If The Wall Street Journal or Bloomberg or The Financial Times or even The Economist are taken, broadly speaking, as the major organs of the financialized evangel, I still hold that it is The New York Times which best represents the way the rentier class in America self-perceives and self-represents. The former are a sort of priestly class; the Times is a congregant and a believer. It sits in the pews, prays to the gods, and authors the temple newsletter. When some doubt arises about the rightness of global capital, when some evidence appears that the augurs have been diddling the young pigeonkeepers behind the altar, it wrings its hand with worry; fortunately, all depredations are ultimately revealed to be aberrations—indeed, to be extravagantly so.
Signs and wonders! The Times has discovered, mirabile dictu, that “inequality” is not getting worse, as is the conventional wisdom. Not only that: it is getting better. “Inequality” is already a dire euphemism for capital—ownership of and access to—but let’s not reinvent the wheel again. The Times has discovered, or has, more accurately, discovered someone discovering, that if you look at the recent percentage changes in annual incomes, the very, very rich have seen far steeper declines. Ergo, therefore, and hallelujah.
I assume there’s a certain joy in delivering the good news that the world really is, after all, mounted on the back of a turtle. You may all recall, some years ago, that Stephen Pinker delivered the great, good news that the modern world is not only a kinder, less violent, more gentle place than it has ever been, but that it is measurably so. There’s the old saying about lies, damned lies, and statistics, but the last of these should really be percentages. David Bentley Hart was onto him:
Even so, the numbers do not add up. Pinker’s method for assessing the relative ferocity of different centuries is to calculate the total of violent deaths not as an absolute quantity, but as a percentage of global population. But statistical comparisons like that are notoriously vacuous. Population sample sizes can vary by billions, but a single life remains a static sum, so the smaller the sample the larger the percentage each life represents. Obviously, though, a remote Inuit village of one hundred souls where someone gets killed in a fistfight is not twice as violent as a nation of 200 million that exterminates one million of its citizens. And even where the orders of magnitude are not quite so divergent, comparison on a global scale is useless, especially since over the past century modern medicine has reduced infant mortality and radically extended life spans nearly everywhere (meaning, for one thing, there are now far more persons too young or too old to fight). So Pinker’s assertion that a person would be thirty-five times more likely to be murdered in the Middle Ages than now is empirically meaningless.
In the end, what Pinker calls a “decline of violence” in modernity actually has been, in real body counts, a continual and extravagant increase in violence that has been outstripped by an even more exorbitant demographic explosion.
So too, this idea that a larger percentage change in a very large income number is in any meaningful sense a greater loss or gain than a commensurate change in a very small one. If a investment banker with a base salary of a million bucks makes two million in bonus in a very good year and only a million the next, his income has declined by a full third, but he’s still making two million bucks in a year. If a guy making twenty bucks an hour working 37.5 hours a week for fifty weeks a year has his hours cut back to just thirty hours a week, his income declines only 20%, but it represents the loss of 10 months’ rent. Also, he loses his health insurance. Also, he’s paying about a third of his income in taxes, whereas Joe Millionaire is at half that. Did we mention that the Times is looking only at pre-tax income. We mention it now.
You might argue in good faith that inequality doesn’t matter, that it’s fine and well to have a society in which a very few people are very rich and many people are just scraping by. I’d disagree, but there’s a legitimate argument that, so long as there exists some open path for the guy making forty grand a year to one day make forty million, however unlikely, then there’s not a structural problem. But to say, instead, that because very large incomes are more volatile than very ordinary incomes, therefore their recent declines represent a countervailing trend to the concentration of wealth is to engage in what I choose to interpret as an astonishing stupidity lest I have to believe it an even more amazing dishonesty.