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In the increasing debates over capitalism vs. socialism/communism, an assertion I read most often from anti-capitalists is that significant wealth inequality in a laissez-faire society such as the United States shows that capitalism is “unfair.”
I note that none of these assertions are accompanied by any description of wealth distribution under communism or socialism.
Most of us here, however, notice that every communist or socialist nation seems (at least on the surface) to have a great deal of wealth inequality. And even theoretically, a system of “equal” wealth distribution requires some limited number of people to decide (or to design a system that decides) what constitutes “equal.” Given human nature, such systems will favor somebody (or at least be subject to accusations of favoring somebody).
I vaguely recall some reports (probably at least a couple of decades ago) that showed a correlation between higher levels of economic freedom (which I consider part of capitalism) and less wealth inequality. I think the finding was that although both free and unfree markets produce vast differences between the wealth pinnacle and the wealth floor, freer markets find most people spread all along the wealth continuum between those extremes. There was often considerable movement of people up and down that wealth continuum, whereas controlled economies (socialist or communist) also had people at a very high economic pinnacle, but the vast majority of people were at the economic floor. Here, few people are spread along the continuum between the pinnacle and the floor, and movement of people from the economic floor is minimal.
The assertions of too much wealth inequality under capitalism often undergird support for wealth taxes and other actions against people who “have too much.”
A not-infrequent accompanying assertion is that the United States (generally held up as the prototypical capitalist country) is the worst place in the world in which to be born poor because capitalism is so harsh to the poor. Looking around the world, it seems to me the United States is the least bad place to be born poor. Hard as poverty in the United States might look to the vast numbers of middle-class Americans, being poor in much of the world is profoundly harsh. The poor in America have access to food, comforts, conveniences, services, and opportunities that even the wealthy couldn’t have foreseen in the recent past and which most poor people around the world can hardly imagine. Capitalism seems to bring the economic floor up.
But why this concern in the first place? Why is reducing wealth inequality itself a desirable goal? Why is wealth inequality a problem that must be solved?
Each of us is a unique individual, with our own individual mix of looks, talents, capabilities, strengths, weaknesses, interests, and ambitions. No two of us are exactly alike. So why should we want and expect equality in our financial outcomes?
Discussion (70)
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I reject the idea that "wealth inequality" per se is any kind of problem. The whole argument is based on a false premise, that buildilng wealth is a zero-sum game. They seem to believe that there is a finite pool of money, and therefore if somebody has "too much" it means less for the rest of us. But that ain't how it works. Each of us is free to build wealth independently from everyone else. Wealth can be created using hard work, ingenuity, and luck. You don't have to take it from someone else.
The goal should be increased prosperity for everyone. It shouldn't matter at all to me (and it doesn't) that Elon Musk gets richer, as long as I do too.
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Wealth inequality is not the problem, I think. Wealth envy is the problem. Neither is something government should try to solve because governments cannot solve either of those problems. As stated in the OP, any solution through socialism or communism brings equality at the bottom-end of the economic spectrum and those who decide what that equality looks like are at the other end of that spectrum; the vast majority at the bottom-end not only have no say in what is "equal" but also cannot depose the top-end.
At least in free market capitalism (not controlled by gov't cronyism or corporatism), individuals have the opportunity to better their economic situation. And even if they choose not to, market forces tend to make everyone's life better. One need not experience envy...if one does not choose to.
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Easy quiz today, Tabby.
Because both envy and sympathy are failings of weak people (we're all weak) and so it gives the psychopaths a point of attack.
Because reducing inequality requires the use of force and therefore the acquisition of authority and the means of force. Jefferson told us the key distinction of people of the left is that they want to rule over us.
Precisely because it cannot be solved.
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I completely agree, and this used to be a view shared by almost all Republicans. Today, though, most apparently think that this principle only pertains to our 50 states. If a guy a few houses down from me is doing very well, that's OK. But if the average person in Mexico (or name whatever country you want) is becoming less poor, that SOB is eating our lunch!
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Can you provide a single example of anyone saying/writing anything even resembling the viewpoint that "if the average person in Mexico (or name whatever country you want) is becoming less poor, that SOB is eating our lunch!"? You should have no trouble doing so, given that you've ascribed that view not just to a few, but most.
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