The problem with income inequality is that most people don’t like it when others are richer than them. As soon as winter is over and the weather turns pleasant the 99% will take to the streets to riot, burn cars, etc., to show how unhappy they are about some people being billionaires. Of course, the assumption is that billionaires must have done something wrong (cheating, stealing, being greedy, being unfair to other people, etc) to invite public ire.
Regardless of your opinion about economic inequality, you have to pay attention when people start rioting, because even if you are not yourself inclined to riotous pursuits you could still get caught up in the unrest and that can be quite inconvenient. Generally speaking it’s easier to go about your business when there aren’t people rioting in the streets. So we all have to care about inequality: the fact is that many people find inequality infuriating, and their ire must therefore become our ire.
Many people blame capitalism for inequality, and this gives rise to the idea that if we get rid of capitalism, we can fix the inequality problem once and for all. Getting rid of capitalism is easy when you live in a democracy: you just need to vote in a series of legislative reforms that will achieve that end. Given that the rich are 1% of voters and the poor are 99% of voters, this becomes quite straightforward. The popular theory is that 'private interests' i.e. rich people, are hugely annoying to 'democratic interests' i.e. poor people. Thus the representatives of democracy (the poor) have to do something about it:
According to that theory, wealth distribution is 'arbitrary' meaning that people find themselves rich or poor quite randomly and entirely unrelated to anything they have ever done. Rich people just got lucky and poor people just got unlucky, or so the theory goes.
Wealth distribution is also described as 'unsustainable' which is vaguely alarming. The minute someone evaluates your position in life as being 'unsustainable', you know you're living on borrowed time.
This leads naturally to democracy and the need to vote in a new dispensation. This creates serious and indeed violent political conflict. Like 18th century France, but without all the guillotines.
'Democracy' works by allowing the majority to take control of things and seize property from the selfish capitalists who care only for their 'private' interests. In Piketty’s book, 'democracy' is about pursuing the ‘general interest’, meaning the interests of the majority of people who will never amass billions of dollars no matter how hard they work. Billionaires are on the wrong side of history at this point. It was ever thus.
Not everybody accepts the popular perception that it sucks to live in a world that has billionaires in it. There are one or two benefits to the existence of wealth, such as the trickle-down effect and the law of unintended consequences where billionaires inadvertently benefit the rest of society.
The rich only select from the heap what is most precious and agreeable. They consume little more than the poor, and in spite of their natural selfishness and rapacity, though they mean only their own conveniency, though the sole end which they propose from the labours of all the thousands whom they employ, be the gratification of their own vain and insatiable desires, they divide with the poor the produce of all their improvements.
So, in the interests of listening to each other, if only out of politeness, here are 5 reasons why some people think there's enough room in the world for a varied and variable wealth distribution:
So there are good reasons why billionaires are quite useful to have around, when you think about it. This shouldn’t stop you from rioting about inequality, of course: who doesn't love a good riot, especially when it's August, the sun is out, and there's nothing interesting on the telly? But at least now you can riot from a more informed perspective.
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