iclysdale and I got into another discussion at http://www.livejournal.com/users/iclysdale/13725.html?thread=49821, which got long enough I figured I should move it to separate post.
Allowing individuals to select their own groups result nigh-inevitably in the elites choosing to be with "people of our kind," and perpetuating and exaggerating class distinctions.
The past century has seen class distinctions get fuzzier and fuzzier, driven by increasing social mobility. It’s gotten to the point where the Democrats get most of their “soft money” from the extremely rich. Look at who’s making the biggest donations—they’re giving to the Dems. So to the extent this is problem it’s solving itself.
United for a Fair Economy has a number of interesting charts (using American data, but its convenient, and the Canadian experience is very similar) showing the changes in income for different income levels over the last fifty years, and - for something really sick - CEO pay as a multiple of average worker pay, 1960-1999.
The relative income level changes hide more than they reveal. Everyone’s been getting richer because a dollar buys more now than it used to—higher quality products delivered faster, as well as access to things that didn’t exist 50 years ago. They don’t stay in the same quintile either. New workers start at the bottom, work their way up to higher salaries, then live on pensions after they retire. Ten years ago I was in the lowest quintile, now I’m in the 2nd highest (though probably in the middle one for Los Angeles). A good article detailing the real improvements is http://reason.com/9512/COXfeat.shtml.
As for the CEO salaries, I don’t give that much of a damn. If a bell curve gets bigger and one end is locked at zero, the other end is going to keep getting farther and farther away. I care where the mean is, an increasing mean is good for everyone. If Bill Gates has his salary doubled it doesn’t affect me.
say that an excess of wealth disparity is bad for us and should be stopped - it's bad in terms of rising crime rates; it's bad in terms of social divides; it's wasteful; and it should be stopped. From all those perspectives, I'm a huge fan of the maximum wage, of high taxes for high incomes, and all sorts of other 'socialist' ideas.
Sigh. Y’know, that’s been tried. It worked out very badly. Humans are inherently hierarchical. Every society has its pecking order, down to hunter-gatherers giving first choice of food to the matriarch or Big Man, and the ones at the bottom get the scraps or starve during droughts. Plunk a bunch of people into a new setting with no distinctions among them and they will rapidly sort themselves into groups with leaders and a hierarchy among the groups. Look at any high school.
Human ambition is a powerful force. If you don’t provide outlets for it the ambitious will find other ways to get to the top. It’s like trying to stop a river dead by damming it—if you don’t have a spillway the water goes over the top, between some other hills, or applies enough pressure to break the dam. If the only way to get ahead in the world is to be part of the government that controls everything all the government posts are held by people whose sole qualification is outmaneuvering the other contenders. This gets you leaders like Josef Stalin, who killed more people than Hitler.
A healthy society—which we’re lucky to have in America—is one that lets people pursue lots of different paths to fulfill their ambitions. You can invent, or entertain, or get elected, or chase a Nobel Prize, or offer people products or services that they’ll give you money for. A decentralized system where people make their own decisions produces better results than one that has bureaucrats deciding what the price of cabbages should be. Some people wind up with a lot more money than others in this system. Get over it—envy is not a sound basis for policy decisions. There’s still a lot of errors in the system, but they’re fixable with jail terms for fraud or bankruptcies. A “millions dead in Siberia” error is not fixable.