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Thursday, June 09, 2016

The Problem With Inequality, According to Adam Smith

Dennis Rasmussen at ​The Atlantic

The Problem With Inequality, According to Adam Smith, by Dennis C. Rasmussen, ​The Atlantic: ...Many a scholar has made a career, in recent decades, by pointing out that this view of Smith is a gross caricature. ...
What has received little attention, even by those who approach Smith’s thought from the contemporary left, is that he also identified some deep problems with economic inequality. ... When people worry about inequality today, they generally worry that it inhibits economic growth, prevents social mobility, impairs democracy, or runs afoul of some standard of fairness. ...
None of these problems, however, were Smith’s chief concern—that economic inequality distorts people’s sympathies, leading them to admire and emulate the very rich and to neglect and even scorn the poor. Smith used the term “sympathy” ... to denote the process of imaginatively projecting oneself into the situation of another person, or of putting oneself into another’s shoes. ... And he claimed that, due to a quirk of human nature, people generally find it easier to sympathize with joy than with sorrow, or at least with what they perceive to be joy and sorrow. ...
What’s more, Smith saw this distortion of people’s sympathies as having profound consequences: It undermines both morality and happiness. First, morality. Smith saw the widespread admiration of the rich as morally problematic because he did not believe that the rich in fact tend to be terribly admirable people. On the contrary, he portrayed the “superior stations” of society as suffused with “vice and folly,” “presumption and vanity,” “flattery and falsehood,” “proud ambition and ostentatious avidity.” In Smith’s view, the reason why the rich generally do not behave admirably is, ironically, that they are widely admired anyway...
Smith also believed that the tendency to sympathize with the rich more easily than the poor makes people less happy. ...Smith’s writings ... associated happiness with tranquility—a lack of internal discord—and insisted not only that money can’t buy happiness but also that the pursuit of riches generally detracts from one’s happiness. ... Happiness consists largely of tranquility, and there is little tranquility to be found in a life of toiling and striving to keep up with the Joneses. ...

[See the full article for more, e.g. Smith's ideas on the alleviation of poverty.]

    Posted by on Thursday, June 9, 2016 at 07:58 AM in Economics, History of Thought, Income Distribution | Permalink  Comments (15)


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