I don’t feel like spending a huge amount of words on this topic, and it likely would not matter if I did anyway, so let’s start here: While I fully understand the tenets of capitalism and “the free market,” I do still think it’s ridiculous that athletes get paid at their level, or millennials get paid big by brands to make meme videos, and meanwhile teachers and social workers and prison guards (Epstein!) barely make a living wage. I understand the system, but that doesn’t mean the system makes sense.
There has been a lot of ink spilled on income inequality and the 1 percent in the past 10 years, and that will only get worse in 2020 with a U.S. Presidential election that potentially will be Elizabeth “War on the Billionaires” Warren vs. an actual (we think) billionaire in Trump. We will see a lot of discussions about money, wealth, taxes, and the like.
Well, here’s some decent new research on income inequality, and let me just take you to an important part:
Our evidence shows that as income inequality in a society rises, the happiness that can be gained from moving up the income distribution increases with it. This can result in people becoming more status conscious and striving to move up the income ladder — and caring less about the growing income inequality around them and its negative effects. Such a shift can be rationalized by believing that income differences are deserved, making income inequality much more acceptable even among those at the bottom of the hierarchy.
So basically, here’s what seems to be happening: We created this little arc where we deify workaholics and we virtue-signal about almost everything. Now add in that lots of people have complicated relationships to money, companies tend to hold all the negotiation cards on salary, many people don’t understand taxation, etc, etc. The list goes on and on.
Where we net out, then, is: “These income differences must be deserved,” and/or something about the evolution of the free market.
That seems to allow us to keep good people, and necessary jobs, down and virtue-signaling, rank-climbing, neck-stepping-on assholes who want more and more for themselves up.
So maybe the core problem of income inequality isn’t anything about taxes or real estate investments or better accountants or whatever … maybe a lot of it simply comes back to virtue-signaling enough that we think these chasms are actually deserved.