Who cares about economic inequality?
Who cares about economic inequality? The answer might surprise you. I have lost count of the number of articles and columns in recent years about widening gaps in wealth and income, especially, but not only in the US. “So what?” some might ask. “Isn’t that a consequence of robust capitalism?” Is it? JD Vance notwithstanding, would Adam Smith agree? Again, the answer might surprise you.
Full disclosure: Borrowing loosely from the disclaimer of the prophet Amos, “I am neither an economist, nor the son of an economist.” (See Amos 7:14.) I studied philosophical theology and taught religion, philosophy, and ethics, then turned to epidemiology and ethics. One remarkable thing about economic inequality is how central it is to all those seemingly disparate disciplines. The issues are prominent, not only in Hebrew and Christian scriptures and modern theology*, but they are also central to understanding what public health professionals call the social determinants of health. The point is that economic inequality is about more than just numbers, equations, and graphs. It is about people and the real-life consequences for their lives of concentration of wealth in a small group of people while the majority struggle to survive or sustain a minimal level of support.
As I was working to finish this post, I heard an NPR news announcement of the death of Gustavo Gutiérrez on Oct. 22 at age 96. He was central to the development of Latin American Liberation Theology, which focused on what he called “a preferential option for the poor”. As an obituary in The Washington Post noted, “Father Gutiérrez helped reshape Catholic teachings with his 1971 book A Theology of Liberation . . . The book emerged out of his work in . . . a barrio of Lima, where he ministered to the poor and came to the conclusion that poverty was not an accident but ‘a human construction,’ the result of structural inequalities in politics and society.”
On August 18, former Secretary of Labor and Substack contributor Robert Reich posted this note: “The median employee of an S&P 500 company today would have had to start working in the year 1755 in order to earn what the average CEO received in compensation last year. You read that right: the year 1755.” His note refers only to income inequality. Economic inequality includes disparate distributions of both wealth and income. The disparity seems to be greater for wealth than for income. **
After years of dealing with what I think of as the catastrophe of ‘trickle down economics’, we are now seeing greater recognition of the injustice as well as the economic failures of that system, which promotes economic inequality more than prosperity. To be fair, there have been critics at least since the Reagan administration, which adopted that theory as a guiding policy.
One indication of the changes, as Rachel Siegel reported in The Washington Post, is that the 2024 Nobel Prizes in economics went to “a trio of economists . . . for research on prosperity gaps between countries — specifically how European colonization led to some nations being rich while others are poor. The laureates’ research found that societies with a poor rule of law, in addition to institutions that exploit the population, do not generate growth or change for the better.” The chair of the committee for the economics prize wrote, “The laureates have demonstrated the importance of societal institutions” for “reducing the vast differences in income between countries. . . . Generally, inclusive institutions — such as public schools, the rule of law and antitrust policies — create incentives and opportunities for growth . . .. Extractive institutions — like slavery and serfdom — concentrate power and resources in the hands of a small few, to the detriment of the broader population.”
This theme has been playing like background music for me for decades. As it does frequently, it came once again to the front, not only because of all of the above and the campaigns, but also because I am slowly working my way through David Lay Williams’ ground-breaking book, The Greatest of All Plagues: How Economic Inequality Shaped Political Thought from Plato to Marx. The main title is derived from The Laws of Plato. As the subtitle indicates, Williams looks at economic inequality as viewed by seven major Western figures: Plato, Jesus, Thomas Hobbes, Jean-Jacques Rousseau, Adam Smith, John Stuart Mill, and Karl Marx. He wants to show that these seven sages have thought about economic inequality and that they all thought it was a threat to social stability and harmony and to the political order, regardless of the social order or political system they advocated. All of them. (Adam Smith and Karl Marx agreeing on something?).
According to Williams, one of the problems in the scholarship has been that most people assume these thinkers were not primarily concerned with economic inequality, so the research has not probed their thought for insight. This post will focus on only a few themes, especially from Plato, in part because I am more familiar with him, but also because those who have read him and remember his political views might be surprised to learn that he thought inequality of wealth was a threat to a stable and just society and to the political order. (See the link in the notes below to a review in The Washington Post for an overview of the book.)
