Inequality, domination, community and human nature

Note: This post is part of our League Symposium on inequality. You can read the introductory post for the Symposium here. To see a list of all posts in the Symposium so far, click here.

James Hanley asks the league:

What, if anything, is wrong with inequality?

My first reaction is to think: “nothing whatsoever”. My initial thoughts are that there are no convincing arguments that could tell me why I should care about material equality as a terminal value.  As far as distribution of material resources is concerned, I’m a maximin guy. I think that any amount of inequality is okay as long as the worst off improve absolutely. However, maybe I’m not thinking through things far enough. I would have reason to care about inequality if inequality produced negative consequences that I thought were serious*. So I thought deep and long and hard and came up with three things that maybe could get me to care about equality: The possibility of domination, the dissolution of community and people’s natural predilection for status games. i.e these are prima-facie compelling, but ultimately not convincing. Let me try to approach this one at a time. I will try to show their initial appeal and also try show why they are unconvincing.

The possibility of domination

This is perhaps one of the most common objections to inequality. The idea is that wealth can purchase political power by lobbying, campaign donations and by controlling the airwaves. Moreover, it is not that the imbalance of power is wrong in and of itself, it is that the imbalance of power allows those with more power and money to use their influence to implement policies that benefit themselves at the expense of the poor. To be clear, not all policies which make the rich better off and the poor even poorer are necessarily problematic. Pace Rawls, if a particular institutional arrangement secures certain fundamental liberties even at the expense of  the income of the poor, such a system is still just. In short, the imbalance of money and therefore power will systematically create policies which are less just than those which would otherwise result. There are basically 3 reasons why this line of argument is not entirely convincing.

1. How likely is it that inequality in wealth will lead to inequality in political power? Is there genuinely an inequality of political power in the US. The US is apparently experiencing unprecedented levels of wealth inequality since the gilded age (or maybe ever). Yet, even though Mitt Romney has more money from millionaires, Obama can make up the difference with voters from other income demographics. On the other hand, one could observe that both parties are corporatist plutocratic parties beholden to business interests. Both parties are the parties of business. The issue of New labour in the UK is similar. However, the fact of the matter is that in a competitive democracy (which the US and UK are), it is really difficult to do an end run around the terminal policy preferences of voters. Even if those preferences are wrong or manipulated it is still the case that in a democracy, political power flows from people. Of course, where there is less political competition, politicians have more room to pursue unpopular policies. Qn for americans: Do American legislators ever pass laws which were unpopular  with a majority at the time they were passed? I’m willing to bet that the answer is no (or very rarely). Legislators will especially not stay in power if they pass unpopular policies. Finally, we can ask if extreme disparities in wealth allow the wealthy to manipulate the conversation by controlling the press. Given the internet, it seems to be the case that the influence of formal journalism (the kind that is backed by large corporations) is waning relative to the influence of other more democratic or even anarchic and informal journalism.**

2. Even if large disparities in political power follow from large disparities in wealth, is does not necessarily (or even probabilistically) follow that policies that result from such power disparities are less just. For example, if lower-income folks are more likely to increased labour regulations, less foreign trade, less immigration or are more likely to be socially conservative, then the overall effect of their power on policy is likely to lead to greater injustice rather than less. In such a case, power inequality would be a good thing. i.e. neoliberal/libertarian-ish policies are antecedently prima-facie just, and if the system is more neoliberal/liberaltarian because elites who tend to be neoliberal/liberaltarian have a disproportionate influence, this is a good thing.

3. Even if income inequality led to power inequality, which in turn, resulted in genuine injustice, is this necessarily a problem with inequality? It could on the other hand be a problem with the institution type. There may be alternative institutions where the proper functioning of the system was not vulnerable to increases in income or power inequality. For example, if there were constitutional protections for various basic liberties, private property and even some provision for a social safety-net (we leave the details up to individual’s ideas about what is antecedently required by justice), then the proper functioning of the system would be more robust to increases in material inequalities. While the rich may find it easier to influence individual ordinary legislative acts, they would find it harder to garner the requisite supermajorities to change the constitution in such a way as to unjustly dominate others. Consider an analogy with the pursuit of self-interest. In command economies, self-interested behaviour often becomes detrimental to the public good. On the other hand, this is far less so in market economies. Whether or not self-interest is bad (or sinful) is beside the point. One set of institutions harnesses self-interest for public benefit to a greater degree than another. As far as institutional principles go (as opposed to principles of private morality), the problem is not selfishness because selfishness is impossible or at least highly impracticable to eliminate.

