Thursday, June 7, 2012

The myth of the country of opportunity

"A closer look at those at the top reveals a disproportionate role for rent-seeking: some have obtained their wealth by exercising monopoly power; others are CEOs who have taken advantage of deficiencies in corporate governance to extract for themselves an excessive share of corporate earnings; and still others have used political connections to benefit from government munificence – either excessively high prices for what the government buys (drugs), or excessively low prices for what the government sells (mineral rights)."
writes Joseph Stiglitz in an article, about inequality in the USA.

In Garden Earth I write:

A widespread myth is that United States is the country of opportunity; the success of the individual is in his or her own hands. This was in particular repeated in conjunction with Barack Obama being elected as President, and by Obama too in his speeches. One is told that American society is a model for how people can be successful if they just work hard. Perhaps this was true[1] in nineteenth–century United States when conditions were very different and where there were almost inexhaustible natural resources waiting to be exploited (well, if one doesn’t consider that Native Americans, salmon and bison already used the space), especially compared to Europe, which was still half feudal. But the growth of the welfare state in Europe and the closing of the frontier in the United States changed this radically. Studies comparing the United States and Great Britain, on the one hand, with Canada, Germany and Scandinavian countries, on the other hand, show that social mobility is considerably higher in the Scandinavian countries and Canada and to a lesser extent in Germany than in Great Britain and the United States (Blanden et al. 2005). 

This pattern coincides with the level of inequality so that the countries with the lower equality show less social mobility. Unfortunately, many Americans still seem to believe the opposite and nurture the myth that the only thing that needed to get rich is hard work and dedication. Consequently, even if rarely spelled out as clearly, if one is poor one is to blame oneself. Those who ‘win’ are in some way seen as ‘better’ and therefore they have the moral right to their wealth. Considering that most wealth is just circulated among the already wealthy, this simply gives a moral superiority to those who are already rich. This also seems to be the message from Christian fundamentalists who have adopted the virtues of wealth and success as expressed in Proverbs 10:22 ‘The blessing of the Lord brings wealth, and he adds no trouble to it,’ instead of the dull and depressing moral of Matthew 19:24 ‘Again I say to you, it is easier for a camel to go through the eye of a needle than for a rich man to enter the kingdom of God.’

I note that in comments to Stiglitz article as well as in many other articles on the same topic, many refer to that many have been brought out of poverty the last decades. That is certainly true. Unfortunately, the most impressive record for this poverty reduction comes from a dictatorship with no liberal-capitalist policies, China. A country where inequality is rampant and extend also into other spheres than economics.  

In have written many more posts on inequality. e.g. 

The monuments of the city are built on the backs of poor rural people
Location divide is more important than class divide today
Growing inequality, between people, between countries, between region, between urban and rural
Tale from the sandpit
Equality is good for growth, but growth is not necessarily good for equality





[1]            For whites not subject to indentured labour; certainly not for the Native Americans or the African slaves.

No comments:

Post a Comment