Progress does not, of course, materialize at random and without a cause. Many economists attribute the extraordinary increase in human development, at least in part, to the revolution in international connectivity that has defined modern globalization. Indeed, the role of trade, and associated specialization, in creating economic growth and prosperity cannot be overemphasized. By liberalizing economic cooperation and exchange across borders, the expansion of global markets has helped produce the innovations and prosperity underlying many gains, as recorded on websites such as Our World in Data, Gapminder, and HumanProgress.org.
But have those gains been widely shared? Have the benefits of globalization‐driven economic growth reached people in different countries “equally”? Put simply, is the world becoming more equal?
As this essay will detail, the answer to these questions is an unequivocal “yes.”
While not as widely known as it should be, the fact that international income inequality has decreased since at least the mid‐2000s has not gone unnoticed. Branko Milanović, an inequality expert and former lead economist in the World Bank’s research department, contends that population‐weighted global intercountry income inequality has plummeted since 1980. (See Figure 2). Milanović’s recent research has updated his popular but often misinterpreted “elephant chart”—which famously seemed to show the global poor, people in developing countries, and the wealthy reaping the benefits of globalization while the middle class in rich countries lost out. His newer research suggests that the poor and middle class have made gains fasterthan the rich, revealing what the Financial Times economics editor Chris Giles calls a “link between trade integration and falling global inequality.” In fact, even Piketty’s much‐criticized calculations showed a decline in global income inequality over the long term.
Domestic income inequality has similarly decreased. Economist John F. Early has found that income inequality in the United States has been falling for the past 70 years—yet official U.S. statistics often do not fully account for the effects of important factors (such as transfer payments, income taxes, and inflation) and thus overstate the level of inequality by a factor of four, further distorting public perceptions.
Moreover, as global development has raised incomes internationally and enlarged the share of humanity that can be classified as middle class or above, this enrichment has opened many paths to happiness beyond income maximization. In a subsistence society, income is a decent proxy for well‐being because, in situations of dire poverty, income is often the difference between survival and starvation. However, in rich countries today, many people choose careers that do not maximize income potential but offer other benefits, such as the flexibility to spend more time with family and friends, a sense of purpose related to the mission of one’s employing organization, one’s prestige, or one’s feeling of creative or intellectual fulfillment. Therefore, as Geloso and I note, “economic development foils the relevance of income as a proxy for well‐being.” As global gross domestic product (GDP) grows and more people rise from subsistence‐level poverty, it is less and less accurate to claim that income fully speaks to living standards, and it is increasingly urgent to emphasize a richer conception of living standards.
In summary, the explosion of interest in the topic of inequality and the widespread belief that inequality is increasing have led to a plethora of policy proposals, some quite extreme, promoted by influential individuals and organizations. But the perceived problem these policies attempt to address is trending downward. Globalization and free exchange, although unpopular among those who think they benefit only the rich, are in fact responsible for plummeting poverty and shrinking inequality across the world. Again and again, history presents examples of societies liberalizing economically and escaping poverty.
Far from making sure that employees “clearly and affirmatively consent” before union fees are deducted from their pay, these states — under pressure from mobilized unions — deny them any independent workplace source of information about their right to refuse. Often new hires are simply given a dues-withdrawal form to sign along with all the other first-day paperwork. When disgruntled dues-payers later learn of their rights and seek to withdraw their agreement, they are routinely confronted with confusing rules intended to make it almost impossible to stop paying. The Freedom Foundation, a workers’ rights education and litigation institute, documents dozens of such cases in a recent Supreme Court filing.
Salter sets out with three goals: (1) to remind readers of liberty’s central place in American public affairs; (2) to offer an apologia for libertarianism; and (3) to propose a return to a libertarian approach to concrete national problems. Lest skeptical readers—who may associate libertarianism with libertinism or naïveté about human nature—chafe at the term, Salter carefully and broadly defines libertarianism as a natural-rights philosophy of ordered liberty.
Salter then distills his home discipline of Public Choice theory. He appeals for a move away from politics as romance, and towards a more realistic vision of politics as exchange, compromise, and special interests. He next builds a case for libertarianism by appealing to natural rights and the non-aggression principle. But he is quick to add an appeal to the skeptical reader by emphasizing the prudence of reducing the size of the state and the scope of the political as vehicles for human thriving and decreased polarization. And, “if duty is too abstract a concept for you, an 85-fold increase in living standards [since the start of the market-driven industrial revolution] is a pretty good reason to defend natural rights!”
Indeed, while Democrats profess their devotion to social justice and fight against income inequality, they often push for policies that favor the rich. Take their nonstop battle over the last five years to ease the tax burden of their high-income constituents.
The State and Local Tax (SALT) deduction cap, part of the 2017 Tax Cuts and Jobs Act (TCJA), placed a $10,000 limit on the amount of state and local taxes that can be deducted from federal taxable income. This move predominantly affected high earners in high-tax states like New York, California and many others that are Democratic strongholds.
That’s a tax hike on the rich. This shouldn’t bother Democrats, who are usually happy to demonstrate their egalitarian chops by clamoring for that very thing. Yet this time, by demanding repeal of the SALT cap, they are on the front lines of a battle to restore tax breaks for the rich. As it turns out, when affluent Californians and Northeasterners felt the pinch, Democrats were ready to cha-cha for tax relief.