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West Coast Publishing Wealth Inequality & Democracy Spring 2016 UIL LD MAIN File

West Coast Publishing

Wealth Inequality & DemocracySpring 2016 UIL LD

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WEST COAST DEBATE

Spring 2016 UIL LD Main FileWealth Inequality & Democracy

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WEST COAST DEBATE.................................................................................................................................2

RESOLVED: In the United States, wealth inequality is detrimental to democratic ideals.......................6

Definitions..................................................................................................................................................9

Wealth Inequality.................................................................................................................................10

Detrimental..........................................................................................................................................11

Democratic Ideals.................................................................................................................................12

Affirmative...............................................................................................................................................13

1AC 1/3................................................................................................................................................14

1AC 2/3................................................................................................................................................15

1AC 3/3................................................................................................................................................17

Criteria Extensions: Wealth Influences Policies and Rules of Game.....................................................18

Criteria Extensions: Reject Countercriteria that Justifies Inequality.....................................................19

Value Extensions: Founders Favored Material Equality.......................................................................20

Criteria Extensions: Reject Elitist Economists.......................................................................................21

Inequality undermines democracy.......................................................................................................22

Inequality Undermines Democracy......................................................................................................23







Financial Laws Have Been Hijacked by the Wealth-Holders.................................................................30

The American Economic System Makes Wealth Inequality Inevitable.................................................31

Inequality Allows Wealthy to Buy Law and Policy................................................................................32

Consumerism Destroys Democracy......................................................................................................33

Democracy Requires Equality...............................................................................................................34

Inequality Creates Political Extremism.................................................................................................35

Inequality Hurts Individuals and the Economy.....................................................................................36

Wealth Inequality Exacerbates Racial Inequality..................................................................................37

Inequality Doesn’t Positively Affect Employment Rates.......................................................................38

Promoting Economic Equality Improves Democracy............................................................................39

Promoting Economic Equality Improves Democracy............................................................................40

Answers to “Marketplace of ideas” arguments....................................................................................41




Answers to “People in Poverty are comparatively wealthy/better off than . . .” Arguments...............42

Answers to “Inequality creates incentives” arguments........................................................................43

Answers to “People choose to participate or not in the political process” arguments........................44

Answers to “Income inequality isn’t the same as wealth inequality....................................................45

Answers to “Democracy is bad” arguments.........................................................................................46

Answers to “Individual responsibility” and “people make their own choices” arguments..................47

Negative...................................................................................................................................................48

1NC 1/2................................................................................................................................................49

1NC 2/2................................................................................................................................................50

Value Extensions: Economic Freedom..................................................................................................51

Criteria Extensions: Neutrality..............................................................................................................52

Extensions: Must Limit Direct Democracy with Elites and Free Markets.............................................53

Democracy Will Fail Independently of Wealth Inequality....................................................................54

Democracy Fails: Voters Irrational.......................................................................................................55

No Unequal Distribution of Wealth......................................................................................................56

Attributions of Wealth Inequality Are Incorrect...................................................................................57

Economic Injustice Spurs Political Change...........................................................................................58

Inequality is Good................................................................................................................................59

Inequality is Good................................................................................................................................60

Focusing on Inequality Generally Bad..................................................................................................61

Inequality and Poverty Are Decreasing................................................................................................62

Inequality Does Not Undermine Democracy........................................................................................63

Inequality Does Not Undermine Democracy........................................................................................64

Inequality Has No Effect on Democracy...............................................................................................65

High-Level Wealth Benefits Everyone..................................................................................................66

Americans Accept Inequality................................................................................................................67

There is No Permanent Wealth Gap.....................................................................................................68

No Long-Term Inequality: Wealth Spreads Naturally...........................................................................69

The Inequality Thesis is False—Very Little Inequality...........................................................................70

The Inequality Thesis is False—Very Little Inequality...........................................................................71

Inequality Decreasing Now...................................................................................................................72

Inequality Decreasing Now...................................................................................................................73

No Objective Basis for Inequality.........................................................................................................74

Too Many Barriers to Establishing Inequality Patterns.........................................................................75




Answers to “Piketty proves capitalism causes inequality” arguments.................................................76

Answers to “collective responsibility” arguments................................................................................77

Answers to “Wealthy pay no taxes” arguments...................................................................................78

Answers to “Inequality decreases faith in democracy” arguments......................................................79

Answers to “Inequality = Suffering” arguments...................................................................................80

Answers to “The wealthy don’t pay their fair share” arguments.........................................................81

Answers to “inherited wealth is unfair” arguments.............................................................................82




RESOLVED: In the United States, wealth inequality is detrimental to democratic ideals

Introduction

This resolution asks debaters to discuss the relationship between the allegedly large concentrations of wealth at the top of American society (and the accompanying poverty and deprivation at the bottom) and the democratic process itself. During the current election cycle, national-level candidates for the presidency and even Congress will spend over a billion dollars, and no candidate without money is going to get a fair hearing. But even more important than campaign spending is the amount of money wealthy individuals and corporations spend lobbying for particular laws—so much that social scientists say America no longer has a functioning democracy.

In fact, this was the sober conclusion of a study released in 2014 by Princeton University’s Martin Gilens and Benjamin I. Page. After examining myriad features of a typical democracy, they conclude that those features either no longer exist in America or exist in an extremely anemic form. One of the most important of these facets is the ability for large groups of people to influence the course of policy. The authors argue that “economic elites and organized groups representing business interests” have a larger influence on democracy than ordinary citizens.

On the other hand, defenders of the status quo say that money is the way people in America express their approval and disapproval of both actions and people. And the fact that particular ideas and particular candidates command large sums of money is evidence of those groups’ and individuals’ power. In fact, the concept of a “natural aristocracy” is part of America’s heritage. Those with a great deal of money should control the political process, because the fact that they’ve become rich is evidence of their effective leadership.

Some words in the resolution

Wealth inequality: One important definitional distinction has to do with types of inequality. The resolution asks for a debate about the role of “wealth inequality” rather than “income inequality.” That difference is simple: Income is how much new money a person makes, while wealth is the accumulated value of a person or a family. It can consist of real estate, precious stones, money currently saved, and other real assets. Wealth disparities are typically seen more much more serious to long-term economic well-being than income disparities. In fact, wealth disparities outweigh income disparities by as much as three to one. On the other hand, as far as perceptions of Americans is concerned, wealth inequality and income inequality are perceived as largely the same. Thus, if debaters are making arguments about Americans’ perceptions of the economy, they can probably use the concepts interchangeably, but if they are making predictive, social-scientific or academic claims about inequality, they should probably understand the difference, and remember that the resolution calls for an analysis of the causal role of wealth inequality.

How is inequality measured? Traditionally, those investigating economic inequality use what is known as the Gini Index, from the statistician who devised it in 1912, Corrado Gini. The formula goes like this: “If all the income in the world were earned by one person and everyone else earned nothing, the world would have a Gini index of one. If everyone in the world earned exactly the same income, the world would have a Gini index of zero.” Thus, the difference between only one person having all the wealth and everyone having all the wealth is the difference between zero and one. At various times in American history, the Gini index has been at, for example, a low .386 (in the immediate years after the Second World War) and




a higher .476 in 2013, in the midst of a long period of alleged economic inequality. Other countries who practice more robust distributions of wealth like Sweden and Finland report a Gini index in the .200 range.

Another important distinction debaters should be aware of is types of democracy. The obvious distinction is between participatory and representative democracy. Participatory democracy facilitates access to the political process among ordinary citizens, grassroots organizations, and a bottom-up rule-making process. Affirmatives will quite naturally argue that participatory democracy is incompatible with high levels of economic inequality and wealth concentration. Representative democracy consists of electing officials to engage in that deliberative process on behalf of ordinary people, not necessarily alongside them. The "natural aristocracy" assumed by many theories of representative democracy arguably favors the negative in this resolution. These elites allegedly have a better understanding of the political process than, say, you or me.

Affirmatives

The best way to explain the affirmative thesis is as follows: Among other sources, Wikipedia published the following definition of “Democratic Ideals,” which holds that:

Democratic ideals include egalitarianism, self-government, self-determination and freedom of conscienceWikipedia, September 29, 2015"Democratic Ideals," Wikipedia.org, https://en.wikipedia.org/wiki/Democratic_ideals (accessed 12/14/2015)In historical texts, the phrase is often used to denote aspirations or norms of behavior, separate from a functioning democracy, including egalitarianism, self-government, self-determination and freedom of conscience.

Based on that nice, comprehensive definition, affirmatives can argue that inequality kills egalitarianism, self-government (citizens grow dependent on Wall Street), self-determination (minority communities are destroyed), freedom of conscience (see Reich on people suppress themselves in politics because of inequality). The point is that affirmatives must demonstrate that wealth inequality tramples on one or more of those ideals, and using those kinds of examples seems like a sound strategy.

Affirmatives have relatively light burdens in terms of what they need to prove about economic inequality and democracy. Mainly, they don’t have to prove that economic inequality is bad—it could have many good effects, but still be detrimental to democracy. Likewise, affirmatives don’t have to prove democracy is good. Democracy could be terrible, but the resolution only asks whether economic inequality undermines democratic ideals, not whether those ideals, in theory or practice, are good things.

Finally, the answers in the affirmative file to “overall wealth has grown,” “everyone is better off” arguments may be the most important and frequently used in the file, so they warrant some attention. The argument is: (1) even if everyone has gotten universally wealthier over the last several hundred years or whatnot, the widely unequal distribution of wealth has allowed the 1% not only to infiltrate the entire democratic process, but also to ensure that new income tends to flow upward, while the foundations of wealth inequality remain in place.




Negatives

The most “straight-up” approach to debating this topic for the negative is to demonstrate that America’s democracy is still functional, still sound, and still true to its ideals, even if wealth inequality exists. However, this approach may cede too much advantage to affirmatives, since the literature base is somewhat skewed towards the conclusion that large differences in wealth really do hurt democracy. Nevertheless, there is a small literature base, much of which is included in the negative file below, arguing that inequality does not undermine democracy, and at best has no effect on the democratic process whatsoever.

Then, there are other arguments the negative should make. Negatives can argue that there are alternative causes of the destruction of democracy, and that democracy will fail because of those causes. Also, negatives can argue that economic inequality is actually good for democracy, since it creates incentives for people to be more productive, which strengthens the nation. The notion that inequality is not a bad thing is well-established in classical and traditional economics.

One way to mitigate the moral weight of poverty and economic inequality is to point out that being poor is not a fixed and immutable state of being, and rather, a large percentage of Americans can, in the course of their lives, find themselves in the top 10% or 20%, sometimes moving up, and sometimes moving down. For example, “12% of Americans end up in the top 1% of income earners at some point during their lives.” If this is true, then it presents a problem for the resolution itself, since it establishes that there’s really no sound conceptual category of wealth inequality that traps people in depoliticizing situations.

Of course, inequality and economic mobility are necessary for capitalism to function, and negatives can argue that capitalism is the true route to democracy. And speaking of capitalism, negatives should be prepared to answer analysis based on the work of Thomas Piketty, a French economist whose 2013 bestselling book Capital in the 21st Century attempts to explain wealth concentration by arguing that the rate of capital return (what financial investors get back for making finance available) exceeds the rate of economic growth that is distributed more equally. The conclusion is that this will cause wealth inequality to continue to increase into the future. Although the book was well-received, it was also widely criticized, and many of those criticisms are contained in the negative file.

A final argument for negatives to explore concerns the virtues of elitism. There are several pieces of evidence in this negative file arguing that ordinary citizens are too misinformed to vote, even though they keep voting. Negatives can argue that the colonization of the political process by elites is actually very good for democracy, since those elites are more familiar with the basic principles of that governance, and have a greater chance of acting in the interests of the people as a whole.

Conclusion

Again, it’s important to remember what neither side needs to defend to have this debate. Democracy doesn’t have to be proven desirable or undesirable. Inequality of income may be deserved or undeserved. The question is merely whether that inequality hinders democracy. Although some debates may very well dive into such issues, it is not necessary that they do, and both affirmatives and negatives should, at least while practicing and preparing for tournaments, gain a firm knowledge base about the central, simple question of the resolution: Does wealth inequality undermine American democracy?




Definitions




Wealth Inequality

Wealth is net worth—assets minus liabilities, covering all items and debts of valueInequality.org 2015"Wealth Inequality," Inequality.org, http://inequality.org/wealth-inequality/ (accessed 12/14/2015)We equate wealth with “net worth,” the sum total of your assets minus liabilities. Assets can include everything from an owned personal residence and cash in savings accounts to investments in stocks and bonds, real estate, and retirement accounts. Liabilities cover what a household owes: a car loan, credit card balance, student loan, mortgage, or any other bill yet to be paid.

Wealth is distinct from income and includes all assetsSigne-Mary McKernan, Senior Fellow in the Center on Labor, Human Services & Population at the Urban Institute, et al, March 27, 2015"Nine Charts About Wealth Inequality in America," Nonprofit Quarterly, Spring, https://nonprofitquarterly.org/2015/03/27/nine-charts-about-wealth-inequality-in-america/ (accessed 12/13/2015)Income is money coming into a family, while wealth is a family’s assets—things like savings, real estate, businesses—minus debt. Both are important sides of families’ financial security, but wealth cushions families against emergencies and gives them the means to move up the economic ladder. Also, wealth disparities are much greater than income disparities: three times as much by one measure.

Wealth inequality is the unequal distribution of all assetsWikipedia, December 14, 2015"Wealth Inequality in the United States," Wikipedia.org, https://en.wikipedia.org/wiki/Wealth_inequality_in_the_United_States (accessed 12/14/2015)Wealth inequality in the United States (also known as the wealth gap) refers to the unequal distribution of assets among residents of the United States. Wealth includes the values of homes, automobiles, personal valuables, businesses, savings, and investments.

The important thing in defining wealth is knowing that it is distinct from income. Although many arguments about income inequality can also be made about wealth inequality, and vice versa, wealth inequality arguably matters more, since assets can be liquidated--and nearly half of all Americans have little-to-no long-term wealth.




Detrimental

To be detrimental, it must cause loss, injury, damage, harm, or prejudiceDictionary.com, 2015"Detrimental," Dictionary.com, http://dictionary.reference.com/browse/detrimental (accessed 12/14/2015)1. causing detriment, as loss or injury; damaging; harmful 2. harmful; injurious; prejudicial

To be detrimental, it must have a tendency to cause harmOxford Dictionary Online, 2015"Detrimental," Oxford Dictionaries, http://www.oxforddictionaries.com/us/definition/american_english/detrimental (accessed 12/14/2015)Tending to cause harm: "releasing the documents would be detrimental to national security;" "moving her could have a detrimental effect on her health"

These two definitions contrast actually causing harm/injury and having the potential to cause harm/injury. If one need only prove the potential to cause harm, this is less of a burden than proving actuality. Affirmatives could argue that wealth inequality theoretically undermines democracy without using actual examples.

On the other hand, negatives could argue that the second definition creates a burden of proving that the examples offered up are representative of a tendency, opening the door to a “hasty generalization” or inductivity argument.




Democratic Ideals

Democratic ideals are qualities or standards of behavior essential for democracyWikipedia, September 29, 2015"Democratic Ideals," Wikipedia.org, https://en.wikipedia.org/wiki/Democratic_ideals (accessed 12/14/2015)"Democratic ideals" is a theorical phrase meaning either personal qualities or standards of government behavior that are felt to be essential for the continuation of a democratic policy.

Democratic ideals are aspirations and norms, not functions, of democracyWikipedia, September 29, 2015"Democratic Ideals," Wikipedia.org, https://en.wikipedia.org/wiki/Democratic_ideals (accessed 12/14/2015)In historical texts, the phrase is often used to denote aspirations or norms of behavior, separate from a functioning democracy, including egalitarianism, self-government, self-determination and freedom of conscience.

Compromise between liberty and equality is a democratic idealUSHistory.org, 2014"Democratic Values: Liberty, Equality, and Justice," American Government, http://www.ushistory.org/gov/1d.asp (accessed 12/14/2015)Democratic societies also expect another kind of balance: a compromise between liberty and equality. Complete liberty logically leads to inequality. A strong or ambitious person might acquire more goods and property than another, and someone is bound to dominate. But the line has to be drawn before an individual seizes power that greatly restricts the liberties of others.

Democratic ideals are clearly not policies, and this is a non-policy resolution that interrogates the role of wealth on the degradation of the political process in general.




Affirmative




1AC 1/3

“The fear of alienating wealthy donors dissuades a nonprofit devoted to voting rights from launching a campaign against big money in politics. A Washington think tank’s study on inequality omits mention of the role big corporations and Wall Street have played in weakening the nation’s labor and antitrust laws. A public broadcasting station decides not to air a program critical of a major supporter. A university shapes research and courses around economic topics of interest to its biggest donors, avoiding mention of the increasing power over the economy of large corporations and Wall Street.”

Because, like former Secretary of Labor Robert Reich, I am concerned about inequality and democracy, I will argue that In the United States, wealth inequality is detrimental to democratic ideals.

Observation One: DefinitionsA. Wealth inequality is the unequal distribution of assets within a population—and the United States leads the developed world in itInequality.org 2015"Wealth Inequality," Inequality.org, http://inequality.org/wealth-inequality/ (accessed 12/14/2015)Wealth inequality can be described as the unequal distribution of assets within a population. The United States exhibits wider disparities of wealth between rich and poor than any other major developed nation.

B. Democratic ideals include egalitarianism, self-government, self-determination, and freedom of conscienceWikipedia, September 29, 2015"Democratic Ideals," Wikipedia.org, https://en.wikipedia.org/wiki/Democratic_ideals (accessed 12/14/2015)In historical texts, the phrase is often used to denote aspirations or norms of behavior, separate from a functioning democracy, including egalitarianism, self-government, self-determination and freedom of conscience.




