Repost-Larry Arnhart At Darwinian Conservatism: ‘Good Inequality’

Full piece here.

For what it’s worth, in my travels, I often find people who believe ‘inequality’ to be a social or moral harm, to also find ‘equality’ to be a social and moral good, and I’m curious as to how they arrived at such a position.

What does ‘equality’ mean, exactly?

In my experience, people can be wildly unequal in terms of physical and mental abilities, innate capacities and learned skills, life experiences, love and relationship goals, drive and ambition, and of course, pure luck.

We’ve all had some good times, some hard times, some things we’ve fought hard for, sacrificed for, and made a central part of our lives.

Am I gonna make it?  How can I be better to someone I love?  Is what I’m doing with my time worthwhile?

I generally agree with equality under the law as far as the equality of ‘life, liberty, and the pursuit of happiness,’ goes, but once I start to hear ‘equality’ as an abstract list of ‘rights’, human and otherwise, I find myself occupying a position of skepticism and doubt.

How much equality is enough, exactly?

Arnhart:

‘Over 11 percent of Americans will be among the top 1 percent of income-earners (people making a minimum of $332,000 per year) for at least one year in their lives.  94 percent of the Americans who join the top 1 percent group will keep that status for only one year.’

It seems to me that economic mobility and opportunity is one of the greatest strengths and cherished inheritances we share as Americans.

We don’t have to build around the ruins of monarchy, aristocracy, feudal landownership and fixed classes as found in most of Old Europe.  Our founders set us on a glide-path out of such constraints, with a lot of foresight and wisdom.

Arnhart:

‘Moreover, the factors that explain higher household incomes among Americans are not fixed over a lifetime, and they are to some degree a matter of personal decisions, which means that people are not forced to remain in one income bracket for their whole lives.  American households with higher than average incomes tend to be households where the members are well-educated, in their prime earning years (between the ages of 35 and 64), working full-time, and are in stable marriages.  Households with lower than average incomes tend to be households where the members are less-educated, outside their prime earning years, unemployed or working only part-time, and they are likely to be unmarried.’

Piketty And Hitchens-Some Saturday Links

Larry Summers via the Democracy Journal has an easily-accessible review of Piketty’s ‘Capital In The Twenty-First Century‘, called ‘The Inequality Puzzle.’

Among other interesting thoughts, there’s this:

‘…there is the basic truth that technology and globalization give greater scope to those with extraordinary entrepreneurial ability, luck, or managerial skill. Think about the contrast between George Eastman, who pioneered fundamental innovations in photography, and Steve Jobs. Jobs had an immediate global market, and the immediate capacity to implement his innovations at very low cost, so he was able to capture a far larger share of their value than Eastman. Correspondingly, while Eastman’s innovations and their dissemination through the Eastman Kodak Co. provided a foundation for a prosperous middle class in Rochester for generations, no comparable impact has been created by Jobs’s innovations’

Addition:  Richard Epstein-Piketty’s Rickety Economics.

Martin Feldstein at the WSJ (behind a paywall)-Piketty’s Numbers Don’t Add Up.

Repost-Revisting Larry Summers: What Did He Say Again?Why Do People Move To Cities? From Falkenblog: ‘The Perennial Urban Allure’

Technotopia And Politics-Jonah Goldberg At The National Review Online: ‘Minimum Wage And The Rise Of The Machines’

Cities should be magnets for creativity and culture? –From The Atlantic: Richard Florida On The Decline Of The Blue-Collar ManFrom Grist.Org Via The New Republic Via The A & L Daily: ‘Getting Past “Ruin Porn” In Detroit’… some people don’t want you to have the economic freedom to live in the suburbs: From Foreign Policy: ‘Urban Legends, Why Suburbs, Not Cities, Are The Answer’

Megan McArdle At Bloomberg: ‘Piketty’s Tax Hikes Won’t Help The Middle-Class’…David Harsanyi: ‘What Thomas Piketty’s Popularity Tells Us About The Liberal Press?’

Walter Russell Mead takes a look at the blue model (the old progressive model) from the ground up in NYC to argue that it’s simply not working.  Check out his series at The American Interest.  Technology is changing things rapidly, and maybe, as Charles Murray points out, it’s skewing the field toward high IQ positions while simultaneously getting rid of industrial, managerial, clerical, labor intensive office jobs.  Even so,  we can’t cling to the past.  This is quite a progressive vision but one that embraces change boldly.  Repost-Via Youtube: Conversations With History – Walter Russell Mead

The Hoover Institution Via Youtube: Charles Murray On ‘Coming Apart’

Globalization Is Having Consequences: Larry Summers & Piketty-Some Wednesday Links

Larry Summers via the Democracy Journal has an easily-accessible review of Piketty’s ‘Capital In The Twenty-First Century‘, called ‘The Inequality Puzzle.’

