Irish people are cute with their money. Unlike in the United States, it’s not the done thing here to flaunt your wealth – but clearly some individuals are sitting on pots of gold.
The number of people in Ireland with wealth of more than $50 million (€46.6m) more than doubled from 655 to 1,435 between 2012 and 2022, according to an Oxfam report last year. Latest Revenue figures show the number of individuals or couples earning more than €150,000 grew from 67,000 in 2018 to more than 146,000 this year.
Should it bother you, however, if you’re not as rich as your neighbour? And from a moral point of view, is economic inequality that big a deal?
This debate has a surprisingly long history, as American political scientist David Lay Williams observes in a new book The Greatest of All Plagues: How Economic Inequality Shaped Political Thought from Plato to Marx (Princeton University Press).
Taking inspiration from Williams’s work, today’s Unthinkable looks at five arguments in defence of economic inequality – and why just one partially succeeds.
1. Economic inequality is not morally significant
“With respect to the distribution of economic assets, what is important from the point of view of morality is not that everyone should have the same but that each should have enough.” So said American philosopher Harry G Frankfurt.
According to this stance, known as “sufficientarianism”, justice is served by ensuring people have sufficient means to get by, rather than by trying to narrow gaps in wealth.
Crucially, however, what is regarded as “enough” in a society is related to average standards of wealth. The economist Adam Smith recognised this in the 18th century when he wrote “a linen shirt ... is, strictly speaking, not a necessary of life ... [but] a creditable day labourer would be ashamed to appear in public without [one]”.
What’s “enough” today? High-speed broadband, a well-stocked fridge and at least one foreign holiday a year? The issue is more complex than Frankfurt makes out.
2. Extreme inequality is all we should worry about
Libertarians see inequality as a largely positive force, suggesting intervention is justified only in extreme cases.
But what counts as “extreme” inequality? One might simply focus at the very top, such as the world’s five richest men – who are estimated to have doubled their fortunes to $869 billion (€802 billion) since 2020, while the world’s poorest 60 per cent (almost 5 billion people) have lost money.
Limiting our concern to the greatest extremes, however, ignores the role played by structural or generational forms of economic inequality. In the United States, for example, 10 per cent of families own 70 per cent of family wealth. Is this not extreme too?
3. We should strive for “fair inequality”
Another tactic for defending inequality is to uphold the fairness of paying some people much more than others. If Taylor Swift or Kylian Mbappé contribute a million times more to society than I do, for example, then shouldn’t their salaries be a million times greater than mine?
But here a group of philosophers called luck egalitarians ask the question: How much can any of us take credit for our success?
For luck egalitarians, it is unjust if some people are worse off than others through no fault or choice of their own. Fairness in wealth distribution must mean more than just letting the market decide.
4. Wealth is a sign of good character
There are two general schools of thought regarding the impact of wealth on character. On the one hand, there are those who see money as a sign of superiority. Think of Donald Trump boasting about well-dressed women from a North Carolina church attending his political rallies: “They look so wealthy and beautiful.” On the other hand, there are those who see money as a corrupting influence. “No man can serve two masters,” said Jesus. You can’t serve God and mammon.
Psychology shows Jesus was right. Studies on empathy found the wealthy tend to act in “self-gratifying and often greedy ways”, Williams points out. One study discovered “the wealthy are significantly more likely to shoplift, have affairs, drive through a crosswalk while ignoring pedestrians, and seize for themselves the last remaining cookie off a serving dish”.
5. Worrying about inequality builds resentment
Jean-Jacques Rousseau said economic inequality inflames the “citizens’ hatred of one another”, while John Stuart Mill said it creates “concealed enmity”. Frankfurt responds with a sort of finger-wagging. “Exaggerating the moral importance of economic equality is harmful,” he writes, “because it is alienating. It separates a person from his own individual reality, and leads him to focus his attention upon desires and needs that are not most authentically his own.”
But Frankfurt’s account of human desire is unrealistic. Individual needs can’t be divorced entirely from societal conditions. He is on safer ground when he makes the point that “those who are doing considerably worse than others may nonetheless be doing rather well”.
It suggests we can reach a compromise on the issue. There are good reasons to be angry about economic inequality but, when it comes to considering your own status in life, don’t forget to count your blessings.