1AC 2/3 Observation Two: Value and CriteriaA. Value: Equality: Equality must be material, not just political. Departure from material equality destroys societies. Economic activity must serve everyoneThomas Jefferson, founder and third President of the United States, October 28, 1785"Letter to Rev. James Madison," in John William Batdorf, The Geometric Tax: The Abolition of Poverty: How to Finance Politics Without Graft, Wikiquote, https://en.wikiquote.org/wiki/Equality (accessed 12/17/2015)Whenever there is in any country uncultivated lands and unemployed poor, it is clear that the laws of property have been so far extended as to violate natural right. The earth is given as a common stock for man to labor and live on. If for the encouragement of industry we allow it to be appropriated, we must take care that other employment be provided to those excluded from the appropriation. If we do not, the fundamental right to labor the earth returns to the unemployed. It is too soon yet in our country to say that every man who cannot find employment but who can find uncultivated land shall be at liberty to cultivate it, paying a moderate rent. But it is not too soon to provide by every possible means that as few as possible shall be without a little portion of land.

B. Criteria: Access to policymaking is key. Laws and policy mechanisms are key to the reasons inequality harms people and the democratic processShi-Ling Hsu, Professor of Law at Florida State University, 2015"The Rise and Rise of the One Percent: Considering Legal Causes of Wealth Inequality," Emory Law Journal Online, Vol. 64:2043, http://law.emory.edu/elj/_documents/volumes/64/online/hsu.pdf (accessed 12/13/2015)The answer is a mixed question of law and economics. There are, to be sure, a number of economic mechanisms that contribute to inequality.

Inflation is generally regressive, as those owning real estate enjoy some hedge against rising prices, while renters, who tend to be less wealthy, are buffeted by market volatility. It is also the case that there are economies of scale to investing, so that the wealthier are generally able to earn higher returns. It is a market truism that risk and return are positively correlated, so that the wealthier, having greater freedom to take risks, can garner higher returns. Almost always, an economic effect can be traced to some conscious policy decision, which in turn can be traced to a legal rule or institution. As between legal and economic explanations for inequality, it is almost surely a greater question of law than economics.




Observation Three: Inequality Disempowers American DemocracyA. As a result of great concentrations of wealth and the ability of the wealthy to shape law and policy, no democracy, in any meaningful sense, currently exists in American policymakingMartin Gilens, Professor of Politics at Princeton University, and Benjamin I. Page, Professor of Decision Making at Northwestern University, September 2014"Testing Theories of American Politics: Elites, Interest Groups, and Average Citizens," Perspectives on Politics, Vol. 12, No. 3, https://scholar.princeton.edu/sites/default/files/mgilens/files/gilens_and_page_2014_-testing_theories_of_american_politics.doc.pdf (accessed 12/13/2015)In the United States, our findings indicate, the majority does not rule—at least not in the causal sense of actually determining policy outcomes. When a majority of citizens disagrees with economic elites or with organized interests, they generally lose. Moreover, because of the strong status quo bias built into the U.S. political system, even when fairly large majorities of Americans favor policy change, they generally do not get it.




1AC 3/3

B. Inequality destroys political participationFrederick Solt, Assistant Professor of Political Science at University of Iowa, 2015"Economic Inequality and Nonviolent Protest," Social Science Quarterly, http://myweb.uiowa.edu/fsolt/papers/Solt2015a_pre.pdf (accessed 12/14/2015)More inequality does not enhance poorer individuals’ sense of relative deprivation in ways that make them more likely to engage in protest, nor does it make richer individuals more likely to protest by providing them with more of the resources needed to do so.

Instead, these results support only the relative power theory. By increasing the political power of richer individuals relative to poorer ones, greater inequality leads people of all but the highest income quintile to become less likely to participate in nonviolent protests. This pattern is similar to that found for electoral participation and other forms of political engagement (see Solt 2008, 2010), and it provides additional evidence that higher levels of economic inequality restrict the scope of democracy in ways that work to demobilize poorer people.

C. Wealth inequality is the first priority and the foremost concern that must precede any political reformLawrence Lessig, Professor of Law and Leadership at Harvard Law School, November 25, 2015"Our democracy is completely unrepresentative: Citizens United, gerrymandering, and the real story behind the GOP’s takeover," Salon, http://www.salon.com/2015/11/25/our_democracy_is_completely_unrepresentative_citizens_united_gerrymandering_and_the_real_story_behind_the_gops_takeover/ (accessed 12/13/2015)If we set as our ideal the fundamental principle of any Republic— that citizens be represented equally— then there are a host of ways that we could make dramatic improvements on the system we have now— improvements, at least, from the perspective of the equality of citizens, without changing the Constitution, and without triggering any First Amendment concern. But of these inequalities, the money is the most significant. There is no other exclusion as dramatic in our democracy today, and none that is as consequential. Every other problem either flows from this inequality, or is exacerbated by this inequality. This is the one we must fix first.




Criteria Extensions: Wealth Influences Policies and Rules of Game A critical approach to inequality and democracy must focus on how inequality influences the rules of the game, and model how capital influences inequalityRavi Kanbur, Professor of Economics at Cornell, and Joseph Stiglitz, Professor of Economics at Columbia, August 28, 2015"Wealth and Income Distribution: New Theories Needed for a New Era," Economic Intersection, http://econintersect.com/a/blogs/blog1.php/wealth-and-income-distribution-new (accessed 12/13/2015)The new models need to drop competitive marginal productivity theories of factor returns in favour of rent-generating mechanism and wealth inequality by focusing on the ‘rules of the game.’ They also must model interactions among physical, financial, and human capital that influence the level and evolution of inequality. A third key component will be to capture mechanisms that transmit inequality from generation to generation.

Capital is change-resistant, and our laws have been shaped to strengthen that resistance, discouraging regulation and competitionShi-Ling Hsu, Professor of Law at Florida State University, 2015"The Rise and Rise of the One Percent: Considering Legal Causes of Wealth Inequality," Emory Law Journal Online, Vol. 64:2043, http://law.emory.edu/elj/_documents/volumes/64/online/hsu.pdf (accessed 12/13/2015)Legal rules and institutions most commonly distribute rents by promoting the formation of private capital or by boosting returns to private capital. While capital is essential to economic growth, the long-term nature of capital is such that it creates an incentive for owners of that capital to resist change. It is thus the very nature of capital, which in Piketty’s account is responsible for creating inequality that also sustains inequality. The law thus acts as a force of divergence in two stages: first, by directly contributing to the formation of private capital (predominantly to the benefit of the one percent) and second, by protecting that capital from regulation or competition that might devalue that capital.




Criteria Extensions: Reject Countercriteria that Justifies Inequality Unequal societies tend to justify inequality in numerous waysJosh Curtis, professor of sociology at Western University, and Robert Andersen, professor of sociology at University of Toronto, 2015"How Social Class Shapes Attitudes on Economic Inequality: The Competing Forces of Self-Interest and Legitimation," International Review of Social Research, Vol. 5 no. 1, http://www.degruyter.com/view/j/irsr.2015.5.issue-1/irsr-2015-0002/irsr-2015-0002.xml (accessed 12/14/2015)In equal societies, people are less likely to hold the opinion that there is enough wealth for everyone. We argue this reflects that more people have an equal share of the income distribution—i.e., wages are more equal across social classes—and thus people are more likely to believe that becoming wealthy is done at the expense of others. In highly unequal societies, on the other hand, people from all social classes are more likely than those living in relatively equal societies to report that wealth and affluence can be attained by all members of society. This finding suggests, then, that people in equal societies understand that most people do not attain vast wealth, and those who do are an exceptional case. As society becomes more unequal, however, people from all classes accept wealth inequality and believe that becoming wealthy is fair and achievable. We suspect that greater exposure to wealthy people functions to legitimize inequality.

Wealthy people tend to think inequality is justifiedJosh Curtis, professor of sociology at Western University, and Robert Andersen, professor of sociology at University of Toronto, 2015"How Social Class Shapes Attitudes on Economic Inequality: The Competing Forces of Self-Interest and Legitimation," International Review of Social Research, Vol. 5 no. 1, http://www.degruyter.com/view/j/irsr.2015.5.issue-1/irsr-2015-0002/irsr-2015-0002.xml (accessed 12/14/2015)At this point, we have clear evidence to support our first hypothesis that opinions on inequality are affected by social class and income. The higher people’s economic position, the more likely they are to feel that inequality is justified and that more is needed.




Value Extensions: Founders Favored Material Equality

John Adams supported the resolution, believing inequality destroys political libertyDavid Cay Johnston, Pulitzer Prize-winning economic journalist, February 4, 2014"Why Thomas Jefferson Favored Profit Sharing," Newsweek, http://www.newsweek.com/2014/02/07/why-thomas-jefferson-favored-profit-sharing-245454.html (accessed 12/17/2015)The second president, John Adams, feared "monopolies of land" would destroy the nation and that a business aristocracy born of inequality would manipulate voters, creating "a system of subordination to all... The capricious will of one or a very few" dominating the rest. Unless constrained, Adams wrote, "the rich and the proud" would wield economic and political power that "will destroy all the equality and liberty, with the consent and acclamations of the people themselves."

Madison and Hamilton favored economic equality and checks on extreme wealth hierarchyDavid Cay Johnston, Pulitzer Prize-winning economic journalist, February 4, 2014"Why Thomas Jefferson Favored Profit Sharing," Newsweek, http://www.newsweek.com/2014/02/07/why-thomas-jefferson-favored-profit-sharing-245454.html (accessed 12/17/2015)James Madison, the Constitution's main author, described inequality as an evil, saying government should prevent "an immoderate, and especially unmerited, accumulation of riches." He favored "the silent operation of laws which, without violating the rights of property, reduce extreme wealth towards a state of mediocrity, and raise extreme indigents towards a state of comfort." Alexander Hamilton, who championed manufacturing and banking as the first Treasury secretary, also argued for widespread ownership of assets, warning in 1782 that, "whenever a discretionary power is lodged in any set of men over the property of their neighbors, they will abuse it."




Criteria Extensions: Reject Elitist Economists We should be wary of pro-capitalist policy analysis since the elites hire intellectuals to justify their policiesRobert B. Reich, former Secretary of Labor and current Chancellor’s Professor of Public Policy at the University of California at Berkeley, September 23, 2015"Economics Is Too Important to Be Left to Economists," Chronicle of Higher Education, http://chronicle.com/article/Economics-Is-Too-Important-to/233335In practice, economic policy analysis itself is often at the service of powerful interests. Economists and policy experts are routinely hired to participate in agency rule-making proceedings, or provide testimony in court, or appear before legislative committees, or back a particular political candidate’s positions — all in order to justify or legitimate policies that those powerful interests seek. In this way, economic analysis as actually practiced within politics actively masks the issues of distribution, democracy, and power.

Focusing only on economic growth and a sterile notion of efficiency ignores how power stacks the deck and entrenches elite domination of debates about the economy, ignoring alternativesRobert B. Reich, former Secretary of Labor and current Chancellor’s Professor of Public Policy at the University of California at Berkeley, September 23, 2015"Economics Is Too Important to Be Left to Economists," Chronicle of Higher Education, http://chronicle.com/article/Economics-Is-Too-Important-to/233335Finally, and perhaps most significantly, a focus on efficiency and growth disregards the allocation of power in a political-economic system and the role of political power in determining what the economic rules will be. It fails to examine whether that allocation of power is likely to result in a stream of future decisions that further entrench the powerful and add to their winnings. And it doesn’t ask whether a different balance of power might be preferable.




Inequality undermines democracy

The equal ability to influence policymaking is central to democracy, but economic inequality makes this impossiblePatrick Flavin, Assistant Professor of political science at Baylor University, November 5, 2013"Campaign Finance Laws, Policy Outcomes, and Political Equality in the American States," Baylor Blogs, http://blogs.baylor.edu/patrick_j_flavin/files/2010/09/Flavin_Campaign_Finance_Political_Equality_11.5.13-2c1mik1.pdf (accessed 12/14/2015)Political equality is a cornerstone of democratic theory. However, there is increasing concern among scholars, elected officials, and the general public about unequal political influence in the United States and its possible consequences for economic inequality (Jacobs and Skocpol 2005; Bartels 2008; Kelly 2009; Hacker and Pierson 2010; Flavin 2012; Gilens 2012; Kelly and Witko 2012). One common explanation for why citizens with lower incomes exert little influence over the policy decisions made by elected officials is that this group provides relatively few contributions (both in number and amount) to political campaigns compared to more affluent citizens (Schlozman, Verba, and Brady 2012).

Inequality undermines democracyFrederick Solt, Assistant Professor of Political Science at University of Iowa, 2015"Economic Inequality and Nonviolent Protest," Social Science Quarterly, http://myweb.uiowa.edu/fsolt/papers/Solt2015a_pre.pdf (accessed 12/14/2015)The relative power theory starts with the proposition that money is a political resource: that is, that it can be used to influence others. Therefore, the theory contends, where the rich are richer relative to the poor, they will also be more powerful relative to the poor (Goodin and Dryzek 1980). In this view, the greater power imbalance that results from higher levels of economic inequality then allows richer individuals not only to prevail more consistently in open debates on issues that divide primarily along income lines, but also to more successfully prevent these issues from reaching the political agenda at all, and even to more thoroughly convince poorer individuals to abandon their preferences on these issues entirely in favor of the positions maintained by the rich (Solt 2008, 49).

Inequality discourages protest from the poor and increases participatory resources for the richFrederick Solt, Assistant Professor of Political Science at University of Iowa, 2015"Economic Inequality and Nonviolent Protest," Social Science Quarterly, http://myweb.uiowa.edu/fsolt/papers/Solt2015a_pre.pdf (accessed 12/14/2015)According to this view, belying its common depiction as a ‘weapon of the weak,’ engaging in protest is a demanding activity, and those with higher incomes are better able to afford its associated costs (e.g., Verba, Schlozman, and Brady 1995, 191). This suggests that, all else equal, as economic inequality increases within a country, relatively poor individuals will have fewer—and relatively rich individuals will have more—of the resources needed to participate in protest activities.




Inequality Undermines Democracy Inequality kills democracy by allowing elites a disproportionate influence on policymaking, which is used to prioritize private over public interestsErik Olin Wright, professor of sociology at University of Wisconsin, and Joel Rogers, professor of law at University of Wisconsin, August 2009"Thinking About Fairness and Equality," in American Society: How it Really Works, https://www.ssc.wisc.edu/~wright/ContemporaryAmericanSociety/Chapter%2010%20--%20inequality%20&%20fairness%20--%20Norton%20August.pdf (accessed 12/14/2015)The second critical effect of high levels of inequality concerns its impact on democracy: high inequality concentrates material resources in the hands of elites in ways that enable them to have a vastly disproportionate influence in political life, both at the local level and at higher levels of the political system. Furthermore, since high inequality erodes the sense of everyone being in the same boat – we are all in this together – the influence of wealthy elites on state policy tends to serve their interests over those of the broader public.

Even substantial majorities cannot guarantee support for policiesMartin Gilens, Professor of Politics at Princeton University, and Benjamin I. Page, Professor of Decision Making at Northwestern University, September 2014"Testing Theories of American Politics: Elites, Interest Groups, and Average Citizens," Perspectives on Politics, Vol. 12, No. 3, https://scholar.princeton.edu/sites/default/files/mgilens/files/gilens_and_page_2014_-testing_theories_of_american_politics.doc.pdf (accessed 12/13/2015)A final point: Even in a bivariate, descriptive sense, our evidence indicates that the responsiveness of the U.S. political system when the general public wants government action is severely limited. Because of the impediments to majority rule that were deliberately built into the U.S. political system—federalism, separation of powers, bicameralism—together with

further impediments due to anti-majoritarian congressional rules and procedures, the system has a substantial status quo bias. Thus when popular majorities favor the status quo, opposing a given policy change, they are likely to get their way; but when a majority—even a very large majority—of the public favors change, it is not likely to get what it wants. In our 1,779 policy cases, narrow pro-change majorities of the public got the policy changes they wanted only about 30 percent of the time.

More strikingly, even overwhelmingly large pro-change majorities, with 80 percent of the public favoring a policy change, got that change only about 43 percent of the time.




Inequality Undermines Democracy Concentration of wealth gives a small portion of rich people almost total control over the political process, guaranteeing even more concentration of wealthDavid Cay Johnson, professor at Syracuse University College of Law, December 1, 2015"The wealthiest dozen Americans own more than the bottom half," Al Jazeera America, http://america.aljazeera.com/opinions/2015/12/the-wealthiest-dozen-americans-own-more-than-the-bottom-half.html (accessed 12/13/2015)The intense concentration of wealth matters because it makes the economy less efficient, discouraging investments that create jobs while giving a relative handful of superrich Americans vast sway over the agendas that politicians pursue. Just 158 families, along with companies they own or control, provided nearly half the contributions to

the presidential candidates in both parties, though giving was heavily skewed to Republicans. The result is policies that take from the many and redistribute to the already rich few through stealth techniques that rarely make the news but can be found in the public record. Among these policies are a failure to enforce the laws of business competition, severe restrictions on unions and subsidies galore for big companies.

Economic independence is essential to political independence—wealth hierarchies make this impossibleElizabeth Winkler, contributing writer for The Economist, The New Republic, Foreign Policy, and The Los Angeles Review of Books, November 27, 2015"According to Bernie Sanders, income inequality means many Americans aren’t 'truly free,'" Quartz, http://qz.com/560106/according-to-bernie-sanders-income-inequality-means-many-americans-arent-truly-free/ (accessed 12/13/2015)In fact, the idea that economic independence is essential to freedom and citizenship stretches back well before Roosevelt. Thomas Jefferson insisted that political liberty was safe only so long as a man wasn’t economically beholden to any other. Abraham Lincoln advocated “free labor,” the “just and generous and prosperous system which opens the way for all—gives hope to all, and energy, and progress, and improvement of condition to all.” What made labor “free,” in Lincoln’s view, wasn’t the worker’s voluntary

agreement to work for a wage but the opportunity it gave him to eventually rise above wage-earning to self-employment and independence.




