Cary Neeper's Blog: Reviewing World-changing Nonfiction - Posts Tagged "inequality"

Social Anxiety Rooted in Inequality?
From Blog 18 by Donald Neeper at http://neeper.net/social-anxiety/
Richard G. WilkinsonA Review of The Spirit Level, Richard Wilkinson and Kate Pickett, Bloomsbury Press, 2009, updated 2010.

What's going on? There's a feeling that people sense an impending social failure but are unable to identify it. What's causing this stress? As documented in the recent scholarly book, The Spirit Level, we really are much more anxious than we used to be.

Wilkinson and Pickett (W&P) are professors who have studied economics and epidemiology. They quantitatively evaluate many symptoms of social dysfunction, comparing results for 23 developed countries and also comparing data for the 50 states of the U.S. In each case, they correlate the severity of a social problem (e.g. teen births or homicides or obesity) with income inequality. The correlations are independent of the average income or overall wealth of a country. In other words, the greater the disparity in income, the more dysfunction a society has in multiple characteristics, including infant mortality, social mobility, literacy, AIDS, homicide rate, degenerative diseases, teenage births, trust, and status of women.

The authors present extensive arguments to justify inequality as the common factor underlying the other characteristics. For example, public spending on health and education does not correlate with homicide rates, but income inequality does. In a postscript, the authors counter what appears to be politically motivated criticism of the book, including statistical arguments or missing factors such as ethnicity. W&P assert ethnicity is not a factor because the same correlations occur across societies of widely differing cultures. Data from Italy and Finland fall along the same line in the graphs.

Wilkinson and Pickett argue that our need to feel valued and capable implies we crave feedback regarding our worth, but social status causes distress because it carries messages of superiority and inferiority. Greater inequality amplifies the importance of social status.

Both the relatively rich and the relatively poor have relatively better health, less violence, and less anxiety in a country (or state) with less inequality. That is, despite our expectations otherwise, all classes are happier in a society with less inequality.

Obesity occupies a special chapter in Spirit Level. In the U.S., about half the population were overweight and 15 percent were obese in the late 1970s. Now two-thirds of adults are overweight and about thirty percent are obese as measured by body mass index, which normalizes the effect that a taller person normally weighs more.

Obesity in the U.S. is more than twelve times greater than that in Japan, which is the least unequal society of the 23 so-called rich countries. In Japan, the basic wages are more equal, with smaller differences between the highly paid and the lower salaries.

Wilkinson and Pickett explain that many people have a strong personal belief in equality and fairness, but these values have remained private, hidden, unshared, inactive because people think their fellows disagree. Instead, political differences reflect beliefs about how to solve the problems, while desire for a safer and more friendly society goes across political lines. Politics have been weakened by the loss of any concept of a better society, a vision of how to get from here to there.

The authors, however, clearly identify corporate power as the elephant in the living room—the biggest determinant of political action. In the U.S., the highest-paid people in corporations received almost 40 times as much as the highest-paid people in the non-profit sector, and 200 times more than the highest-paid generals or cabinet secretaries in the Federal Government. Does that illustrate where our social priorities lie, despite our underlying shared personal belief? B&P suggest that worker ownership of corporations would induce both better satisfaction and better production.

Wilkinson and Pickett conclude that many of the growing social problems are maintained by income inequality, whereby the poor cope with their own poverty and also with the consequences of the poverty of their neighbors, while the rich pay to live separately in residential economic segregation. As the authors say, governments can spend either to prevent social problems or else to deal with the consequences. In the U.S. since 1980, public expenditure on prisons has risen six times as fast as public expenditure on education.

A missing argument.
One key observation seems missing from the excellent presentation of data and observations in The Spirit Level. Almost any enduring symptom (good or bad) of a complex system is maintained by a loop of positive feedback, as outlined in Blog 14 and Blog 16 at http://neeper.net. The search for ways to rectify income inequality must first locate the unchecked positive feedback loops that maintain and increase the inequalities. Often, those loops are what we label "growth." As argued in Blog 16, disallowing political action by corporations would be one powerful step toward equal justice because corporate governance is simply sophisticated bribery.

The Lessons of History by Will & Ariel Durant, New York, Simon & Schuster, 1968, 1996.

Another prescient, must-read from the past, the Durants' short book reminds us of cycles in history-- from democracy to inequality in wealth to revolution and chaos and hopefully back to democracy. Given the current uproar in politics, their analysis is chilling, especially since Congress is so dysfunctional. History meets critical situations by ..."legislation redistributing wealth or by revolution distributing poverty," they say.

