Timothy Noah has one story about inequality. Mine, I think, is a bit different.
According to Noah’s story, while conservatives mostly deny the existence of inequality, liberals tend to focus on the gap between the 1 percent and everyone else and forget about the skills-based gap between those with a college education and those without.
I wonder what people he’s talking about. At least in the discipline of economics, while he’s mostly correct about conservatives (who spend a good bit of their time, when they address the issue of inequality at all, denying it’s a problem), liberal economists are the ones who have focused on the different rewards to different levels of education (which can then be solved by improving schools and encouraging higher levels of education). What conservative and liberal economists share is the idea that, in a market system, everyone gets what they deserve (at least when markets clear and there’s full employment).
As I see it, the idea that we needed to worry about the widening gap between the 99 percent and those at the very top actually came from outside the terms of that conservative-liberal debate—in the empirical work of Thomas Piketty and Emmanuel Saez and in the critique of current economic arrangements posed by the Occupy Wall Street movement. It has represented a challenge to both conservatives (based on the idea that inequality is a real problem) and liberals (since the 1 percent-99 percent gap simply can’t be accounted for by skill-based technical change).
Moreover, focusing on the top 1 percent (and, within that, the top .1 percent and top .01 percent) of the nation’s income distribution raises, in turn, the issue of class, which neither conservative nor liberal economists ever want to discuss.
Nor, as it turns out, does Noah. Until the end, when he finally mentions the divergence between the share of income going to capital (which has been rising) and that going to labor (which has been falling). But focusing on factor shares actually takes us away from skill-based inequality, even when connected to the demise of the union movement, and toward something more fundamental: the growing gap between the vast majority who produce the nation’s wealth and the tiny minority at the top who are able to appropriate a larger and larger share of that wealth.
And solving that problem means going beyond the terms of the conservative-liberal discussion of the problem of inequality and putting class itself on the table.
I guess, in the end, that’s where my story about the problem of inequality differs from the one Noah wants to tell.