Inequality Undermines Democracy Poverty and economic hierarchy undermine political autonomyElizabeth Winkler, contributing writer for The Economist, The New Republic, Foreign Policy, and The Los Angeles Review of Books, November 27, 2015"According to Bernie Sanders, income inequality means many Americans aren’t 'truly free,'" Quartz, http://qz.com/560106/according-to-bernie-sanders-income-inequality-means-many-americans-arent-truly-free/ (accessed 12/13/2015)Michael Sandel, professor of government at Harvard University, points out in his 1998 book Democracy’s Discontent, that Lincoln and other leaders of his generation believed that a worker who was locked into dependence on an employer, who lived in poverty with no hope of improving his condition, wasn’t really a free man. In 1869, The New York Times went so far as to compare the factory system to “a system of slavery as absolute if not as degrading as that which lately prevailed at the South.”

Wealth inequality destroys faith in democracy and free marketsThe Economist, December 12, 2015"The gifts of the moguls," The Economist, http://www.economist.com/news/finance-and-economics/21679796-extreme-philanthropy-upside-worryingly-unequal-distribution (accessed 12/13/2015)Economists worry about such highly unequal distributions of resources for reasons that go beyond questions of fairness. One concern is that as wealth concentrates, democratic societies will lose faith in the fairness of liberal, market-oriented government. That, in turn, could lead to political crises—a point made most recently by Thomas Piketty, an economist at the London School of Economics, in his book “Capital in the Twenty-First Century”. But another fear is that unequal wealth may be a sign of inefficiency, accumulated not just through economically beneficial innovation, but also by exploiting market power.




Inequality Undermines Democracy American democracy has already been destroyed by concentrations of wealth and its complete control over the political processEric Zuesse, author of They're Not Even Close: The Democratic vs. Republican Economic Records, 1910-2010, December 7, 2015"Inequality in America: The Fish that Rots the Head," The People's Voice, http://www.thepeoplesvoice.org/TPV3/Voices.php/2015/12/07/inequality-in-america-the-fish-that-rots (accessed 12/13/2015)The first-ever thorough scientific and academic study of whether the U.S. is a democracy was published in 2014, and it finds, as an overwhelming statistically established fact now, that the U.S. definitely is not a democracy. This landmark study, by Gilens and Page, finds that,

"When the preferences of economic elites and the stands of organized interest groups are controlled for, the preferences of the average American appear to have only a minuscule, near-zero, statistically non-significant impact upon public policy.”

The concentration of wealth makes America more a theocracy than a democracy, with the elite playing the role of Iran’s Grand Ayatollah in selecting policymakers and policiesEric Zuesse, author of They're Not Even Close: The Democratic vs. Republican Economic Records, 1910-2010, December 7, 2015"Inequality in America: The Fish that Rots the Head," The People's Voice, http://www.thepeoplesvoice.org/TPV3/Voices.php/2015/12/07/inequality-in-america-the-fish-that-rots (accessed 12/13/2015)Just the way that the Grand Ayatollah in Iran chooses which candidates there will have a chance to win the Presidency, etc., America’s few super-rich here choose which candidates will have a chance to win the Presidency etc., and which won’t. In Iran, the Grand Ayatollah is chosen by, and serves, the mullahs; and, in America, the Party chiefs etc., are chosen by, and serve, the super-rich.




Inequality Undermines Democracy Inequality creates fear, making advocates hesitant to mention class inequality for fear of alienating big donorsRobert B. Reich, former Secretary of Labor and current Chancellor’s Professor of Public Policy at the University of California at Berkeley, September 23, 2015"Economics Is Too Important to Be Left to Economists," Chronicle of Higher Education, http://chronicle.com/article/Economics-Is-Too-Important-to/233335The fear of alienating wealthy donors dissuades a nonprofit devoted to voting rights from launching a campaign against big money in politics. A Washington think tank’s study on inequality omits mention of the role big corporations and Wall Street have played in weakening the nation’s labor and antitrust laws. A public broadcasting station decides not to air a program critical of a major supporter. A university shapes research and courses around economic topics of interest to its biggest donors, avoiding mention of the increasing power over the economy of large corporations and Wall Street.

Elites’ voices drown out the general public in policymakingMartin Gilens, Professor of Politics at Princeton University, and Benjamin I. Page, Professor of Decision Making at Northwestern University, September 2014"Testing Theories of American Politics: Elites, Interest Groups, and Average Citizens," Perspectives on Politics, Vol. 12, No. 3, https://scholar.princeton.edu/sites/default/files/mgilens/files/gilens_and_page_2014_-testing_theories_of_american_politics.doc.pdf (accessed 12/13/2015)These results suggest that reality is best captured by mixed theories in which both individual economic elites and organized interest groups (including corporations, largely owned and controlled by wealthy elites) play a substantial part in affecting public policy, but the general public has little or no independent influence.When wealth hijacks the political process, this undermines equality of opportunity, creating a vicious circle that allows still more colonization of political powerDaron Acemoglu, professor of Economics at MIT, and James A. Robinson, professor of government at Harvard, March 11, 2012"The Problem with U.S. Inequality," Huffington Post, http://www.huffingtonpost.com/daron-acemoglu/us-inequality_b_1338118.html (accessed 12/13/2015)When politics gets thus hijacked, inequality of opportunity follows, for the hijackers will use their power to gain special treatment for their businesses and tilt the playing field in their favor and against their competitors. The best, and in fact the only, bulwark against this is political equality to ensure that those whose rights and interests will be trampled on have a say and can prevent it. So here is the concern: economic inequality will lead to greater political inequality, and those who are further empowered politically will use this to gain a greater economic advantage by stacking the cards in their favor and increasing economic inequality yet further -- a quintessential vicious circle.




Inequality Undermines Democracy The wealthy outnumber the poor 7-1 in attending political meetings and doing campaign work, and the richest donors dominate the political processDaniel Weeks, fellow at the Edmond J. Safra Center for Ethics at Harvard University, January 10, 2014"Why Are the Poor and Minorities Less Likely to Vote?" The Atlantic, http://www.theatlantic.com/politics/archive/2014/01/why-are-the-poor-and-minorities-less-likely-to-vote/282896/ (accessed 12/15/2015)For example, just two percent of Americans at the bottom of the income and education ladder attend campaign meetings and rallies or conduct campaign work, compared to 14 percent of people at the top—a factor of seven to one. When it comes to selecting candidates and funding their campaigns, two percent of all Americans give money in

presidential elections and less than half of one percent provide the lion's share. In fact, the largest single donor in 2012 personally accounted for more money than the bottom 98 percent of citizens combined.

Legitimate government can only occur through the active consent of the governedMitch Edelman, reporter for Carroll County Times, November 4, 2014"Democracy Requires Participation," Carroll County Times, http://www.carrollcountytimes.com/news/opinion/ph-cc-edelman-1104-20141104-column.html (accessed 12/15/2015)Classical liberalism gave voice to the idea that governments derive their power from the consent of the governed. Thomas Jefferson incorporated that idea into the Declaration of Independence, and the Constitution institutionalized the principle. We are responsible for choosing the men and women who hold positions of power in government. Not only is this important, it's a privilege not all people have.

Interest groups and lobbyists represent the wealthy and almost never the poorMartin Gilens, Professor of Politics at Princeton University, and Benjamin I. Page, Professor of Decision Making at Northwestern University, September 2014"Testing Theories of American Politics: Elites, Interest Groups, and Average Citizens," Perspectives on Politics, Vol. 12, No. 3, https://scholar.princeton.edu/sites/default/files/mgilens/files/gilens_and_page_2014_-testing_theories_of_american_politics.doc.pdf (accessed 12/13/2015)Moreover, in harmony with theories of biased pluralism, the evidence clearly indicates that most interest groups and lobbyists represent business firms or professionals. Relatively few represent the poor or even the economic interests of ordinary workers, particularly now that the U.S. labor movement has become so weak.




Inequality Undermines Democracy Concentration of wealth allows a few individuals to shape the entire economic and political landscapeChuck Collins, senior fellow at the Institute for Policy Studies, December 2, 2015"Have We Hit Peak Inequality?" Other Worlds, http://otherwords.org/have-we-hit-peak-inequality/ (accessed 12/13/2015)Concentrating wealth to this extent gives rich donors far too much political power, including the wherewithal to shape the rules that govern our economy. Half of all political contributions in the 2016 presidential campaign have come from just 158 families, according to research by The New York Times. The wealth

concentration doesn’t stop there. The richest 20 individuals alone own more wealth than the entire bottom half of the U.S. population. This group — which includes Gates, Warren Buffet, the Koch brothers, Mark Zuckerberg, and Google co-founders Larry Page and Sergey Brin, among

others — is small enough to fit on a private jet. But together they’ve hoarded as much wealth as 152 million of their fellow Americans.

Lack of social cohesion destroys democracyRoberto Cuellar, Executive Director of the Interamerican Institute of Human Rights, 2009"Social Cohesion and Democracy," International Institute for Democracy and Electoral Assistance, http://www.idea.int/resources/analysis/loader.cfm?csmodule=security/getfile&pageid=38089 (accessed 12/15/2015)There is no democratic spirit without social cohesion, just as there is no sustainable development without freedom and respect for diversity and the rule of law. Disintegrating forces can be eliminated by strengthening the existing conditions for democracy in the region. Achieving this is not just a matter of cooperation; although without the cooperation being committed to eliminating poverty it would not be possible to incorporate a clear and complete approach from the human rights dimension.

Social cohesion is necessary for democratic stabilityRoberto Cuellar, Executive Director of the Interamerican Institute of Human Rights, 2009"Social Cohesion and Democracy," International Institute for Democracy and Electoral Assistance, http://www.idea.int/resources/analysis/loader.cfm?csmodule=security/getfile&pageid=38089 (accessed 12/15/2015)A basis for stable democracy is social cohesion – consolidation of plurality of citizenship and reducing inequality and socio-economic disparities and fractures in the society. Social cohesion refers to people’s relationships and interactions in society, including the role of citizenship. Democracy and social cohesion are complementary parts of including in the public decision-making active citizenship with both rights and responsibilities.




Financial Laws Have Been Hijacked by the Wealth-Holders

Securities lawmaking has always privileged private owners, defining them as the only interested partiesShi-Ling Hsu, Professor of Law at Florida State University, 2015"The Rise and Rise of the One Percent: Considering Legal Causes of Wealth Inequality," Emory Law Journal Online, Vol. 64:2043, http://law.emory.edu/elj/_documents/volumes/64/online/hsu.pdf (accessed 12/13/2015)Securities laws are concerned with protecting the integrity of the market , lest there arise some concern that would

cause investors to lose confidence and withdraw from the market. But there is little sense in the law that the finance industry and corporations impose externalities upon a broader society , despite their capacity to redirect the flow of trillions of dollars. Normative and positive research into the functioning of business organizations as an actor in a broader societal fabric have been largely cabined to the area of scholarly research known as “Corporate Social Responsibility.” Otherwise, lawmaking and legal scholarship in the areas of finance and corporations law seem to be based predominantly on the notion that the only truly interested parties are private ones.

Legal rules and policies enable American financial institutions to externalize risk and make others pay the cost of failureShi-Ling Hsu, Professor of Law at Florida State University, 2015"The Rise and Rise of the One Percent: Considering Legal Causes of Wealth Inequality," Emory Law Journal Online, Vol. 64:2043, http://law.emory.edu/elj/_documents/volumes/64/online/hsu.pdf (accessed 12/13/2015)It is the public nature of systemic risk that is problematic and made this last crisis a force of wealth divergence. The instability of banks created a credit crisis that threatened not just a handful of wealthy investors and managers but a much wider circle of borrowers, including the vast majority of American businesses that depend on credit for cash flow to conduct their business and employ workers. With the sharp contraction in credit availability, businesses suffered and unemployment soared, reducing consumer spending just when the economy needed it most, and further pushing the economy into a nasty spiral of business failures leading to more unemployment, leading to even less spending. All of this occurred because some legal rules enabled or encouraged risky behavior by some managers that generated systemic risk, which imposed losses on those that took no part in the assumption of risk, and were least able to absorb the loss. That widespread risk is an externality. As others have pointed out, systemic risk that poses a threat to the entire economy imposes social costs well in excess of the market punishments meted out to managers responsible for creating that risk.




The American Economic System Makes Wealth Inequality Inevitable

Private capital exceeds the rate of return on economic growth, and the legal system in place for finance in the U.S. ensures this will increase wealth inequalityShi-Ling Hsu, Professor of Law at Florida State University, 2015"The Rise and Rise of the One Percent: Considering Legal Causes of Wealth Inequality," Emory Law Journal Online, Vol. 64:2043, http://law.emory.edu/elj/_documents/volumes/64/online/hsu.pdf (accessed 12/13/2015)Piketty’s core argument is that throughout history, the rate of return on private capital has usually exceeded the rate of economic growth, expressed by Piketty as the relation r > g. If true, this relation means that the wealthy class—who are the predominant owners of capital—will grow their wealth faster than economies grow, which means that relatively speaking, the nonwealthy will fall behind. But even if we accept Piketty’s assertion that this has been a “historical fact,” why is r > g most of the time? Piketty offers a few economic factors and a few legal rules, but mostly demurs as to why the “forces of [wealth] divergence” generally

overwhelm the “forces of [wealth] convergence.” This Essay argues that legal rules and institutions exhibit an inherent bias toward some forms of private capital and serve to inflate returns to private capital—Piketty’s r.

As capital has grown, wealth inequality has grownRavi Kanbur, Professor of Economics at Cornell, and Joseph Stiglitz, Professor of Economics at Columbia, August 28, 2015"Wealth and Income Distribution: New Theories Needed for a New Era," Economic Intersection, http://econintersect.com/a/blogs/blog1.php/wealth-and-income-distribution-new (accessed 12/13/2015)The share of capital as conventionally measured has been on the rise, as has interpersonal inequality of income and wealth. Of course, there are variations and subtleties of data and interpretation, and the pattern is not uniform. But these are the stylised facts of our time. Bringing these facts centre stage has been the achievement of research leading up to Piketty (2014). It stands to reason that theories developed to explain constancy of factor shares cannot explain a rising share of capital. The theories developed to explain the earlier stylised facts cannot very easily explain the new

trends, or the turnaround. At the same time, rising inequality has opened once again a set of questions on the normative significance of inequality of outcomes versus inequality of opportunity. New theoretical developments are needed for positive and normative analysis in this new era.

Because of the structural relationship between capital and labor, increase in the wealth of the top percentage will always result in increased inequality between the rich and poorRavi Kanbur, Professor of Economics at Cornell, and Joseph Stiglitz, Professor of Economics at Columbia, August 28, 2015"Wealth and Income Distribution: New Theories Needed for a New Era," Economic Intersection, http://econintersect.com/a/blogs/blog1.php/wealth-and-income-distribution-new (accessed 12/13/2015)This contingent support to income flows from ownership of bank shares will be capitalised into the value of these shares. Of course, there is an equal and opposite contingent liability on all others in the economy, in particular on workers -- the owners of human capital. Again, without any necessary impact on total output, the political economy has created rents for share owners, and the increase in their wealth will be reflected in rising inequality.




Inequality Allows Wealthy to Buy Law and Policy The wealthy lobby policymakers to distort income flow toward themselvesJuan Cole, Professor of History at the University of Michigan, December 13, 2015"Top 10 Signs the U.S. Is the Most Corrupt Country in the World," Truthdig.com, http://www.truthdig.com/report/item/top_10_signs_the_us_is_the_most_corrupt_country_world_video_20151213 (accessed 12/13/2015)The rich are well placed to bribe our politicians to reduce taxes on the rich. A nonentity like Donald Trump got filthy rich via tax loopholes, and is now trying to buy the presidency. The way the Supreme Court got rid of campaign finance reform and allowed open, unlimited buying of elections is the height of corruption. Note that despite his supposed “populism,” Trump never talks about the unfairness of our current tax system, instead dividing and ruling working and middle class Americans by stirring racial and religious hatreds. As it stands, 400 American billionaires are worth $2 trillion, as much as the bottom 150 million Americans. That kind of wealth inequality hasn’t been seen in the US since the age of the robber barons in the nineteenth century. Both eras are marked by extreme corruption.

The wealthy can always lobby to strengthen laws that hold unequal relationships in placeRavi Kanbur, Professor of Economics at Cornell, and Joseph Stiglitz, Professor of Economics at Columbia, August 28, 2015"Wealth and Income Distribution: New Theories Needed for a New Era," Economic Intersection, http://econintersect.com/a/blogs/blog1.php/wealth-and-income-distribution-new (accessed 12/13/2015)Of course, the rents once created will provide further resources for rentiers to lobby the political system to maintain and further increase rents. This will set in motion a spiral of increasing inequality, which again does not go through the production system at all -- except to the extent that the associated distortions represent a downward shift in the productivity of the economy (at any level of inputs of ‘K’ and labour).

Privatization and closure of the public sector increases inequality and undermines democracyJohn Weeks, Professor Emeritus, School of Oriental & African Studies, University of London, November 17, 2015"Bread, circuses and inequality – a dishonest bargain," OpenDemocracy.net, https://www.opendemocracy.net/uk/bread-circuses-and-inequality (accessed 12/13/2015)Evidence unambiguously shows that that the size of the state relatively to the economy as a whole is closely linked to inequality in countries with democratic institutions: a smaller public sector results in greater inequality. In the private sector capital is more powerful than labour, and the corporations that sell are more powerful than the citizens who buy. A small public sector enhances the power of capital as well as undermining any redistributive effect of taxation. Almost by definition the inequality generated by shrinking the public sector limits to a minority those who gain from neoliberal consumerism. As a result, consumerism can never be an ideology that benefits the majority. Private benefit in exchange for democratic rights is a bargain between the upper middle class and an authoritarian state.




