Sunday, March 2, 2014

American's Woke Up and Realized They are Getting Screwed. Envy Isn't the Emotion They're Expressing.

Arthur Brooks has a column in today's NY Times that I take a bit of exception to. In it, he makes the claim that envy is on the rise in America and that this is a problem.

My central issue with this is that I believe that over the past 30 years institutional and cultural shifts have resulted in an increasing exploitation of the majority of society by those at the very top of the income scale. There is no other credible explanation for why these trends are so pronounced in the Anglo-Saxon countries, with the US an outlier among this group, and so much weaker in the rest of the developed world. While there is a small shift towards inequality that is occurring across all developed nations, probably largely the result of the vast increase in labor supply caused by the development of the third world, this international component is far smaller than the country specific shifts we have observed in the U.S., Canada, and Great Britain.

However, Brooks mentions none of this, instead trying to frame it as if there is a cultural shift towards envy being caused by politicians "fomenting bitterness" and reduced mobility resulting from regulations, taxes, and a lack of school choice (never mind that this agenda doesn't well describe the policies of countries with greater mobility than us). He summarizes Alexis de Tocqueville, stating that:

Alexis de Tocqueville phrased it a little differently, but his classic 19th-century text contains the same observation. Visiting from France, he marveled at Americans’ ability to keep envy at bay, and to see others’ successes as portents of good times for all.
It's been a long time since I've read de Tocqueville, but from what I remember of it his main explanation for American's attitude is that rich and poor alike share in all aspects of life. They meet and discuss the issues of the day at each other's homes and public entertainments, they recognize the mutual equality of each in politics, they live amongst each other and interact continuously in life's daily commerce, and the benefits and burdens of living in a civilized society are shared according to each individual's means and talents.

This is not descriptive of modern America. Our rich do not brush up against their inferiors in every day life. Today, they have separate stores, separate clubs, and a diverse array of high brow entertainments unavailable to the working poor. Their children attend separate schools, they live in separate, wealthy suburbs, and network amongst each other, not their less affluent fellow citizens. Furthermore, they pour money into influencing their favored political candidates, violating the original Americans' compact amongst each other to have equal voice in the political sphere even when of unequal means.

It isn't envy to realize that this is not de Tocqueville's America. If the rich want to maintain their wealth while dispelling envy the onus is on them to return to these roots. Live in Detroit instead of Grosse Pointe, send their kids to public schools instead of private schools, and shop at Walmart. Talk to the grocery store clerk about the most recent episode of Teen Mom and commiserate about the pot holes and bad public transit that each takes along the same commuting route. In short, live life amongst those of lesser means.

The major issue throughout is that Brooks attempts to make the claim that it is American's perceptions are changing without ever stopping to consider that their view might be accurate. He states that

According to Pew, the percentage of Americans who feel that “most people who want to get ahead” can do so through hard work has dropped by 14 points since about 2000. As recently as 2007, Gallup found that 70 percent were satisfied with their opportunities to get ahead by working hard; only 29 percent were dissatisfied. Today, that gap has shrunk to 54 percent satisfied, and 45 percent dissatisfied. In just a few years, we have gone from seeing our economy as a real meritocracy to viewing it as something closer to a coin flip.

How can we break the back of envy and rebuild the optimism that made America the marvel of the world?

Brook's makes his own suggestions, such as education and a larger EITC, but these aren't particularly compelling. First of all, education doesn't make any sense as a diagnosis. A PhD and post doc in a STEM field doesn't get someone into the 1% but require some of the rarest individual character traits and ability; not to mention making the greatest contributions to our quality of life. There is no evidence that superior skill acquisition has anything to do with widening inequality, and international comparisons are entirely inconsistent with this explanation. His suggestion of a better EITC, while not a bad idea, only really addresses the sliding position of the poorest while inequality is driven specifically by trends within the 1%, not between the lowest and top deciles.

The second part of his conclusion is what really bugs me,

Second, we must recognize that fomenting bitterness over income differences may be powerful politics, but it injures our nation. We need aspirational leaders willing to do the hard work of uniting Americans around an optimistic vision in which anyone can earn his or her success. This will never happen when we vilify the rich or give up on the poor.
Only a shared, joyful mission of freedom, opportunity and enterprise for all will cure us of envy and remind us who we truly are.
This does nothing but blame the victims. We don't have to blame the rich, inequality can be explained solely in institutional, cultural and other structural terms without blaming individuals. But we must deal with these root causes, it's not about positive visions but about concrete reforms to counterbalance, and, where possible, change, the structural forces leading to inequality.

While structural issues are the best fit to the evidence for a cause, it doesn't help that the rich have been acting abominably. There are efforts in almost every major metropolitan area to keep the tax bases of small suburban enclaves that the rich live in distinct from the greater metro area thus robbing cities of the tax base they need to support good schools and transportation that would benefit everyone. There is almost no communication between the classes outside of the command and control relationships in the workplace. Politically, money is dominating the issues on the agenda to an ever greater extent.

To be blunt, I don't see how it is possible to construct a narrative that blames envy and the poor with the rich behaving as they are. It is not envy to realize you're getting screwed and taking exception to it. The real problem is not that American's have lost their optimism but that the reality their optimism was based on has disappeared. Policies implemented back in the 70s and 80s have led to real differences in Americans' ability to get ahead and how the product of our amazingly productive country is allocated. It was only a matter of time before attitudes shifted to match a changed reality. A scam can only continue so long until people wise up to it. If we want to get rid of envy the powerful need to stop screwing over the weak, no leader can simply cajole people into laying down and taking it forever; which is what Brooks seems to want.

[Edited for clarity]

1 comment:

  1. The oldest trick in the book Tzi, blame and shame the victim...