Fairness as justice: income inequality versus income unfairness, and what Democrats need to do about the distinction

April 21, 2022 • 10:15 am

Eric Protzer and Paul Summerville are coauthors of a recent book, Reclaiming Populism: How Economic Fairness Can Win Back Disenchanted Voters, and the Persuasion site we’re discussing today gives these IDs:

Eric Protzer is a Research Fellow at Harvard’s Growth Lab. Paul Summerville is an Adjunct Professor at the University of Victoria’s Gustavson School of Business.

The article below is clearly a summary of part of their book, and makes the point that it’s not income inequality that makes people so disaffected as much as “economic unfairness”: the sense that the deck isn’t stacked against you and that you, too, could have a shot at becoming a billionaire. Protzer and Summerville contend that if the Left is going to start winning elections, they have to enact policies that people see as fair.  One of these is decent healthcare initiatives, another is ceasing the campaign to cancel all student loan debt. In the former case there’s a sense of fairness of everyone being able to get decent healthcare (even if the rich can get super-expensive health care); in the latter people grouse that others shouldn’t get their loans canceled if they themselves had to pay off.

This does seem to have some truth in it. Do Americans really want equal incomes or drastic income distribution, or do they just want to know that they can work hard and be able to live decently? I for one don’t find that the “eat the rich” rhetoric resonates, as the billionaires that people despise generally made their dosh by providing a good or service that people want. (Yes, I think there should be a graduated income tax, but not the kind of equity that “progressive” seem to call for. At any rate, I’m neither a political nor financial pundit, so read and decide for yourself (click screenshot below):

The distinction between economic unfairness and economic inequality:

The fundamental problem with the left’s political program, currently centered around identity-based social justice and economic redistribution, is that it misunderstands the causes of this populist frustration. As our new book demonstrates, the left would do well to reorient itself around the true wellspring of populist anger: a scarcely-understood phenomenon called economic unfairness.

Economic unfairness is distinct from what we typically think of as economic inequality. It is characterized by low social mobility rather than inequalities of income or wealth. It’s not that the rich have too much, it’s that success depends on family wealth and status, when it should depend on good ideas, effort, and merit. It’s anger at this rigged system, rather than anger at inequality, that drives contemporary populist movements.

Why it hurts Democrats to confuse these concepts:

Unfortunately, the global left remains deeply confused about the distinction between economic fairness and equality. Consider, for example, how Democrats have often found that healthcare reform is an enormously popular issue with swing voters. This in fact makes a lot of sense: medical debt is the leading cause of personal bankruptcy in the U.S., and can unfairly shut down a person’s life chances regardless of how hard they’ve worked. Better, more affordable healthcare is a key missing input to equal opportunity in America. But the left flank tends to misinterpret this trend as a blanket indicator that “progressive policies do not hurt candidates,” including far more questionable measures to equalize outcomes.

Figures like Bernie Sanders and Alexandria Ocasio-Cortez have vocally excoriated income and wealth inequality and promoted policies, such as a universal job guarantee and eliminating all student debt, that expressly aim to equalize outcomes instead. Republicans eagerly frame the entire Democratic message in this way, and even specifically referred to these politicians in advertisements during the 2020 Presidential Election. The electoral consequences have been devastating. Latino voters swung heavily toward Trump in 2020 on the fear that the Democratic equalization policies were “socialist,” and polling indicates a top concern among this segment of the electorate was that people would ultimately become “lazy and dependent on government.”

What’s more, Democrats have further alienated potentially-populist voters by embracing an identity-based approach to social justice that frequently dismisses the problem of economic unfairness. Too often, the social justice movement assumes that anyone who might consider voting for a right-wing populist must be motivated by spurious and malignant cultural concerns. It labels populist voters as racist and stupid, hoping that with enough condemnation or a resultant change in the political scene their views will somehow evaporate. This framing fails to acknowledge that when populist voters complain about a rigged system, they could actually have a point.