Consumerism Destroys Democracy Consumerism undermines democracy by redefining citizens as market transactionsJohn Weeks, Professor Emeritus, School of Oriental & African Studies, University of London, November 17, 2015"Bread, circuses and inequality – a dishonest bargain," OpenDemocracy.net, https://www.opendemocracy.net/uk/bread-circuses-and-inequality (accessed 12/13/2015)Consumerist ideology treats society as a collection of individuals, each seeking to maximise their private consumption. It follows that taxation for any purpose diminishes personal welfare. In a consumerist world the public sector should only do those activities that the individual cannot purchase as a private commodity. Human interactions are not merely analogous to market transactions, they are market transactions. Consumerism replaces citizenship with commodity ownership.

Consumerist ideology replaces the participating political subject with consumers who only calculate value through profit and lossJohn Weeks, Professor Emeritus, School of Oriental & African Studies, University of London, November 17, 2015"Bread, circuses and inequality – a dishonest bargain," OpenDemocracy.net, https://www.opendemocracy.net/uk/bread-circuses-and-inequality (accessed 12/13/2015)Consumerist ideology replaces the de Tocqueville vision of informed citizens defining the role of the public sector through collective action with the informed consumer assessing value for money in both the public and private sectors. Buying and selling replaces the ballot box. Under consumerist ideology the relation between citizen-consumer and the state becomes a bargain. The former surrenders democratic rights in exchange for material gain that the state takes credit for delivering.

U.S. citizen participation in the political process is one of the lowest among the democratic world Eric Black, former reporter for Minneapolis Star Tribune, September 29, 2014"Why do so few citizens participate in our democracy?" MinnPost, https://www.minnpost.com/eric-black-ink/2014/09/why-do-so-few-citizens-participate-our-democracy (accessed 12/14/2015)The highest turnout is Italy, with an average participation rate of 86.12 percent. The top 10 countries by this measure — all with average turnouts above 78 percent — are Italy, Belgium, Greece, Australia, Denmark, Sweden, Brazil, Finland, Korea and New Zealand. The United States comes in 29th of the 31 nations, with an average turnout of 57.28 percent.




Democracy Requires Equality Representative democracies must weigh each citizens’ voice equally Lawrence Lessig, Professor of Law and Leadership at Harvard Law School, November 25, 2015"Our democracy is completely unrepresentative: Citizens United, gerrymandering, and the real story behind the GOP’s takeover," Salon, http://www.salon.com/2015/11/25/our_democracy_is_completely_unrepresentative_citizens_united_gerrymandering_and_the_real_story_behind_the_gops_takeover/ (accessed 12/13/2015)This is the sense of equality as citizens: the idea that we should all have an equal place in a representative democracy. That as a “Republic” (by which the Framers meant a representative democracy), we weigh the voice of each citizen equally. This is the sense of equality in John Adams’s description of a legislature: “an exact portrait, in miniature of the people at large, as it should feel, reason and act like them .” This is the sense of equality that James

Madison had when he promised a branch “dependent on the people alone,” in which “the people” were “not the rich more than the poor.” This is the sense of equality that makes the very idea of a “representative democracy” make sense.

Inequality hurts everyone, including the wealthyDavid Callahan, senior fellow at Demos, November 18, 2013"The Single Best Argument Against Inequality," The American Prospect, http://prospect.org/article/single-best-argument-against-inequality (accessed 12/15/2015)This argument follows a simple causal chain: unequal growth concentrates wealth in the hands of a tiny slice of consumers who can only spend so much money . In turn, the vast majority of earners are left with little extra cash for goods and services. Resulting weak demand undermines growth. Low growth makes everyone poorer than they otherwise might be, including those who own the means of production. Inequality produces other bad economic outcomes, too, such as the underutilization of the nation's human capital, inadequate public investment in both human and physical capital, and social ills that are costly to address, diverting away resources from investment.




Inequality Creates Political Extremism Market-driven inequality makes public participation meaningless and results in massive material deprivation, resulting in anti-democratic extremismPhys.org, November 30, 2015"What is left of our democratic ambitions?" Phys.org, http://phys.org/news/2015-11-left-democratic-ambitions.html (accessed 12/13/2015)Michael J. Sandel also observes "the population's deep frustration with politics, parties, and politicians, due to a void in public discourse," combined with the prominent place that money and free-market ideology hold in society." "These two trends are now embedded in every sphere of daily life," said Sandel. Our societies have become businesses. Everything is now for sale or monetized. And, according to him, the situation is worrisome for two reasons. First, it creates deep inequalities. "I am not talking about inequalities that prevent some people from buying a luxury vacation or having a BMW: we cannot be all equal in society," he said. "I am talking about inequalities that prevent people from having access to the minimum, such as adequate health care, quality education, and living in a safe neighbourhood. Without such access, inequality brings about changes that can become fertile ground for extremist thought."A small number of families currently controls the American political processMichael Tomansky, editor of Democracy: A Journal of Ideas, October 13, 2015"The Hard-Right Swerve of the Super Rich," The Daily Beast, http://www.thedailybeast.com/articles/2015/10/13/the-hard-right-swerve-of-the-super-rich.html (accessed 12/14/2015)But at least now we know the extent of the problem. We have 138 families who are, it’s no exaggeration to say, defining the terms of debate in this campaign. When this kind of thing happened in little Central America countries, as with El Salvador’s famous 14 families, we had no trouble calling it what it was. But today in the United States, we still try to call it democracy. At least now we should know better.




Inequality Hurts Individuals and the Economy Poverty disenfranchises citizens and makes adverse conditions more likelyDaniel Weeks, fellow at the Edmond J. Safra Center for Ethics at Harvard University, January 6, 2014"Poverty vs Democracy in America," The Atlantic, http://www.theatlantic.com/politics/archive/2014/01/poverty-vs-democracy-in-america/282809/ (accessed 12/14/2015)Socially speaking, poor people occupy a space apart from mainstream. For the nearly one in four children who are impoverished, hunger and homelessness, absent and incarcerated parents, violence, and substance abuse are regular facts of life. These and other "toxic stressors" contribute to high-school dropout rates of around 50 percent and college-graduation rates of less than 10 percent for people in poverty—five times worse than upper-income youth. Without a high-school diploma, poor children are four times more likely than their college-educated peers to be unemployed and 10 to 20 times more likely to end up behind bars.

Wealth inequality hurts economic growth, eg through inequalities in land ownershipSutirtha Bagchi, professor of economics at the University of Michigan, and Jan Svejnar, Director of the Center on Global Economic Governance at Columbia University, November 2013"Does Wealth Inequality Matter for Growth? The Effect of Billionaire Wealth, Income Distribution, and Poverty," IZA Discussion Paper, No. 7733, http://www.econstor.eu/bitstream/10419/89996/1/dp7733.pdf (accessed 12/13/2015)Our estimates in Tables 7 and 8 hence support the conclusion we drew earlier that wealth inequality has a negative effect on economic growth. Moreover, we find that the effect of initial poverty is statistically insignificant irrespective of whether wealth inequality is included or excluded as a regressor as long as the variable is introduced in a panel set-up with country fixed or random effects – a likely reason why our estimated effect of poverty differs from the negative OLS estimate of Ravallion (2012). Finally, we are able to replicate Forbes’ (2000) positive effect of income inequality on growth in the early (1987-1997) period when wealth inequality is excluded, but we show that the effect becomes less robust when wealth inequality is included. Interestingly, the effect of income inequality becomes insignificant in the post-1997 period, suggesting that wealth rather than income inequality has started to play an increasingly important part. It is worth noting that our results are consistent with those of Deininger and Olinto (2000) who include land

inequality (their proxy for wealth inequality) and income inequality in the same specification in a panel setup. They find that the coefficient on land inequality is negative and significant, while the coefficient on income inequality is positive and occasionally significant.




Wealth Inequality Exacerbates Racial Inequality Wealth inequality exacerbates racial inequality—African American families have far less accumulated wealthSigne-Mary McKernan, Senior Fellow in the Center on Labor, Human Services & Population at the Urban Institute, et al, March 27, 2015"Nine Charts About Wealth Inequality in America," Nonprofit Quarterly, Spring, https://nonprofitquarterly.org/2015/03/27/nine-charts-about-wealth-inequality-in-america/ (accessed 12/13/2015)Since the mid-2000s, African-American families, on average, have carried more student loan debt than white families. This is driven in large part by the growing share of African-American families that take on student debt. In 2013, 42 percent of African Americans ages twenty-five to fifty-five had student loan debt, compared with 28 percent of whites.

African Americans’ relative wealth deprivation forces families to take our loans for education, exacerbating their debtSigne-Mary McKernan, Senior Fellow in the Center on Labor, Human Services & Population at the Urban Institute, et al, March 27, 2015"Nine Charts About Wealth Inequality in America," Nonprofit Quarterly, Spring, https://nonprofitquarterly.org/2015/03/27/nine-charts-about-wealth-inequality-in-america/ (accessed 12/13/2015)Because African-American families, on average, have less wealth and fewer private resources, they may be more likely to turn to loans to finance their education. White families are five times more likely than African-American families to receive large gifts or inheritances, which can be used to pay for college.

African American and Hispanic families have less liquid savings, homeownership, and other markers of wealthSigne-Mary McKernan, Senior Fellow in the Center on Labor, Human Services & Population at the Urban Institute, et al, March 27, 2015"Nine Charts About Wealth Inequality in America," Nonprofit Quarterly, Spring, https://nonprofitquarterly.org/2015/03/27/nine-charts-about-wealth-inequality-in-america/ (accessed 12/13/2015)African Americans and Hispanics are less likely to own homes and have less in liquid retirement savings, so they more often miss out on these powerful wealth-building tools. Homeownership, in particular, makes the most of automatic payments—homeowners must make mortgage payments every month—to build equity.




Inequality Doesn’t Positively Affect Employment Rates Inequality does not decrease unemploymentSonja Jovicic, instructor at Schumpeter School of Business and Economics, and Ronald Schettkat, Professor of Economics at Schumpeter School, September 17, 2013"Does Inequality Promote Employment?" Schumpeter Discussion Papers, No. 2013-009, http://www.econstor.eu/bitstream/10419/97210/1/775705594.pdf (accessed 12/15/2015)Unemployment rates do not decline where inequality increases, and employment-to-population rates, as well as hours worked per head of population, do not improve significantly with rising inequality . Inequality measures may be regarded as ‘output’ variables, and our analysis then confirms the results of studies using indicators for institutions – e.g. Howell/Baker/Glyn/Schmitt (2007) – which may be regarded as ‘input’ variables. Richard Freeman (2005) concluded that institutions affect distribution, but that labor market performance is hardly affected, which is totally consistent with the findings presented in this paper.

Inequality has no effect on any unemployment indictatorsSonja Jovicic, instructor at Schumpeter School of Business and Economics, and Ronald Schettkat, Professor of Economics at Schumpeter School, September 17, 2013"Does Inequality Promote Employment?" Schumpeter Discussion Papers, No. 2013-009, http://www.econstor.eu/bitstream/10419/97210/1/775705594.pdf (accessed 12/15/2015) Unemployment rates – but also employment to population rates and hours worked per head of population – seem not to vary systematically with measures of inequality. The only distributional variable

which shows an effect is the D9-D5 wage ratio, although one would have expected the D5-D1 ratio to be important, given the arguments for the negative effects of minimum wages on employment. With respect to hours worked, the effects of the D9-D5 ratio may be relevant if high wage earners are motivated to work long hours.




Promoting Economic Equality Improves Democracy

Inequality is not inevitable: History demonstrates that the U.S. can willfully decrease wealth concentrationEmmanuel Saez, Director of the Center for Equitable Growth, University of California Berkeley, and Gabriel Zucman, Assistant professor of economics, London School of Economics, October 28, 2014"Exploding wealth inequality in the United States," VOX EU, http://www.voxeu.org/article/exploding-wealth-inequality-united-states (accessed 12/13/2015)Wealth inequality, it turns out, has followed a spectacular U-shaped evolution over the past 100 years. From the Great Depression in the 1930s through the late 1970s there was a substantial democratisation of wealth. The trend then inverted, with the share of total household wealth owned by the top 0.1% increasing to 22% in 2012 from 7% in the late 1970s (see Figure 1). The top 0.1% includes 160,000 families with total net assets of more than $20 million in 2012.

Limiting the role of wealth in politics creates political equality in policymakingPatrick Flavin, Assistant Professor of political science at Baylor University, November 5, 2013"Campaign Finance Laws, Policy Outcomes, and Political Equality in the American States," Baylor Blogs, http://blogs.baylor.edu/patrick_j_flavin/files/2010/09/Flavin_Campaign_Finance_Political_Equality_11.5.13-2c1mik1.pdf (accessed 12/14/2015)In an examination of possible mechanisms, I also uncover evidence that stricter campaign finance laws alter incentives for officeholders to respond to wealthy constituents by lessening both the total amount of money flowing to candidates as well as the proportion of contributions that originate from business interests in a state. Taken together, the results reported in this paper suggest that laws that regulate the financing of political campaigns can play an important role in promoting the interests of disadvantaged citizens and enhancing political equality in the state policymaking process.




Promoting Economic Equality Improves Democracy

Egalitarian policies facilitate political participation Frederick Solt, Assistant Professor of Political Science at University of Iowa, 2015"Economic Inequality and Nonviolent Protest," Social Science Quarterly, http://myweb.uiowa.edu/fsolt/papers/Solt2015a_pre.pdf (accessed 12/14/2015)Beyond institutional characteristics, higher levels of economic development have been argued to create environments conducive to nonviolent protest by bringing a dense infrastructure for communication among the potential protesters as well as vibrant media that increase awareness of protest activity among the broader public (Dalton, Van Sickle, and Weldon 2010, 4-5). Economic development is operationalized here as GDP per capita adjusted for differences in

purchasing power, with data drawn from the Penn World Tables (Heston, Summers, and Aten 2011). Further, labor unions work to politically organize and mobilize not only their members but also the rest of their societies (Radcliff and Davis 2000), so the union

density of a country’s workforce might be expected to have a positive relationship with protest activity. On the other hand, stronger unions are better situated to negotiate on behalf of their constituencies through institutionalized bargaining, which may make people less likely to resort to protest where union density is higher (see, e.g., Wallace and Jenkins 1995, 53).

Communities that regulate campaign finance also promote egalitarian policiesPatrick Flavin, Assistant Professor of political science at Baylor University, November 5, 2013"Campaign Finance Laws, Policy Outcomes, and Political Equality in the American States," Baylor Blogs, http://blogs.baylor.edu/patrick_j_flavin/files/2010/09/Flavin_Campaign_Finance_Political_Equality_11.5.13-2c1mik1.pdf (accessed 12/14/2015)I find evidence that campaign finance laws do have important effects on public policy decisions that matter most for disadvantaged citizens (Mettler and Stonecash 2008; Franko 2013). Specifically, when states more strictly regulate the financing of political campaigns, they tend to devote a larger portion of their spending each year to redistributive programs such as public assistance and housing and community development.




Answers to “Marketplace of ideas” arguments Business groups dominate federal policymaking and typically cluster around one side of every issueMartin Gilens, Professor of Politics at Princeton University, and Benjamin I. Page, Professor of Decision Making at Northwestern University, September 2014"Testing Theories of American Politics: Elites, Interest Groups, and Average Citizens," Perspectives on Politics, Vol. 12, No. 3, https://scholar.princeton.edu/sites/default/files/mgilens/files/gilens_and_page_2014_-testing_theories_of_american_politics.doc.pdf (accessed 12/13/2015)The advantage of business-oriented groups in shaping policy outcomes reflects their numerical advantage within the interest-group universe in Washington, and also the infrequency with which business groups are found simultaneously on both sides of a proposed policy change. Both these factors (numerical dominance and relative cohesion) play a part in the much stronger correlation of the overall interest-group alignment index with business groups than with mass-oriented groups (.96 versus .47, table 2). The importance of business groups’ numerical advantage is also revealed when we rescale our measures of business and mass-oriented interest-group alignments to reflect the differing number of groups in each of these categories. Using this rescaled measure, a parallel analysis to that in table 4

shows that on a group-for-group basis the average individual business group and the average mass-oriented group appears to be about equally influential. The greater total influence of business groups in our analysis results chiefly from the fact that more of them are generally engaged on each issue (roughly twice as many, on average), not that a single business-oriented group has more clout on average than a single mass-based group.

Wealth concentration destroys the diversity of ideasMartin Gilens, Professor of Politics at Princeton University, and Benjamin I. Page, Professor of Decision Making at Northwestern University, September 2014"Testing Theories of American Politics: Elites, Interest Groups, and Average Citizens," Perspectives on Politics, Vol. 12, No. 3, https://scholar.princeton.edu/sites/default/files/mgilens/files/gilens_and_page_2014_-testing_theories_of_american_politics.doc.pdf (accessed 12/13/2015)It is simply not the case that a host of diverse, broadly-based interest groups take policy stands—and bring about actual policies—that reflect what the general public wants . Interest groups as a whole do not seek the

same policies as average citizens do. “Potential groups” do not fill the gap. Relatively few mass-based interest groups are active, they do not (in the aggregate) represent the public very well, and they have less collective impact on policy than do business-oriented groups—whose stands tend to be negatively related to the preferences of average citizens. These business groups are far more numerous and active; they spend much more money; and they tend to get their way.

