6.7.2 Economic Inequality and Sharing Wealth

Politicians control enough levers of power in the Economic Dimension to increase the probability that all those who are economically active are adequately rewarded, whilst also catering for those who are unable to look after themselves – whether on a permanent or temporary basis.  Perfect equality of income and assets is unachievable and undesirable: people need to feel that they can improve their finances by hard work, as an incentive to create wealth (3.2.1), and it would create a sense of injustice if those who were idle received the same economic rewards.

Thomas Piketty’s best-selling book, Capital in the Twenty-First Century, drew attention to the historical tendency for economic inequality to increase.  It is a growing problem that is causing discontent, because it is not just virtuous hard work that has made some people so wealthy.  A BBC article, Thomas Piketty: The French economist US liberals love, explained how Piketty had shown why those who are already wealthy become more so…

“…because the rate of return on capital has been outpacing the rate of economic growth.  In layman’s terms, the rich are getting richer”.

People have now started to realise that the rich have bought themselves political influence to become even richer (6.4.5.3), so politicians are partly responsible for the unfairness.  And some wealthy politicians have shown a staggering degree of unawareness of the problems faced by those who are less fortunate, as exemplified by a New Statesman article: Ranked: every patronising Conservative cost-of-living crisis survival tip; the quotations include:

“Boris Johnson boasts that pensioners can keep warm on buses for free”,

“Kit Malthouse is finding his £115,000 salary “tricky””,

and “we should make more of our enormous back gardens”.

Clearly, none of those people had the faintest idea what it is like to be poor.  The Boris Johnson quotation came from a very revealing ITV interview, in which he showed his failure to understand the problem and his lack of credible solutions. The party was punished in local elections two days later, though, so he could see that it was becoming politically necessary to share wealth more fairly.

The following sub-sections explore the political aspects of inequality in more detail:

●  Individualists and collectivists differ (6.7.2.1) on whether inequality is a problem and, if so, what to do about it.  This is very evident in Britain and America, where economic inequality is higher than in most other countries.

●  Economic inequality causes social hardship and political discontent, in addition to the moral and economic reasons for wanting to reduce it (6.7.2.2).

●  The criteria for making political interventions differ according to levels of need, and can be considered both locally and globally (6.7.2.3).

●  There are several ways of redistributing wealth (6.7.2.4).

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This page is intended to form part of Edition 4 of the Patterns of Power series of books.  An archived copy of it is held at https://www.patternsofpower.org/edition04/672.htm.