Monday, August 2, 2010


This story in the Telegraph caught my eye when it appeared a couple of weeks ago. It says that well-educated people (another story in the same paper on the same day calls them "Champagne socialists") are not as left-wing as they think they are. According to the story, "the respondents’ actual ideological position ... was established by asking them whether they believed wealth should be divided more equally."

Now Chris Bertram is talking about it at Crooked Timber. He quotes the questions asked about the division of wealth:
“Incomes should be made more equal vs We need larger income differences as incentives. How would you place your views on this scale?”
“Imagine two secretaries, of the same age, doing practically the same job. One finds out that the other earns considerably more than she does. The better paid secretary, however, is quicker, more efficient and more reliable at her job. In your opinion, is it fair or not fair that one secretary is paid more than the other?
The underlying assumptions (or some of them anyway) seem to be that income differences are incentives, that you either believe in incentives or you don't, and that left-wing people don't. The last two of these ideas are not admirably sophisticated.

The first might sound true, but it needs to be read not as saying that, among other things, income inequalities are incentives, but rather as saying that this is all that such inequalities are. So what you cannot think is that qua incentives such inequalities are good but that all things considered they are bad. There are, supposedly, no other things to be considered. That's quite a claim, but I suppose the main problem is with the second assumption. You can, in fact, believe that two people doing the same job should have some incentive to do that job well without thinking that the top 1 or 2% of earners should be paid vastly more than everyone else.

It is perfectly reasonable to think that incentives can encourage people to work harder. It is less reasonable to think that this is what explains the inequalities in our society. CEOs make about ten times what coal miners make. They don't work ten times harder. Nor are they ten times better as people. It might be true that it is a sad fact that CEOs need to be paid this much in order to get the best people to do their important work. But that has nothing to do with the question about the fairness of paying a quicker, more efficient, more reliable secretary more than a sluggish, inefficient, unreliable co-worker. Fairness and reliability are moral concepts, but if there is a need to pay CEOs vast amounts then this has nothing to do with morality. Although I'm sure many CEOs would like to think that it does.

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