Tuesday, July 15, 2014

Against Class Warfare

John Oliver’s recent talk on wealth inequality got me thinking a bit more on the topic. What is the relationship between good government and class warfare? Is government properly an instrument of class warfare? Sometimes government gets corrupted that way, but its proper role is quite the opposite.

Some sort of formal government structure becomes necessary for any society larger than perhaps a hundred families. Very small societies can get away with informal structures. Everyone will know the details of every conflict. The character of everyone else is known and one can understand how to navigate the ambiguities of any transaction. But at a larger scale of society, one regularly interacts with people whom one does not know very well if at all. Some basic framework of assumptions is needed so one can negotiate a transaction without a thorough preliminary investigation being required. It is the job of government to regulate the interactions between individuals so the benefits of larger scale society can be enjoyed.

The fabric of society is woven with relationships of trust. With trust, individuals can interact while giving each other the space for individual decisions. Without trust, one is forced to the extremes of isolation or domination. Warfare is the symptom of the breakdown of trust. Warfare is the symptom of ineffective government. Whether or not global government could ever be a real or desirable possibility, it has never been an actuality, and so war between nations has always been with us. Warfare within nations, civil war or class war, is not so constant. Reasonably effective government is not impossible.

When dealing with people whom you don’t know, the difficulty that you have no basis to trust them as individuals can be resolved to the extent that you can trust that the government will work to maintain the interaction within the frameworks it has established. You have effective recourse if the other party fails to live up to their end of the bargain.

Trust in government can falter for many reasons. The government can simply be too weak or remote to be effective. But a government that fails to be impartial is also not trustworthy, at least for those who get the short end of the stick. If individuals in some group within society cannot rely on the government to resolve their disputes with others outside that group, then the conditions are ripe for some kind of civil war.

Is rich versus poor really a class distinction? Certainly we do regularly estimate each other’s wealth status and view them from that perspective. But I suspect that class divisions are not quite the same as wealth divisions, though of course they are highly correlated. The distinction that really matters for class warfare is that of political power. If there are groups that can steer the government so that the frameworks it establishes are biased in their own favor, that bias undermines the trustworthiness of government and creates the conditions for class warfare.

The fundamental problem of politics is that imbalances in power tend to amplify themselves. Good government may be possible, but it is not stable. It requires constant work to identify and correct bias. The best way to correct bias is to remove the mechanisms that create the bias. A much less satisfactory method is to introduce additional mechanisms with the opposite bias, in hopes of producing a total result that is unbiased.

Taxation is a nice example where these questions of bias are at play. To what extent is wealth inequality a result of bias in government? To what extent do the rich create governmental structures that reinforce their own wealth?

In the vision of the proper role of government that I am sketching here, the government’s role is not to create the world we want. It is our responsibility as members of society to create that world. The government’s proper role is indirect. It is to create a framework for the interaction of members of society, to enable them more effectively to create that world together. Of course some people will want one kind of world and others will want a different sort of world. The proper role of government is not to resolve those differences, but simply to create a common framework where issues of diversity and conformity can be negotiated between individuals.

From this perspective, it would be entirely inappropriate to put higher taxes on wealthy individuals for the purpose of reducing wealth inequality. But look at how government functions preferentially to enhance the wealth of the wealthy! For example, a huge fraction of the federal budget is devoted to international relations. These relations are managed to nurture and protect business relationships such as foreign investments, trade, etc. Certainly we all benefit from the trade in coffee, bananas, etc., but such international business benefits the wealthy preferentially to a very great degree. Given that government benefits the wealthy much more than the poor, it makes perfect sense that the wealthy should provide a similarly greater degree of financial support for those government operations. Or, for another example, when foolish bankers and foolish home buyers entered into foolish lending relationships, it does seem quite unfair to bail out the lenders and hand the resulting tax bill to the borrowers.

Perhaps there is some natural logic to the rich getting richer. What is of fundamental importance is that the government not be biased toward enhancing the power of any such powerful group, or even be perceived as having such a bias. Such bias is the fuel that feeds class warfare. We are reaching a point where there are concentrations of wealth and power that can and do dominate the government and steer the development of laws and regulations to amplify their own advantages. To recognize this bias and to work to correct it is not to engage in class warfare, but to fight against it.


  1. You've definitely reached the right conclusion here. And the influence of concentrated wealth on governmental policy is at such a level that we could probably say there isn't really a political solution at hand. That's why I advocate increasing the power of civil society in the economy, which isn't an automatic fix by any means, but an avenue with possibilities, at least.

  2. Yes, and increasing the power of civil society in politics should do some good, too!