is an excellent exposition of Karl Polanyi, an anthropological, sociological, and historical economist who focused on the ways that markets are always embedded in civil society. “Laissez-faire was planned,” Polanyi argued, echoing the research of Karl Marx finding that capitalism was born through violence and oppression. Second, It's the Crude, Dude looked at oil reserves as a major precipitating cause of the Iraq War. Especially enlightening in the book is her consideration of gas efficiency standards and the associated loopholes created for SUVs when they first arrived on the market.
While her talk was not as engaging as a previous one Wes and I had saw for It's the Crude, Dude, she nonetheless brought forth some very interesting ideas. First is the idea of the income parade, which she borrows from Dutch economist Jan Pen. The idea is simple: each person has a height based on their income, with mean heights representing a person with a mean income, and each person having heights taller or shorter respectively. (Make twice the mean income and you're twice as tall; half and you're a shorty.) Each person in the society is ordered by height/income and marches in a parade that lasts one hour. The idea behind the income parade is to give clear images to make comparisons and to imagine unfathomable amounts of money – for instance, we can compare how many minutes it takes to get to the mean income; how short the earliest (that is, poorest) people are; and even how far into outer space the richest person's head goes.
The second intriguing idea McQuaig had concerns the argument for income distribution. My own thoughts on this topic have been essentially as follows. First, wealth tends to exhibit a Matthew effect. The Matthew effect was coined by the eminent functionalist sociologist Robert K. Merton to describe the ways that well-known researchers tend to receive more credit for their work than lesser known academics, even where the quality and topic of their work is held constant. Merton takes this from a Bible quotation; in the New International Version of the Bible (the Bible favoured by many fundamendalist churches!), it reads as follows: For to all those who have, more will be given, and they will have an abundance; but from those who have nothing, even what they have will be taken away (Matthew 25:29). People with money often make more money for doing nothing. People with only small amounts of capital (such as machinery worked by the owner of a company) or none at all tend to have to earn income by working; those with more can simply invest it and watch more money come in.
Second, wealth tends to exhibit what I would call an “elephant effect,” by which I mean that the wealthy (the elephant), by dint of their influence, “crash” around civil society and use their money in ways that do not make the rest of us better off. A good example of this would be the use of money to purchase media outlets and production, which results (at least potentially) in the reduction in the number of viewpoints necessary to sustain liberalism and democracy. The United States demonstrates this effect all the time with the amount of money that is poured into elections and buying off government officials.
Third, those with money tend to rely on a greater share of societal resources in order to sustain that wealth. More money requires more use of roads, more need for protection in the legal/police system, more to lose in case of invasion (hence more need for defense), more benefit from healthy employees who work to sustain the wealth, and so on. McQuaig's second intriguing point is a variant of this third argument. In essence, however, she argues that the wealthy more often do not only rely on such government provided public goods for the basis of their wealth, but also upon the cultural inheritance that comes before them. Her example (which in my mind is unfortunate) is that of Bill Gates, who relied on every technical improvement from the wheel to language in order to create DOS and later Windows. Although he deserves to be compensated (and perhaps quite handsomely) for these innovations, she argued that these represent at best piecemeal improvements over previous technologies. Moreover, because they rely on materials that are not “his” – public goods and “common goods”[1] – he deserves not to be permitted to gain benefits from the public and common goods that form the basis of his work. Moreover, redistribution of income and wealth makes possible the very creation of public and common goods that lead to more wealth.
One interesting point raised by Matt Ferrell, a professor at Fanshawe who teaches political science, concerns the “after effect” of such innovations. Bill Gates's innovations, he argued, obviously improve (or perhaps could be argued to have improved!) our ability to teach, to design courses, to communicate with each other and students; so, what, then, is the amount of compensation he should be rewarded for this? McQuaig's arguments really did not hold much water here, as she simply continued to assert that redistribution of income is fair given that most individuals rely on public and common goods to generate their wealth in the first place. But Wes pointed to a far more simple argument: none of us rightly makes claims to wealth generated from our activities, except as they pertain to the direct rewards of the activity themselves. A taxicab driver has no claim to the winnings from a lottery player who takes a ride to collect their winnings; a Tim Horton's employee has no claim to the wages made from an officer worker's increased productivity because of caffeine; a construction company has no claim to the profits of a multinational corporation when they build their head office. Therefore, I don't think that Bill Gates deserves to get to hold onto his money because he has continued to make our lives . . . let's say “different,” because I would feel uncomforable with asserting that he's made them “better.” Especially considering that I am typing this with Open Office 3.2 (A free Microsoft Office rival) on the aforementioned Linux.
[1] I am not well versed in economics to know if there is a term that is covered by what I mean by common goods. I use it to represent human inheritance patterns – culture – that are either too diffuse or too remote in origin (language is a good example of this, as are many inventions) to specifically locate in the work of one person, or even of a bounded group of individuals. Inventions which originate with such individuals can become common goods through diffusion and further application. Although evolutionary theory as we know it first emerges with Alfred Wallace and Charles Darwin, the “body” of knowledge since gained about evolution would be hard to pin down on any individual scientist(s), unless we focus on only very specific areas of work. Non-rivalrous (from economics) captures some of this distinction as common goods are generally infinitely shareable with others, and limited only by the capacity of our media and educational systems to disseminate such goods.
