On Inequality

PRINCETON UNIVERSITY PRESS

Contents

economic equality as a moral ideal

First man: "How are your children?" Second man: "Compared to what?"

I

1. In a recent State of the Union address, President Barack Obama declared that income inequality is "the defining challenge of our time." It seems to me, however, that our most fundamental challenge is not the fact that the incomes of Americans are widely unequal. It is, rather, the fact that too many of our people are poor.

Inequality of incomes might be decisively eliminated, after all, just by arranging that all incomes be equally below the poverty line. Need- less to say, that way of achieving equality of incomes — by making everyone equally poor — has very little to be said for it. Accordingly, to eliminate income inequality cannot be, as such, our most fundamental goal.

2. In addition to the incidence of poverty, another part of our current economic disorder is that while many of our people have too little, quite a number of others have too much. The very rich have, indisputably, a great deal more than they need in order to live active, productive, and comfortable lives. In extracting from the economic wealth of the nation much more than they require in order to live well, those who are excessively affluent are guilty of a kind of economic gluttony. This resembles the gluttony of those who gobble down considerably more food than they need for either their nutritional well-being or a satisfying level of gastronomic enjoyment.

Apart from harmful psychological and moral effects upon the lives of the gluttons themselves, economic gluttony presents a ridiculous and disgusting spectacle. Taken together with the adjacent spectacle of a sizable class of people who endure significant economic deprivation, and who are as a consequence more or less impotent, the general impression given by our economic arrangements is both ugly and morally offensive.

3. To focus on inequality, which is not in itself objectionable, is to misconstrue the challenge we actually face. Our basic focus should be on reducing both poverty and excessive affluence. That may very well entail, of course, a reduction of inequality. But the reduction of inequality cannot itself be our most essential ambition. Economic equality is not a morally compelling ideal. The primary goal of our efforts must be to repair a society in which many have far too little, while others have the comfort and influence that go with having more than enough.

Those who are much better off have a serious advantage over those who are less affluent — an advantage that they may tend to exploit in pursuing inappropriate influence over electoral and regulatory processes. The potentially antidemocratic effects of this advantage must be dealt with, accordingly, by legislation and regulation designed to protect these processes from distortion and abuse.

4. Economic egalitarianism is, as I shall understand it, the doctrine that it is desirable for everyone to have the same amounts of income and of wealth (for short, "money"). Hardly anyone would deny that there are situations in which it makes sense to deviate from this standard: for instance, where opportunities to earn exceptional compensation must be offered in order to recruit employees with skills that are badly needed but uncommon. However, despite a readiness to agree that some inequalities are permissible, many people believe that economic equality has, in itself, considerable moral value. They urge that efforts to approach the egalitarian ideal should therefore be accorded a significant priority.

In my opinion, this is a mistake. Economic equality is not, as such, of any particular moral importance; and by the same token, economic inequality is not in itself morally objectionable. From the point of view of morality, it is not important that everyone should have the same. What is morally important is that each should have enough. If everyone had enough money, it would be of no special or deliberate concern whether some people had more money than others.

I shall call this alternative to egalitarianism the "doctrine of sufficiency" — that is, the doctrine that what is morally important with regard to money is that everyone should have enough.

5. The fact that economic equality is not in its own right a morally compelling social ideal is in no way, of course, a reason for regarding it as being, in all contexts, an unimportant or an inappropriate goal. Indeed, economic equality may have very significant political or social value. There may be quite good reasons to deal according to an egalitarian standard with problems having to do with the distribution of money. Hence it may at times make sense to be more immediately concerned with attempting to increase the extent of economic equality than with trying to regulate the extent to which everyone has enough money.

Even if economic equality itself and as such is not important, commitment to an egalitarian economic policy might be indispensable for promoting the attainment of various desirable social and political ends. Also, the most feasible approach to reaching universal economic sufficiency might actually turn out to be, in fact, a pursuit of equality. That economic equality is not a good in itself leaves open the possibility, obviously, that it may be instrumentally valuable as a necessary condition for the attainment of goods that do genuinely possess intrinsic value.

So a more egalitarian distribution of money would certainly not be objectionable. Nevertheless, the widespread error of believing that there are powerful moral reasons for caring about economic equality for its own sake is far from innocuous. As a matter of fact, this belief tends to do significant harm.

6. It is often argued as an objection to economic egalitarianism that there is a dangerous conflict between equality and liberty. The argument rests on the assumption that if people are left freely to themselves, there will inevitably be a tendency for inequalities of income and wealth to develop. From this assumption, it is inferred that an egalitarian distribution of money can be achieved and sustained only at the cost of repressing liberties that are indispensable to the development of that undesired tendency.

Whatever may be the merit of this argument concerning the relationship between equality and liberty, economic egalitarianism engenders another conflict, of more fundamental significance. To the extent that people are preoccupied with economic equality, under the mistaken assumption that it is a morally important good, their readiness to be satisfied with some particular level of income or wealth is — to that extent — not guided by their own most distinctive interests and ambitions. In- stead, it is guided just by the quantity of money that other people happen to have.

In this way, economic egalitarianism distracts people from calculating their monetary requirements in the light of their own personal circumstances and needs. Rather, it encourages them to aim, misguidedly, at a level of affluence measured by a calculation in which — apart from their relative monetary situation — the specific features of their own lives play no part.

But, surely, the amount of money...