The negative’s marketplace of ideas argument assumes a perfect marketBut the affirmative’s examples and the conclusions of affirmative authors indicate that wealth inequality ruins both economic markets and the marketplace of ideas




Answers to “People in Poverty are comparatively wealthy/better off than . . .” Arguments

Even if overall income has increased over time, inequality creates a power differential that poisons the political process with resentment, and income has been redistributed upwardShi-Ling Hsu, Professor of Law at Florida State University, 2015"The Rise and Rise of the One Percent: Considering Legal Causes of Wealth Inequality," Emory Law Journal Online, Vol. 64:2043, http://law.emory.edu/elj/_documents/volumes/64/online/hsu.pdf (accessed 12/13/2015)The neoclassicist economic response is factually accurate: poverty worldwide has fallen and in general the wealth pie has grown. And yet, even if the poor are better off in absolute terms, it has remained a source of discontent that they are poorer in relative terms. The continuing political salience of the inequality issue suggests that while a robust discussion can be had on the normative implications of inequality, a parallel discussion on the causes of inequality is still well worth having. Piketty marshals vast amounts of data that span long periods of time and several countries. Between 1976 and 2007, the top one percent of all wage-earners garnered nearly sixty percent of the income growth in the United States. Over the past thirty years in the United States, a transfer of income amounting to fifteen percent of national income—a little more than $2 trillion per year 14—has shifted from the bottom ninety percent to the top ten percent.

Meanwhile, wealth (as distinct from income) remains mostly in the hands of the 1% because returns to private capital exceed any growth distributed to the rest of usShi-Ling Hsu, Professor of Law at Florida State University, 2015"The Rise and Rise of the One Percent: Considering Legal Causes of Wealth Inequality," Emory Law Journal Online, Vol. 64:2043, http://law.emory.edu/elj/_documents/volumes/64/online/hsu.pdf (accessed 12/13/2015)Meanwhile, not only is it more difficult to make economic growth—Piketty’s g—keep pace, but it is more contentious. The result is that returns to private capital have indeed commonly exceeded the rate of economic growth. This historical truism can be traceable to a capital-friendly bias that inheres in legal rules and institutions. The bias is particularly pronounced in several areas of law in which law and policy have inflated returns to private capital and driven it well above the rate of economic growth, exacerbating economic inequality.

The question is the effect of inequality on the political process—and that’s a question of powerRegardless of total wealth, large wealth differentials create large power differentials.




Answers to “Inequality creates incentives” arguments

Inequality isn’t necessary for incentives—equal opportunity would create even more progressRonald Schettkat, Professor of Economics at Schumpeter School, 2012"Inequality and Employment, Intereconomics Vol. 47 No. 5, http://www.econstor.eu/bitstream/10419/68319/1/728437899.pdf (accessed 12/14/2015)Proponents of the positive effects of inequality emphasise individual incentives to invest in human capital and to work. But if higher equality (achieved in the market or by redistribution) leads to more equal opportunities and higher enrolment in education, the assumed negative impact on incentives may be well compensated or overcompensated for by a higher rate of technological progress.

The incentives argument props up privilege; those who have more will always say they need it to be motivatedErik Olin Wright, professor of sociology at University of Wisconsin, and Joel Rogers, professor of law at University of Wisconsin, August 2009"Thinking About Fairness and Equality," in American Society: How it Really Works, https://www.ssc.wisc.edu/~wright/ContemporaryAmericanSociety/Chapter%2010%20--%20inequality%20&%20fairness%20--%20Norton%20August.pdf (accessed 12/14/2015)Of course, people who are in a position to use their power to extract high income are likely to defend their high incomes in terms of necessary incentives. Privileged elites will always say that they “need more” to be motivated to work hard, to produce, to save, to invest. They will fight against tax increases directed against the rich on the grounds that this will destroy the incentive to invest and thus everyone will be worse off as a result. Such claims are often – perhaps usually – self-serving rationalizations masking the simple desire to preserve privilege and advantage.

This argument has never made senseIf the poor need to be poor in order to get the incentives to work, why doesn’t that apply to rich people? Or those who have large inheritances? There isn’t one kind of motivation for poor people and another kind for the wealthy.




Answers to “People choose to participate or not in the political process” arguments

Economic inequality is associated with low participationDaniel Weeks, fellow at the Edmond J. Safra Center for Ethics at Harvard University, January 10, 2014"Why Are the Poor and Minorities Less Likely to Vote?" The Atlantic, http://www.theatlantic.com/politics/archive/2014/01/why-are-the-poor-and-minorities-less-likely-to-vote/282896/ (accessed 12/15/2015)For starters, low-income citizens are far less likely to vote. According to the U.S. Census, 47 percent of eligible adults with family incomes of less than $20,000 a year voted in 2012 and just one in four voted in the midterm election of 2010. By contrast, those with annual earnings of $100,000 or more turned out at rates of around 80 percent and 60 percent, respectively. Similar disparities are seen in voter registration.

Low participation is nevertheless bad for political healthEric Black, former reporter for Minneapolis Star Tribune, September 29, 2014"Why do so few citizens participate in our democracy?" MinnPost, https://www.minnpost.com/eric-black-ink/2014/09/why-do-so-few-citizens-participate-our-democracy (accessed 12/14/2015)You can argue, I suppose, that as long as people have a right to vote, it is up to them whether they choose to exercise that right. I’m not interested in making excuses for lazy or tuned-out voters , but Professor Bingham

Powell of the University of Rochester, a veteran comparer of different systems of democracy, urges me (and you) to bear in mind that “lots of things affect voter turnout other than interest and competence of the voters.” Even bearing that mind, in judging the health of a democracy, I don’t know how a low rate of voting participation can be taken as anything other than a serious sign of democratic ill health.

This is irrelevant to the resolutional questionInequality makes democracy more difficult. Even if some people choose not to participate, the system shouldn’t be rigged against poor people who want to participate.




Answers to “Income inequality isn’t the same as wealth inequality Income inequality causes wealth inequalityEmmanuel Saez, Director of the Center for Equitable Growth, University of California Berkeley, and Gabriel Zucman, Assistant professor of economics, London School of Economics, October 28, 2014"Exploding wealth inequality in the United States," VOX EU, http://www.voxeu.org/article/exploding-wealth-inequality-united-states (accessed 12/13/2015)If income inequality stays high and if the saving rate of the bottom 90% of families remains low then wealth disparity will keep increasing. Ten or 20 years from now, all the gains in wealth democratisation achieved during the New Deal and the post-war decades could be lost. While the rich would be extremely rich, ordinary families would own next to nothing, with debts almost as high as their assets.

Any positive effect of income inequality is outweighed by wealth inequalitySutirtha Bagchi, professor of economics at the University of Michigan, and Jan Svejnar, Director of the Center on Global Economic Governance at Columbia University, November 2013"Does Wealth Inequality Matter for Growth? The Effect of Billionaire Wealth, Income Distribution, and Poverty," IZA Discussion Paper, No. 7733, http://www.econstor.eu/bitstream/10419/89996/1/dp7733.pdf (accessed 12/13/2015)Our first key finding is that wealth inequality tends to have a negative effect on economic growth, income inequality has no or at most a weak positive effect on growth, and the effect of poverty on growth is insignificant. The

reason why the positive growth effect of income inequality found in a leading earlier study (Forbes, 2000) is less statistically significant in our data appears to be brought about by the exclusion of wealth inequality in Forbes’ (2000) specification and by weakening of the previously positive growth effect of income inequality from the mid-to-late 1990s on.

Wealth inequality outweighs income inequalityLori Ann Campbell, Assistant Professor of Sociology at California State University Northridge, July 2, 2015"Causes and Consequences of the Racial Wealth Gap Across the Life Course," Society for the Advancement of Socio-Economics, https://sase.confex.com/sase/2015am/webprogram/Paper3682.html (accessed 12/13/2015)While the story of rising income inequality is well known, wealth inequality is much greater than income inequality , as an examination of the Gini coefficient shows. Between 2001 – 2 010, the Gini coefficient for income averaged 0.56 while the Gini coefficient for wealth averaged 0.82 (Keister and Lee 2014), indicating a far greater concentration of wealth than income. In fact, wealth is so concentrated that Saez and Zucman (2014) estimate that the richest 0.1% of families collectively own 22% of U.S. wealth compared to the bottom 90% of families who hold just 23%. Part of the story of wealth inequality is that the growth in wealth among the richest families has largely been among rich, white families while minority families have not seen their wealth increase at the rate that white families have experienced. Scholars have established that extreme racial-ethnic differences in wealth exist (Oliver and Shapiro 1995, Conley 1999, Keister 2004, Campbell and Kaufman 2006).

The presence of income inequality proves the argument about wealth inequalityIncome inequality either exacerbates or is created by wealth inequality, but overall wealth is the final determinant of political power. The affirmative can only win more by including income inequality in the overall analysis.




Answers to “Democracy is bad” arguments

Ordinary people’s political views are as good as elites’Martin Gilens, Professor of Politics at Princeton University, and Benjamin I. Page, Professor of Decision Making at Northwestern University, September 2014"Testing Theories of American Politics: Elites, Interest Groups, and Average Citizens," Perspectives on Politics, Vol. 12, No. 3, https://scholar.princeton.edu/sites/default/files/mgilens/files/gilens_and_page_2014_-testing_theories_of_american_politics.doc.pdf (accessed 12/13/2015)A possible objection to populistic democracy is that average citizens are inattentive to politics and ignorant about public policy; why should we worry if their poorly informed preferences do not influence policy making? Perhaps economic elites and interest-group leaders enjoy greater policy expertise than the average citizen does. Perhaps they know better which policies will benefit everyone, and perhaps they seek the common good, rather than selfish ends, when deciding which policies to support. But we tend to doubt it. We believe instead that—collectively—ordinary citizens generally know their own values and interests pretty well, and that their expressed policy preferences are worthy of respect. Moreover, we are not so sure about the informational advantages of elites.

Elites won’t act in the public goodMartin Gilens, Professor of Politics at Princeton University, and Benjamin I. Page, Professor of Decision Making at Northwestern University, September 2014"Testing Theories of American Politics: Elites, Interest Groups, and Average Citizens," Perspectives on Politics, Vol. 12, No. 3, https://scholar.princeton.edu/sites/default/files/mgilens/files/gilens_and_page_2014_-testing_theories_of_american_politics.doc.pdf (accessed 12/13/2015)Surely wealthy Americans and corporate executives tend to know a lot about tax and regulatory policies that directly affect them. But how much do they know about the human impact of Social Security, Medicare, food stamps, or unemployment insurance, none of which is likely to be crucial to their own well-being? Most

important, we see no reason to think that informational expertise is always accompanied by an inclination to transcend one’s own interests or a determination to work for the common good.

This isn’t a resolutional burdenThe resolution requires the affirmative to prove wealth inequality hurts democracy—not that democracy is good. Democracy could be horrible and the affirmative still wins by proving wealth inequality hurts it.




Answers to “Individual responsibility” and “people make their own choices” arguments

Emphasis on individual mobility ignores numerous contextual impediments to equalityNicholas Fitz, staffwriter for Scientific American, March 31, 2015"Economic Inequality: It's Far Worse than You Think," Scientific American, http://www.scientificamerican.com/article/economic-inequality-it-s-far-worse-than-you-think/ (accessed 12/13/2015)By overemphasizing individual mobility, we ignore important social determinants of success like family inheritance, social connections, and structural discrimination. The three papers in Perspectives on Psychological Science indicate not only that economic inequality is much worse than we think, but also that social mobility is less than you’d imagine. Our unique brand of optimism prevents us from making any real changes.

The fair share argument ignores the effects of inequality on children, who have no political and economic agencyErik Olin Wright, professor of sociology at University of Wisconsin, and Joel Rogers, professor of law at University of Wisconsin, August 2009"Thinking About Fairness and Equality," in American Society: How it Really Works, https://www.ssc.wisc.edu/~wright/ContemporaryAmericanSociety/Chapter%2010%20--%20inequality%20&%20fairness%20--%20Norton%20August.pdf (accessed 12/14/2015)Even if one rejects fair shares as a general argument for redistribution, there is another fundamental problem with fair play as the exclusive moral principle governing acceptable inequality. This concerns the fate of children. So long as children are raised in families, then large inequalities in the life circumstances of parents profoundly undermine equal opportunity for children . At first glance it seems that fair play and fair shares are radically different ideas: the former concerns the fairness of opportunity to acquire income and says nothing about the actual distribution; the latter says nothing about the process of acquiring income, but focuses only on the fairness of the shares people acquire. In reality, however, these two principles interact, especially in the lives of children.

Everything we know about macro-economic structures contradicts this argumentLarge-scale economic structures overwhelm individual choices; even if people make mistakes, those mistakes affect the wealthy differently than they do the poor. We can’t make value judgments about the entire economy based on individual choices.




Negative




1NC 1/2 “So that the record of history is absolutely crystal clear that there is no alternative way, so far discovered, of improving the lot of the ordinary people that can hold a candle to the productive activities that are unleashed by a free enterprise system.”

Because I agree with Milton Friedman, I oppose the proposition that in the United States, wealth inequality is detrimental to democratic ideals.

Observation One: Definition: Democratic Ideals aspire to compromise between liberty and equalityUSHistory.org, 2014"Democratic Values: Liberty, Equality, and Justice," American Government, http://www.ushistory.org/gov/1d.asp (accessed 12/14/2015)Democratic societies also expect another kind of balance: a compromise between liberty and equality.

Observation Two: Value and CriteriaA. Value: Economic Freedom: Economic freedom is fundamental to democracyRobert D. Cooter, Professor of Law, UC Berkeley School of Law, 2013"Freedom, Creativity, and Intellectual Property," 8 N.Y.U. J. L. & Liberty 1, http://scholarship.law.berkeley.edu/facpubs/2236 (accessed 12/15/2015)Democrats and Republicans do not argue about whether we ought to have freedom of speech; they argue about what exactly freedom of speech is. Similarly, people with different political philosophies should not argue about whether we ought to have economic freedom. Its intrinsic and instrumental value is too large to deny. Instead, Democrats and Republicans should agree that economic freedom is a fundamental value of a democracy, and then argue about how to interpret its bounds.

B. Criteria: Neutrality: We should be wary of conclusions about inequality and politics, because claims of rampant inequality are made by those with a divisive political agendaChris Matthews, economic writer for Fortune, June 11, 2015"4 things you didn't (but should) know about economic inequality," Fortune, http://fortune.com/2015/06/11/income-inequality/ (accessed 12/13/2015)Despite the fact that there is a growing consensus that inequality is important, there is little agreement on how it affects average Americans. This is partly because more research needs to be done on the topic. But it’s also because the research that has been done has been hijacked by those with political agendas in order to further policy goals that existed long before we ever thought that America was divided between the 99% and the 1%.




1NC 2/2 Observation Three: Wealth Inequality Doesn’t Hurt DemocracyA. Minimal access to sufficient resources is enough for citizens to exercise libertyStephen Nathanson, professor emeritus in philosophy at Northeastern University, 2005“Equality, Sufficiency, Decency: Three Criteria of Economic Justice,” Ethical Issues for the Twenty-First Century, ed. F. Adams (Charlottesville: Philosophy Documentation Center), http://www.usbig.net/papers/EcJusAPAVolume.pdf (accessed 12/14/2015)Finally, from the perspective of liberty, once people have the resources for a decent level of liberty to pursue their goals, there is no objection to a system that permits the otherwise unconstrained exchange of goods through the market or voluntary gifts. When the decent level criterion is not met, however, these liberties for some are purchased at the cost of denying others the liberty to pursue their goals. Overall, then, a plausible case can be made for the decent level criterion based on the same values that rule out an equal distribution of economic resources.

B. Growth creates political conditions for individual rightsBrink Lindsey, vice president for research at the Cato Institute, 2009"Paul Krugman's Nostalgianomics," Cato Institute, http://object.cato.org/sites/cato.org/files/pubs/pdf/Nostalgianomics.pdf (accessed 12/15/2015)What is the connection between economic growth and cultural individualism? In Inglehart’s view, the key is the freedom to shift one’s attention from physical survival and security to other needs and goals. “This shift in worldview and motivations,” he states, “springs from the fact that there is a fundamental difference between growing up with an awareness that survival is precarious, and growing up with the feeling that one’s survival can be taken for granted.

C. Political stability depends on putting a firewall between the government and the people; economic elitism serves this purposeRichard Kreitner, Archivist for the Nation Magazine, December 13, 2015"The Constitution Requires Inequality," Boston Globe, https://www.bostonglobe.com/ideas/2015/12/13/the-constitution-requires-inequality/PfxEpBF8h5VrOeI9m5NKAM/story.html (accessed 12/13/2015)For starters, Madison suggested, put some distance between the people and the levers of actual power. Such representation would “refine and enlarge the public views by passing them through the medium of a chosen body of citizens, whose wisdom may best discern the true interest of their country and whose patriotism and love of justice will be least likely to sacrifice it to temporary or partial considerations.” The implication is clear: Settle disputes between the people and the elite by making the elite the representatives of the people. Madison even suggested that perhaps such an arrangement would render “the public voice, pronounced by the representatives of the people . . . more consonant to the public good than if pronounced by the people themselves.”




Value Extensions: Economic Freedom

Economic freedom is necessary for creativity, crucial to innovation and growthRobert D. Cooter, Professor of Law, UC Berkeley School of Law, 2013"Freedom, Creativity, and Intellectual Property," 8 N.Y.U. J. L. & Liberty 1, http://scholarship.law.berkeley.edu/facpubs/2236 (accessed 7/5/2015)Economic freedom provides the conditions under which people can be creative in their work. Creativity is valuable intrinsically because of its connection to self-expression, and it is valuable instrumentally because of its connection to innovation and growth. Creativity is so valuable intrinsically and instrumentally that we need to rehabilitate economic freedom as a human right, especially with respect to innovation.

