One Finite Planet

Wealth Inequality: Who wants More Inequality?

The Wikipedia article on Wealth inequality in the United States describes wealth inequality as a problem almost every would like to see reduced. Yet wealth inequality is increasing, not decreasing. What gives? Is humanity unable to address this problem? Or is will to address the problem not as universal at it might appear? Either consensus for action to decrease wealth inequality in not sufficient to stop the increase, or alternatively, there are forces actively working against this ‘consensus’, which means it is not actually a complete consensus. Are there dissenters working (and succeeding) to increase wealth inequality? This post is looks at the question: Who wants wealth inequality to increase?

  • The consensus
  • A more meaningful consensus?
  • Why the dissent?
  • The power of the dissenters
  • Who wants wealth inequality to increase: the wealthy

The consensus

To quote the previously referenced Wikipedia article:

A 2011 study found that US citizens across the political spectrum dramatically underestimate the current US wealth inequality and would prefer a far more egalitarian distribution of wealth.[15]

[15] http://www.people.hbs.edu/mnorton/norton%20ariely%20in%20press.pdf

The survey records what people say they feel is the ideal distribution of wealth, and this ideal far more egalitarian. This suggests there is consensus of what people believe is ideal, or at least what they say is the ideal.

A More Meaningful Consensus?

However, if you ask a different question, for example, select A) or B)

  • a) I seek to increase my wealth relative to others
  • b) I seek to decrease my wealth relative to others

You may find an overwhelming response of individuals who want to increase their wealth relative to others. This a) response may still hold as the dominant answer for those groups who hold the most wealth, and thus are best placed to increase their own wealth. If this response does hold as I suggest it will, a new consensus becomes “the vast majority of the very wealthy seek to increase their relative wealth, which if they succeed means an increase in wealth inequality.

Why the dissent?

Each individual may wish to increase only their own wealth relative to all others, and be quite satisfied if the overall wealth divide moves towards the ‘ideal’ distribution, but very few philanthropic members of that wealthy group are actually planning to themselves move down in relative wealth.

The gap is between what people believe is ideal for world, and what they personally are prepared to support happening for themselves. Few people in any group would support any policy that means they as an individual become less wealthy relative to others.

If the majority of all people in below average wealth groups wishes to increase their own wealth, then those with below average wealth will support policies to make increase the wealth of the poor (themselves) and are supporting steps to decrease inequality.

Conversely, if the majority of those in above average wealth groups will take active steps to support policies increasing their personal wealth, then these above average wealth people are effectively supporting steps to make the rich (themselves) even richer and and looking to make a personal contribution to increasing inequality.

The Power of the Dissenters.

With wealth comes power. While both rich and poor may be equally motivated to increase their own wealth, it is those who are currently wealthy who have greatest power to see policies implemented that produce the outcomes they personally seek. End result: the wealth divide will continue to increase

Comment?

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