Saturday, May 10, 2014

"Never Envy The Rich": What Michael Novak Can Teach Thomas Piketty About Income Equality



By  Jerry Bowyer
Saturday, May 10, 2014

Continuing my interview with the great philosopher Michael Novak about his book, Writing From Left to Right, Novak talks about the working class commonsense he learned from his family growing up as a Democrat in Johnstown and McKeesport. He captures an attitude about coercive income equality programs which has almost completely been lost in the Democratic coalition. The transcript is below.

Jerry: “Is that maybe one of the ways in which that old union democrat base of the party inadvertently invited in the new left: the resentment against management? I remember a lot of that. That’s still around, [and] that still dominates the world that I live in of Western Pennsylvania: resentment against the wealthy, a kind of a class reverse-snobbery. I mean, it seems to me socialism could have invaded the Republican Party or the Democratic Party but those union democrats, in my opinion at least, kind of left the door open a little bit. Maybe they didn’t like when the socialist intellectuals shoved their way in, but to some degree those union democrats gave them an opportunity (in my opinion, [but] I’d like to hear yours) by having such negative views towards management, [and] such negative views towards capital in general and towards people who were wealthier than they were.”

Michael: “That probably was stronger in Pittsburgh from everything I know and read, and even [from] some family connections. It wasn’t Johnstown; Johnstown’s a smaller place, and while there were clearly felt resentments between those who lived up on the hill — as we used to put it, ‘the hills that towered above the city’. Johnstown’s the kind of city [where] on all sides it’s surrounded by hills… not Rockies, but they’re considerable and they block out the sun. It’s not until ten in the morning that the sun gets to shine downtown up over the hills, and then at four in the afternoon it’s disappearing behind the hills on the other side. Anyway, there was animosity going up towards the people living in the hills but not that much. It just was diminished and people from the valley started moving up — I think my father was one of the first ones to do so — started moving up on the hills. My father said things to me like, “Michael, never envy the rich. Just look around. They tend to lead such unhappy lives.” That I thought was a pretty common view: “Don’t envy the rich, you have your place, you can do better things than they can do and you live happier lives.””

Jerry: “It’s almost a Solomonic insight, a kind of Ecclesiastes insight. “The trouble of wealth.” You write a lot in the book Writing from Left to Right about envy and covetousness as destructive.”

Michael: “Yeah, most destructive in the world. Most destructive forces in the world.”

Jerry: “There’s something in Proverbs, another Solomonic insight: “Envy rotteth the bones.” I don’t think it’s just a medical observation, [envy] probably rotteth the bones of society as well, that kind of class resentment.”

Michael: “I was getting an honorary degree with the great conductor Rostropovich, and he told me a really funny story coming back in the limo to the airport; we were talking about envy and he said, “There were three Europeans, caught by a cannibal king, who were going to be boiled in oil on a following Wednesday, but over the weekend he allowed each of them to live out their wishes [or] fantasies. So, the Frenchman wished for a weekend in Paris with his mistress, no questions asked and no promises made. The Englishman wished for a couple of afternoons to walk through the fields of Oxfordshire with his colleague, reciting Keats and Shelley. And the Russian wished that his neighbor’s barn would burn down.” You’re only happy when you bring everybody down to your level, and I think that’s a lot of what’s going on now. There’s a lot of articles these days about growing inequality and there are two features of them: one is [that] they try to separate the top one percent out from the other 99 percent… well, that gives you a horribly exaggerated view of things because there’s a terrific spread right on up that ladder and an awful lot of the people born very poor – Andrew Carnegie himself included– became wealthy and then that family died off and their descendants experienced downward mobility. There’s this churning in America.”

Jerry: “From shirtsleeves to shirtsleeves in three generations. Is that the old saying?”

Michael: “Something like it. Maybe more generations…”

Jerry: “Maybe four.”

Michael: “Even if you go back to the founders, you know, the Washingtons and Lees and Lodges and Cabots – most of those families have died out. Most of those families are not big players today. This is a country of tremendous downward mobility but with a certain nobility, a certain calm and acceptance. I love that churn in America and I expect – and the figures show – that in every ten year period people in bottom twenty percent… more than half of them are no longer there. And we accept in this country almost ten million immigrants legally every ten years and who knows about the illegally, and most of them are out of poverty within that time. They’re poor for a few years and then they’re out of it, but then new ones come in to replace them. So one thing about the stability of our poverty figures is we’re constantly being inundated by poor people. Good thing.”

Jerry: “Right. In other words, by being a welcoming society we’re going to have a bottom. So we shouldn’t be rhetorically punished for being hospitable by allowing low-wage, low-skill immigrants to come to the country by being beaten up by inequality statistics or Gini indices or anything. That they’ll take account of the fact that actually it’s our openness and compassion as a society that’s led to that [or] that helped lead to that.”

Michael: “The other thing I notice in these figures is that in showing the inequality most of the people who stress that and try to point that out actually make it up, partly because they use numbers which don’t show the taxes people who earn income are paying.”

Jerry: “Right. Those are never after-tax income distributions.”

Michael: “And then they also don’t show the welfare benefits that have been put in place since the 1960s. So it gives a really false view of what’s happening in this society.”

Jerry: “One of the things that’s so crazy about that is [that] it’s used to justify more transfer payments, but transfer payments can never solve the problem because the statistic doesn’t take into account the transfer payment. So you can never redistribute your way out of that if the redistribution is not counted as income to people at the bottom.”

Michael: “Yeah. It’s discouraging to people who think that these redistributions are working less well than they actually are because the opponents keep saying, “Nothing has changed, it’s getting worse.” Well, holy smokes, we just laid out thirty billion or X trillion dollars and it didn’t do any good? That’s not right.”

