More inequality thinking...

Lane Kenworth continues his superb series on addressing inequality (and diffusing what I believe to be dangerous political and social side-effects it causes), and really hits home with this suggestion.

Imagine an America in which high-quality public services raise the consumption floor to a high level: most citizens can put their kids in high-quality child care followed by good public schooling and affordable access to a good college; they have access to good health care throughout life; they can get to or near work on clean and efficient public transportation or roads with limited congestion; they enjoy clean and safe neighborhoods, parks, roads, museums, libraries, and other public spaces; they have low-cost access to information, communication, and entertainment via reliable high-speed broadband; they have four weeks of paid vacation each year, an additional week or so of paid sickness leave, and a year of paid family leave to care for a child or other needy relative. Even if the degree of income inequality were no less than today and we still had CEOs, financiers, and entertainers raking in tens or hundreds of millions of dollars in a single year, that society would be markedly less unequal than our current one.

It’s worth emphasizing that markets too boost the consumption floor. New technologies and consumer products—indoor plumbing, cars, air conditioning, cell phones, ipods, and many others—have eventually become affordable for even the least well-off, and in doing so they reduce inequality of living standards. But markets haven’t, and likely won’t, bring us affordability coupled with high quality in health care, education, child care, safety, and mass ground transportation. In these and other areas, government is needed.

The United States provides less in the way of public services than many other rich countries, but we nevertheless have a rich history here, from universal elementary and secondary education to the interstate highway system to the internet. There’s a legacy to build on, and good reason to do so. [More][More] 

We can remain true to our belief in individual responsibility and still provide good schools, just like we do roads. We can allow extreme salaries while not making health care a Faustian bargain with an employer.

In fact, the real danger for those who refuse to contemplate any approach other than winner-take-all is as they win, they are more at risk in our political system, since their numbers become so very small as wealth concentrates.  The political voltage demonstrated by the outrage over CEO salaries and bonuses have resulted in draconian measures that could have been avoided by minimal restraint and/or redistributive taxation. Lacking those efforts, we will instead lose much of an entire financial sector that arguably could be saved simply because they are unsympathetic figures.

Too much extreme wealth has also been acquired by the active partnership of government via lobbying for tax breaks, contracts, or simply soliciting government spending. Indeed, for every example of wealth properly earned (Google) we can usually find a beneficiary of government money (Halliburton).  The assumption of justified rich folks is a suspect as the questionable portrayal of the deserving poor.

I think many at the top know this and realize especially now how daily revelations about how this wealth was amassed is a potential landmine.  Which leads to my fear - that to protect the right to enormous inequality, the first target of the rich will be democracy.