What we can do about this? (By “we”, I mean liberals):

The left needs to decisively pivot away from its current political dead-end, and toward the real predictor of populist disruption: economic fairness. Rather than focusing on cutting down the successful, the left should ask how it can give more citizens a fair chance to get ahead. Instead of enlarging government in every possible respect, it should ask where the state can intervene to expand opportunity and where it must avoid meddling. How, then, can it realize this vision?

A handful of countries stand out as role models, with the highest rates of social mobility in the world—like Canada, Australia, and the Nordics. These countries pair strong state support for equal opportunity through public goods like education and healthcare with competitive private markets. These factors combine to create an economy where many people can get ahead in life with talent and hard work, regardless of family origins. In turn, this creates best-in-class social mobility, the perception of a meritocratic system, and high levels of trust. Thus when populists run for office, their claims that the system is rigged do not resonate with most voters.

If the left cannot reconfigure itself toward economic fairness it has no hope of winning back disenchanted populist voters. Social justice platforms of defunding the police, open borders, and enforced anti-racism indoctrination communicate condescension and dismissal to the very citizens who already feel unfairly treated. Proposals to unfairly equalize outcomes, so that people largely get the same reward regardless of how hard they work, are not just irrelevant but actually antithetical to what these voters want.

This is why the notion of “equity” bothers so many of us. It conveys the message that there must be equal outcomes—outcomes proportional to the distribution of groups in a population—rather than equal opportunities. Inequities need not reflect “structural bigotry” in the present.

Now I’ve discussed this at length, for some inequities do reflect historical lack of opportunity: racism against African-Americans is a lingering reason why they’re not represented in higher proportions in measures of “success”. (This is one reason I favor some affirmative action, as a form of present reparations.) But everyone knows that the ultimate solution is indeed equal opportunity beginning at birth. It’s just that that permanent solutions are lot harder than striving to achieve equity by dismantling traditional standards of merit or representation. It would take tremendous societal will and resources to eliminate inequality. A good society—a just society—would make those changes, as the societies listed above have tried (as well as Scandinavia).

But harping endlessly on “equity” also creates a sense of unfairness among voters: Asians who feel they’re discriminated against in college admissions and so on, and a disenchanted voter will vote for Republicans.  To me, the solution is not to eliminate affirmative action (at least for a while), but to raise the bar to achieving so that at least people feel that it’s high enough to be fair (i.e., those who achieve are “qualified”), but still allows more equity than we have now. And that must be coupled with de-racializing rhetoric, realizing that it’s not just race that holds people back, and that we have to deal with issues like poverty and class. The desire for equity right now is intimately coupled with the dissolution of the meritocracy, as instantiated in getting rid of standardized tests and grades. But the meritocracy—the sense that if you have the right stuff and work hard, you can achieve—is intimately coupled with “the American dream.”

But I’ve said enough. The article speaks better than I on this topic, so do read it. It’s not very long. As you see, I’m concerned with things Democrats can do that are both acceptable and will help us in this fall’s election.

Paging James Carville! Here he talks about focusing on Dems’ economic accomplishments in fixing society—showing fairness towards “the little guy.”

42 thoughts on “Fairness as justice: income inequality versus income unfairness, and what Democrats need to do about the distinction

  1. I think there’s some merit to this argument. The authors use Canada as an example of a country that does economic fairness better, and we do have a higher social mobility score. On the whole, we are not as wealthy as the United States but the wealth we do have is less concentrated.

    However, this economic fairness comes with a downside. We (and all the other exemplar nations) are not as innovative, nor as economically dynamic as the US. Whether that’s due to increased risk aversion, or it is a direct consequence of a “fair” economic model, or whether economic fairness leads to risk aversion, I don’t know. But the lack of dynamism makes for a strong counter-argument to increased economic fairness.

    Still, it has proven to be an effective inoculant against populism. We’ve flirted with it in the past with the Reform Party (since merged with the Conservative Party), and we’re flirting with it again with the leading candidate to lead the Conservatives, but it has yet to take hold to the point populist politicians actually hold the levers of power.

