Against Inequality

1. Extreme Inequality is a Profound Injustice

Never across the entire expanse of human history has such a level of inequality been seen before.

Unprecedented disparity. The world today exhibits extreme economic inequality, with a handful of billionaires possessing wealth equivalent to half the planet's population. This stark contrast is evident in figures like Elon Musk's wealth, which would take a median American worker millions of years to earn, or the fact that the richest 1% of Americans own 40% of the country's wealth. Such disparities are worse than those seen in the Roman Empire or pre-revolutionary Russia.

Beyond poverty. While poverty is a critical concern, inequality itself is a distinct and independent problem. It undermines the foundational ideal of equal human worth, suggesting that some lives are inherently more valuable than others based on arbitrary economic standing. This perspective challenges the notion that simply having "enough" negates the moral consequences of vast wealth gaps.

Societal breakdown. Extreme inequality leads to significant social friction, fostering anger and resentment among the less fortunate, while the wealthy may view others with contempt. This can tear the fabric of community, leading to:

• Political instability and plutocracy
• Reduced social mobility and unequal opportunities
• Increased crime rates and mental health issues

2. Reducing Inequality is Feasible with Smart Policies

Overall, the income share of the Danish top 1% fell quite consistently from 1870 (when they received about 20% of the country’s income, the same as what currently happens in the United States) to receiving only 6.4% in 2010.

Historical precedent. History demonstrates that significant reductions in inequality are achievable, even in countries like the United States, which once had top marginal income tax rates exceeding 90% for decades. Denmark and Sweden also offer compelling examples of nations that successfully lowered inequality through high taxation and robust social policies. This historical evidence serves as a powerful rebuttal to claims that inequality reduction is impossible.

Beyond taxation. While income and wealth taxes are crucial, a comprehensive approach to reducing inequality also involves predistributive measures that shape market outcomes. These include:

• Strengthening labor unions to enhance worker bargaining power
• Implementing full employment policies to benefit the poorest workers
• Investing in quality, accessible education, especially early childhood programs
• Raising minimum wages to ensure a living income

Broader reforms. Other vital tools for predistributive equality include reducing monopolies, providing housing support (especially public rental housing), offering universal child care, and exploring basic income schemes. Democratizing firms through employee share ownership or worker cooperatives can also shift power and wealth towards workers, leading to more equitable internal pay structures.

3. Effective Taxation Requires Robust Design and Enforcement

The basic lesson from the past 30 years of tax research is that tax changes have a clear and unambiguous impact on avoidance but an unclear and ambiguous impact on real effects.

Combating avoidance. The primary obstacle to high income taxes is not reduced work effort, but tax avoidance and evasion. Wealthy individuals often exploit loopholes, shift income sources, or hide assets. To counter this, effective tax systems must:

• Institute rigorous third-party reporting for all income types
• Broaden the tax base by eliminating exemptions and deductions
• Increase enforcement resources for tax authorities
• Impose severe penalties for tax fraud, treating it as a serious crime

Addressing wealth taxes. Wealth taxes, while less common, are essential for tackling the superrich, whose accumulated assets often grow faster than the economy. Past European wealth taxes faced challenges like undervaluation and evasion. A viable wealth tax requires:

• A high threshold to target only the very rich
• Progressive rates, with higher rates for the superrich
• A broad tax base with minimal exemptions
• Extensive third-party reporting and enhanced enforcement
• Formulaic prospective and retrospective valuation

Global cooperation. Tax havens pose a significant challenge, enabling individuals and corporations to hide trillions in wealth. Solutions demand international coordination, including automatic exchange of information between tax authorities (like FATCA and CRS), beneficial ownership registration, and a global minimum corporate tax rate. Unilateral actions like taxing worldwide income and imposing exit taxes on expatriates are also crucial.

4. The Benefits of Lower Inequality Far Outweigh the Costs

The costs of high taxes and low inequality are likely to be only moderate, whereas the benefits are potentially enormous, a different order of magnitude entirely.

Economic resilience. While concerns about high taxes reducing work or investment exist, empirical evidence is mixed and often suggests minimal impact on overall economic growth. Public investments funded by taxes can significantly boost productivity through improved infrastructure, science, technology, and education. Furthermore, redistribution can increase aggregate demand, stimulating job creation and enhancing economic stability by acting as an "automatic stabilizer" during downturns.

Environmental imperative. Lowering inequality is crucial for addressing the climate crisis. The rich are disproportionately responsible for carbon emissions, and redistributing their wealth can fund essential green investments. Reduced consumption and work hours in a more equal society can also contribute to ecological sustainability, shifting focus from endless GDP growth to economic security and well-being.

Societal flourishing. The social benefits of reduced inequality are profound and wide-ranging. It strengthens democracy by curbing the disproportionate political influence of the wealthy, fosters greater social mobility, and enhances economic security for all. Furthermore, lower inequality is associated with:

• Reduced xenophobia, racism, and the appeal of far-right populism
• Increased social solidarity, trust, and civic engagement
• Better mental health outcomes and lower crime rates

5. Market Income is Not Morally Deserved

The essential point is that income can only ever be an indirect and opaque reflection of economic contribution because it is always refracted by the political nature of the market system and market prices.

Unlevel playing field. The notion that individuals morally deserve their market income is fundamentally flawed because opportunities are severely unequal. Factors like inherited wealth, race, gender, and access to quality education create a rigged competition, making claims of "meritocracy" disingenuous. The vast majority of wealth is inherited or accumulated through advantages, not purely individual effort.

