1. The comments
on my wage disparity posts [comments invoking Nash equilibria and such like
arcana] suggest that I failed to make myself clear. I was not at all offering an answer to the question,
What explains the current structure of wages and salaries in America? I was merely offering an argument against the assertion by countless
economists and sociologists, and presupposed by Rawls, that unequal compensation
is required to draw into key jobs the people best suited to perform them,
thereby maximizing the collective social output. I may have missed something, but I did not
see a comment that directly engaged with that argument and sought to rebut it.
2. We need to
stop talking about White non-college
educated males as though they are a niche segment of the electorate, like
Soccer Moms. Sixty-five percent of White
males 25 and older do not have
bachelor’s degrees. They are two-thirds
of all White males. It might be much
more helpful to speak of White male racists, which helps to overcome the
natural tendency for those of us on the left to suppose that blatant racism
must have its source in economic disadvantage.
3. If I
believed that Biden is far and away our best chance of defeating Trump, I would
be prepared to swallow my bile and support him, but I really think that in
addition to being deeply objectionable, Biden is also simply a lousy candidate
and a very weak horse on which to put our money. But I doubt he can get the nomination, so we
probably need not worry about him.
I recently saw a report of a poll that asked "are you opposed to or do you support assisting immigrants?" White fundamentalist christians had the lowest level of support. On the other hand, the religiously unaffiliated and African American Baptists were in favor of helping immigrants. You gotta love it when those who are allegedly the most religious are the least Christian while those that are the least religious are the most Christian.
ReplyDeleteAnother poll asked "How do Trump's statements make you feel." 76% concerned, 67% exhausted, 65% angry, 62% insulted, 56 % frightened, and proud or inspired, you may wonder, came in at 36% and 33% respectively.
Re: 2) you are right on the mark. Re 3) the turnout in 2020 needs to match the turnout in 2018. That means high turnout among millennials, Blacks and Hispanics and reproducing the shift of formerly R leaning suburban women (and men) to the D column. If the 2018 turnout is matched, the likely result is a D win of landslide proportions. Candidate Biden is least likely of the top contenders to generate a huge turnout. Never under estimate the capacity of the Dems to shoot themselves in the foot.
I too buried the lede. The answer was: with the prevailing system of property rights, after the adjustments you allow for you would see the same distribution of income. With a different system of property rights, the distribution would be different. I doubt that your experiment is refutable. I'm with you regarding Rawls: there is no "original position" to start from.
ReplyDelete@NN
ReplyDeleteYou're missing the point, I think. RPW is asking a straightforward question -- are significant inequalities in salary or wages (compensation) required or necessary to attract certain people to certain jobs? -- and his answer is "no." Now, such inequalities might (though I think this is highly debatable) tend to occur anyway given a certain "system of property rights" -- that seems to be your view -- but whether such inequalities would tend to occur given a certain "system of property rights" has no bearing on the question of whether such inequalities are necessary from a societal standpoint.
It seems clear to me that a CEO earning 300 times the salary of his average employee, say, can't be justified on grounds of "necessity" since among other things, as RPW pointed out, there was a period in the not-too-distant past when salary inequalities of this magnitude did not exist.
(The notion or implication, by the way, that Rawls thought CEOs need to earn 300 times or even 30 times what their ordinary employees do in order to attract "talented" people to become CEOs is in my view wrong -- i.e. Rawls did not think that -- but that's a side point in this context.)
Also NN, you refer to "adjustments" that RPW "allows for," but I don't know what this means. He's asking a particular, discrete question and arguing for a particular answer to it, and that's all.
Finally, my own intuition is that some inequalities in compensation might be societally necessary (not just to attract people to "undesirable" jobs but also to "desirable" ones that might also be quite stressful, for instance), but nothing anywhere near the magnitude of current inequalities in compensation.
LFC, that is exactly correct. By the way, I did not say that Rawls thinks the current strcuture of unequal compensation is justified by the Difference Principle, only that he assumes without argument that some sigificant inequalities would be necessary, and hence justified.
ReplyDeleteAlso NN, you refer to "adjustments" that RPW "allows for," but I don't know what this means.
ReplyDeleteRPW wrote, "Well, if too few people choose to be maintenance personnel, sweeping floors, emptying trash baskets, cleaning toilets, and washing windows, then it might be necessary to raise the wages of those jobs to fill them. If a great many people want to be division managers, and if testing shows that there are more well suited people wanting those jobs than are needed, then it will not be necessary to raise the pay associated with those jobs above the social norm. And so forth."
I referred to this passage, but if "adjustments [in salary] that RPW allows for" is a mischaracterization, let me know a better one, unless neither of us know what RPW means by this.
I tell you that under the prevailing system of property rights, we see the current distribution. Then I claim that under a different system, we would see another one. There is empirical evidence for this: we did see less outrageous CEO to line worker salaries in the past. Given the relationship, it follows that the current inequalities in salaries are not necessary to motivate people to work. Yet you conclude that the system of property rights is irrelevant to the question. That would be true if one could leave the same patterns of ownership in place, with the same laws and institutions, the same taxes, the same industries, the same regulatory capture of government by business and so on, and still realize a more equal income distribution than the current one. But I don't see these considerations as irrelevant, unless you want a yes/no answer to Prof Wolf's question, without mentioning the assignment of property rights in play and the opportunity costs these create, which include income inequalities. If the answer must be controlled in this way, then I agree with his answer of "no' with no further explanation.
ReplyDeleteI was not at all offering an answer to the question, What explains the current structure of wages and salaries in America? I was merely offering an argument against the assertion by countless economists and sociologists, and presupposed by Rawls, that unequal compensation is required to draw into key jobs the people best suited to perform them, thereby maximizing the collective social output.
ReplyDeleteWhether readers believe it or not, I felt tempted to explain precisely that.
In defense of those who misunderstood RPW's argument, I'd say that his single mention of Marx in the second post (More on Inequality, July 12), secondary to his argument as it was and almost off the cuff, may have triggered an instinctive need to show Marx was wrong and "his" argument simplistic. Think of a reflex.
The lesson: be careful when using that name.
I also noticed that those who did understand the thrust of RPW's argument but were unable to refute his conclusion, quickly shifted the discussion.
-- The AnonyMouse