    1. Yes, as long as Canada can draw on the United States for innovation and venture capital, and as a shelter for endogenous capital fleeing a hostile business climate, and still somehow earn enough as a nation to bribe the grievance groups into quiescence, if not docility and educability, all the while looking down our noses at America, we should do just fine. We seem so far willing to flirt with shrinking the economy as the only feasible way to shrink CO2 emissions, but it has yet to take hold at the individual purchasing level despite the increasingly hysterical utterances of Kerry (America) and Guilbeault (us). I will say that social mobility is aided by our colleges and universities which are all partially publicly funded and don’t need to give children of alumni preferential admission in order to attract huge donations. But tuition for professional degrees particularly has become very expensive and the universities do not have the endowments to give scholarships to any but a very few.

      Of course we are not racist at all, but Scandinavia absolutely is. That’s what underpins their egalitarian and homogeneous societies in which almost everyone works, and so trusts that people are pulling their weight. Identifiable out-groups are not seen to be free-riding, not seen at all*. High taxes are acceptable because the benefits are shared—that’s what “social trust” means. It doesn’t just mean you trust the government’s Covid advice. Lars is willing to tax-fund Olaf’s sickness benefits because he knows Olaf will do the same for him. Both Olaf and Lars work steadily, as do their wives, but not too hard because tax rates escalate very rapidly if you rise out of the middle class. The marginal value of striving is small but freeloading is socially discouraged: “You don’t want to end up like your Aunt Greta.”

      The Nordics never had to think about racism except in theory when they criticized other societies for it. They never had overseas colonies to generate immigration (like France and England) or African slavery, or indigenous people to displace (except a long long time ago.) But then the migrants arrived: dark-skinned, no useful skills, no knowledge of Swedish (or Norwegian or Danish), hostile tribal religious values, and no 9-5 work ethic or habits. In Sweden, the unions have self-interestedly pressured the government into not letting the migrants work, with predictable results. Presto: they (Sweden especially) now have an underclass and far-right populism has popped up to question the sanctity of the Welfare State.

      No easy answers. We’ll all muddle through I suppose.
      *But do see the film Montenegro if you possibly can. ABBA and Marianne Faithful in the soundtrack.

    2. “However, this economic fairness comes with a downside. We (and all the other exemplar nations) are not as innovative, nor as economically dynamic as the US.

      To whatever extent that might be true (and I’m not sure it currently is or will continue to be) it’s not obvious to me that this correlates with economic fairness.

      One example, what was arguably the most robust period of innovation and economic dynamism in the US, post WWII (1950s – 1960s), was also a time of above average economic fairness. Arguably the highest degree of economic fairness in US history, or at least a period of the highest rate of change towards economic fairness. Two factors commonly talked about as being causes for these changes are the high tax rates on wealth during that period and the huge spike in college educated people that resulted from WWII veterans taking advantage of the GI Bill to get college degrees. It has always seemed very plausible to me that these were indeed significant factors.

  2. The current use of the term “equity” is problematic indeed, although the underlying idea can be found as far back as LBJ’s famous speech in 1965 at Howard University. He stated that “we seek not just equality as a right and equality as a theory, but equality as a fact and equality as a result.”

      1. Probably. I also imagine that, given the year, his “equality as a result” wasn’t referring to the modern concept of equity but instead the notion of society actually living up to what it was promising. So for illustrative example, not just equal schools on paper while in reality one is pristine and the other is falling down, but equal schools in fact.

  3. Protzer and Summerville’s thesis rings true to me. It seems patently unfair to demand equal outcomes, as equal outcomes penalize those who work hard and achieve success, yet reward those who do not. Demanding equal opportunity allows everyone to rise economically based on their abilities and efforts (at least in theory—see below). Most Americans value hard work, and believe that their achievements should be rewarded.

    One problem with equality of opportunity is that it is easier to measure “outcomes” than “opportunities,” so it is easier to demonstrate and decry inequality of outcomes. Since it’s easier to measure, equality of outcomes stands out as a more vivid target, and advocates for equality of outcomes have a practical advantage.

    Despite the practical difficulties of measuring opportunities than outcomes, I do agree with the authors that striving for the former is almost certainly more palatable to a larger number of voters. Democrats should take heed.

