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20160903 The Spirit Level

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MAIN IDEA:

The main idea of this book is to present a nice collection of data linking inequality with everything bad one can think about from obesity to murder rate and consequently convince reader that inequality had to be eliminated or at least dramatically decreased in order to improve quality of live for everybody. The method of inequality correction is usual: big government with political will for equalizing.

DETAILS:

PART ONE Material Success, Social Failure

  1. The end of an era

This is about the end of era of materialism, which is consistent improvement in material wellbeing. Authors believe that contemporary western society achieved limit when material improvement does not provide for improvement in quality of live. Here is typical “evidence” they provide to support this view:Screen Shot 2016-09-04 at 11.21.23 AM

Obviously people in Tanzania or Vietnam are as happy as people in USA despite huge difference in resource availability. Besides authors really believe that there environmental limits to growth.

  1. Poverty or inequality?

Here authors make the point that inequality is more important characteristics than income in defining quality of live:

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  1. How inequality gets under the skin

In this chapter authors analyze how exactly inequality causes deterioration of quality of live. Here are reasons:

  • High Anxiety
  • Impact on self-esteem and social insecurity
  • Impact on pride, shame, and status
  • Threats to social self
  • Destruction of community with defined place for individual

 

PART TWO The Costs of Inequality

All chapters in this part pretty much about negative impact of inequality on all aspects of people well being from trust between people to obesity. This thesis illustrated by a bunch of interesting graphs showing relation between levels of inequality and other aspects of human live.

  1. Community life and social relationsScreen Shot 2016-09-04 at 11.21.42 AMScreen Shot 2016-09-04 at 11.22.03 AMScreen Shot 2016-09-04 at 11.22.13 AMScreen Shot 2016-09-04 at 11.22.21 AMScreen Shot 2016-09-04 at 11.22.36 AM

PART THREE A Better Society

  1. Dysfunctional societies

After presenting correlation between inequality and everything that is conceivably bad authors trying to analyze alternative explanation of correlation via external factors. They look at ethnicity, society history, and social class. They generally reject all other explanations and provide a separate discussion on causality of inequality – everything bad correlations. This explanation is pretty much comes down to: inequality correlates with everything bad so it must be causal. Even such seems to be obvious causal link as poor health – inability to work – low income is rejected. They also reject direct influence of ideology, but consider its indirect impact via: neoliberal free market lead to increase in inequality causing everything bad to occur. However authors admit that they really cannot prove causality and claim that it could require impossible experiment by dramatically changing level of inequality in some country and observe results.

  1. Our social inheritance

This is look at social impact of inequality such as difficulty of real friendship between individuals with high difference in status and negative impact on human relations by perceived unfairness and strict hierarchy. Authors bring in research on chimps versus bonobos, ultimatum games, and anthropological research of Paleolithic societies and their social structures. They also discuss human duality of individual and group survival both of which are necessity for humans.

  1. Equality and sustainability.

Here authors link everything to ecology sharing their dream for “steady-state economy”. As usual this dream includes hope to decrease consumption of the “rich people” who work too much and consume by far more than other people. Here is their graphic representation of this idea:

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  1. Building the future

This chapter is about what should be done to decrease inequality, after authors put blame for it on political development. Interestingly enough they point out that level of taxation seems to be irrelevant providing example of low tax New Hampshire with very high quality of live and health. However they see solution in politics of society that would force equality on people and suppress corporate power that authors believe promotes inequality. They also see solution in non-profit corporations, trade unions, and employees ownership. However ultimate do-gooder should be big benevolent government that would have political will to make people more equal.

MY TAKE ON IT:

The data set provided in this book is nice, but ideology is somewhat stale. In their passion for equalizing authors somehow manage completely ignore that huge equalizing experiments ware conducted and on the huge scale: Russia, China, and many other countries that were taken over by communists with immediate and drastic decrease in inequality to such level of equalization that even amount of available food was made equal. Probably authors ignore it because it makes their thesis of inequality causing everything bad kind of ridiculous if compared to millions of deaths caused by extreme equality. Another interesting phenomenon, typical for all socialists, is authors’ completely blind spot to inequality created by government and myriad “non-profit” organizations. It seems to be that huge amount of resources spend on building palaces and providing good live for government bureaucrats, politicians, non-profit CEOs, and Union bosses somehow is not counted into inequality. For them a multimillion private 12 seats plane compared with economy middle seat in jumbo jet is huge example of inequality, while government jumbo jet used to carry one important politician to play golf over weekend is not. Especially egregious example is calculation of Gini coefficient without taking into account control over resources by bureaucrats and politicians, so for example country like Sweden, where a few hundred people at the top of government control about 60% of country’s resources, has lower levels of inequality than USA where similar number of top politicians and bureaucrats control just over 30% of all resources. With this approach one gets a ridiculous result when something like North Korea where current Kim controls 100% of country resources somehow has Gini coefficient less than USA, rather than 1, as it should.

While agreeing with findings that inequality hurts people and causes health and other societal problems, I think that most important part is missing: causes of inequality. People are not equal, but this inequality could not cause income/wealth ratio in millions. The real cause of inequality is government that forces on people such rules of game that allow some individuals acquire control over huge amounts of resources, while leaving others with nothing. I think it does not matter whether this control is implemented via mechanism of private or government property. What does matter is real control over resources.

My approach to fixing this problem would be to equalize natural resources availability and making people who use more than average to buy this right from people who use less. With no restrictions and no redistribution of produced wealth the inequality between people would be limited to difference in productive abilities and luck, that could not possibly be that huge, therefore removing all these negative problems that authors wrote about.

 


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