Galun.com - The End of Equality

Notes: The End of Equality

If liberals don't demand absolute money equality, then how do they decide how much is enough? "Once we've failed to draw a line at 1 to 1 and 2 to 1, what's the basis for so self-confidently taking a stand at 8 to 1 or even 1,000 to 1?"
"What do we care about money inequality anyway? If liberals aren't pursuing equality for its own sake, why are they pursuing it? There must be other, hidden desires sublimated within the general liberal urge to equalize in incomes."
What the liberal desire for money equality boils down to is really: 1) a desire that everyone have the ability to meet his minimal survival needs; 2) an end to class immobility and privilege; and 3) social equality.
Social equality is not money equality, and it is not simply equality before the law. It is "something beyond formal legal equality, even beyond the basic freedoms of speech, association, and the ballot box. We can have all those things and still not live in a society in which everyone feels he is, at bottom, an equal member. That feeling is a species of equality that is quite substantive, not just procedural or formal. It is no less substantive because it concerns people's attitudes rather than money."
Money liberalism "seeks to prevent income differences from corroding social equality by the simple expedient of reducing the income differnces..."
Civic liberalism "pursues social equality directly, through government action, rather than by manipulating the unequal distribution of income generated in the capitalist marketplace. Instead of trying to suppress inequality of money, this strategy would try to restrict the sphere of life in which money matters, and enlarge the sphere in which money doesn't matter."
"Instead of worrying about distributing and redistributing income, [Civic Liberalism] worries about rebuilding, preserving, and strengthening community institutions in which income is irrelevant, and preventing their corruption by the forces of the market."
We can applaud capitalism "as long as we also maintain a sturdy community sphere that constantly reminds us that capitalist success is morally arbitrary, that the rich are no better than the poor, that we all share common obligations and status as citizens."
The 1980s seemed like a time of terrible inequality not because income inequality had increased so greatly (although it had increased), but because society began to affirm the airs of the rich to affected superiority (Donald Trump, Leona Helmsley, etc.).
And more dangerous in the 1980s than the acceptance of the rich as superior, was the airs of the middle class to superiority over the poor. Hundreds of thousands of "classified ads for roommates or tenants or lovers [limited] the search to 'professionals.' No janitors or drill press operators need apply. For social equality, the routing acceptance of 'professionals' as a class apart is far more dangerous than Trump or Robin Leach. The implication, of course, is that professionals are not just richer, but more civilized, better educated, wittier, smarter, cleaner, prettier."
Four major factors in growing money inequality: 1) The global market makes the differential between pay in skilled and unskilled jobs much greater; 2) Men and women both work now, so there is a much greater gap between single and married parents (and, of course, there are many more single mothers); 3) People marry within their class much more often now, rather than marrying their secretary or the girl next door; 4) Increased importance of how you invest your wealth to your overall wealth - those who can afford to invest stocks continue to increase their lead over those who cannot.
In 1968, near the low point of money inequality in recent history, a study of George Wallace supporters showed that they resented most not blacks, but white-collar, middle-class professionals. "Or, as Wallace delicately put it, 'the over-educated ivory-tower folks with pointed heads looking down their noses at us.' Here was the social gulf, in all its yawning splendor, as seen from the bottom. But the year was 1968. Long before the 'regressive' Reagan years, fifteen years before Gordon Gekko and yuppies and personal trainers. The trend for decades had been one of growing money equality. ...Yet something was dividing Americans; something had destroyed the vaunted 'classlessness' of the 1950s."
Meritocracy can increase social inequality by making the wealthy believe that they are successful because they are more intelligent.
The SAT is our chief meritocratic instrument, it thoroughly divides "individuals on the basis of traits that are tested and recorded at an early age."
Since the SATs measure one kind ofpotential, not competence, and there are actually many different types of competence, this is a very divisive way to run a meritocracy. Better to follow James Fallows' plan for a series of apprenticeships, which develop the skills and competencies needed for a particular type of job. Every person would have to start at the lowest apprenticeship and work themselves as far up as they could. And anyone could switch fields to try something else at which they might be beter.
This would greatly increase social inequality: No one would be branded early in life, it would make it apparent that there are a number of skills that are good in different jobs (rather than one skill which divides us all into winners and losers), and no one would know when they started their career whose career would peak where. This last point is important - if all med students started out as orderlies, and had to work their way up, med students couldn't begin thinking from the moment that they entered school that doctors were superior to nurses, because they wouldn't know that they would actually end up as a doctor.
