X-Spam-Status: No, score=-1.9 required=5.0 tests=BAYES_00,SPF_NEUTRAL autolearn=no version=3.2.2 Sender: -1.9 (spamval) -- NONE Return-Path: Received: from newman.eecs.umich.edu (newman.eecs.umich.edu [141.213.4.11]) by boston.eecs.umich.edu (8.12.10/8.13.0) with ESMTP id l83MWgux010348 (version=TLSv1/SSLv3 cipher=DHE-RSA-AES256-SHA bits=256 verify=FAIL) for ; Mon, 3 Sep 2007 18:32:43 -0400 Received: from icestorm.mr.itd.umich.edu (mx.umich.edu [141.211.176.135]) by newman.eecs.umich.edu (8.14.1/8.14.1) with ESMTP id l83MW6rW026873 for ; Mon, 3 Sep 2007 18:32:14 -0400 Received: FROM edinburgh.eecs.umich.edu (edinburgh.eecs.umich.edu [141.213.4.27]) BY icestorm.mr.itd.umich.edu ID 46DC8B6A.B3BFB.32358 ; 3 Sep 2007 18:32:10 -0400 Received: from edinburgh.eecs.umich.edu (localhost.eecs.umich.edu [127.0.0.1]) by edinburgh.eecs.umich.edu (8.13.1/8.12.9) with ESMTP id l83MWNCt014524; Mon, 3 Sep 2007 18:32:23 -0400 Received: from localhost (jmickens Æ localhost) by edinburgh.eecs.umich.edu (8.13.1/8.13.1/Submit) with ESMTP id l83MWNud014521; Mon, 3 Sep 2007 18:32:23 -0400 In-Reply-To: Message-ID: References:

MIME-Version: 1.0 Content-Type: TEXT/PLAIN; charset=US-ASCII; format=flowed X-Spam-Checker-Version: SpamAssassin 3.2.2 (2007-07-23) on newman.eecs.umich.edu X-Virus-Scanned: ClamAV version 0.91.2, clamav-milter version 0.91.2 on newman.eecs.umich.edu X-Virus-Status: Clean Date: Mon, 3 Sep 2007 18:32:23 -0400 (EDT) To: Daniel Reeves cc: Michelle Sternthal , Dave Morris , improvetheworld Æ umich.edu, Steven Reeves , reeves-hayos Æ umich.edu, reeves-kalkman Æ umich.edu From: James W Mickens Subject: Re: mind the gap > This is a big contribution to this debate. Thanks Michelle! > > Quick thought though: > > A life expectancy gap is bad and efforts to narrow it are laudable. > Unless the solution is to kill old people to harvest their organs to > save people who are dying younger. > > I'm just pointing out that an income gap being bad doesn't mean that > forced redistribution is good (or even necessarily helps the poor in > absolute terms). I realize that this is just an analogy, but it presents a misleading view of wealth redistribution. After all, it may be that older people have larger organs that are packed with redundant tissue. Thus, we could extract a sliver of an older person's organ with no penalty to her, and transplant that sliver into a younger person (with no organ at all!) for a great increase in net utility ;-). For a more concrete example, suppose that the economy has generated a single "new" dollar and that we can give this dollar to an extremely poor person or an extremely rich person. I claim that giving the dollar to the poor person almost always increases net utility more than giving that dollar to the rich person. Relatively speaking, that single dollar will afford the poor person many more opportunities for acquiring food, shelter, medicine, or simple peace of mind than it would for the rich person. Now let's suppose that the dollar is not "new," but instead has been redistributed from the rich person to the poor person. I would still claim that there is a net increase in utility. In other words, I claim that a public policy can be net-zero with respect to aggregate wealth generation but net-positive with respect to aggregate utility generation. One might argue that, in some cases, the rich person should receive the dollar so that she can invest it. This is a valid point, since the returns on the investment might result in a net increase in utility---for example, the investment might result in new entertainment technology or the creation of high paying jobs. I agree that investment helps to improve our quality of life and that, to some extent, investment is driven by the existence of people with surplus funds (and thus is driven by income inequality). I have no problem with this. However, I also believe in John Rawl's notions on inequality. As he says in his book "A Theory of Justice": "All social values---liberty and opportunity, income and wealth, and the bases of self-respect---are to be distributed equally unless an unequal distribution of any, or all, of these values is to everyone's advantage." Thus, I can tolerate (and, in fact, celebrate) the existence of wealthy entrepreneurs to the extent that the fruit of their labor and talent helps everyone. However, I see no reason to celebrate wealth in and of itself, since wealth isn't welfare, and welfare is what I care about. So, here's my question to the wealth-equals-welfare economists: do we currently live in a society with an acceptable level of wealth inequality? If the answer is yes, then why is this level of inequality acceptable? Furthermore, could it be that even *greater* inequality is acceptable, or even preferable? For example, could *fewer* people have health care in an acceptable world? Could *fewer* people have access to clean, safe neighborhoods? What areas of American society are too equitable for their own good? If the wealth-equals-welfare economists agree that there is too much inequality in our society, I have a different question. Now I want to know why people like Paul Graham spend so much time writing about America-Prime, which is just like America but where poor people deserve their lot in life and rich people are swept by the Darwinian tides to the shores of luxury? Why would Graham claim to derive deep insights about our current society based on the sociology of an alien nation bereft of discrimination and institutional injustice? Sometimes I feel that Graham is not an economist, but an ethnographer for some strange extraterrestrial civilization. Simply put, Paul Graham is not my boyfriend. ~j