This book was written by the Durants after they reread their ten volumes the Story of Civilization (to 1789). The example given by Plutarch in 594 B.C. is very revealing. He saved Athens from revolution by leveling the playing field—forgiving debt, devaluing money, applying a progressive tax and doing a G.I. Bill i.e. providing free education to former soldiers. Sounds like the laundry list in Robert Reich's Saving Capitalism, NY, Knopf, 2015.

Rome didn't do so well—just engaged in war and continued favoring the wealthy, a mistake easily made by the manipulation of democracy. "Men who can manage money manage all." As an example, farmers now must be employees of "...capitalists or the state." Thus history becomes a cycle of "concentrated wealth and compulsive circulation."

Education is required if we are to avoid the violent surge from "...changing political argument into blind hate." Hopefully that stage in the Trump campaign is now over. "If equality of education can be established, democracy will be real and justified." I understand that free college education is provided in Germany these days, and that some states are moving in that direction. Now, how about leveling the playing field, Hilary?

The Durant's lessons are divided into brief, beautifully crafted and readable chapters, summarizing history as seen by the Earth, in biology, by race and character, morals and religion, economics and socialism, government and war, during growth and decay.

We need to believe there is hope. Humans are inventive, stubborn but not stupid. As we face this difficult presidential election, I believe we can find Durants' "...approximate equity of legal justice and educational opportunity."

Billionaires’ Ball: Gluttony and Hubris in an Age of Epic Inequality by Linda McQuaig and Neil Brooks, Boston, Beacon Press, 2012.

In reviewing Billionaires' Ball I'm tempted to quote from the book Zoobiquity: by Barbara Matterson-Horowitz, MD and Kathryn Bowers. Chapter 5 is a fascinating tale of why we all--humans and animals alike--are subject to addiction. Evolution has provided us with nerves and brain chemicals that interplay to create emotions. Survival tactics are rewarded with hits of natural feel-good narcotics like dopamine. Accumulating wealth is a survival tactic, hence it can be addictive--a scary observation for these times.

The authors of Billionaires Ball remind us of the Crash of 2008 and provide a detailed history of “Chapter 5. Why Bill Gates Doesn't Deserve His Fortune, Chapter 6. Why Other Billionaries Are Even Less Deserving...and Chapter 10. Why Billionaires Are Bad for Democracy."

The authors compare the U.S. and Sweden. They observe that most Americans think that we are similar in the distributions of wealth. We are not. Our differences in wealth are currently much higher than the Swedes. In America the average wage has slid downward since the 1970’s, while exorbitant wealth has accumulated to a very low percentage of Americans.

The answers are simple. It is up to Congress to reinstate reasonable leveling measures. Trickle-down economics has been debunked as a myth. I come back again and again to the Lessons of History by Will and Ariel Durant: Rome, faced with hungry people and unequal wealth, chose a ”hundred years of class and civil war," while in the Athens of 594 B.C. Solon, an aristocratic businessman, “…eased the burden of all debtors…established a graduated income tax...reorganized the courts on a more popular basis, and...educated at the government’s expense..." sons of the military. “The government of the United State, in 1933-52 and 1960-65, followed Solon's peaceful methods and accomplished a moderate and pacifying redistribution…"

Why is this so hard to understand? People need to feel some basic respect as part of society, not as lackeys.

The End of Normal: Why the Growth Economy Isn't Coming Back-and What to Do When It Doesn'tThe End of Normal by James K. Galbraith, New York, Simon & Schuster, 2014.
Galbraith begins by mentioning books published as a result of the 2008 debacle—“misfeasance both in government and in the banking sector.”

Galbraith reviews our economic theory, its history and the current worries about capitol takeovers and continuous upgrading, while insisting on growth as the world’s fix-all. He describes calls from both D. Meadows and Herman Daly for recognition of the limit to resources, but he dismisses them as forgetting the “power of new reserves, new technology, and resource substitutes.” He concludes that we must “preserve slow growth…below what cheap energy and climate indifference once made possible,” forgetting that nothing material can grow forever.

It will require “…careful investment and persistent regulation.” Decentralized banks should only “…support household consumption or business investment…in low-cost ways.” To avoid the winner-take-all inequality of high growth, the low-growth economy should be “…based on more decentralized economic units…supported by a framework of labor standards and secured protection. Then all could enjoy value…education, health care, elder care, art and sport.

It’s not Herman Daly’s carefully crafted steady-state ideal, but it is close. The driving force and stress coming from continually growing human populations could easily overwhelm his slow-growth, equitable economic plans.