  4. Economic mobility (or socioeconomic mobility) matters most, IMHO. People like to work and they like to profit from that work. It’s a big part of what makes a human being. If anything gets in the way of that, we’re going to be unhappy. If we’re not allowed to work, or our work doesn’t allow us to raise ourselves up, we’re lost. Wanting to screw the rich is just a symptom of that unhappiness.

  5. …medical debt is the leading cause of personal bankruptcy in the U.S., and can unfairly shut down a person’s life chances regardless of how hard they’ve worked. Better, more affordable healthcare is a key missing input to equal opportunity in America.

    I’m not sure how this is much different from educational debt. My limited understanding of the progressive goals for education is that forgiving college loan debt is NOT some one-shot, unfair “you don’t have to pay back your loan, but he does.” Rather, it’s part of a more comprehensive plan to move college, like health care, out of the realm of personal wealth and make it more of a societal resource everyone can access. Very much in line with Procer’s recommendation to fix economic unfairness not income equality, the argument is that socializing (or greatly reducing) the bill for college makes educational achievement – which is strongly linked to future income – much more about “good ideas, effort, and merit” and less about how much money your parents make.

    1. … makes educational achievement – which is strongly linked to future income …

      They are indeed linked, but that’s mostly because (1) more-capable people attain both educational achievement and high salaries, and (2) employers demand degree certificates as an entry hurdle, regardless of whether they are needed for the job, and mostly just as a marker for the more-capable person.

      I’m highly dubious that a lot of the college degrees being obtained today are actually worthwhile in terms of increasing people’s capability or life satisfaction. Obviously, some are (we need people with engineering and medical degrees, for example).

    2. I think this can be done a bit more fairly not by canceling existing debt but by funding future students. My read on the complaints about canceling existing debt – and a main reason why this differs from medical debt – is that the borrowers chose to take on that debt and agreed to repay it. It wasn’t a life or death choice, but a choice between, say, working while they went to college versus borrowing to put themselves through college with a promise to repay it later.

      1. First, not cancelling student debt for current borrowers because previous borrowers paid off their student debt makes little sense. Rates of increase for tuition and living costs have outpaced median wage growth for decades. The debt the average current borrower bears is literally more onerous than the debt another borrower paid off ten or twenty years ago. Moreover, the notion that we shouldn’t provide relief for extant suffering because some prior population experienced the same suffering without relief doesn’t track. Should we preserve the death penalty in perpetuity because it’s unfair to all the people who were executed in the past?

        Second, the idea that one can just pay for school by working really hard isn’t particularly realistic. In-state tuition at the relatively cheap, humdrum state school I attended costs a tick over $15,000 a year. The average rent in the city where it resides is $575/month. That’s $21,900/year to pay for classes and a place to live. No food, no utilities–just rent and tuition. Yet the minimum wage in the state–the sort of job one tends to get fresh out of high school–is $7.25/hour. Working full time, that’s $15,080/year. Note the $6,820 gap between earnings and expenses.

        The choice you’re presenting certainly isn’t life and death. But it isn’t between working really hard and kicking the can down the road for future you to deal with, either. For many people, the choice is this: take on some debt *and* work to pay rent or don’t go to college at all.

        1. If I were a college administrator, I would be just giddy at the thought of even partial student debt cancellation. Next year’s students will be aware of the cancellation, and will tell themselves that they can borrow freely now, assuming it will be forgiven. Cost is no object, so it will certainly rise.

          I am not as good a planner as my wife. What she did, when each of our children was born, was set up state guaranteed tuition programs for each of them, which were paid off before they reached college age. We are not super wealthy people, so putting that money away meant that we had to forgo some things we might have otherwise enjoyed. Of course, there are parents who could not have afforded such plans, but also a great many who just could not be bothered.
          When you reward thriftlessness, you disincentivize frugality and thrift.

          Plus, student loans have become a scam. When my eldest first registered for college, I accompanied him to freshman orientation and registration. Towards the end of the process, they sent us to a desk where we were told that we qualified for “student aid”, and pushed forms for us to sign. They were loan documents, already filled out. They tried to trick us into signing them, at the end of a long day of filling out forms and signing things. Normally, when you apply for a loan, you at least know it is a loan. Interest is discussed, as well as payment terms. Just the fact that they tried to get us to sign without even knowing they were loan agreements tells me that someone is making big money on this.