Lack of economic freedom spurs violent civil conflictIndra de Soysa, Professor of Political Science at Norwegian University of Science and Technology, and Krishna Chaitanya Vadlamannati, post-doctoral researcher in Political Science at Norwegian University of Science and Technology, 2014"Free Markets and Civil Peace: Some Theory and Empirical Evidence," Economic Freedom of the World, http://www.researchgate.net/publictopics.PublicPostFileLoader.html?id=53bd7758d5a3f2ad488b462e&key=b1785fea-2655-4b18-870e-3b7d9532b857 (accessed 12/15/2015)This article takes a broader perspective on both opportunity and means to argue that economic repression and economic mismanagement supply the “means, motive, and opportunity” for groups to challenge states because economic distortions spawn underground economies that form the “organizational bases” of insurgency that allow groups to succeed and be sustainable in the face of superior state forces.




Criteria Extensions: Neutrality

Inequality is a feeling, not an objective economic factSam Bowman, Executive Director of Adam Smith Institute, May 29, 2015"The case against caring about inequality at all," AdamSmith.org, http://www.adamsmith.org/blog/economics/the-case-against-caring-about-inequality-at-all/ (accessed 12/14/2015)Redistributive policies that reduce actual inequality are costly, and because actual inequality is barely related to perceptions of inequality they may do little to make the country more stable or market-friendly. If these are important problems, we can only solve them by making people feel less unequal – not by making them less unequal in fact. In short: even if people’s perceptions of inequality matter, the reality does not. Perception of inequality bears no resemblance to realitySam Bowman, Executive Director of Adam Smith Institute, May 29, 2015"The case against caring about inequality at all," AdamSmith.org, http://www.adamsmith.org/blog/economics/the-case-against-caring-about-inequality-at-all/ (accessed 12/14/2015)Crucially, given worries about investment and political instability, “In countries where inequality was generally thought to be high, more people supported government redistribution. But demand for redistribution bore no relation to the actual level of inequality.”

Wealth increases at the very top improve all of society, so long as the income at the bottom doesn’t decreaseRichard A. Epstein, Distinguished Service Professor Emeritus of Law and Senior Lecturer at the University of Chicago Law School, February 19, 2013"In Praise of Income Inequality," Hoover Institution, http://www.hoover.org/research/praise-income-inequality (accessed 12/14/2015)This conclusion rests on the notion of a Pareto improvement, which favors any changes in overall utility or wealth that make at least one person better off without making anyone else worse off. By that measure, there would be an unambiguous social improvement if the income of the wealthy went up by 100 percent so long as the income of those at the bottom end did not, as a consequence, go down. That same measure would, of course, applaud gains in the income of the 99 percent so long as the income of the top 1 percent did not fall either.




Extensions: Must Limit Direct Democracy with Elites and Free Markets

Elite rule and the marketization of politics solves better than direct majority ruleBryan Caplan, associate professor of economics at George Mason University, November 5, 2006"The Myth of the Rational Voter," Cato Unbound, http://www.cato-unbound.org/2006/11/05/bryan-caplan/myth-rational-voter (accessed 12/15/2015)So what remedies for voter irrationality would I propose? Above all, relying less on democracy and more on private choice and free markets. By and large, we don’t even ask voters whether we should allow unpopular speech or religion, and this “elitist” practice has saved us a world of trouble. Why not take more issues off the agenda? Even if the free market does a mediocre job, the relevant question is not whether smart, well-meaning regulation would be better. The relevant question is whether the kind of regulation that appeals to the majority would be better.

Successes at the top are due to market success, not a rigged game—everybody is better off Richard Epstein, professor of law at New York University, October 26, 2011"Does U.S. Economic Inequality Have a Good Side?" Public Broadcasting Service, http://www.pbs.org/newshour/bb/business-july-dec11-makingsense_10-26/ (accessed 12/13/2015)And what happens is, if you let people go through voluntary transactions that produce mutual gain, you will increase overall welfare, you will improve the position of those on the bottom. But increased overall welfare will produce greater skews in income, because in a world with genuine opportunities, you will create billionaires. In a world without it, the people at the bottom will remain where they were, there will be nobody at the top to subsidize them, so everybody will turn out to be worse off.




Democracy Will Fail Independently of Wealth Inequality Ignorance, not inequality, is the true enemy of democracyIlya Somin, Professor of Law at George Mason University, October 11, 2013"Democracy and Political Ignorance," Cato Unbound, http://www.cato-unbound.org/2013/10/11/ilya-somin/democracy-political-ignorance (accessed 12/15/2015)Unfortunately, public knowledge about politics is disturbingly low. In addition, the public also often does a poor job of evaluating the political information they do know. This state of affairs has persisted despite rising education levels, increased availability of information thanks to modern technology, and even rising IQ scores. It is mostly the result of rational behavior, not stupidity. Such widespread and persistent political ignorance and irrationality strengthens the case for limiting and decentralizing the power of government.

Big government makes it impossible to save democracy--creates information systems that are too complexIlya Somin, Professor of Law at George Mason University, October 11, 2013"Democracy and Political Ignorance," Cato Unbound, http://www.cato-unbound.org/2013/10/11/ilya-somin/democracy-political-ignorance (accessed 12/15/2015)The problems of political ignorance and irrationality are accentuated by the enormous size and scope of modern government. In the United States, government spending accounts for close to 40% of GDP, according OECD estimates. And that does not include numerous other government policies that function through regulation of the private sector. Even if voters followed political issues more closely than they do, and even if they were more rational in their evaluation of political information, they still could not effectively monitor more than a fraction of the activities of the modern state.




Democracy Fails: Voters Irrational The public misunderstands economics and unreflectively supports wars—this means democracy will failBryan Caplan, associate professor of economics at George Mason University, November 5, 2006"The Myth of the Rational Voter," Cato Unbound, http://www.cato-unbound.org/2006/11/05/bryan-caplan/myth-rational-voter (accessed 12/15/2015)I suspect that the public’s errors extend far beyond economics. There is convincing evidence that the public holds systematically biased beliefs about toxicology and cancer. In foreign policy, similarly, we have the “rally round the flag” effect, the public’s tendency to support wars as soon as they have been declared. But even if the average voter perfectly understood every non-economic subject, misconceptions about economics by themselves would pose a serious problem for democracy.

Irrational voters justify elected officials disregarding public opinionBryan Caplan, associate professor of economics at George Mason University, November 5, 2006"The Myth of the Rational Voter," Cato Unbound, http://www.cato-unbound.org/2006/11/05/bryan-caplan/myth-rational-voter (accessed 12/15/2015)Even in the most democratic countries, political actors have a degree of slack or “wiggle room.” It is usually possible for officials to deviate moderately from voter preferences without being removed from power. And to be blunt, if the average voter holds irrational beliefs that lead him to support bad policies, using political slack to mitigate the damage seems like the right thing to do. If the average voter is wrong about immigration, and you have the political slack to push through an amnesty, go for it.




No Unequal Distribution of Wealth Increases at the top result in job creation and increased wealth for allRichard Berman, president of Berman and Co., March 26, 2015"Warren’s pitchfork brigade skewers the facts," Washington Times, http://www.washingtontimes.com/news/2015/mar/26/richard-berman-elizabeth-warrens-flawed-income-ine/ (accessed 12/15/2015)While Mrs. Warren demagogues the income inequality issue for political purposes, she ignores the obvious: Income gains at the top give us a bigger economic pie, and help support job creation and income gains across other tax brackets. Yes, there is a trickle-down effect. It may not be as large as some would like, but screw down the existing incentives on top earners to succeed and the current inequality will worsen and be baked into the system. That kind of thinking might be new to the Warrenistas, but it’s no surprise to those who ever took economics 101.

Piketty conflates gross and net returns on capital, ignoring what capitalists pay out to othersLawence Summers, former Treasury Secretary and Professor and President Emeritus at Harvard University, Summer 2014"The Inequality Puzzle," Democracy: A Journal of Ideas, Vo. 33, http://democracyjournal.org/magazine/33/the-inequality-puzzle/?page=all (accessed 12/14/2015)Economists have tried forever to estimate elasticities of substitution with many types of data, but there are many statistical problems. Piketty argues that the economic literature supports his assumption that returns diminish slowly (in technical parlance, that the elasticity of

substitution is greater than 1), and so capital’s share rises with capital accumulation. But I think he misreads the literature by conflating gross and net returns to capital. It is plausible that as the capital stock grows, the increment of output produced declines slowly, but there can be no question that depreciation increases proportionally. And it is the return net of depreciation that is relevant for capital accumulation . I know of no study suggesting that measuring output in net terms, the elasticity of substitution is greater than 1, and I know of quite a few suggesting the contrary.




Attributions of Wealth Inequality Are Incorrect Wealth accumulation is not the totality of economic activity—profits from technological development are also being madeLawence Summers, former Treasury Secretary and Professor and President Emeritus at Harvard University, Summer 2014"The Inequality Puzzle," Democracy: A Journal of Ideas, Vo. 33, http://democracyjournal.org/magazine/33/the-inequality-puzzle/?page=all (accessed 12/14/2015)Does not the rising share of profits in national income in most industrial countries over the last several decades prove out Piketty’s argument? Only if one assumes that

the only factors at work are the ones he emphasizes. Rather than attributing the rising share of profits to the inexorable process of wealth accumulation, most economists would attribute both it and rising inequality to the working out of various forces associated with globalization and technological change. For example, mechanization of what was previously manual work quite obviously will raise the share of income that comes in the form of profits. So does the greater ability to draw on low-cost foreign labor.

Investment and inheritance wealth are on the decline, and there’s a great deal of economic mobilityLawence Summers, former Treasury Secretary and Professor and President Emeritus at Harvard University, Summer 2014"The Inequality Puzzle," Democracy: A Journal of Ideas, Vo. 33, http://democracyjournal.org/magazine/33/the-inequality-puzzle/?page=all (accessed 12/14/2015)A brief look at the Forbes 400 list also provides only limited support for Piketty’s ideas that fortunes are patiently accumulated through reinvestment. When Forbes compared its list of the wealthiest Americans in 1982 and 2012, it found that less than one tenth of the 1982 list was still on the list in 2012 , despite the fact that a significant majority of members of the 1982 list would have qualified for the 2012 list if they had accumulated wealth at a real rate of even 4 percent a year. They did not, given pressures to spend, donate, or misinvest their wealth. In a similar vein, the data also indicate, contra Piketty, that the share of the Forbes 400 who inherited their wealth is in sharp decline.




Economic Injustice Spurs Political Change Perceptions of economic injustice drive political changeErik Olin Wright, professor of sociology at University of Wisconsin, and Joel Rogers, professor of law at University of Wisconsin, August 2009"Thinking About Fairness and Equality," in American Society: How it Really Works, https://www.ssc.wisc.edu/~wright/ContemporaryAmericanSociety/Chapter%2010%20--%20inequality%20&%20fairness%20--%20Norton%20August.pdf (accessed 12/14/2015)Why does it matter whether or not you think some form of inequality is unjust? This matters because when people feel something is unjust they are more likely to support efforts to change social institutions than when they think it is just. People are often willing to do things that go against their own personal interests when they think this is necessary for justice.

The wealthy can also fight for economic justiceErik Olin Wright, professor of sociology at University of Wisconsin, and Joel Rogers, professor of law at University of Wisconsin, August 2009"Thinking About Fairness and Equality," in American Society: How it Really Works, https://www.ssc.wisc.edu/~wright/ContemporaryAmericanSociety/Chapter%2010%20--%20inequality%20&%20fairness%20--%20Norton%20August.pdf (accessed 12/14/2015)Many affluent people, for example, believe that it is unjust in a rich country for poor children to be hungry and that therefore it is a good thing to use taxes to pay for food stamps and health care for poor children, even though they pay the taxes. So, the stakes can be quite high in deciding who deserves what, what kinds of inequalities are justified, what kinds violate principles of justice, and what should be done to redress an injustice.




Inequality is Good Inequality incentivizes innovation and benefits everyoneGeorge F. Will, opinion writer for Washington Post, March 25, 2015"How income inequality benefits everybody," Washington Post, https://www.washingtonpost.com/opinions/how-income-inequality-benefits-everybody/2015/03/25/1122ee02-d255-11e4-a62f-ee745911a4ff_story.html (accessed 12/13/2015)Monopoly profits are social blessings when they “signal to the ambitious the wealth they can earn by entering previously unknown markets.” So “when the wealth gap widens, the lifestyle gap shrinks .” Hence, “income inequality in a capitalist system is truly beautiful” because “it provides the incentive for creative people to gamble on new ideas, and it turns luxuries into common goods.” Since 2000, the price of a 50-inch plasma TV has fallen from $20,000 to $550.

There is no injustice in inequality and nothing inherently wrong with the rich having more than the poorBen R. Crenshaw, contributor to Witherspoon Institute for Public Discourse, April 19, 2014"Richard Epstein on Income Inequality," BCrenshaw.com, http://brcrenshaw.com/2014/04/19/richard-epstein-on-income-inequality/ (accessed 12/14/2015)First, it is a natural outcome of human differences: education, experience, skills, hours worked, job type, proficiency, productivity, responsibility, etc. To think that everyone who works and receives pay for their productivity would receive the same amount is absurd. The burden falls upon those who expect income equality to explain why this should be the natural state of humans in a diverse market economy where one is free to pursue their own eduction, develop their skill sets, work as little or as much as they want, and innovate and create according to their passions. But what about the 1% you say? They certainly don’t deserve that much money (millions, billions), right? My response to this objection is that if those who are paid millions have not received their pay by illegal means, then there is nothing wrong with it.

Inequality creates incentivesRichard Epstein, professor of law at New York University, October 26, 2011"Does U.S. Economic Inequality Have a Good Side?" Public Broadcasting Service, http://www.pbs.org/newshour/bb/business-july-dec11-makingsense_10-26/ (accessed 12/13/2015)What’s good about inequality is if, in fact, it turns out that inequality creates an incentive for people to produce and to create wealth, it’s a wonderful force for innovation. So let’s just go and take somebody like Bill Gates again or any entrepreneur. Guy

earns $50 billion, right? How much consumer welfare has he created by selling products? We can estimate the amount of gains to purchases, because everybody who buys one of his products or one of Steve Jobs’ products, in effect, values it more than he receives.




Inequality is Good Inequality spurs growth that benefits everyoneScott Winship, Fellow at the Manhattan Institute, November 5, 2014"Income Inequality is Good for the Poor," The Federalist, http://thefederalist.com/2014/11/05/income-inequality-is-good-for-the-poor/ (accessed 12/13/2015)These findings make sense if you are open to the idea that greater inequality might actually increase the size of the economic pie rather than shrinking it. That is, if economic growth is strong enough—enlarging the pie by a sufficient amount—then even though the slices going to the poor and the middle class are comparatively skinnier, they still end up with more pie. The mistake that decriers of inequality make is to assume that the economic pie is fixed, so that a bigger slice for the top must necessarily result in less pie for everyone else. In fact, the evidence from economic research over the past 15 years is that in developed countries, more inequality tends to go hand in hand with stronger economic growth.Less-equal societies have better economies, benefitting everyoneMatthew Schoenfeld, analyst at Driehaus Capital Management LLC, June 14, 2015"The Mythical Link Between Income Inequality and Slow Growth," Wall Street Journal, http://www.wsj.com/articles/the-mythical-link-between-income-inequality-and-slow-growth-1434319942 (accessed 12/13/2015)When austerity pressures caught up to debt-laden sovereigns in recent years, however, the less leveraged—and not coincidentally, less equal—member countries grew a lot faster than their peers . From 2011-13, according to the World Bank, the five most unequal countries grew nearly five times faster (3.9% cumulative annual average) than the others (0.84%). By using a 2010 cutoff, the OECD has skewed its findings.

Inequality is the price we pay for universal access to informationPiero Scaruffi, university lecturer and founder of Omniware, 2014"A Defense of Inequality," Scaruffi.com, http://www.scaruffi.com/phi/syn138.html (accessed 12/13/2015)In a sense, income inequality is presented by the establishment (and understood by the masses) as the price to pay for information utopia. In fact the younger generations live in a state of euphoria due to the progress of the information and communication utopias, and not in a state of desperation due to rising income inequality.




Focusing on Inequality Generally Bad Preoccupation with inequality ruins politics because it shift the focus away from individual responsibilityHarry G. Frankfurt, professor emeritus of philosophy at Princeton University, August 27, 2015"Economic Inequality is Not Immoral," Bloomberg View, http://www.bloombergview.com/articles/2015-08-27/economic-inequality-is-not-immoral (accessed 12/14/2015)A preoccupation with the condition of others interferes, moreover, with the most basic task on which a person's selection of monetary goals for himself most decisively depends. It leads a person away from understanding what he himself truly requires in order to pursue his own most authentic needs, interests, and ambitions. Exaggerating the moral importance of economic equality is harmful, in other words, because it is alienating. It separates a person from his own individual reality, and leads him to focus his attention upon desires and needs that are not most authentically his own.

Preoccupation with inequality shifts focus away from debt and spending, the true cause of America’s economic illsRachel Greszler, senior policy analyst in economics and entitlements at The Heritage Foundation's Center for Data Analysis, January 29, 2014"U.S. Debt Poses a Greater Barrier to Economic Opportunity Than Income Inequality," The Daily Signal, http://dailysignal.com/2014/01/29/u-s-debt-poses-greater-barrier-economic-opportunity-income-inequality/ (accessed 12/14/2015)When faced with a smaller economy, lower incomes, and massively higher taxes, young and future workers will find little comfort in a $10.10 minimum wage, forced unionism, or extended unemployment benefits. Before the President and policymakers attempt to adjust the rungs on America’s income ladder, they should first fix its broken rails. If the U.S. does not curb its reckless spending and work toward reducing its massive debt, even young and future Americans who make it to the top of the income ladder could be worse off than those at the bottom today.




Inequality and Poverty Are Decreasing

Prosperity has outstripped inequalityMichael Heise, Chief Economist at Allianz, January 19, 2015"A Bit of Inequality is Good, Lots of Inequality is Bad," Allianz.com, https://www.allianz.com/en/press/news/company/point_of_view/150115-a-bit-of-inequality-is-good.html/ (accessed 12/14/2015)What we call the middle wealth class grew by 500 million people over the past 13 years, mainly in the Asian markets. According to the United Nations these are people with gross financial assets from 5,800 to 33,000 US dollars. This rise in prosperity has to be taken into consideration when we discuss inequality.

