some liberal reforms on the inequality front

The annual thumbsuckers inequality ball is going on in the press. The right, of course, is all at the battlements, decrying envy.  Greed is one of those virtuous sins for the rich, while envy is one of the damned sins that shouldn’t enter the New Jerusalem. Myself, I’ve always been a big fan of the evil eye. And I don’t even have the liberal disdain for greed.

But I do have the liberal-left desire to finish the incomplete task of the French revolution. Equality is up there with liberty on the roster.

Instead of kicking around abstractions, however, I think we should start kicking around ratios. How much more income and wealth than that earned and accrued by the top 20 percentile of income is allowable under the ideal of egalitarianism?

My sense is that if we take 250,000 dollars as our base (I am of course speaking of the US), something like 10 times that is as far aw we can go with inequality of income. Wealth is a trickier subject, but if we put a cap on 25 million dollars per person,  we have a good inequality space to work with.

Expropriative taxes are a clumsy way to enforce equality. Of course, the wealthy are always threatening to quit if they aren’t permitted to make world class booty – but I take those to be the rational cries of the hopelessly addicted. They should stop working, it would certainly benefit the rest of us.  But besides this, I think heeding those plutocratic bellows has landed us in a truly nutty variant of capitalism, with speculation ruling the roost.  This is why deeper and more radical reforms would aim at making the new york stock exchange, or any exchange, look more like the real economy. For instance, at the end of the year, the commerce department should tally up assets and earnings and make sure that the market capitalization of the firm equals the actual capitalization of the firm.

This would revolutionize Wall Street. Facebook would immediately shrink to a much lesser company than, say, Caterpillar Tractor. And so it should – being little more than an internet billboard company on which companies post ads, it is too ridiculous that Facebook is one of the world’s huge corporations.  The rule of speculation is intrinsic to the rule of the plutocrats. This is where rugs need to be pulled.