          The real problem, I think, is that tuition and fees have risen to absurd levels. Whether it is going into someone’s pockets, or just subsidizing grievance studies programs, I have no idea. But the rise in costs should be paced with cost increases in the rest of the economy.

      2. I think most people would agree with you. I am a bit more sanguine about the occasional one-time adjustment. Even though yes they are unfair, I think they sometimes do more good than harm. Reagan’s immigration pardon of millions, Ford Pardoning Nixon, Kim Dae Jung pardoning people who tried to kill him, the uncountable instances of debt relief (the practice goes back to Hammurabi)…the specific cases, and many cases of debt relief (though not all) didn’t hurt the countries involved, and they didn’t cause any overall loss of confidence or justice in society merely because they were ‘unfair.’ They arguably helped more than they hurt.

        Besides which, there is the obvious hypocrisy of conservatives complaining the most about such things while debt forgiveness for companies embarking on risky behavior is just considered par for the course. How about we parse college loan forgiveness as “the Millenials and Gen Z are too big to fail.” That’s language that justifies conservative debt relief, right? I’d rather relieve their debt than Wall Street’s, any day.

    3. Be careful with college debt forgiveness. The benefits will fall heavily on Black students, induced through affirmative action admissions policies and bogus self-esteem propaganda to take on far more debt than they will ever be able to service with the jobs they will get. White populists are aware of this and will flay it as worsening the unfairness, not making it better.

      This is not to say that some Black students admitted through affirmative action don’t thrive and prosper but the costs incurred are very high, and unrepayable debt is one of them. The colleges have no incentive, and every disincentive, to take the failing affirmative-action student aside in freshman year and have a heart-to-heart talk. The college just wants its tuition money and good publicity. It will keep the student enrolled until the banks will lend no more.

      My suspicion is that banks are willing to advance these extraordinary sums to less-than-ordinary students only because they predict that the government will indeed pay them off. The banks certainly aren’t going to forgive the debts themselves.

      And people wonder why populism plays.

  6. The United States opted out of the system that provides natural (uncoerced) opportunity: capitalism. In order to achieve it again, the entire Progressive/Keynesian project would have to be dismantled.

    How about it?

    1. Huh? Maybe I’m completely misunderstanding you, but how in Cthulhu’s name has the home of Google, Apple, Starbucks, McDonald’s, Disney, Walmart, thousands upon thousands of corner stores/small businesses/hole-in-the-wall restaurants, etc. etc. etc. opted out of capitalism?

      1. Sounds like Mr. Donohue’s urging absolute laissez-faire capitalism.

        None of that mixed-economy stuff for him.

    2. You got your wish 40 years ago, when under Regan the Progressive/Keynesian project was set aside and hyper-capitalism took its place. Ever since then regulations have shrunk, inequality levels have soared, more and more billionaires and corporations pay nothing in taxes, governments deliver corporate welfare and bailouts, the country has fallen under the sway of monopolistic mega-corporations, and prices for construction, education, and medical care have skyrocketed.

      The Nordic countries are better off precisely because they didn’t follow America’s script and let Capitalism go out of control.

    3. People say this kind of thing all the time. Please explain exactly what you mean — no platitudes — and how you think it will improve our current economic situation and the situation of our citizens. Otherwise, a comment like this is worthless. It’s just an exhortation to presumably do away with all regulation and return to the days of robber barons, child labor, and “trickle-down economics,” all of which have resulted in heavy increases in economic inequality.

  7. Thanks for the excellent Protzer and Summerville article, which I have passed on to a list-serve I belong to. The fallacy it points out—confusing fairness with uniformity—is a trap the pop-Left falls into over and over again. But its present version—with the explicit attacks on advanced classes, educational testing, and the very existence of “natural gifts and talents”—seems to be the most extreme and pernicious yet. I
    wonder why. One speculation: it is the worst yet because it emerged from Academia itself—from the
    variety of bogus academic subjects of Critical X Studies, clothed in the status of pretend-scholarship. A perfect irony: bogus superior credentials fueling a discourse against any kind of credentials.

