Income inequality

Interesting short article in the March Smithsonian called "The Archaeology of Wealth" which touches upon research which traces the inequality gap back into history, upwards of 11,000 years ago.  The basis of the research is to compare the size of dwellings in archaeological ruins, calculate the Gini coefficient for each, then chart the changes in wealth disparity over time. 

First, what is the Gini coefficient?  In layman's terms, it is a statistical instrument developed by an Italian statistician in the early 20th century and has been generally accepted as a way to measure income/wealth distribution of a nation's residents.  The range is 0 to 1 where 0 represents a perfect distribution of wealth, while a 1 rating indicates that all wealth lies in the hands of a small percentage of the population. 

Second, since this is a statistical representation of a subject, we should be cautious when we assign a value to the results, in that a value of 0 may not necessarily be the ideal, and conversely, a value of 1 may not necessarily be the worst possible result.  Societies perception of wealth and its distribution has changed, and will continue to change as humanity evolves. 

For instance, having all the wealth in the hands of a local land owner with all the surrounding population working a plot of land near their small dwelling, turning over excess harvests to the land owner, might seem extremely unfair to all but the family residing on the top of the hill.  But, perhaps, if the land owner respected the work of those living under his rule, made sure not to leave the peasants, so to speak, with less than they needed, provided a system of rewards so their might be varying degrees of livelihood for those toiling the fields, then such a system, while low on the Gini scale, might result in a positive life for most of those subject to its rules. 

Conversely, a society where everyone has the same wealth but which that wealth is dispersed based on existence as opposed to contribution, may attain a high Gini score but not necessarily result in a satisfying experience for its citizens.

That being said, there is probably a sweet spot on the scale which equates to a society which tolerates some wealth inequality to encourage innovation, ambition, and achievement but without subjecting a significant percentage of its citizens to poverty, lack of opportunity or overt discrimination.

So, what does the article reveal about the research?  There seems to be a trend in that technology accelerates the disparity.  Whether that technology be the attainment of fire, the ability to farm and develop the land, the domestication of animals, or the creation of hedge fund accounts, as technologies develop, wealth distribution becomes skewed.  

This, of course, sends a mix signal concerning the rapid advancements that are occurring in medicine, communication, transportation, and robotics.  While we can clearly see that advancing technologies has improved the standards of living for all of Earth's inhabitants, whether it be as simple as my ability to sit at my desk in Perkasie, Pa, and have my thoughts available to anyone on the internet anywhere in the world, or as complex as the effect that  social media has had on documenting atrocities in previously closed societies, or bringing the viewpoints of previously unknown perspectives right to our phones, it is also true that those same advances have created a class of people with wealth greater than entire countries of tens of millions of people.

To me, the question is how do we monitor wealth in our country, our world, to achieve that sweet spot I mention above.  Capitalism provides the means to reward those who put to best use their skills.  It fosters innovation and creativity by providing the positive results, money, possessions, freedom, which encourage even more innovation.  But greed is its main enemy, and when greed infects capitalism through doctrines that advocate selfishness and tribalism, capitalism can quickly produce a society high on the Gini scale and low on values that separate us from our animal heredity. 

Nora and I have been watching the new HBO series called Here and Now.  One of the characters, a friend of the lead couple of the show, Audrey and Greg, is known to them from their college days of anti-establishment protests.  Now, while he is trying to help Audrey in her attempts to teach compassion and understanding at a time when conflict and vitriol seems the norm, it becomes known that his wealth has been partially attained through his use of third world labor that features harsh working conditions.  

Audrey is aghast at this revelation, wondering how such an idealist (past) could justify engaging in such abuse of fellow humans to make his fortune while he has long ago convinced himself that the wages he pays are and improvement, and that through their (cheap) labor he is providing millions of Americans with cheaper products, and that if he didn't do it someone even less nice than he, would be doing it.  And, of course, he believes that funding Audrey's positive programs somehow washes him clean of his human abuse, and that the two dramatically different ways he treats people evens out in the end. 

Socialism for all its suppression of individual achievement, can also act as a conscious and regulator to capitalism that runs amok.  Whether it be through programs for the most needy, safety nets for the aged and infirmed, or temporary assistance when unforeseen events occur, a socialistic outlook that recognizes our duty to take care of each other, especially those that are unable to take care of themselves, is a necessary filter through which we must gauge our capitalistic tendencies. 

Images of income inequality when shown to us through the horrible examples of third world countries where the leaders live a lavish lifestyle while the children of the poor have bloated stomachs and a one in five chance of death before reaching school age, make us shake our heads, hug our kids and thank god we live in America.  

But income inequality reflected through million dollar mega mansions, CEO salaries as compared to minimum wage employees, multi-national companies that pick and choose their home base to pay the least taxes, and public servants that spit in the face of the electorate by using their positions to gain even more wealth and resources while dehumanizing those who turn to the government, we the people, for some aid, we somehow accept as a way to make America better.

The Gini scale indicates that the United States has a poor grade in the area of income inequality.  We can do better, we must do better, before we find ourselves in a future filled with wonderful innovations that only a small percentage of Americans enjoy.