The "understructure" of wealth. Individual economic contribution is massively magnified by the "understructure" – the collective accumulation of physical, political-legal, cultural, knowledge, care, and natural infrastructures built by generations of others. This societal inheritance, for which no individual is responsible, accounts for the vast majority of modern income, rendering individual claims of desert largely baseless. For example, a typical American worker's income is overwhelmingly due to the productive social system they are born into, not solely their personal effort.

Politically shaped markets. Market prices and incomes are not neutral reflections of supply and demand but are deeply influenced by political decisions, laws, and regulations (e.g., copyright, patent, immigration, labor laws). This inherent political construction means that income is always at least partially arbitrary from a moral perspective, making it an unreliable measure of genuine economic contribution or desert.

6. Luck, Not Merit, Drives Economic Outcomes

It seems to be one of the fixed points of our considered judgments that no one deserves his place in the distribution of native endowments any more than one deserves one’s initial starting place in society.

Arbitrary abilities. Even if a perfectly level playing field of opportunity existed, individuals would still not morally deserve their income because talents, skills, and even the capacity for effort are ultimately products of luck. One's genetic makeup, temperament, and psychological traits—which influence perseverance, concentration, and self-cultivation—are not chosen but emerge from unchosen genetic and environmental factors.

Ableist implications. Rewarding people with significantly greater means to live a good life due to luckily possessing more talent or effort is akin to rewarding them for arbitrary characteristics like skin color. This "ableist" aspect of meritocracy blames individuals for their unchosen disadvantages, such as disabilities or mental health challenges, and heaps disrespect onto misfortune. A just society would ensure everyone has the means for a flourishing life, regardless of their arbitrary abilities.

Beyond autonomy. While individuals possess varying capacities for choice and reflection, these capacities themselves are not equally distributed. The idea that a "pure choosing entity" exists, independent of genetic and environmental influences, is empirically false and conceptually flawed. Rejecting desert does not deny autonomy; it rejects unfair competitions where arbitrary advantages determine life outcomes.

7. Property Rights Are Contingent, Not Absolute

If money, according to Augier, “comes into the world with a congenital blood-stain on one cheek,” capital comes dripping from head to foot, from every pore, with blood and dirt.

Violent origins. The libertarian claim that property rights are absolute and inviolable rests on the false premise of just initial acquisition and pristine transfers. In reality, much of today's wealth, particularly in North America, is deeply intertwined with historical injustices such as:

• Colonialism and the theft of Indigenous land
• Slavery and the exploitation of Black labor
• Patriarchal systems that devalued women's work
• Rapacious industrialism and union suppression

Rectification is essential. Given this history, redistribution is not theft but often a necessary act of rectification. The idea that property is "manna" from heaven, unattached to historical injustices, is a misleading fantasy. Current property ownership is built upon systemic violence and ongoing unequal opportunities, making claims of absolute rights morally untenable.

Needs outweigh property. Even after rectification, property rights should remain contingent, not absolute. The urgent needs of others—such as basic survival, essential opportunities, and a livable planet—can and should outweigh an individual's right to unlimited control over their excess wealth. The libertarian stance, which prioritizes property over basic human needs, is ethically indefensible and fundamentally one-sided.

8. Maximum Limits on Wealth Are Necessary for a Just Society

Coherent egalitarianism actually embodies limitarianism.

Protecting democracy. Allowing individuals to accumulate limitless wealth inevitably leads to disproportionate political influence, transforming democracy into plutocracy. The superrich can sway public opinion, fund campaigns, and threaten capital flight, undermining the principle of equal political voice. Imposing maximum limits on wealth is crucial for safeguarding political equality and ensuring a truly representative democracy.

Meeting urgent needs. The vast resources hoarded by the superrich are desperately needed to address critical societal problems. Redistributing this excess wealth could:

• Eliminate global extreme poverty and homelessness
• Fund essential opportunities like universal healthcare, education, and child care
• Finance massive green investments to combat climate change
• Enhance economic security to reduce the appeal of xenophobia and populism

Beyond sufficiency. While ensuring everyone has "enough" is vital, it's insufficient. A society with billionaires, even if it meets basic needs, still suffers from relational harms like reduced social solidarity and increased crime. Furthermore, it perpetuates an unjust system where arbitrary luck dictates vast differences in life quality. Limitarianism directly addresses these issues by capping wealth, ensuring a more equitable distribution of resources and power.

9. Abolishing the Superrich is a Moral Imperative

The superrich are pirates, pillaging the common wealth. We can and should abolish them.

Structural immorality. The existence of the superrich is not merely an unfortunate outcome but a structural immorality. Their wealth is largely undeserved, accumulated through systems of privilege and luck, and its concentration actively harms society by undermining democracy and diverting resources from urgent collective needs. This calls for a fundamental shift from wealth idolatry to a critical examination of its societal impact.

Practical implementation. Imposing maximum limits on income (e.g., 10-20 times the minimum wage) and wealth (e.g., 200-400 times the median wealth) is a bold but feasible step. While such limits would impact a small percentage of the population and might cause some market distortions, these are manageable with careful policy design, such as robust tax enforcement and a focus on public investment. The goal is not to stifle innovation but to ensure that economic activity serves the common good.

A new vision. A truly just society would be a democratic socialist one, characterized by:

• Highly progressive income, inheritance, and wealth taxes
• Extensive universal public services and a guaranteed basic income
• Guaranteed rights for workers, including time sovereignty and workplace democracy
• A focus on collective ownership and shared prosperity

This vision prioritizes fairness, need, and limits over arbitrary privilege, aiming to create a community of equals where everyone has the means to lead a good and flourishing life.