  8. I have never seen “equality of outcome” as a slogan on the Left, despite reading political sites in english for many years. If it was in any way relevant, I’m confident I would have seen it at some point. I just didn’t. No doubt, it will be possible to turn up a rando on Twitter who tweeted this, but I don’t believe this is an actual thing. In contrast, Karl Marx, in the famous butchered passage, argues that treating different people as if they were the same was unfair. However, I did see the slogan many times on the American Right, as something “the Left” allegedly wants. It’s total straw-man, isn’t it?

    The people who wrote this are unsurprisingly connected to banks, investment and United States International Trade Commission (two or three clicks on the names, the institutions and donors shows it). Of course they don’t want to lose out on people in debt, and sure enough, “leave the millionaires and billionaires alone”. The problems here are too numerous to discuss them. But since Democrats are really just Republicans Lite, I see no problem with adopting their plan.

    The conception of fairness is already difficult. An approximation would be that rules are fair when they are agreeable to all players even if they don’t know on which position they will be competing. The US has Citizen United instead, and people who get bailed out after their ninth bankrupcy to go on their tenth adventure. If Ordinary Joe makes a business mistake, there is no tax payer coming to the rescue to bail him out, and handing him a big bonus cheque on top. Further, what people “earn” really depends on what they are using. If you make money by digging holes, you only marginally extract from the commons but mostly transfer your own energy into money. However, you don’t get rich that way. This requires to tap into, and exploit resources we are taught to overlook. All the education of the workforce they need to do the job, all the roads and infrastructures, all the habits that are cultivated. Yes, people in the right position extract money from you drinking your morning coffee (where you can work more, better etc). There is already a big questionmark if “the boss” truly “owns” what he extracted. Why does the bucket stop there?

    This is not even beginning to unravel the problems when “players”, who have assumed specific roles in which they are absolutely set, can change those rules as they see fit. They can effectively look at the mirror and then make totally fair rules that totally work for everyone who is bald, likes to wear cowboy hats and owns some yachts. Then there will be some writers who try to convince everyone that, since these rules really truly apply to everyone, it’s really fair, after all you could shave your head, wear cowboy hats and own multiple yachts, too. It’s totally fair equal opportunity.

    1. Equality of outcome is a constant slogan on the Left. Perhaps they don’t always say it literally but it permeates much of their thinking. It goes like this. We’ve battled against racism but there is still a vast gap between black and white people on many measures. Outcomes are far from equal, in other words. This means we’re experiencing structural racism. The only way out of it is to absolutely demand equal outcomes. I’m not saying I agree with it but it’s not hard to hear.

      1. The context in the piece above is citing economy, linking to a Guardian piece where Bernie Sanders argues against an oligarchy of billionaires. He states for instance:

        In 1978, the top 0.1% owned about 7% of the nation’s wealth. In 2019, the latest year of data available, they own nearly 20%. Unbelievably, the two richest people in America, Jeff Bezos and Elon Musk, now own more wealth than the bottom 40% of Americans combined.

        Okay, what are those draconian, Soviet-Stalinist ☭ measures Bernie Sanders wanted to impose to achieve “equality of outcome”.

        We must raise the minimum wage from the current starvation wage of $7.25 an hour to a living wage of at least $15 an hour. A job should lift workers out of poverty, not keep them in it.

        I’m glad you saw right through it. I have missed the ruse by Bernie on my first reading. It’s the cheeky “at least”, isn’t it? It would otherwise take a while to bring Agnes the Cleaning Lady on Bezos and Musk’s level on a $7.75 / hour raise. But the trick must be the “at least”. Maybe he means to actually raise minimum wage to a few million dollars an hour to bring “equality of outcome” into a timeframe slightly shorter than it would take until the sun consumes the earth. Otherwise I just don‘t see the argument here.

        How come so many here take the writing of these investment banker types seriously, who worry about a minimum wage increase and such? I recall even Republican voters in Florida were in favour of a minimum wage increase.

