Since coming back to the US, I have been surprised how often the national debt comes up in conversations about most any political topic. In discussions about inequality, for instance, I hear that we can hardly trust the government to address inequality given its own financial incompetence, and that if there is financial injustice about, surely the greatest injustice is the government’s systematic stealing from our children and grandchildren, whom we are saddling with an intolerable burden of debt. The theme of the travesty and looming catastrophe of US government debt has fueled the rise of the Tea Party, and played a role in the ridiculous fiscal standoffs in Congress over the past couple years. Of course, it is an important fiscal concern that both parties should be attentive to, but this is not usually how one hears it discussed—i.e., in the context of particular policies for fiscal responsibility. Rather, it is used as a universal putdown—a way of claiming, no matter what the particular point is under discussion, that the government cannot be trusted because its debt is both irresponsible and immoral, and that only a radical overhaul (one might almost say “overthrow” from some of the rhetoric) of our government can save us from imminent disaster.Read More
Here's another post on Piketty that isn't really about Piketty per se, but about the sorts of conversations one finds oneself in when talking about him. Over the past week and a half, I have been struck by a curious tendency I have encountered in a number of Christians when the subject of inequality comes up.
"So are you saying inequality is a problem, inequality is bad?"
"Well, yeah, I do think that, at least beyond a certain point, it's a problem."
"So why is it bad?"
. . . But the biggest reason for my enthusiasm for Frozen was its stark repudiation of “the Disney worldview” for lack of a better term—which is essentially the modern American ethos in a nutshell: you have to learn to “be yourself,” to break free from the constraints of society’s expectations (often in the form of a bumbling and oppressive parental figure) and do your own thing, which usually includes “following your heart” in pursuing a love-at-first-sight infatuation that is described as “true love.” It is an outlook in which freedom is defined in starkly individualist terms, in which one’s identity is crafted in opposition to one’s social relationships, rather than in terms of them, and in which love is irrational, emotional, and rarely expressed toward one’s family (indeed, often expressed in opposition to one’s family).Read More
"When the rate of return on capital significantly exceeds the growth rate of the economy (as it did through much of history until the nineteenth century and is likely to be the case again in the twenty-first century), then it logically follows that inherited wealth grows faster than output and income. People with inherited wealth need save only a portion of their income from capital to see that capital grow more quickly than the economy as a whole....
"...The difficulty of the whole subject is of course clearly before our mind. We feel it deeply, and not without anxiety and alarm. But we are not bound to solve it, and have no more interest in doing so than others. We have not made the difficulty in any way. We are not responsible for it, and we have no mind or care at present to charge ourselves with the burden of its explanation. There it stands before the whole world. It is of age too, we may say, full formed and full grown; let it speak then for itself."
....To put it bluntly, the discipline of economics has yet to get over its childish passion for mathematics and for purely theoretical and often highly ideological speculation, at the expense of historical research and collaboration with the other social sciences. Economists are all too often preoccupied with petty mathematical problems of interest only to themselves. This obsession with mathematics is an easy way of acquiring the appearance of scientificity without having to answer the far more complex questions posed by the world we live in.
So this isn't so much a note on anything in Piketty per se, but rather some thoughts in answer to one of the objections that inevitably comes up as soon as the subject of inequality is raised (in particular, this arises out of a recent exchange on Facebook). You are no doubt familiar with the line of objection: "Why does it matter so long as everyone is benefiting? If the poor guy sees his income double, and the rich guy sees it go up tenfold, then the only possible reason for complaining must be envy."
Of course, there are a zillion things that could readily be said in response to this objection....But for now, I want to get to the heart of the objection, by asking, "Suppose the concern is inequality per se—in abstraction from various injustices that may have led to it, and various social ills expected to follow from it. Is there an immediate and inherent problem, and if so, is it distinguishable from sinful envy?"