The undermining of Community

Other things being equal, large differences in wealth can provide very different backgrounds for people. If you are part of the really upper-crust set in the US, you are more likely to have grown up playing soccer and polo. You probably have your own horse and being part of the country club is normal. You fly first class wherever you go and going overseas at the drop of the hat is not a problem. Your family probably owns many luxury cars and you probably have a summer mansion, a city house, a country estate etc. i.e. like those guys in the Hamptons. You went to a private school which required uniforms etc. On the other hand, if instead of growing up in the Hamptons, you grew up in the Bronx, you have a whole different set of experiences. You rarely if ever have travelled overseas, and most likely on economic class instead of business or first class. You commute to school or work on public transport. If you do own a car, its more often than not second-hand and will be something like a ford or a Toyota. You’d have gone to a public school and you probably would have had to work part-time to pay your university tuition fees (unless you got a scholarship) And that’s just scratching the surface. There tend to be deeper differences in culture, outlook and expectations. People who have such different backgrounds are unable to identify with each other  or find it very difficult to do so, and may probably find it difficult to empathise with each other as well. In other words, they lack the shared understanding of the world which allows people to form communities. At this point, there are two things the egalitarian may want to say in favour of communities. The first is that community ties can have material benefits. For example, if I shared a sense of community with my employees, then my business decisions would not just be driven by profit maximisation, but by the welfare of my workers. As M.A has written, employers won’t just make decisions that lay off lots of workers and make half a town jobless, they will, in feeling connected to the workers either find a way to re-train them, or cut into their own salary package in order to help out the workers.

The second thing is that community ties are themselves intrinsically good, even if describing how is somewhat difficult. To illustrate, lets consider two situations A and B. Situation A and B are state descriptions of various individuals in parallel universes. In A, all the individuals concerned have community ties with each other and each enjoys some level of material wealth. In B, everyone has a somewhat higher level of material wealth, but the community ties are gone, and there are no compensating ties to other communities. The communitarian in a number of cases is going to say that A is preferrable to B. While such a conclusions may seem bizarre to the more individualist among us, there are communities like this. The Amish, for instance, forgo insurance and social security because they see such things as undermining their community ethos. If someone falls sick and the family cannot afford treatment, the whole community bands together. If there is too much strain on community resources, people are allowed to die. The Amish, in certain cases (at least in times past), will allow children to die in order to prevent their community from fracturing. Without passing judgement on the Amish, the example is merely to illustrate the level of commitment some people have to communitarian ideals.

What then is wrong with the community based critique of inequality?

One problem with the idea of community bonds between employer and employee is that where such community bonds are detrimental to the bottom line, such a model of business will be less competitive to than familiar profit maximisation models. This, however, is a limited critique. In theory at the least, company profits need not be affected if the CEO, out of a sense of solidarity merely decides to take less compensation and increases the pay of his workers. Perhaps I am missing something, but if a particular company compensates its workers at a higher than market rate without harming profits (and the CEO can be gotten to play along out of altruism and community feeling), there is nothing that makes this company less competitive. (In fact, offering compensation at above existing market rates attracts more candidates and allows a CEO to be more picky and thus have more talented workers) Chalk this down to 1 point in favour of community. The sustainability of such a system is still problematic. The problem lies in the fact that a lack of severe income inequality is insufficient to sustain community, and that a sense of community (at least within reasonable non-Amish limits) is insufficient to contain income inequality. Such that even if the US started off with a sense of community and little inequality, with sufficient time and prosperity, both would be eroded to current levels. Even the Amish way of life is changing, with increasingly more contact with outsiders and modernity, it wouldn’t take me by surprise if their way of life  as it currently exists died out in 200 years time. The cure for inequality in this case would be worse than the problem. Let us grant that everything else being equal, drastic income inequality actually makes the wost off even worse off (in terms of material goods) via erosion of community ties. The measures required to maintain a sense of community may nevertheless be worse; ranging from economy crippling measures to basic liberty eroding social policies. Nevertheless, I will grant this: It is worth caring about for at least this reason (that community ties can benefit the worst off) and if it could be achieved without the drawbacks, we should aim to engender and preserve community ties and insofar as it is instrumental to this end, reduce inequality.

But what if you cared about community for reasons that had little to do with the material benefit to its members? In that case, the drawbacks of trying to maintain community do not really matter as much. The problem again may lie along impracticability lines. While community sounds okay in the abstract, and we certainly have our own small communities that we have allegiance to, having a megacorporations a community sounds weird. I think part of this is because in certain ways, market relations are supposed to be impersonal. One person’s money should be good as anyone else’s. (We can all think of ugly situations where the acceptability of a person’s money was based on some other characteristic like the colour of their skin or their religious affiliation) Trying to build a nationwide community sounds a lot closer to madness. It seems insane for a country of 3 million and would be much worse for a country of 300 million. Especially where the population is already diverse in a number of ways. There just seems to be so many things standing in the way of nationwide community. Moreover can we really speak of being in a community with persons you never interact with in any way at all?