Runaway government spending is out of controlStephen Moore, Distinguished Visiting Fellow at The Heritage Foundation, May 19, 2015"Obama's Poverty Mythology," Heritage.org, http://www.heritage.org/research/commentary/2015/5/obamas-poverty-mythology (accessed 12/14/2015)In 1950, total state, local and federal government spending was just over $500 billion (in constant 2015 dollars) and 22.2 percent of our gross domestic product (GDP). Today it is nearly $6 trillion and 33 percent of our GDP. Under Mr. Obama, federal spending will reach $4 trillion next year and borrowing to finance these “common investments” will have risen by $8 trillion over his tenure. The only thing that has been underfunded over the last decade is middle-class family incomes, which have stagnated.




Inequality Does Not Undermine Democracy

Inequality doesn’t damage politics—the rich often favor egalitarian policies and the poor favor wealth-creationBoer Deng, writer for Nature and Slate, April 24, 2014"The Silver Lining to Our Oligarchy," Slate, http://www.slate.com/blogs/weigel/2014/04/24/gilens_and_page_find_that_rich_americans_rule_politics_but_despair_the_fact.html (accessed 12/14/2015)This does not necessarily mean the average voter always loses: Just as poor folk in Kansas sometimes favor policies that benefit the rich, affluent individuals and interest groups can favor policies that benefit the poor. Gilens points out in his 2012 essay that LBJ’s landmark Great Society bills enjoyed only slightly less popularity among elites than among low- and middle-income Americans, but were supported by both groups. Warren Buffett saying he ought to pay higher taxes may not be as unusual as it seems.

Inequality is inscribed in American politics, not a departure from them; the founders believed inequality was essential to political stabilityRichard Kreitner, Archivist for the Nation Magazine, December 13, 2015"The Constitution Requires Inequality," Boston Globe, https://www.bostonglobe.com/ideas/2015/12/13/the-constitution-requires-inequality/PfxEpBF8h5VrOeI9m5NKAM/story.html (accessed 12/13/2015)Today, many people argue that campaign finance reform is the primary reason the wealthy so thoroughly control the government. But a careful reading of Federalist No. 10 ought to disabuse them of that notion. According to Madison, representative government is superior to democracy — a form of government, he says, that is “incompatible with . . . the rights of private property” — because it filters the public will through the medium of allegedly disinterested leaders. For the founders, only the rich were truly above corruption by “partial considerations.”




Inequality Does Not Undermine Democracy The Constitution deliberately preserved inequality to ensure good governanceRichard Kreitner, Archivist for the Nation Magazine, December 13, 2015"The Constitution Requires Inequality," Boston Globe, https://www.bostonglobe.com/ideas/2015/12/13/the-constitution-requires-inequality/PfxEpBF8h5VrOeI9m5NKAM/story.html (accessed 12/13/2015)The main purpose of the new Constitution, then, was to preserve inequalities among individuals and the inequalities in the distribution of property among them. “Those who hold and those who are without property have ever formed distinct interests in society,” Madison observes. Ever had it been, and ever under the Constitution would it be. The division of wealth and political power, between the haves and the have-nots, between (as the new Speaker of the House of Representatives Paul Ryan has put it) the makers and the takers, was to be carefully maintained.

There has always been inequality, and people have always cycled in and out of wealthTim Worstall, Fellow at the Adam Smith Institute and contributing financial writer for Forbes, December 2, 2015"Well of course the rich list own more than all cat owners," Forbes, http://www.forbes.com/sites/timworstall/2015/12/02/well-of-course-the-rich-list-own-more-than-all-cat-owners/ (accessed 12/13/2015)This is not something specific to US society, it’s not something specific to today’s neoliberal plutocratic world either. This is simply a function of how wealth distributions are. Thus comparisons between the top 1% of the society and the bottom 50% simply aren’t going to be of any great interest to anyone when we start talking about wealth distributions. For the world was like this back in those mythical 1950s of greater equality (as long as you weren’t a woman, black, or gay or anything) and this would also be true even if we had much greater income equality. Simply because there’s a huge lifetime cycle element to wealth, plus the fact that it’s possible to have negative wealth.




Inequality Has No Effect on Democracy

Prosperity has created new political norms in AmericaBrink Lindsey, vice president for research at the Cato Institute, 2009"Paul Krugman's Nostalgianomics," Cato Institute, http://object.cato.org/sites/cato.org/files/pubs/pdf/Nostalgianomics.pdf (accessed 12/15/2015)The emergence of a more individualistic ethos thus represents a case of cultural adaptation to new social conditions. The advent of American mass prosperity in the years after World War II was a new social reality that called for the development of a new, corresponding set of social norms.

Improved economy will render critique of inequality irrelevantDavid Callahan, senior fellow at Demos, November 18, 2013"The Single Best Argument against Inequality," The American Prospect, http://prospect.org/article/single-best-argument-against-inequality (accessed 12/15/2015)Recent public concerns about inequality could quickly melt away if the economy cranks back up and modestly good times return. The fact that tens of millions of workers will still be trapped in low-wage hell while a sliver of Americans live better than the kings of old will seem like a minor detail. Remember, this is America, where people will seize any chance they get to blame themselves for their economic misfortune as opposed to larger systems or the elites who run things.




High-Level Wealth Benefits Everyone

Billionaires succeed by making the rest of society secure and happyTim Worstall, Fellow at the Adam Smith Institute and contributing financial writer for Forbes, December 2, 2015"Well of course the rich list own more than all cat owners," Forbes, http://www.forbes.com/sites/timworstall/2015/12/02/well-of-course-the-rich-list-own-more-than-all-cat-owners/ (accessed 12/13/2015)In fact, I’m just overjoyed that they’ve got so much money. Because in order to gain it Sam’s heirs have had to be, through that company Walmart, offering something of value to the rest of us. And we even know how much that value is. Jason Furman

(currently Obama’s Chair of the Council of Economic Advisers, not right winger he) has pointed out, the mere existence of Walmart, the competition that it provides to other retailers with its low prices, saves the American consumer $250 billion a year. And if we collectively get $250 billion a year then I’m just entirely happy with the idea that those who provide it get a capital stock of $100 billion.

Not because it’s just or righteous you understand, rather, because it’s a pretty good incentive to the next group of people who want to come along and save us all $250 billion a year. Do note again that that’s the capital value, the total value, of $100 billion, while we’re getting the annual benefit of $250 billion. The capital value of that annual saving to us is perhaps $5 trillion (using a 5% discount rate).

Policies aimed at limiting wealth destroy our ability to make positive changesBrink Lindsey, vice president for research at the Cato Institute, 2009"Paul Krugman's Nostalgianomics," Cato Institute, http://object.cato.org/sites/cato.org/files/pubs/pdf/Nostalgianomics.pdf (accessed 12/15/2015)Consider high trade barriers, farm price supports and production limits, price and entry regulations in transportation and energy, interest rate caps and branching restrictions, national-origin immigration quotas—does Paul Krugman really wish to defend such things? Yet all of those policies—along with the labor laws, high minimum wage, and progressive tax rates that Krugman does celebrate—were constituent elements of the postwar economic order. All shared the same bias in favor of producer welfare at the expense of consumer welfare. And it was that pro-producer, anti-competition bias that served to promote income convergence: first, by limiting competition among less skilled workers; and second, by limiting competition for the highest-skilled workers.




Americans Accept Inequality Most Americans accept the current wealth distributionSuzy Khimm, senior editor at The New Republic, December 9, 2015"The Year the Fight Against Inequality Went Mainstream," New Republic, https://newrepublic.com/article/125363/year-fight-inequality-went-mainstream (accessed 12/13/2015)A recent study conducted by economists from Princeton, Harvard, and University of California, Berkeley professor Emmanuel Saez—one of the most prominent

researchers on inequality—put the political challenges of the issue in sharper relief. Based on a survey of 10,000 Americans, the study found that those who received more information about inequality were more likely to believe that economic disparity was a problem. At the same time, “they show no more appetite for many government interventions to reduce inequality”—such as an expansion of the Earned Income Tax Credit and food stamps—“with the notable exceptions of increasing the estate tax and the minimum wage.”

Americans reject sweeping solutions to wealth distributionSuzy Khimm, senior editor at The New Republic, December 9, 2015"The Year the Fight Against Inequality Went Mainstream," New Republic, https://newrepublic.com/article/125363/year-fight-inequality-went-mainstream (accessed 12/13/2015)The study hypothesizes that Americans are more comfortable with government solutions when they’re narrowly targeted or otherwise limit government involvement. That suggests that any kind of broad government intervention will be a hard sell to the broader public, even if the public believes the scales are unfairly tipped because of government policies. “Respondents who have learned the role of government in creating the current level of inequality seem to be telling us they do not trust that government is also the entity to address the problem,” the authors conclude.

Concerns about inequality do not spillover into general political conclusions; Americans are typically only concerned about their personal economic conditionsJohn B. Judis, senior writer at The National Journal and a former senior editor at The New Republic, November 23, 2015"The Paradoxical Politics of Inequality," Talking Points Memo, http://talkingpointsmemo.com/features/marchtoinequality/twoparadoxicalpolitics/ (accessed 12/13/2015)What, then, can those who want to use government to reduce income inequality do to get results now? In her recent book, The Undeserving Rich, sociologist Leslie McCall observes that the public’s concern about inequality does not necessarily jibe with the actual rise in economic inequality but with how they evaluate their own and their children’s economic opportunities. Pessimism about opportunity and concern about inequality grows during recessions and the first part of halting recoveries

like the recoveries from the 1991 downturn or Great Recession. Pessimism about opportunity doesn’t fall off until a boom visibly begins, and at that time concern about economic inequality also subsides. It subsided during the Clinton boom of the late 1990s even though the gulf between the one percent and everyone else grew significantly during this period. We are presently still in the halting recovery from the Great Recession when Americans remain pessimistic about their futures and concerned about inequality .




There is No Permanent Wealth Gap

Wealth inequality and inherited wealth are in dramatic decline and wealth is redistributed within the span of a few yearsRobert Arnott, Chairman of Research Affiliates, LLC, et al, 2015"The Myth of Dynastic Wealth: The Rich Get Poorer," Cato Journal, Volume 35, No. 3, http://object.cato.org/sites/cato.org/files/serials/files/cato-journal/2015/9/cj-v35n3-1_0.pdf (accessed 12/15/2015)Another way to examine the dynamism of legendary wealth is to observe how fast it has fallen in past generations. Piketty’s core thesis is that the rich know how to get richer. If they do, our evidence would suggest that they’re not trying. For the 10 wealthiest families of 1918, the average erosion of wealth relative to the prosperity of the average American was 5.3 percent a year between 1918 and their disappearance from subsequent top 10 lists, suggesting a half-life in relative wealth of 13 years. The average wealth erosion for the 10 wealthiest families of 1930, 1957, and 1968, until they were last evident on any list, was 6.6 percent, 5.3 percent, and 8.7 percent, respectively. These figures correspond to a half-life of wealth—the length of time it takes for half of the family fortune to be redistributed within society through taxation, spending, and charitable giving—of 10 years, 13 years, and (remarkably) 8 years, respectively.

Inequality inevitably dissipates; there is no permanent long-term wealth gapRobert Arnott, Chairman of Research Affiliates, LLC, et al, 2015"The Myth of Dynastic Wealth: The Rich Get Poorer," Cato Journal, Volume 35, No. 3, http://object.cato.org/sites/cato.org/files/serials/files/cato-journal/2015/9/cj-v35n3-1_0.pdf (accessed 12/15/2015)Collective second-generation wealth from the early 1980s through the early 1990s was sometimes just as large as collective first-generation wealth, as a share of top 30 wealth. No more. In recent years, first-generation wealth—wealth earned by creating products that people want and jobs that people need—has comprised over 70 percent of the top 30 wealth list, while second-generation and third-generation wealth has comprised less than 30 percent and about 2 percent, respectively. Dynasties? By the third generation, they’re in free fall. In the history of mankind, no great wealth has ever escaped the eventual “fall from grace.”




No Long-Term Inequality: Wealth Spreads Naturally Benefits of wealth and innovation will spread widely because the market wouldn’t function otherwiseTim Worstall, economic writer for Pando, 2015"Will technological progress lead to greater wealth inequality?" Pando.com, https://pando.com/2014/03/10/will-technological-progress-lead-to-greater-wealth-inequality/ (accessed 12/15/2015)A common myth is that robots are coming to take all of our jobs. The usual assumption is that the capitalists, who own most of the robots, will grab all that income in the economy as profits. We, the unemployed proletariat, will then starve as our overlords ground our faces into the dust. But this doesn't ring true for a number of reasons. The first is that we in the tech world can look around us and see that there's no way that any interesting new technology will remain in the hands of any one small group. Open Source is far too advanced for that. If any level of a truly robotic economy becomes possible (which I define as where the robots make the robots that repair the robots that dig up the ore to make more robots) there's absolutely going to be one group of geeks out there who will release the plans to build the first step in ones' garage.

Wealth is static—the power it provides will be widely distributedRay Hennessey, editorial director at Entrepreneur.com, February 12, 2014"The Myth of the Have-Nots," Entrepreneur.com. http://www.entrepreneur.com/article/231491 (accessed 12/14/2015)All of the current rhetoric deals with wealth alone. We hear about wealth inequality, and lawmakers push policies designed to redistribute wealth,

usually by increasing taxes on the successful to support programs for those that have less. Yet, that approach assumes that wealth is static, when the opposite is true. We know that affluence is often elusive, that people make money, then lose it and make it again. It is not locked up in a tower, to be freed through an economic storming of the Bastille (or a malodorous occupation of some public square). Redistributing that wealth doesn't help solve the issue because it destroys the very thing you are trying to preserve, like bringing a snowman indoors. Equal wealth doesn't make different people rich. It makes everyone poor.

Growing wealth decreases overall rich/poor gap through innovationTim Worstall, economic writer for Pando, 2015"Will technological progress lead to greater wealth inequality?" Pando.com, https://pando.com/2014/03/10/will-technological-progress-lead-to-greater-wealth-inequality/ (accessed 12/15/2015)What usually happens to something that we've just made more of? Yup, the price goes down. So, if robots do make capital more productive, and thus we've created more capital by producing those robots, that means that the price of capital falls. So, the gap between those with capital and those of us without it falls. This, I must point out, is the opposite of increasing wealth inequality.




The Inequality Thesis is False—Very Little Inequality Inequality is a myth—data shows substantial increases in wealth stability and a narrowing of the gapDiana Furchtgott-Roth, economist and senior fellow at the Manhattan Institute, December 16, 2013"The Myth of Increasing Income Inequality," E21: Manhattan Institute, http://www.economics21.org/research/myth-increasing-income-inequality (accessed 12/15/2015)Many commentators today bemoan a supposed inequality in the United States. Much of this concern is a problem in search of reality, caused by problems of measurement and changes in demographic patterns over the past quarter-century. Government data on spending patterns show remarkable stability over the past 25 years and, if anything, a narrowing rather than an expansion of inequality.

Everyone has access to wealth and successRay Hennessey, editorial director at Entrepreneur.com, February 12, 2014"The Myth of the Have-Nots," Entrepreneur.com. http://www.entrepreneur.com/article/231491 (accessed 12/14/2015)Instead of inequality of wealth, the focus should be the equality of ability. There are no Have-Nots when it comes to ability. Everyone is capable of success. Everyone, through their talent and attitude, can better themselves. It is not easy, nor is it guaranteed. But it is possible.




The Inequality Thesis is False—Very Little Inequality

Inequality is conceptually flawed—there’s no such thing as 99% versus 1%, and most people move up and down the economic ladder throughout their livesChris Matthews, economic writer for Fortune, June 11, 2015"4 things you didn't (but should) know about economic inequality," Fortune, http://fortune.com/2015/06/11/income-inequality/ (accessed 12/13/2015)There’s no such thing as the 99% and the 1%. Class divisions, at least when measured by income rather than wealth, are actually quite fluid in the United States . I recently highlighted a study by by sociologists Thomas Hirschl of

Cornell University and Mark Rank of Washington University which shows that, on average, Americans reside along many different income brackets throughout their lives. They relied on the government-sponsored Panel Study on Income Dynamics, and found

that from 1968 to 2011: 70% of the population will have experienced at least one year within the top 20th percentile of income; 53% of the population will have experienced at least one year within the top 10th percentile of income; and 11.1% of the population will find themselves in the much-maligned 1% of earners for at least one year of their lives.

The very concept of wealth inequality is flawed, assumes that differences are fixed and that we aren’t all increasing our living standards togetherAlison Basley, activist with Young Americans for Liberty, September 30, 2015"Bernie Sanders is wrong about income inequality," The Eastern Echo, http://www.easternecho.com/article/2015/09/sanders-wrong-about-income-inequality (accessed 12/14/2015)The truth is “wealth inequality” is a great catch phrase, but assumes that a fixed rich one percent of the population has attained that status at the expense of a fixed 99 percent. On the contrary, while it is true that inequality has increased, it is due to more people moving into higher income brackets. This wealth increase is even more pronounced by America’s growing population.




Inequality Decreasing Now

Poverty is decreasing worldwideRichard W. Rahn, senior fellow at the Cato Institute and chairman of the Institute for Global Economic Growth, November 23, 2015"A Bounty of Good News," Cato Institute, http://www.cato.org/publications/commentary/bounty-good-news (accessed 12/15/2015)New World Bank data shows that world poverty will fall to a record low of only 9.6 percent this year, or about one-fifth of its level as recently as 1980. The fall in poverty is closely related to the rise in world economic freedom over the same period. Countries giving up socialism for free markets and moving toward free trade accounted for most of this improvement.

