Very civilized men can all become equal because they all have at their disposal similar means of attaining comfort and happiness. Savages are equal because they are equally weak and ignorant. If one looks closely at what has happened to the world since the beginning of society, it is easy to see that equality is prevalent only at the historical poles of civilization. Likewise, China’s booming coastal elite is a world apart from the roughly half of the population who still live in villages in the country’s vast hinterland.Īs is so often the case when analyzing the United States, that early 19th-century French sage of American customs, Alexis de Tocqueville, came up with a far more useful and truthful insight than what the rich protester piped into President Obama’s ears. For all the luxury the Ambani brothers and others are basking in, the “India Shining” of the urban middle class has left untouched hundreds of millions of peasants living at subsistence levels, as the Bharatiya Janata Party discovered to its dismay when it sought re-election on the strength of that slogan. In fact, there is a similar story behind the boom in the emerging markets. This is not a uniquely American story, though. It was definitely a recovery - for the 1%. Meanwhile, the incomes of the top 1% jumped by 11.6%. That’s because for 99% of Americans, incomes increased by a mere 0.2% during the tepid recovery of 2009-10. Average Americans have reason to doubt that there is an economic comeback for them. Look more closely at the data, though, as University of California, Berkeley economist Emmanuel Saez did, and it turns out that Obama is well justified in his views. “I didn’t attack them for their success,” President Clinton wrote, attributing to that softer touch his greater success in getting those at the top to accept higher taxes. Striking a similar tone, Bill Clinton, in his 2011 book, Back to Work, faulted Obama for how he talks about those at the top. But if the president couldn’t avoid singling out the country’s top earners, he should call them “affluent.” Naming them as “rich,” he told me, sounded divisive - something the rich don’t want to be. It would be best not to refer to income differences at all, the banker said. financial institutions, told me President Obama had alienated the business community by speaking about “the rich.” One Wall Street Democrat, who has held big jobs in Washington and at some top U.S. That is, after all, at least part of the purpose of yachts, couture, vast homes and high-profile, big-buck philanthropy.īut when the discussion shifts from celebratory to analytical, the super-elite does get nervous. The point isn’t that the members of the super-elite in the United States are reluctant to display their wealth. But inequality is different: Every mention of it raises in fact the issue of the appropriateness or legitimacy of my income.” Charity is a good thing - a lot of egos are boosted by it and many ethical points earned even when only tiny amounts are given to the poor. “Because ‘my’ concern with the poverty of some people actually projects me in a very nice, warm glow: I am ready to use my money to help them. “Yes, they would finance anything to do with poverty alleviation, but inequality was an altogether different matter.” “I was once told by the head of a prestigious think tank in Washington that the think tank’s board was very unlikely to fund any work that had income or wealth inequality in its title,” Milanovic, who wears a beard and has a receding hairline and teddy bear build, explained in a recent book. But putting those two conversations together and talking about economic inequality was pretty much taboo. After all, the central ideological promise of socialism was to deliver a classless society.īut when Milanovic moved to Washington, D.C., the capital city of the country that serves as the citadel of capitalism, he discovered a curious thing.Īmericans were happy to celebrate their super-rich and, at least sometimes, worry about their poor. At the time, he discovered the subject was officially viewed as a “sensitive” subject in his home country - which meant one the ruling regime didn’t want its scholars to look at too closely. He first became interested in income inequality studying for his doctorate in the 1980s in his native Yugoslavia. Branko Milanovic is an economist at the World Bank.
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