-populism”… [which] unleash[es] forces… [that] render liberal democracy unsustainable…. corruption, arbitrariness of justice, and fear for future prospects are poisonous to the body politic…. Its final sentence, “If we fail, the light of political and personal freedom might once again disappear from the world,” reads less like a call to action and more like an epitaph…
Martin Wolf’s The Crisis of Democratic Capitalism and Barry Eichengreen’s The Populist Temptation are, I think, the best books on theDover-Circle-Plus societies current Time of Troubles. And there is no clear way through.
It was James Madison who wrote, in 1787:
Democracies have ever been spectacles of turbulence and contention; have ever been found incompatible with personal security or the rights of property; and have in general been as short in their lives as they have been violent in their deaths…
And the death of real democracy does not have to be accompanied by the end of the form. The classic example here is the Jim Crow U.S. South from 1876-1965. It was less than half as rich as the rest of the United States for almost a complete century. It was ruled by an oligarchy uninterested in economic development and very interested in corruption. The oligarchy its power by focusing the electorate on the necessity of keeping the Black Man Down, and tarring anyone who wanted a government that was less corrupt or more pro-development with being a negro-lover. That it held rocksolid from 1876 to 1965 shows that the future of anything we could call prosperous democratic capitalism is not assured…
Bracing: “Pluto-Populism,” from @delong.
See also: Kishore Mahbubani‘s “Democracy or Plutocracy? – America’s Existential Question” (source of the image above).
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As we get back to basics, we might recall that it was on this date in 1934 that Depression Era bandits Bonnie and Clyde were ambushed by police and shot to death in Bienville Parish, Louisiana. Bonnie Elizabeth Parker and Clyde Chestnut (Champion) Barrow were a criminal couple who traveled the Central United States with their gang during the Great Depression. The couple were known for their bank robberies, although they preferred to rob small stores or rural funeral homes. Their exploits captured the attention of the American press and its readership during what is occasionally referred to as the “public enemy era” between 1931 and 1934.
The 1967 hit film Bonnie and Clyde, directed by Arthur Penn and starring Warren Beatty and Faye Dunaway in the title roles, revived interest in the couple, who were treated somewhat sympathetically. The 2019 Netflix film The Highwaymen depicted their manhunt from the point of view of the pursuing lawmen but received mixed reviews.
“I think inequality is fine, as long as it is in the common interest. The problem is when it gets so extreme, when it becomes excessive.”*…
Alvin Chang, with a beautifully-told (and beautifully-illustrated) primer on a startling unpacking of the fundamental logic of our market economy…
Why do super rich people exist in a society?
Many of us assume it’s because some people make better financial decisions. But what if this isn’t true? What if the economy – our economy – is designed to create a few super rich people?
That’s what mathematicians argue in something called the Yard-sale model…
Read it and reap: “Why the super rich are inevitable,” by @alv9n in @puddingviz.
* Thomas Piketty, A Brief History of Equality
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As we ponder propriety, we might recall that it was on this date that Jane Austen‘s [and here] Pride and Prejudice was published. A novel of manners– much concerned with the dictates of wealth (and the lack thereof), it was credited to an anonymous authors “the author of Sense and Sensibility,” as all of her novels were.
Title page of the first edition (source)
“Material progress does not merely fail to relieve poverty, it actually produces it. This association of progress with poverty is the great enigma of our times. It is the riddle that the sphinx of fate puts to our civilization. And which NOT to answer is to be destroyed.”*…
John Burn-Murdoch brings the data…
Where would you rather live? A society where the rich are extraordinarily rich and the poor are very poor, or one where the rich are merely very well off but even those on the lowest incomes also enjoy a decent standard of living?
For all but the most ardent free-market libertarians, the answer would be the latter. Research has consistently shown that while most people express a desire for some distance between top and bottom, they would rather live in considerably more equal societies than they do at present. Many would even opt for the more egalitarian society if the overall pie was smaller than in a less equal one.
On this basis, it follows that one good way to evaluate which countries are better places to live than others is to ask: is life good for everyone there, or is it only good for rich people?
To find the answer, we can look at how people at different points on the income distribution compare to their peers elsewhere. If you’re a proud Brit or American, you may want to look away now…
To be clear, the US data show that both broad-based growth and the equal distribution of its proceeds matter for wellbeing. Five years of healthy pre-pandemic growth in US living standards across the distribution lifted all boats, a trend that was conspicuously absent in the UK.
But redistributing the gains more evenly would have a far more transformative impact on quality of life for millions. The growth spurt boosted incomes of the bottom decile of US households by roughly an extra 10 per cent. But transpose Norway’s inequality gradient on to the US, and the poorest decile of Americans would be a further 40 per cent better off while the top decile would remain richer than the top of almost every other country on the planet.
Our leaders are of course right to target economic growth, but to wave away concerns about the distribution of a decent standard of living — which is what income inequality essentially measures — is to be disinterested in the lives of millions. Until those gradients are made less steep, the UK and US will remain poor societies with pockets of rich people…
“Britain and the US are poor societies with some very rich people,” from @jburnmurdoch.
