Sunday, October 24, 2010

The end of disgust (among other things)?

An economist recently complained in the NYT about the rise of inequality in the United States. After the furor caused by the publication of The Spirit Level, it has apparently become acceptable even for practitioners of the “dismal science” to frown at extreme inequality. If not to condemn it on the basis of a frivolous “value judgment,” at least to point to its troublesome social consequences – including its negative externalities for even some of the top dogs. Call it the “negative utility” of wealth. The NYT contributor draws a stark contrast between two ages in American history: the 1950s, when decreased income and wealth inequalities (and a marginal federal tax rate of 91 per cent for incomes over $200,000 – or two million in today’s dollars) went hand in hand with rapid economic growth; and the period since the 1980s featuring rapid economic polarization , much slower growth rates, and a series of financial hiccups. Incidentally, there are other contrasts between the two periods. In the 1960s, the majority of American Caucasians professed to feel disgust if forced to drink from a water fountain after an African-American person. Three decades later such squeamishness at even imaginary contact with in individuals belonging to a different “race,” sexual orientation, or subculture had miraculously evaporated. Could this amazing march of tolerance have also come to include tolerance of gross inequality, as a result of weakened disgust at the obscene salaries and profits reaped by the best and the brightest in some sectors of the economy? And their casual flaunting of extreme opulence?