Among other interesting thoughts, there’s this:

‘…there is the basic truth that technology and globalization give greater scope to those with extraordinary entrepreneurial ability, luck, or managerial skill. Think about the contrast between George Eastman, who pioneered fundamental innovations in photography, and Steve Jobs. Jobs had an immediate global market, and the immediate capacity to implement his innovations at very low cost, so he was able to capture a far larger share of their value than Eastman. Correspondingly, while Eastman’s innovations and their dissemination through the Eastman Kodak Co. provided a foundation for a prosperous middle class in Rochester for generations, no comparable impact has been created by Jobs’s innovations’

Eastman Kodak is going through Chapter 11, as those Kodak innovations have been surpassed as well (I remember family gatherings around the slide projector, holding strays up to the light).

It seems there’s a race on right now for political, policy, and ideological means of explaining and adapting to the dislocation and rapid changes going on in our lives. Changes like immediate access to global markets and to relatively cheaper foreign labor. There’s also, as Summers points out, a lot of automation coming down the pike. The erosion of manufacturing jobs and the coming of robots, 3D printing, automated cashiers etc. will continue to shake things up across our society, altering how we work and live.

As for Piketty’s reception in the States, I’m guessing those who share in more basic assumptions (often anti-capitalist) about r > g being not only a potentially valid empirical observation, but a likely fatal flaw and nearly cosmic affront to justice within the capitalist system, they naturally welcomed the book. There aren’t a lot of card-carrying Marxist economists left, but there are people sympathetic to manifestations of Left-liberal thought which would harbor many…sympathies, especially in the political realm: Union organization and protectionism, the pursuit of social justice and redistribution of wealth, the genuine cultural Marxism of some feminists and some disgruntled reds who’ve gone green, a mild to virulent anti-corporatism in favor of a more collectivist Statism.

On that note, is the constant hammering of inequality in progressive fashion a winner for Democrats politically? Megan McArdle argues perhaps not on the city/country divide: ‘Inequality’s A Loser For Democrats.’

‘You can make a case that the difference between the Republican and Democratic politics of wealth lie in the difference between who tends to make up “the wealthy” in their districts. The rich of America’s affluent urban areas tend to be the beneficiaries, one way or another, of a global tournament economy in which markets are often close to “winner take all,” and vast sums can flow to people who are just a little bit better than their competitors. The wealthy in Republican districts, on the other hand, are more likely to be competing in local or national markets, not glamour industries, where sales are ground out one at a time. Because the sums involved are smaller, the wealth gap is also smaller — and business owners are less likely to be sympathetic to the idea that their success has a huge luck component.’

I wonder about a correlation between mobile capital, access to global markets, high-rates of immigration and more redistributive policy solutions in major cities?  There certainly are very ambitious and talented people drawn to New York and San Francisco, for example, and more extreme examples of rich and poor (usually along with a lot of political corruption, higher crime etc).

But does cosmopolitanism naturally lead towards policy solutions which favor redistribution of wealth, or some overall regulatory framework?

A greater likelihood to recognize that sometimes it’s better to be lucky than good?

Have global markets untethered even American companies more than previously from local responsibilities and tax obligations?

Readers of this blog know I like the idea of Burkean conservatism: Family, friends, churches, Little-league, the Rotary club, good ole American volunteerism in small town fashion are what form much of America’s backbone, and are vital to securing our liberties. Yet, they too are subject to global markets and subject to the changes going on right now. (I’m also fond of a kind of Jeffersonian liberalism, which perhaps while not religious and socially conservative, can protect individuals from large institutions and state structures and the excesses and over-promising of Statists and progressives).

There’s a lot to think about these days, especially where globalization and technology meet economics and political philosophy.

Tell me what I’ve got wrong. Any thoughts and comments are welcome.

Addition:  Richard Epstein-Piketty’s Rickety Economics.

Martin Feldstein at the WSJ (behind a paywall)-Piketty’s Numbers Don’t Add Up.

Repost-Revisting Larry Summers: What Did He Say Again?Why Do People Move To Cities? From Falkenblog: ‘The Perennial Urban Allure’

Technotopia And Politics-Jonah Goldberg At The National Review Online: ‘Minimum Wage And The Rise Of The Machines’

Cities should be magnets for creativity and culture? –From The Atlantic: Richard Florida On The Decline Of The Blue-Collar ManFrom Grist.Org Via The New Republic Via The A & L Daily: ‘Getting Past “Ruin Porn” In Detroit’… some people don’t want you to have the economic freedom to live in the suburbs: From Foreign Policy: ‘Urban Legends, Why Suburbs, Not Cities, Are The Answer’

Megan McArdle At Bloomberg: ‘Piketty’s Tax Hikes Won’t Help The Middle-Class’…David Harsanyi: ‘What Thomas Piketty’s Popularity Tells Us About The Liberal Press?’

