Mares: Drivers Of Economic Leveling

Apr 17, 2017

Walter Scheidel, a Stanford humanities professor, builds on Joseph Stiglitz's and Thomas Piketty's work on economic inequality with his own book, The Great Leveler, Violence and the History of Inequality from the Stone Age to the Twenty-first Century.

In it, Scheidel offers a perceptive, if grim, explanation for the ever-widening socio-economic gap in America, for the growing practice of paying corporate leaders 300 or 400 times what’s paid workers on the shop floor, and for the reasoning behind appointing a Cabinet filled with billionaires who have little in common with average citizens.

Instead of focusing on the great, if fitful, advance of the democratic impulse from the Greeks to town meeting, he argues that four immense shocks have been the principle drivers of economic leveling. And when almost everyone was made poorer, the rich arguably lost the most.

The first driver is pestilence or plague, like the Black Death of the late Middle Ages, which, by killing more than a third of Europe's population, radically changed the value of land and labor.

The second is the collapse of whole empires, such as that of Western Rome, or various Chinese dynasties.

Next are the great wars of mass mobilization, two of which happened in the 20th Century. Scheidel argues that a greater degree of democracy - and patriotism - was the price that political and economic elites paid to engage the middle and lower classes in mass warfare.

Finally, socio-economic leveling occurs during financial upheavals like the Great Depression of the 1930's, the only one of these four shocks to the socio-economic system in which millions did not die. That this Depression was book-ended by two world Wars created a tri-fecta of misery but also more economic equality.

On the one hand, considering Scheidel’s four alternatives, I’m pessimistically reminded of the wag's version of the Golden Rule, in which it’s said that "He who has the gold, makes the rules!"

But the optimist in me says that while peaceful efforts to narrow this economic inequality have been weak, most people, including Scheidel would agree they’ve done little harm.

Besides, even if they’re not fully up to the "growing challenges ahead" I don’t even want to consider the alternatives.