My old classmate and friend Roger Koppl alerted me to this essay in yesterday’s New York Times by Deirdre McCloskey. Here are some large selections (but do, by all means, read the whole thing):
The world is rich and will become still richer. Quit worrying.
Not all of us are rich yet, of course. A billion or so people on the planet drag along on the equivalent of $3 a day or less. But as recently as 1800, almost everybody did.
The Great Enrichment began in 17th-century Holland. By the 18th century, it had moved to England, Scotland and the American colonies, and now it has spread to much of the rest of the world.
Economists and historians agree on its startling magnitude: By 2010, the average daily income in a wide range of countries, including Japan, the United States, Botswana and Brazil, had soared 1,000 to 3,000 percent over the levels of 1800. People moved from tents and mud huts to split-levels and city condominiums, from waterborne diseases to 80-year life spans, from ignorance to literacy.
You might think the rich have become richer and the poor even poorer. But by the standard of basic comfort in essentials, the poorest people on the planet have gained the most. In places like Ireland, Singapore, Finland and Italy, even people who are relatively poor have adequate food, education, lodging and medical care — none of which their ancestors had. Not remotely.
Inequality of financial wealth goes up and down, but over the long term it has been reduced. Financial inequality was greater in 1800 and 1900 than it is now, as even the French economist Thomas Piketty has acknowledged. By the more important standard of basic comfort in consumption, inequality within and between countries has fallen nearly continuously.
In any case, the problem is poverty, not inequality as such — not how many yachts the L’Oréal heiress Liliane Bettencourt has, but whether the average Frenchwoman has enough to eat. At the time of “Les Misérables,” she didn’t.
The root cause of enrichment was and is the liberal idea, spawning the university, the railway, the high-rise, the internet and, most important, our liberties. What original accumulation of capital inflamed the minds of William Lloyd Garrison and Sojourner Truth? What institutions, except the recent liberal ones of university education and uncensored book publishing, caused feminism or the antiwar movement? Since Karl Marx, we have made a habit of seeking material causes for human progress. But the modern world came from treating more and more people with respect.
Ideas are not all sweet, of course. Fascism, racism, eugenics and nationalism are ideas with alarming recent popularity. But sweet practical ideas for profitable technologies and institutions, and the liberal idea that allowed ordinary people for the first time to have a go, caused the Great Enrichment. We need to inspirit masses of people, not the elite, who are plenty inspirited already. Equality before the law and equality of social dignity are still the root of economic, as well as spiritual, flourishing — whatever tyrants may think to the contrary.
Today’s ordinary Americans and Australians and Canadians and Dutch and Germans and Japanese – as with ordinary people today throughout the developed world – are, by historical standards, super- hyper- crazy-rich. The differences separating the material living standards of, say, a randomly chosen factory worker in Greer, South Carolina, today and Bill Gates today are minuscule compared to the differences separating the material living standards of that same factory worker and any randomly chosen denizen of anywhere in the world during the 15th century BC, or during the 18th century AD, or during the you-name-the-time-before-the-industrial-revolution – before what Deirdre rightly calls “the Great Enrichment.” (Indeed, that factory worker today in Greer, SC, is almost certainly materially richer than was J.D. Rockefeller a mere 100 years ago.)
And yet many ordinary Americans (and ordinary Australians and Canadians and Dutch and Germans and Japanese and etc.) complain about income or wealth inequality as if today’s differences in monetary incomes or wealth are a major problem. These differences are insignificant compared to the differences that separate the living standards of ordinary people today from those of their ancestors of just a few generations ago. Some of these people today buy big books written by statisticians such as Thomas Piketty and, if they read these volumes (or read about them), get the vapors because of the financial inequality reported therein.
Note to such people: stop complaining. Quit your juvenile, perspective-less whining and bitching. Abandon your disgraceful, childish envy. Grow up. Your tiresome wailing about how many more dollars or euros or yen Mr. Billionaire has than you have, or that Madame Billionaireiss has than is had by some statistically average person, is ethically no more becoming than would be the wailing, at an exclusive marina, of Sancerre-sipping owners of average-size yachts that a handful of other yacht owners possess yachts that are multiple times bigger than theirs or bigger than ‘the average’ yacht.
And, again, grow up.