Walter Russell Mead takes a look at the blue model (the old progressive model) from the ground up in NYC to argue that it’s simply not working.  Check out his series at The American Interest.  Technology is changing things rapidly, and maybe, as Charles Murray points out, it’s skewing the field toward high IQ positions while simultaneously getting rid of industrial, managerial, clerical, labor intensive office jobs.  Even so,  we can’t cling to the past.  This is quite a progressive vision but one that embraces change boldly.  Repost-Via Youtube: Conversations With History – Walter Russell Mead

The Hoover Institution Via Youtube: Charles Murray On ‘Coming Apart’

Megan McArdle At Bloomberg: ‘Piketty’s Tax Hikes Won’t Help The Middle-Class’

Full piece here.

McArdle:

‘If we look at the middle three quintiles, very few of their worst problems come from the gap between their income and the incomes of some random Facebook squillionaire. Here, in a nutshell, are their biggest problems:

-Finding a job that allows them to work at least 40 hours a week on a  relatively consistent  schedule and will not abruptly terminate them.

-Finding a partner who is also able to work at least 40 hours a week on a relatively consistent schedule and will not be abruptly terminated.

-Maintaining a satisfying relationship with that partner over a period of years.

-Having children who are able to enjoy more stuff and economic security than they have.

-Finding a community of friends, family and activities that will provide enjoyment and support over the decades.

This is where things are breaking down — where things have actually, and fairly indisputably, gotten worse since the 1970s. Crime is better, lifespans are longer, our material conditions have greatly improved — yes, even among the lower middle class. What hasn’t improved is the sense that you can plan for a decent life filled with love and joy and friendship, then send your children on to a life at least as secure and well-provisioned as your own.’

There are serious forces at work in our society right now, from high-rates of technological change and many areas of rapid scientific advancement, to many political, social, and cultural effects as a result. Global market forces continue to apply downward pressure across many industries and sectors of our economy, as they have for many years, altering the kinds of decisions people must make in their daily lives.

Is inequality so bad that we need a ‘global wealth tax’?

I’m someone fairly convinced that American progressive politics and Left-liberalism, in the long-run, generally leads to less opportunity for greater numbers of people, less overall wealth, and more social stratification. It’s a fast-track to many of the problems that many European societies and their governments face:  Sclerotic, slow-growth economies, deep structural debt and lower birth-rates.

In America, such an approach seems a sure way to grow a deeply wasteful, unresponsive, over-promising and under-delivering government which fails to protect and serve the kinds of everyday people that have made our country so remarkable. In practice, I imagine this looks more like De Blasio’s coalitions in New York City:  Labor activists are quite good at moving tax-revenue and labor activists around, while searching for the right cronies and monied interests to help fund their efforts and realize their aims. This can burden our institutions with impossible demands and a narrow coalition of interests working under what is presumed to be a universal idealism, making our politics deeply contentious and bitter as we fight over scarce resources (including political power).

As McArdle points out, challenging and/or rewarding work and career opportunities, more money and perhaps a little time to maintain the love and family lives that are often at the heart of so much of what we do…this is a good place to focus the debate. In my opinion, this requires broad economic growth and a private sector outgrowing the public sector, and many other things besides.

I’m hardly encouraged by our politics right now, either side really, but I think we can do so much better than this.

Any thoughts and comments are welcome.  Let me know what I’ve got wrong.

Link From A Reader: ‘Richard Epstein Introduces Chicago’s Best Ideas To Students’

————-

As I’m neither a lawyer nor an economist, feel free to chime in.  Epstein is intense.

Once you convince yourself that the business of government is to ‘worry about the elimination of wealth differentials,” as he states, then you will almost always end up shrinking the pie.  Epstein advocates keeping the pie growing, and removing barriers for people to enter into voluntary exchanges where both parties can benefit.

The income inequality folks often end up making more inequality through good intentions, cinching off the economy at its top through crony capitalism (favoring a few business winners and creating barriers to market entry along with enormous, inefficient bureaucracies).  They can also increase the politicians’ control over the money supply, eroding capital and tying outcomes to short-term political cycles.  Aiming for more equality often leads to less equality, much as the equality of outcome folks want more one-man, one-vote democracy, which is pretty much impossible in practice.

The whole thing slows down and/or stalls as people fight more over less.

***Say you’re more conservative, or religious, a Burkean, a la Kirk, or very interested in what keeps families together and the restraints necessary upon individuals and their own passions, helping to pursue life, liberty and some happiness.  As a libertarian law/economics thinker, Epstein makes the case that conservatism is great for genetic relations and family units, but not always scalable beyond these smaller circles necessary to maintain greater freedoms in civil society:  our families, churches and civic organizations.  He advocates a broader system of voluntarily entered into agreements and contracts, through Chicago School economic theory, which keeps the pie growing below in a large republic like ours.

————–

***One concern from the conservative perspective is that libertarian theory can introduce an individualism into people’s lives that is destructive as much as constructive, one that can flirt with anarchy, anti-traditional, anti-authority.  Maybe that individualism is already here, as a friend points out, and if so, perhaps it’s better than filling the postmodern hole with rights-based secular humanism, collectivism, or tying postmodernism and leftist solidarity to liberalism proper. There is both a classically liberal and a deeply anarchic libertarianism.