The problem with a meritocracy is the Fairness Trap: "The more the economy's implicit judgments are seen as being fair and based on true 'merit' (and 'equal opportunity'), the more the losers will tend to feel that they deserve to lose, the easier it will be to equate economic success with individual worth, and the greater the threat to social equality."
"The subtle innuendos of meritocracy may well encourage the translation of increasingly unequal economic fortunes into feelings of superiority or inferiority. But what of institutions desired to block that translation, the institutions of an egalitarian public sphere? They constitute our immune system against these social toxins. If we've contracted the disease, it could be because the toxins have become more virulent. But it could also be because our immune system has broken down."
In 1943, JFK, well-known author, son of one of the richest men in America, and Harvard graduate, served on a small PT boat with a high-school dropout, a son of Polish immigrants, a machinist, another Ivy Leaguer, a high school graduate, a career Navy man who had taken a job with the CCC during the depression, a jazz pianist, etc.
By the end of WWII, "70 percent of all able-bodied males from age 18 to 38 had served...even during the peaceful, Cold War years of the late fifties, young men of all classes could expect to get called. Fully 64 percent of the eligible age group wound up serving. An additional 24 percent were declared unfit. Only 12 percent escaped both the draft or some form of military service. They even drafted Elvis...[But in Vietnam], 57 percent of draft-age men were somehow excused or exempted. Those who went to Southest Asia, a famous 1971 Harris Poll reported, were seen as 'suckers.'...[and] the 'suckers' tended to be the less affluent and educated. In the working-class neighborhood of SOuth Boston, of 2,000 draft-age men, 25 died in Vietnam. In contract, James Fallows surveyed his Harvard Class and found only 2 or 1,2000 classmates who had even served in Vietnam."
People of all classes used to be schooled together, because in small towns there was only one school, and in cities people of different classes lived near each other because they had to live near their work. But now people have divided geographically by class, and therefore schools no longer bring together people of different classes.
Money inequality can make social inequality worse, but it did not cause the problem. Money inequality did not end the draft, for example.
Even small differences in money can be held to represent giant differences in social value. "The increasing stratification of society by smarts and skills might give even small income differences a harsh meritocratic meaning."
To "tax the richest one percent enough to counteract the effect of the recent rise in income inequality...so their share of after-tax income would be equal to what it was, say, in 1977...the total effective tax rate on the rich would have to be more than doubled, to around 57 percent...The U.S. has never had an effective tax rate on the rich of even close to 57 percent...Even going back to 1977, the high point of tax progressivity before all those nasty Reagan-era cuts, will only produce an effective rate on the richest of about 35 percent."
Training for the poor won't really solve income inequality, because increasingly "as skills become more important and are rewarded financially, differences in performance between individuals with the same formal 'skills' or training also become more important, and are rewarded financially." For example, Tom Cruise and the actor waiting tables in LA both have acting skills, but Tom Cruise makes 200 times as much. The difference between what high-priced and low-level lawyers make today is huge.
Increased training also brings up the Fairness Trap - if you receive a lot of training opportunities and still can't succeed, you will believe that you are just a loser and that others really are superior to you.
To create his "immune system," Kaus suggests: a reconstituted draft, a national service program for anyone not drafted, campaign finance laws (to force politicains to reach out to the people, not the lobbyists), universal health care (although Kaus' argument for why this needs to be part of the immune system is muddy), communal day care centers which can "escape the tyranny of suburban class-segregation" by being "conveniently located near places of work rather than near homes."
Kaus also suggests a good day care system - it doesn't matter whether it's better roads or improved public transportations, as long as everyone is sharing the same experience of how they get from point A to point B, more museums, libraries, etc. He even suggests public ownership of sports teams so that the prices of tickets to games can go down. Back when everyone could afford to see baseball games, classes mixed at the stadium as they all rooted for the same team. Now, only the rich can afford to see a Knicks game.
"There is an important distinction to be made...between provision of such common services and the provision of cash favored by Money Liberalism. With 'in-kind, universal' services, Robert Kuttner notes, people of all classes actually meet and interact with each other and with those doing the servicing. They wait together, flirt, swap sob stories and advice, save each other's places in line, keep an eye on each other's kids. The 'middle class is...reminded that poor people are human,' Kuttner writes. This is the stuff of social equality. But virtually none of these virtues are evident when all the government does is distribute cash benefits - even if, as Money Liberals typically recommend, benefits go to the middle class and rich as well as the poor. Recipients receive their benefit checks in isolation. The cash is spent, and is intended to be spent, in the private, money sphere. No communal experience is involved. On the contrary, the recipient's attention is focused more intensely on the importance of money and what it can buy. How much solidarity is there in cashing a check? Rich and poor don't even cash them in the same places."