Jerry: “And the other thing is [that] those income distributions never include an age adjustment so comparing a 55 year old to a 20 year old is not really an apples to apples comparison when it comes to the amount of wealth they’ve accumulated in their lifetime.”

Michael: “That’s right.”

Jerry: “Let’s come back to envy a little bit. Given the fact that envy is sort of a dominating impulse of socialism – do you agree with that, that envy is kind of the moral impulse behind socialism?”

Michael: “Well, I think it’s deeper. In the ten commandments the Lord forbids covetousness at least five times.”

Jerry: “Seven.”

Michael: “Seven it could well be. I’m just a poor Catholic, I’m not as good as some people on the Scripture.”

Jerry: “We Protestants, maybe we read it a little more. I don’t know.”

Michael: “Alas, I think that may be true. But in any case, “Thou shalt not covet thy neighbor’s wife; thou shalt not covet thy neighbor’s goods,” and it just goes on and on. That must be the most besetting sin. And I think it stays the most persistent sin, the desire for what is others’, because it’s so hidden. You know when people are hateful [or] violent; you can see it. But when people are envious, they don’t call it envy. They just call it ‘the longing for equality’ or ‘social justice’.”

Jerry: “’Fairness’.”

Michael: “Yeah, ‘fairness’. They all sound so good but you can tell what the underlying motive of it is. If it’s to bring down the people on top, that’s socialism. If it’s to move the whole society upwards, that’s the democratic republic.”

Jerry: “Right. Whenever I run into someone who sort of focuses on income inequality I try to figure out [if it is] mainly about floors or mainly about ceilings. If it’s putting floors under the poor, wonderful! Sign me up. If it’s about putting ceilings on top of the rich, then I just don’t see what benefit that is to anybody.”

Michael: “Microsoft, Bill Gates… If you want to put a limit on people, he’d be the one you’d have to put a limit on. But, my gosh, those of us who are however so poor [and] going to college or high school usually find those supplied to us or we’re given help in buying the computers. Now in school we’re learning computer skills – we wouldn’t have that sort of thing without the Bill Gates of this world. And when you think of the millions of people that he’s been served, [it’s] okay that he gets a penny for every one of those. He deserves it. What can he do with it? He’s going to invest in what he calls “good projects”. Whether you agree with his choice of good projects or not, he’s going to put it back into charity. He can’t eat it, he can’t take it away with him, and so there’ll be a building at the University of Pittsburgh or University of Wisconsin built in his honor.”

Jerry: “Every billionaire lives below his means. So that’s charitable, you know. The difference tends to be charitable donations.”

Michael: “That’s in America, I have to say. The rest of the world doesn’t seem to have that custom. You know, they pay so much in taxes that they’re not likely to put more into philanthropy in other countries.”

Jerry: “Yeah, that’s a good point. If you give on April 15th then that’s less you’re going to give, say, at the end of the year.”

Michael: “Yeah. Let Uncle Sam do it.”

Jerry: “Since envy is as pervasive as you say – and not just pervasive across the human race but pervasive longitudinally, throughout human history – that suggests to me that these constant declarations that socialism is dead, or socialism is over because we know it doesn’t work, seem to be maybe a little optimistic. Because if the driving force is envy, a vice which is a permanent part of human nature, instead of being just an honest mistake in interpreting the data, then new data for people for whom the vice of envy has made them data-immune don’t abandon the dream of socialism because they don’t abandon the vice that lies behind it.”

Michael: “Well, there’s a lot of truth in that. Italy, where I lived for two or three years off and on… There’s a wonderful joke I’ve heard which is about the Greens. They say the Greens are like tomatoes: they begin the summer green but by the end of July they’re red, and that means that typically the Green impulse – whatever its good intentions and good sentiments are – ends up in creating more and bigger government and intrusive government trying to manage peoples’ affairs. It ends up being socialist. It’s socialism by another root.”

Jerry: “And it lives on something in us. This is not imposed on us entirely; there’s an envy in us that makes that politically plausible and popular despite all the contrary evidence.”

Michael: “Well, I don’t so much link the environmental movement to envy. All those who rage about equality and inequality almost always aim at the rich and humiliate them and that tells me [that] they’re not for equality. They’re moving from resentment.”

Jerry: “A point you make in your book is that the global warming hypothesis does fit an already existing anti-market, anti-business kind of mental space in the left; whatever the evidence is contrary or against, that it sure does conveniently fit with people who want to bash business executives.”

Michael: “Yeah, but you know, I’m stunned by the fact that in Washington D.C., where I’ve lived for the last 31 years – not now, but did – there are more raccoons all over the city than there were in George Washington’s times. And even the deer come through the big culverts under the roads and are a bit of a menace on military roads and a few other places. And Pennsylvania is overrun with deer compared to anytime in the past. And you know, if you fly over the United States, the east coast, you see so much woodland, so much green.”

Jerry: “And it’s increasing. Forestland in the United States is increasing on an annual basis.”

Michael: “But this green is creeping even into the cities, right from the air as you see it. So there’s something very good going on in the American environment, whatever faults there are to be pointed out and corrected. Again, I judge literature of this sort by whether it’s fair to the realities, whether it’s noticing all the places in which we’ve made progress or it’s playing upon that American guilt which we are frail to.”

Jerry: “Yes. I agree with what you’re saying about the environment and yet, as the environment improves, the virulent nature – the zeal – of the environmental movement glows hotter and hotter.”

Michael: “That’s sort of normal for the course, I think.”

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