December 2, 2014

Austrian Attitudes Towards Inequality

It seems to be very commonplace these days for politicians and media pundits to discuss inequality and its negative consequences.  Their argument usually states that inequality is a problem for society, and so if we have greater equality (or reduce inequality to a minimum), society will be better off as a whole.  It seems to me that discussing inequality and the pursuit of greater equality is a political tactic aimed at justifying the use of force in the lives of others.  Since the Austrian school holds a much different attitude towards inequality, it is worth further discussing below.

One of the key points many politicians overlook today when discussing inequality (specifically income inequality and poverty) is just how relatively well off even those we consider poor (in this country) truly are.  There are people living under the poverty line who live in three bedroom houses, drive a car, and own a flat screen TV and a cell phone.  These individuals are enjoying comforts and amenities that even the ruling elite of the middle ages couldn't even have dreamed of.  And, somewhat surprisingly, these comforts may actually have come about thanks to some level of inequality.

To carry this idea further, it is important to discuss the role of the "wealthy" members of society and their use of new luxury products.  Before a good or service is available to all, it is generally first used by only the wealth members in a society (take the car or cell phone as an example).  This is usually because they can afford to test such new luxury items.  But this testing fulfills an important function in society: it makes goods and services that were once only afforded to a few (because of price, or because they hadn't refined the production process yet) available to all.  Thirty years ago, only wealthy businessmen could afford the new technology that was the cell phone.  But today it is not uncommon to walk down the 16th Street Mall in Denver and see homeless folks chatting on them.

Because everyone is born with different attributes, aptitudes, skills, technical abilities, physical features, drive, ability to gain and retain knowledge, attitudes towards problem solving, and so on and so on, it makes very little sense to me to talk about equality.  Since no two individuals are completely alike, it is farcical to imagine a world in which they are.  It would be a world of homogeneous people all with the same abilities.  It doesn't sound much like a world I would care to live in.

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