  9. Increasing economic opportunity is great, but specifically what does that entail? Even if the appropriate measures to accomplish this are identified, just how will they be implemented when the Republicans will kill any and all bills to foster equal opportunity, blame Democrats for the failure to create equal opportunity when they are at fault, and then bleat on relentlessly about the cultural outrage of the day that they just discovered? Personally, I favor a wealth tax on individuals with a net worth over fifty million. Call this redistribution if you want, but I am all for it.

  10. As Obama should have said, “You didn’t build that – all by yourself.” Most companies rely on an infrastructure created by society. Plus, billionaires often got there by gaming the system. Without massive subsidies from the Federal government and the state of California, Tesla probably could not exist. I am not saying the subsidies should not have existed; I am saying we should tax the butt off those who raked in billions from taking advantage of them – 95% on any income over a billion would not be unreasonable. But of course, the billionaires own Congress [and now the Supreme Court, too], so never going to happen.

    1. I understand the emotion behind this but I think it is wrong. The government, and the voters if they’re smart, want to attract investment from the private sector in industries that are deemed to have a big future and in which the US is well-poised to take advantage. We should not want to punish people like Musk from simply being one of those investors we’re trying to attract and making a successful investment. Musk and Tesla are a huge win for the US.

      1. So if you told Musk he would only end up with 10 billion, instead of 200 billion, he would have said “Building electric vehicles? Not worth it.” And as for Musk himself – using his wealth for political causes likely is a great danger to American democracy. Opinions may differ; that’s mine. And I am not sure what emotion you are talking about.

        1. The emotion I’m talking about is the implication that Musk has just “gamed the system”, to use your phrase. My point, which you seem to have ignored, is that whatever “gaming” he did was the whole point of the “system” in the first place. Yes, there might well be a point where Musk or his other investors would have said its “not worth it”. Investors do those kinds of calculations all the time. If they didn’t, governments wouldn’t offer subsidies.

      2. I don’t see how it’s “punishment” to tax the likes of Musk et al in return for all the subsides and support they have gotten. Is paying dividends to investors “punishment”?

        1. I’m ok taxing the rich and I would place the bar much lower than $50M a year. When people talk about that bring Musk into the conversation, I suspect that there are other motivations at play than just a desire to boost the US tax base. I’m no Musk fan boy but he should be treated like a hero for the companies he’s created. I am not a fan of his tweets and shallow manipulations of the stock market, for example.

  11. EDIT: meant as a reply to Historian comment #9

    Neither Democratic nor Republican politicians are helping, and both parties deserve a heaping ton of scorn. The go-to of 99% of people and Democratic politicians who want to achieve better economic opportunity is to “tax the rich,” but raising taxes to, say, 50% on people who make over $50 million would barely make a dent in our economy. You could tax them 75% and we still wouldn’t be able to pay for just the rising tidal wave created by social security.

    What we need to be doing is strengthening unions, breaking up monopolies, instituting better regulation of markets and banks (to avoid pitfalls like the 2008 crisis), and raising wages, just to start. Making healthcare the sole province of government is something neither Democratic nor Republican politicians on average seem to want, and the same can be said of various other social programs.

    According to polls, unions now have the most support they’ve had among the populace since the 1960s, and yet unions themselves are at their nadir. People also largely support breaking monopolies. These are the kinds of things that will have concrete, long-term effects for the daily lives of everyday citizens. Extremely simple wealth redistribution and recriminations between Democrats and Republicans won’t cut it; those are just simple answers to a complex question. Among citizens, both Democrats and Republicans actually agree on many of the things that truly would help economic opportunity, but our politicians don’t care, their voters don’t care enough to organize en masse for what’s truly required, and everyone is distracted by culture wars.