At the very beginning, Williams provides an overview of what I consider a shocking trend:
“Whereas the poorest 50 percent of Americans have seen their wealth grow an average of $12,000 per household since 1976—scarcely enough to cover a single major medical crisis without insurance, far less than one year of college tuition—those occupying the top 10 percent have seen their wealth grow by nearly $3 million. Those in the top 1 percent have seen their wealth grow by $16 million. Those in the top 0.1 percent have seen theirs grow by $85 million. And those occupying the top 0.01 percent have seen their net wealth grow by $440 million per household. If anything, the pace of inequality’s growth appears to be accelerating. Per Oxfam, over a recent two-year period, billionaires across the globe have seen their fortunes grow more than they did in the previous twenty-three years combined, such that now the world’s wealthiest ten individuals have more than the poorest 40 percent of humanity. Elon Musk alone saw his wealth grow from $25 billion to more than $200 billion over the course of a few years. Per data available from the Federal Reserve, the top 1 percent of Americans in 2020 held more than fifteen times the wealth of the bottom 50 percent of all Americans.” [pp. 1-2, footnote numbers omitted]
Williams hopes to show, through detailed study of the original works of his seven guides (or the traditions in the case of Jesus), that “they argue with striking consensus that excessive inequality threatens to divide communities, pit citizens against one another, undermine democratic legitimacy, and, in the most extreme cases, even foment revolution. . . . Remarkably, they all want something different in their political and moral theories, yet they all clearly understand inequality as a threat to their respective goals.” [pp. 5, 7] He also believes that they all saw excessive wealth, and not only poverty, as a threat to society, civic virtue, justice, and the political order. This might appear to distinguish him from focus on poverty in liberation theology, but the latter’s emphasis on poverty as structural would suggest that excessive wealth supports and feeds off of the structures that impose poverty. The view of the state as an organism, seen as interrelated components, operating in concert, is an important element in Plato (Republic, 462c). And Williams notes the relationship: “While the extremely wealthy grow egoistic and pleonectic [greedy or avaricious], the poor grow destitute, embittered, desperate, and angry.” [p. 40]
Williams writes: “This consuming desire of the rich to enhance their wealth at the expense of all other concerns is the vice of pleonexia (πλεονεξια), often translated as ‘greed.’ Those infected with pleonexia are reduced to desiring more without the possibility of satisfaction. No matter how much they acquire, they will want more. The desires for money and power are perhaps the most susceptible to pleonexia. . .. [Unlike gluttony,] there is no threshold beyond which one cannot want more. The lure of boundless wealth means that one can be ruled by pleonexia for an entire lifetime.” [p. 30] Contemporary examples of this can be left to the reader to discern.
Another striking commonality is that all seven figures sought something more than economic justice; all of them, in one way or another, sought what can be described as social cohesion or harmony, and they all thought economic inequality was a threat to achieving that goal. [p. 17] In public health we often talk about well-being or flourishing, and we have come to appreciate the importance of social capital and cohesion, as well as economic security and justice for achieving those goals. In the Laws, Plato developed and refined his political theory. There he “defines inequality as central problem of politics” and insists that no one person or group can be above the laws of the city that are there for the ordering of the whole. [p. 34-36]
One incisive quote from The Laws makes this clear: “Yet a man who is to attain greatness must be devoted not to himself or to what happens to belong to him, but to what is just—whether it happens to be done by himself or by someone else. This same failing is the source of everyone’s supposing that his lack of learning is wisdom. As a result, we think we know everything when in fact we know, so to speak, nothing: and when we refuse to turn over to others what we don’t know how to do, we necessarily go wrong, by trying to do them ourselves. So every human being should flee from excessive self-love.” (Laws, 731e–732b) [p. 38, emphasis added] Williams comments, “They are unjust insofar as they assume their own concerns transcend or even define the common good. They are ignorant insofar as they come to assume they are wise in all things when they clearly are not.” [p. 39]
I hope this ancient passage, with modern comment, speaks for itself.
This post has run too long, with too little reflection, something I hope to remedy next week. Thank you for reading.
* This may be the subject of a future post.
**This was illustrated in one of my favorite comic strips recently. Frazz is the janitor at an elementary school and the central figure of the eponymously named comic strip by Jef Mallett. The idea for the strip came when he “noticed that often, the most respected, best-liked grown-up in the building was the janitor." Some of the funniest exchanges in the strip are with Caulfield, a precocious, if mischievous because unchallenged, 8-year-old. Recently Caulfield was raising questions with Frazz about economics. In the October 17 strip, Frazz says, “Economics is simple. It’s just who gets what.” Caulfield challenges with the question: “What about how and why and whether they ought to?”, to which Frazz responds, “That might be another, more complex, field.” Indeed. https://www.gocomics.com/frazz/2024/10/17
https://en.wikipedia.org/wiki/Frazz
Notes:
Truesdale BC, Jencks C. The Health Effects of Income Inequality: Averages and Disparities. Annu Rev Public Health. 2016;37:413-30. doi: 10.1146/annurev-publhealth-032315-021606. Epub 2016 Jan 6. PMID: 26735427.
https://www.weforum.org/agenda/2021/12/global-income-inequality-gap-report-rich-poor/
https://www.brookings.edu/articles/rising-inequality-a-major-issue-of-our-time/
https://inequality.org/facts/inequality-and-health/
https://nap.nationalacademies.org/read/10548/chapter/4
https://www.washingtonpost.com/obituaries/2024/10/23/gustavo-gutierrez-dead-liberation-theology/
See also the note posted on Oct 18 by Dr. William Bestermann related to his Substack column Slow Aging and Delay Chronic Disease Development.
David Lay Williams, The Greatest of All Plagues: How Economic Inequality Shaped Political Thought from Plato to Marx. Princeton University Press, 2024.
Madison Powers & Ruth Faden, Social Justice: The Moral Foundations of Public Health and Health Policy. Oxford University Press, 2006