For a different (but not altogether contrary) perspective, see Noah Smith (@Noahpinion): “No, the U.S. is not “a poor society with some very rich people” (“We’re a rich society with some very poor people…”)
For an authoritative (and fascinating) account of how we got here: “Our Ancestors Thought We’d Build an Economic Paradise. Instead We Got 2022,” from @delong, adapted from his terrific new book, Slouching Toward Utopia.
* Henry George, Progress and Poverty (whose point seems to accrue whether one comes down with Burn-Murdoch or with Smith…)
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As we ponder progress, we might recall that it was on this date in 1962 that Americans met The Jetsons; the animated series premiered on ABC (the first color series on the network). The show was scheduled opposite Walt Disney’s Wonderful World of Color and Dennis the Menace and didn’t receive much attention; it was cancelled after one season and moved to Saturday mornings, where it was very successful.
Apart from flying cars and outer-space dwellings, much of the technology of The Jetsons has become commonplace: people now communicate via video chat on flat screens; domestic robots (like Roomba) are widespread, and various high-tech devices are the instruments of our leisure. But The Jetsons broader portrayal of life is still far from commonplace: while its world is one in which capitalism and entrepreneurship still exist and technology has not changed fundamental elements of human nature, it posits social advances (e.g., George Jetson works an hour a day, two days a week) that haven’t accrued and a society– no people of color, no working mothers, no single parents, no gay marriage, no poverty– that seem (to put it politely) quaint. Still, Smithsonian‘s Matt Novak, in an article called “Why The Show Still Matters” argues, “Today The Jetsons stands as the single most important piece of 20th century futurism… It’s easy for some people to dismiss The Jetsons as just a TV show, and a lowly cartoon at that. But this little show—for better and for worse—has had a profound impact on the way that Americans think and talk about the future.”
And we might agree with Andrew Womack (@Womack) and Rosecrans Baldwin (@rosecrans) that “it is a special pleasure to link this year after year: “it’s decorative gourd season, motherf*ckers.”
“Infant mortality and life expectancy are reasonable indicators of general well-being in a society”*…
… and in the U.S., as Adam Tooze explains, we’re doing not so well of late…
In August America’s Center for Disease Control (CDC) published a set of data that ought to have brought political, economic and social debate to a standstill. If there is one question that should surely dominate public policy debate, it is the question of life and death. What did the Declaration of Independence promise, after all, if not “life, liberty and the pursuit of happiness”. But on that score the CDC in 2022 delivered alarming news. In the last three years, life expectancy in the United States has plunged in a way not seen at any point in recent history.
America is inured to bad news about its health. Life expectancy in the United States has stagnated since 2011, a trend which separates the United States not just from rich peer countries but from most other countries in the world, rich or poor.
Given economic growth and advances in medicine for life expectancy to stagnate requires serious headwinds. In the United States those headwinds include, homicides and suicides, the opioid epidemic (so-called deaths of despair) car accidents and obesity. As John Burn-Murdoch shows in the FT, without those factors the US would have tracked its peer societies much more closely…
But stagnation is one thing, the collapse since 2019 is a phenomenon of a different quality. It is a full measure of the disaster that was the COVID pandemic in the United States. Over a million Americans died of COVID, one of the worst outcomes on the planet.
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…it is not only China that has overtaken the United States based on this metric. In 2021 Cuba has a higher life expectancy than the US. So does Albania.
In a society marked by inequality as deep as modern America’s, to speak in terms of national averages is not very meaningful. The circumstances of life and health outcomes are vastly different…
…One might think that faced with these stark facts all other subjects of political debate would pale into insignificance. Whatever else a society should do, whatever else a political system promises, it should ensure that its citizens have a healthy life expectancy commensurate with their nation’s overall level of economic development. An ambitious society should aim to do more, as Japan does for instance. Judged by this basic metric, the contemporary United States fails and for a substantial minority of its population, it fails spectacularly. And yet that extraordinary and shameful fact barely registers in political debate, a silence that is both symptom and cause.
“Life, liberty and the pursuit of happiness? How China, Cuba and Albania came to have higher life expectancy than the USA,” from @adam_tooze. Eminently worth reading in full.
For an example of the ways in which these wounds are self-inflicted: “The Human Psyche Was Not Built for This.”
* P. J. O’Rourke
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As we ponder priorities, we might recall that it was on this date in 1892 that the first diagnostic public heath laboratory in the U.S. was founded by New York City (as its “Division of Pathology, Bacteriology and Disinfection”). Spurred by the cholera epidemic of the time, it soon took on the diagnosis and tracing of diphtheria and tuberculosis; in 1895, it began production of a smallpox vaccine.
The New York City public health laboratory became a model for other cities’ public health departments. Within a few years, similar labs had become essential components of an effective health departments across the nation.
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