    Talking about how bad the other side is accomplishes nothing. The Democrats haven’t done much to help the situation either, and bleat on about how the Republicans are the ones keeping the everyday person from economic prosperity. And those culture wars you dismiss have become a key tool of the corporate left and the Democratic Party for distracting everyone from the issues of economic mobility and security. The reason corporations are so happy to jump on the Woke train isn’t because they truly care about diversity or social justice, but because it’s an easy way to signal that they’re the “good guys” without doing something that would actually cost them money. Amazon can put a banner on its website promoting black or LGBTQ voices in cinema or whatever, while treating its workers like garbage. But they get nice pats on the head while distracting everyone from their horrid business practices. Academics work tirelessly to get these corporations to run workplace “training” in how to not be racist, while making tons of dosh for themselves. Ridding ourselves of the culture wars would mean an enormous increase in attention on what truly matters.

    By far, the number one metric to predict someone’s future earnings is their socioeconomic class. Not race, or sex, or gender, or sexual orientation. It’s economics. While the left and right and the corporations divide us with the culture wars of the day, they keep us oblivious to the real issues. The culture wars are important not because their issues are important, but because of the distractions they provide and the cover they give to corporations to shield them from opprobrium for their economic irresponsibility.

    1. It’s a complex question but unions are not the best way to restore economic mobility. They are well known for keeping dead-end industries alive well past their sell date. I’m not saying that unions don’t have their place but they are far from an unalloyed good. For example, Manchin and the coal miners union in WV. Though, interestingly, that union thought Manchin was wrong not to support Build Back Better.

      1. I agree that unions are often counter-productive, and they’re less about economic mobility than economic stability and an increase in wages and fair working conditions. Amazon employees, for example, would benefit greatly from unionization. Unions alone won’t accomplish much, but would be very helpful as part of a larger raft of policies.

        EDIT: to be clear, I’m not advocating unionization in every workplace or industry. Just for low-level employees caught in the cogs of behemoths like Amazon.

        1. I think unions should be easier to create but go away as soon as their immediate goals are realized. Where things go wrong is that they have a life of their own and, like all life, it tries to persist.

          I had some very bad experiences with unions early in my career. I worked for a computer-aided design software company and was involved in exhibiting at big trade shows in places like Chicago, St. Louis, Boston. We would do simple things such as wiping the fingerprints off CRT displays and union stewards would threaten to write us up. They wanted to charge $45 for a 1/2-hour minimum work order to do the job. We had to pay hundreds of dollars to pay an electrician to plug our computers into the outlets. The electrician had to be directed to do all this “wiring” by us because they had no idea what needed to be plugged into what. If we tried to avoid some of these charges, we would expect them to toggle the power on and off during our demos, crashing the computers. I realize this is perhaps the worst of unions but I suspect it isn’t that rare and I haven’t heard that it is any better now.

          1. You’re 100% right, and I appreciate the context. Construction and electrician unions are notorious for this kind of crap. I simplified the issue, but the context you brought it really important, and I agree that there need to be constraints on time and/or function for unions.

    1. But they invent things that those equal, happy, and democratic societies need and are happy to use but are unable to invent for themselves. So there is that.
      And those happy countries need someone to look down on.

  12. Isn’t income equality not just a special case of income fairness? F.I. I think it is fair for a garbage man to have the same salary as a brain-surgeon. Most people would disagree because they think brain-surgeon deserve more pay and it’s better for the economy because it motivates people to show more effort. If you have a deterministic world view, a believe in “just deserts” isn’t very convincing. If you don’t have a deterministic world view, your believes are not based on facts and therefore pointless from the start (still might make you feel good, nothing wrong with that).

    It might be true that unequal pay motivates people to put in more effort, but that can also be done with just very small differences in pay and making people feel important. More importantly differences in skill and motivation are becoming less an less important because we build machines that make human jobs very easy. Human progress comes from scientific and technical innovation, but makes human labor less important and often even counter productive (f.i. in relation to climate change).

    All in all it means that income equality and income fairness are becoming more and more the same thing (Universal basic income?). And whether it is right to optimize income fairness over income equality is mostly matter of opinion not a matter of fact, it only says something about the state of mind of the person holding these opinions. Both sides just tap into very good motivational sources: envy and greed. I cannot see anything wrong with that 🙂

    I don’t know what a winning strategy looks like and doubt anyone knows. The world is changing all the time, nothing stays the same and nothing is forever.

Leave a Reply