One final question that we may want to ask ourselves is that even if community is important, is it the proper domain of the state to interfere in it? As with religion, it seems to be that government involvement with community is corrupting to both community and government. So even if inequality endangered community, it may not necessarily be appropriate for the government to interfere.

Concern for relative status as a fundamental fact of human nature

In what may perhaps be the most compelling set of reasons as yet, we may find that we ought to care about material inequality because it is human nature to care about status games and wealth and conspicuous consumption is one of the avenues through which status games are often played by many. When proposing principles for institutions, one of the key constraints that are imposed is that the institution be able to generate the attitudes required to support it. However, when pursuing ideal theory if we place no limits on sources and extents of human motivation, then for any set of putative social goals, we could device almost any kind of institutional set-up together with the requisite complementary motivational set. Therefore, it would be theoretically impossible to designate any kind of institutional structure as ideal as almost any kind of institutional structure would be capable of producing the relevant state of affairs as long as the complementary set of motivations was postulated. For example, if our goal is to minimise inequality, having a very high tax rate coupled with a strong moral incentive to maximise pre-tax income does as well as a laissez-faire system where people are morally motivated to voluntarily donate most of their excess income to charitable organisations. When we can have a range of institutions that Therefore, when discussing institutional structure, even ideal theory must be aware of the natural limits of human motivation. If a libertarian critique of communism is that it is unrealistic in its hubristic assumption that people can be re-engineered to be sufficiently morally motivated to work even though they know that they all or most of the product of their labour will be confiscated in order to be redistributed, then perhaps those of us of a libertarian persuasion are similarly misguided in our assumption that in a world with great prosperity (even among the worst off) but tremendous income inequality, people will not feel envious and only care whether they had enough wealth to satisfy their own goals and desires.

But is it really misguided? Part of what motivates a libertarian belief that we can be unconcerned about status associated with wealth is that many of us are not concerned with how much wealth other people have. We don’t feel worse off just because others have more wealth than we know what to do with. It is not that libertarians are a non-materialistic bunch. I enjoy my creature comforts as much as the next guy and I want to earn oodles so that I can maintain or even improve my standard of living and provide the same or even better for my offspring. So here is a  set of questions for the league:

1. How do you self identify politically?
2. What is your assessment of your financial situation relative to the various goals you have in life? Do you feel that you are financially capable of securing your most important goals and projects? answer 0 if none of your projects can be satisfied and 10 if all your wants can be satisfied
3. How do you personally feel about those who have lots more wealth than you do? 0 if they’re stinkers, 10 if you think “good for them!”
4. [edit h/t to Kazzy] How do you personally feel about luxuries that you and your compatriots previously enjoyed exclusively but are now enjoyed by others poorer than you? 0 if they should keep to their place, 10 if  you think “fantastic, the more the merrier!”[/edit]

If it is plausible that many of us could have no animus towards those who are better off than us, then it would seem that it is not beyond human nature to eliminate material envy as a key motivation (at least under favourable conditions). i.e. we may still be motivated to be status seekers, but we ideally would seek status in ways that have less to do with how much wealth we have and more to do with personal achievements.

Conclusion

I have tried to show what I think to be the most fruitful arguments in favour of being concerned or income inequality. At the same time I have tried to take a critical look at the various reasons. Admittedly, the treatment provided here is inadequate. More can genuinely be said with regards to these arguments both pro and con. But perhaps it is best if I leave my discussion here for now

*Caring about inequality when it is caused by unjust processes is just bad reasoning. Just because a particular unequal outcome is caused by an unjust procedure doesn’t mean that the outcome is problematic in virtue of its inequality. The outcome, insofar as it is realisable by other more just procedures is not even necessarily intrinsically bad. Inequality doesnt suddenly become a bad-making feature of the world just because the inequality was produced bad procedures. Where an unjust procedure produces a particular set of consequences, there are so many different dimensions along which we could talk about said state of the world that it seems particularly odd to pick out inequality as the bad making feature. I’m not saying that bad making features cannot be conditional, I’m asking why  we pick out inequality rather than the average wealth, or the median wealth or the lowest quintile of wealth as the feature that is worrisome whenever we think some kind of cheating has been going on. Answering the question of why we should care about inequality when it is caused by an antecedently unjust procedure faces the same sorts of justificatory burden as the question of why we should care about inequality at all.

**A lot of claims here. Links will be provided on request. I’m lazy, so sue me.