Economic Inequality and Social Division

Arts and Letters Daily links to a Boston Globe story on Kate Pickett and Richard Wilkinson’s UK book, The Spirit Level. The authors marshall persuasive evidence that in countries where income inequality is high, social conditions and general welfare suffer.

It is economic inequality, not overall wealth or cultural differences, that fosters societal breakdown, they argue, by boosting insecurity and anxiety, which leads to divisive prejudice between the classes, rampant consumerism, and all manner of mental and physical suffering.

The source of this anxiety, they argue, is status disparities and the inability of those of low means to achieve higher status. Ironically, their research shows that increasing wealth disparities lead to a more consumeristic society (and, we might add, increase the destructive pressure on that society):

We want bigger houses and more cars, not because we need them, but because we use them to express our status. Material goods are how we show the world we’re keeping up, and in a more hierarchical society that’s more important. Status competition becomes more intense, and that increases our need to consume.

A challenging and tempering thesis … if only we can heed the warning.

An opportunity in prison budget cuts?

The Christian Science Monitor editorial board offers a useful and well-reasoned defense of shrinking prison budgets, driven by states’ revenue shortfall, as an opportunity to rethink our approach to treatment and punishment.

The US ranks as the prison capital of the world. In 2008, more than 2.3 million men and women (or 1 in 100 adults) sat in prisons or jails. This dubious distinction comes from a near tripling of the inmate population over the past two decades – and a similar rise in state spending on corrections.

Drawing from the results of a recent study by The Pew Center on the States, the board notes that states can count on public support for rehabilitation, vocational training, and parole reform, while support for sentencing reform is weaker. Even so, the editorial concludes,

The states are imprisoned by their prison budgets. Economic necessity can unloose their chains with a different way of doing things.

The virtues that lead to recessions

Dierdre McCloskey, professor at the University of Illinois-Chicago, is a Harvard-educated economist who taught at the University of Chicago before moving north to UIC. She is the author of a theological defense of capitalism, The Bourgeois Virtues: Ethics for an Age of Commerce. Self-described as “a postmodern free-market quantitative rhetorical Episcopalian feminist Aristotelian woman who was once a man” and an “iconoclastic” economist, her thoughts on the sources of the current recession appear in a compilation in the July 28, 2009, Christian Century (p. 24). Her perspective: That recessions don’t come from greed but, rather, from risk and daring undertaken by fallible humans; and without the economic growth that has resulted from such risk and daring, the world’s poor would be much less well off.

The recessions do not come from greed …. The recessions come from hope and courage, from venturing on building railways and then overbuilding them; from founding dot-com companies, and the overfounding them; from innovating in financial services and then overinnovating. We go too far, as imperfect creatures with imperfect knowledge of the future …. But in the meantime we get better railways, computers, banks. That’s why the recovery is always greater than the decline. The trend has been startlingly upward, the second most important event in human history.

The jagged rise of innovation has been disturbing, but on balance it has been immensely good for the poorest among us ….

This is a writer and thinker whom I need to get to know better.