Wealth is less concentrated than everBrink Lindsey, vice president for research at the Cato Institute, 2009"Paul Krugman's Nostalgianomics," Cato Institute, http://object.cato.org/sites/cato.org/files/pubs/pdf/Nostalgianomics.pdf (accessed 12/15/2015)And, obviously, wealth inequality can contribute to income inequality, and vice versa. But the trends in wealth inequality and income inequality have been quite different. According to economists Emmanuel Saez of Berkeley and Wojciech Kopczuk of Columbia University, wealth inequality (at least as measured by the share of total wealth held by the wealthiest 1 percent of Americans) has trended up slightly since the 1970s, but wealth remains considerably less concentrated than it was during the 1950s and ’60s—and dramatically less so than back in the 1920s.




Inequality Decreasing Now The material condition of all humanity is improvingCato Institute, January-February 2015"If Everything's Getting Better, Why Are People So Pessimistic?" Cato Policy Report, http://www.cato.org/policy-report/januaryfebruary-2015/everything-getting-better-why-are-people-so-pessimistic (accessed 12/15/2015)Evidence from academic institutions and international organizations shows dramatic improvements in human well-being. These improvements are especially striking in the developing world. Unfortunately, there is often a wide gap between reality and perception, including that of many policymakers, scholars, and intelligent lay persons. To make matters worse, the media emphasizes bad news, while ignoring the many positive long-term trends. At a Cato Policy Forum in November, Steven Pinker, the Johnstone Family Professor of Psychology at Harvard University and author of such books as How the Mind Works and The Blank Slate, discussed the psychological, cognitive, and institutional factors behind the persistence of pessimism in an age of growing abundance.

Real income increased 35 percent over ten yearsRichard Berman, president of Berman and Co., March 26, 2015"Warren’s pitchfork brigade skewers the facts," Washington Times, http://www.washingtontimes.com/news/2015/mar/26/richard-berman-elizabeth-warrens-flawed-income-ine/ (accessed 12/15/2015)But the Piketty-Saez data has been criticized for focusing too narrowly on tax return data that doesn’t give a complete picture of income. When Cornell University economist Richard Burkhauser and his colleagues expanded the analysis to look at households and include additional income sources such as benefits, tax credits and social welfare programs, they reached a very different conclusion: The bottom three income quintiles saw their real income rise by approximately 35 percent between 1979 and 2007.




No Objective Basis for Inequality

Wealth levels fluctuate, so inequality is always fluidScott Winship, fellow at Manhattan Institute, February 24, 2015"The Incessant Myth of the Growing Wage Gap," The Fiscal Times, http://www.thefiscaltimes.com/2015/02/24/Incessant-Myth-Growing-Wealth-GapIn fact, the Saez-Zucman data actually show that the wealth of the top one percent declined by 3.5 percent from 2007 to 2012. Wealth levels did recover over this period for the top 0.1 percent, but only because wealth levels at the top jumped strikingly between 2011 and 2012. That is likely due to the tax policy changes that occurred at the end of that year, which raised the top tax rates for 2013 and caused many individuals to sell assets and realize capital gains in 2012 in order to avoid higher taxes.

There are too many variables to make conclusive arguments about inequalityDiana Furchtgott-Roth, economist and senior fellow at the Manhattan Institute, December 16, 2013"The Myth of Increasing Income Inequality," E21: Manhattan Institute, http://www.economics21.org/research/myth-increasing-income-inequality (accessed 12/15/2015)But measuring inequality is not simple. The choice of the measure of income, along with the measure of the household unit, substantially influences the results of the inequality measure. Should income be measured before the government removes taxes, or after? Should income include government transfers such as food stamps, Medicare, Medicaid, unemployment benefits, and housing supplements? Furthermore, should wealth measures be included? In order to measure inequality, disposable income is the most accurate measure. This is what Americans can spend to make themselves better off. Hence, income should be measured after taxes are paid because households cannot avail themselves of tax revenue for expenditures. Similarly, income should include transfer payments because those are available for spending.

Arguments about inequality are premised on a false perceptionDiana Furchtgott-Roth, economist and senior fellow at the Manhattan Institute, December 16, 2013"The Myth of Increasing Income Inequality," E21: Manhattan Institute, http://www.economics21.org/research/myth-increasing-income-inequality (accessed 12/15/2015)Another change is the shrinkage in household size at the bottom of the income scale, adding to a false perception of increased inequality. This is due to the increased longevity of today’s seniors and to the higher numbers of divorced people and single- parent households.




Too Many Barriers to Establishing Inequality Patterns

Can’t compare long-term trends in wealth inequality, since the tax code dramatically changed in 1986Diana Furchtgott-Roth, economist and senior fellow at the Manhattan Institute, December 16, 2013"The Myth of Increasing Income Inequality," E21: Manhattan Institute, http://www.economics21.org/research/myth-increasing-income-inequality (accessed 12/15/2015)With the implementation of the Tax Reform Act of 1986, the top individual tax rate of 28 percent meant that small businesses were often better off filing under the individual tax code. Revenues shifted from the corporate to the individual tax sector. In the late 1980s and 1990s, that made it appear as though people had suddenly become better off and income inequality had worsened. This had not happened; rather, income that had been declared on a corporate return was being declared on the individual return. This makes any comparisons between pre- and post-1986 returns meaningless.

Geographical variance makes inequality appear greater than it actually isDiana Furchtgott-Roth, economist and senior fellow at the Manhattan Institute, December 16, 2013"The Myth of Increasing Income Inequality," E21: Manhattan Institute, http://www.economics21.org/research/myth-increasing-income-inequality (accessed 12/15/2015)Finally, inequality appears greater because the cost of living varies substantially in different parts of the country. College graduates tend to move to locations with higher costs of housing, food, and services, such as New York, Boston, Washington, D.C., and San Francisco. College students prefer these cities because they have amenities such as museums, theaters, shopping, and restaurants. As more well-educated people move into these locations, they become more attractive. What this means for the study of inequality is that high incomes are less valuable in high-cost locations.




Answers to “Piketty proves capitalism causes inequality” arguments

Piketty’s research is flawed: he disregards incentives, his analysis is too static, puts government off the hook, etc.Mark Hendrickson, adjunct professor of economics at Grove City College, January 7, 2015"Assessing Thomas Piketty's Capital In The Twenty-First Century," Forbes, http://www.forbes.com/sites/markhendrickson/2015/01/07/assessing-thomas-pikettys-capital-in-the-twenty-first-century/ (accessed 12/14/2015)Piketty’s book is riddled with flawed modes of economic analysis. Here is a partial list: He disregards incentives; clings to vestiges of the long-defunct labor theory of value; applies static analyses to a dynamic world; attributes no blame to government policy mistakes for the financial crisis of 2008-9; credits both taxes and inflation with nonexistent benefits; and mangles the history of America’s Great Depression, our graduated income tax, and federal minimum wage laws. The list above is not exhaustive, but hopefully shows that Piketty’s mistakes are not trivial, but fundamental and not rare, but pervasive.

Pikkety reversed his position on inequalityRobert Rosenkranz, economist and founder of the Intelligence Squared U.S. debates, March 8, 2015"Piketty Corrects the Inequality Crowd," Wall Street Journal, http://www.wsj.com/articles/robert-rosenkranz-piketty-corrects-the-inequality-crowd-1425854415 (accessed 12/13/2015)When he narrows his focus to what he calls “labor income inequality”—the difference in compensation between front-line workers and CEOs—Mr. Piketty consigns his famous formula to irrelevance. “In addition, I certainly do not believe that r>g is a useful tool for the discussion of rising inequality of labor income: other mechanisms and policies are much more relevant here, e.g. supply and demand of skills and education.” He correctly distinguishes between income and wealth, and he takes a long historic perspective: “Wealth inequality is currently much less extreme than a century ago.” All of this takes the wind out of enraptured progressives’ interpretation of Mr. Piketty’s book, which embraced the r>g formulation as relevant to debates playing out in Congress.

Pikkety makes no arguments about the political processEven if he’s right that capitalism allows for elites to take a disproportionate share of wealth, this doesn’t necessarily mean that such wealth differentials damage the political process.




Answers to “collective responsibility” arguments Arguments about inequality assume wealth is collective rather than individualPeter Schwartz, Distinguished Fellow at Ayn Rand Institute, November 9, 2015"The Collectivist Mentality," Huffington Post, http://www.huffingtonpost.com/peterschwartz/the-collectivist-mentalit_b_8500630.html (accessed 12/14/2015)The same philosophy underlies the crusade for income equality. “Why should the top 1 percent own close to 50 percent of the wealth in America?” the crusaders ask. Or, looking at the issue more globally, “Why should the U.S., with under 5 percent of the world’s population, have more than 20 percent of the world’s GDP?” If your life is not yours, neither is your money. Instead it supposedly belongs to the collective, which then determines how much you should be allowed to have.

The rich have more because they have produced morePeter Schwartz, Distinguished Fellow at Ayn Rand Institute, November 9, 2015"The Collectivist Mentality," Huffington Post, http://www.huffingtonpost.com/peterschwartz/the-collectivist-mentalit_b_8500630.html (accessed 12/14/2015)But don’t the rich have more because they have produced more? Doesn’t a Bill Gates or a Warren Buffett or a Sam Walton create his wealth through his own efforts? No, says the collectivist emphatically — no one does. This view holds not just that your money may be seized at will by society, but that you never earned it in the first place. It’s the view that your income is a collective product.

Collective responsibility doesn’t make any senseSince only the individual can be a moral agent, only the individual can be responsible.




Answers to “Wealthy pay no taxes” arguments

Tax burden is lowest on the low-income and highest on those at the topN. Gregory Mankiw, Professor of Economics, Harvard University, Summer 2013"Defending the One Percent," The Journal of Economic Perspectives, Volume 27, Number 3, http://www.ingentaconnect.com/content/aea/jep/2013/00000027/00000003/art00003 (accessed 12/15/2015)The Congressional Budget Office (2012) does precisely that when it calculates the distribution of the federal tax burden—and it paints a very different picture than did Buffett’s anecdote. In 2009, the most recent year available, the poorest fifth of the population, with average annual income of $23,500, paid only 1.0 percent of its income in federal taxes. The middle fifth, with income of $64,300, paid 11.1 percent. And the top fifth, with income of $223,500, paid 23.2 percent. The richest 1 percent , with an average income of $1,219,700, paid 28.9 percent of its income to the federal government.

Federal tax system is highly progressiveN. Gregory Mankiw, Professor of Economics, Harvard University, Summer 2013"Defending the One Percent," The Journal of Economic Perspectives, Volume 27, Number 3, http://www.ingentaconnect.com/content/aea/jep/2013/00000027/00000003/art00003 (accessed 12/15/2015)To be sure, some taxpayers aggressively plan to minimize taxes, and this may result in some individual cases where those with high incomes pay relatively little in federal taxes. But the CBO data make clear that these cases are the exceptions. As a general rule, the existing federal tax code is highly progressive.

This strongly proves that the elites do not control individual laws or general bodies of lawIf they did, you’d think that the first thing they’d do is eliminate or severely curtail the tax system.



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Answers to “Inequality decreases faith in democracy” arguments There is no democratic discontent in the status quo—those “left behind” by wealth are happier than everPiero Scaruffi, university lecturer and founder of Omniware, 2014"A Defense of Inequality," Scaruffi.com, http://www.scaruffi.com/phi/syn138.html (accessed 12/13/2015)This third stage is rather bizarre: after a Great Recession that was caused by unbridled capitalism and that decimated the middle class, while broke governments had to increase the costs of everything from health care to education, the young generations of the West seem perfectly happy to be left behind. Violent crime has dropped by 32% since 1990 across the USA at the same time that income inequality peaked. The fact that people in developed countries don't protest as much as in the past must be interpreted as evidence that people are happier, even though they are poorer than ever as a percentage of global wealth.

Freed-up capital benefits societyMark Hendrickson, adjunct professor of economics at Grove City College, January 7, 2015"Assessing Thomas Piketty's Capital In The Twenty-First Century," Forbes, http://www.forbes.com/sites/markhendrickson/2015/01/07/assessing-thomas-pikettys-capital-in-the-twenty-first-century/ (accessed 12/14/2015)When freed from political control, capital—the key ingredient of wealth creation—is not the social scourge conjured up by Piketty, but a great social benefactor. His blind spots are equally glaring: He gives short shrift to pro-growth policies; he doesn’t draw the obvious connection between high government spending and high public debts; and for a book ostensibly about “capital,” the author says virtually nothing about the economic function of capital or how capital increases.

There are many factors involved in faith in the democratic systemThe affirmative fails to prove that inequality is one of those, or even partially responsible for it.




Answers to “Inequality = Suffering” arguments

Arguments against inequality conflate it with poverty, which is unwarrantedStephen Nathanson, professor emeritus in philosophy at Northeastern University, 2005“Equality, Sufficiency, Decency: Three Criteria of Economic Justice,” Ethical Issues for the Twenty-First Century, ed. F. Adams (Charlottesville: Philosophy Documentation Center), http://www.usbig.net/papers/EcJusAPAVolume.pdf (accessed 12/14/2015)One possible alternative is the sufficiency criterion proposed by Harry Frankfurt. Frankfurt sets the stage for the sufficiency criterion by offering several arguments

against economic equality. He points out that people who have less than others need not be badly off. If everyone is well off but some are exceedingly wealthy, then no one suffers by virtue of having fewer resources. In such cases, he claims, there is nothing wrong with inequality. This is because there is an important difference between having less than others and having less than one needs or desires . Only in the second case is there something to be

lamented, and considerations of justice enter the picture only when people’s conditions are bad. As Frankfurt says, “To show [that] poverty . . . is compellingly undesirable does nothing whatsoever to show the same of inequality.”

As long as all have access to a decent standard of living, inequality doesn’t matterStephen Nathanson, professor emeritus in philosophy at Northeastern University, 2005“Equality, Sufficiency, Decency: Three Criteria of Economic Justice,” Ethical Issues for the Twenty-First Century, ed. F. Adams (Charlottesville: Philosophy Documentation Center), http://www.usbig.net/papers/EcJusAPAVolume.pdf (accessed 12/14/2015)My thesis is that while justice requires neither that all have equal resources nor that all have sufficient resources to make them content, it does require that, at least in affluent societies, all members have the resources required for a decent level of well-being. Once this standard is met, it does not matter whether others have more than a decent level. Inequality per se is not unjust; what is unjust is that some have much more than they need or deserve while others lack the basic resources required for a decent life.

The alternative is a politics of resentment and class warfareOur argument is that, even if there are vast differences in wealth in the United States, there are no barriers to each person enjoying an abundant life. The affirmative would have you believe that most people who’ve acquired wealth have done so in ways that take advantage of other people. No aggregate evidence bears this claim out.




Answers to “The wealthy don’t pay their fair share” arguments The wealthy pay for the vast majority of services in the United StatesStephen Moore, Distinguished Visiting Fellow at The Heritage Foundation, March 1, 2015"Do the Rich Pay their Fair Share?" Washington Times, http://www.washingtontimes.com/news/2015/mar/1/stephen-moore-do-the-rich-pay-their-fair-share-of-/ (accessed 12/15/2015)The top 10 percent pay two-thirds of the income tax. And the bottom 50 percent — all Americans with an income below the median — pay just 3 percent of the income tax. The federal income tax, according to a recent study by the Tax Foundation, is one of the most progressive tax systems in the world. Scott Hodge, president of Tax Foundation, says: “Almost no other industrialized nation depends on the rich to pay the bills more than the United States.”

The top .01 percent pay more taxes than half the populationStephen Moore, Distinguished Visiting Fellow at The Heritage Foundation, March 1, 2015"Do the Rich Pay their Fair Share?" Washington Times, http://www.washingtontimes.com/news/2015/mar/1/stephen-moore-do-the-rich-pay-their-fair-share-of-/ (accessed 12/15/2015)What about the super duper rich? The multimillionaires and billionaires. Warren Buffett famously says he pays a smaller share of his income in tax than his secretary. But when properly accounting for the taxes paid and income earned, the top 0.1 percent paid 16 percent of the income tax. So the top 0.1 percent paid an aggregate amount more than five times that of half the population.

Inequality actually allows the rich to pay more than they would in a world of equal or near-equal incomeIf not for the vast increases in wealth held by the top 1%, and top .01%, America wouldn’t be leading the industrialized world in the extent to which economic elites keep the ship afloat.




Answers to “inherited wealth is unfair” arguments

Intergenerational wealth is virtually impossible to sustainRobert Rosenkranz, economist and founder of the Intelligence Squared U.S. debates, March 8, 2015"Piketty Corrects the Inequality Crowd," Wall Street Journal, http://www.wsj.com/articles/robert-rosenkranz-piketty-corrects-the-inequality-crowd-1425854415 (accessed 12/13/2015)Second, it ignores the basic rule of economics that when supply of capital increases faster than demand, the yield on capital falls. For instance, since the great recession, the money supply has grown far more rapidly than the real economy, driving down interest rates. Returns on government bonds, the least risky asset, are now close to zero before inflation and negative 1% to 2% after inflation. In today’s low-return environment, with the headwinds of income and estate taxes, it becomes a Herculean task to build and transmit intergenerational wealth.

U.S. inheritance tax is fourth-highest in the worldAlan Cole, Economist with the Center for Federal Tax Policy at the Tax Foundation, March 17 2015http://taxfoundation.org/article/estate-and-inheritance-taxes-around-world (accessed 12/15/2015)The U.S. has the fourth highest estate or inheritance tax rate in the OECD at 40 percent; the world’s highest rate, 55 percent, is in Japan, followed by South Korea (50 percent) and France (45 percent). Fifteen OECD countries levy no taxes on property passed to lineal heirs.

The affirmative doesn’t establish the impact to inheritance as transfer of wealthWe aren’t sure how much money is actually passed down from generation to generation, but we can surmise that, at this point, it’s not much.



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