Civic liberalism would have to overcome the problem that government tends to be awful at providing services, and therefore the well-off might still choose to pay for private versions of the services that the government offers for free (like UPS vs. the post office). But Kaus believes that much of the reason government service stinks so much is because of civil service rules and government employee union power that the Money Liberals have supported and furthered.
Kaus believes we should encourage public holidays with communal celebrations as opposed to private vacation time.
Social equality can't exist when the ghetto underclass can't be a part of larger society and makes people flee the cities for the class-segregated suburbs,
The majority of blacks are not poor, "But it's simply stupid to pretend that the underclass is not mainly black. A large ongoing survey at the University of Michigan shows that although African Americans compose only 12 percent of the population, they make up 55 percent of those who stay poor for a long time, and 60 percent of those who stay on welfare a long time. In this respect the old stereotype that most of the poor are black is accurate. In 1980, of the 1.8 million poor people in 'extreme poverty' neighborhoods in America's one hundred largest cities, some 68 percent were black...Blacks constituted 58 percent of those living in neighborhoods with extreme social problems..."
Welfare isn't the cause of the underlcass - it's not like poor single women have babies because they have done the economic calculations and figured out that they'll get more from welfare than they would from working - but it enables the poor to survive without changing destructive habits, like young, single mothers.
Early intervention programs like Head Start and condom programs just aren't effective enough to solve the underclass problem. And we can't keep the job market tight enough to solve it either.
The government should provide a job that pays slightly less than minimum wage to anyone who wants it, but end welfare. That would mean that everyone could work, and everyone would have to work. By forcing everyone to work, people learn the work ethic, and would also learn self-improvement because they would rather get a get private-sector job, which would pay, at the least, minimum wage, than a government job that pays less than minimum wage.
This jobs program would increase two-parent families because it is simply easier to raise a child when there are two parents and two incomes. By comparison, welfare guarantees the mother's income but goes away if her husband has a job, so she has no incentive to marry someone.
Money Liberals claim that welfare is unpopular because it is not universal. IF everyone, including working middle class mothers, received welfare, then it would be more popular. It is just dividing society into givers and takers that causes the dislike of the program, they claim. But Kaus disagrees. There is no popular universal government cash benefit that is not work-tested (e.g., only people who pay into Social Security through work taxes receive in the end). But there are work-tested programs which divide society into givers and takers - like the EITC - which are nevertheless very popular, precisely because they help people who are working hard for themselves.
Because Money Liberals mistakenly believe that universality is the key to programs' popularity, they refuse to means-test Social Security by giving less to the rich. But if we did means-test Social Security, we could save tens of billions of dollars a year, which could then pay for the work program.
The Money Liberal electoral strategy is to promise to tax the rich and then use the money to pay for programs that appeal to different constituencies, until they have the majority of the vote (i.e., one program for unions, one for blacks, one for suburban moms, etc.). But while the bottom 80% of the population can be turned against the top 20% in elections, they forgot that the top 80% can also be turned against the bottom 20%. So while the Dems can try to turn everyone against the rich, the Republicans have been successful at turning everyone against the ghetto.
Additionally, Money Liberals forget that people aren't just baldly, simply self-interested - they don't just vote based on which party will send them more money in the mail. People also want their government to create a better society for them to live in. The Money Liberal program has been failing at improving society overall.
When the Dems can't sell a program to the majority on self-interest - for example, when they're trying to sell a program to help the ghetto - they sell them by guilt-tripping the majority. But that's not a very effective strategy long-term. It would be much better to sell a program by showing how it improves society over all - for example, by making it safe to go to the city again - rather than making people feel guilty.
"Americans tend to be steadfast social egalitarians but unreliable money egalitarians...Where liberals take their stand, not against wealth but against the translation of wealth into differential status, they get the votes of everyone who admires Steve Jobs or Warren Buffett but dislikes Leona Helmsley and thinks Zsa Zsa Gabor shouldn't get away with slapping cops. Social egalitarians are not less 'populist' than money egalitarians. Theirs is just a more popular populism."
Welfare may be a very small percentage of government spending, but it sends a message to the public that if you let liberals spend money, they'll give it in a way that destroys the work ethic and creates ghettoes. "through a relatively small expenditure, Money Liberals have managed to poison voters against government spending in general...Money Liberalism's disparaging of the work ethic has in fact cost tens of millions of votes for almost all government programs."
"We could all drive government-issue Ford Tauruses in a Money Liberal paradise, but if only some people could afford the LX edition we might soon be craning our necks to spot those two letters on every car that passed."