So people really are serious about trying to figure out what the truth value of the sentence “inequality is the defining issue of our time” is. Because the idea of the “defining issue of our time” is empty and meaningless, there is no serious way to debate about it. Normally if you want to debate whether X is Y, you’d have some test or set of criteria for what constitutes Y. Then you would apply that test to X. But “defining issue of our time” is such a vacuous phrase that you can’t do that. With that kind of analysis foreclosed, all you can do is play the intuition pump game.
Ezra Klein got the ball rolling with the most spectacularly confusing intuition pump of all time:
But is inequality really the country’s most pressing problem? Imagine you were given a choice between reducing income inequality by 50 percent and reducing unemployment by 50 percent. Which would you choose?
Haha, what? In Ezra’s intuition pump, everyone is given a bag of 50 percents (of anything, just percents standing alone detached from any unit) and asked where they would apply those percents. This made enough sense in his head somehow to put it out on the internet, but makes no actual sense in reality. If nothing else, the 50 percents are best spent on increasing employment, not reducing unemployment. This is a comically tedious point, but it also reveals how goofy the whole intuition pump is.
Now Dylan Matthews has his own intuition pump:
Let’s suppose you actually believe that America’s biggest problem is *inequality*. You’re not saying “inequality” when you mean “poverty” or “unemployment” or “median wage stagnation” or “conspicuous consumption” or “political corruption.” You really think the gap between the rich and poor, separate from the actual positions of the rich and poor on their own, is the problem.
Imagine that in 2033, America looks like this…
* Absolute poverty, hunger, and homelessness are either at 0 percent or damn close to it.
* Unemployment is below 4 percent, as it was in the late Clinton years.
* Real GDP is growing at about 4 percent a year.
* Median wages are growing at about 4 percent a year too.
* Total factor productivity is growing at about 2 percent a year, as it did in the years after WWII.
* Inflation is either negligible — around 2 percent, say — or has been eliminated through e-money.
* Health spending (incl. Medicare/Medicaid/etc.) is growing at the inflation rate.
* We have a carbon tax set to the actual social cost of carbon, as do all other countries.
* The gender and racial pay gaps have been closed.
* The racial achievement gap in schools has been closed.
* Free pre-K is a part of all public school districts, as is a bachelor’s from a community college.
* The median American worker has a BA, and high school dropouts are negligibly small.
* We have public financing of federal elections, and donor influence is at a nadir.
* Social Security is 100% solvent.
* And, for kicks, let’s say we don’t have any public debt and are running a balanced budget.However…
* There are many more Americans worth in the billions, tens of billions, and even hundreds of billions.
* The Gini index has grown substantially from its 2013 level because of the previous development.If you really believe inequality is our most serious problem, you have to look at an America that looks like this and say that it hasn’t solved its most serious economic problem yet. Sure, all the progress made in the preceding 20 years is good, but it didn’t touch the really big problem.
If that sounds preposterous, then maybe it’s because you don’t actually think inequality is our biggest problem. You think something like poverty or joblessness or median wage stagnation is. And you’re right.
This intuition pump is interesting because in paragraph one Dylan decides that he is going to drill down hard on what someone can mean when they talk about inequality. Using inequality to refer to the phenomenon itself and its attendant epiphenomena is not allowed. It has to be the phenomenon and only the phenomenon, or what Matthews calls “the gap.”
Ultimately, there is a problem with this parametrization strategy. Matthews adopts the strategy to try to, on the parametrization level, make it very difficult to forward an inequality point (because things you want to call inequality points don’t count as “inequality” points). This is a common debater strategy, but it will sink his and Ezra’s arguments about unemployment just the same. Watch:
Let’s suppose you actually believe that America’s biggest problem is *unemployment*. You’re not saying “unemployment” when you mean “growth” or “wage growth” or “health effects” or “anything else.” You really think that some people not getting up each morning to go work at jobs, separate from the any consequences of them not doing this, is the problem.
Now, nobody is going to say (not even those who think work is good for the soul, after all you can work without having a job) that literally high unemployment in and of itself is the biggest problem. Therefore you don’t actually think “unemployment” as I have rigidly circumscribed it so as to definitionally keep you from accessing any of its epiphenomena is the real problem, do you?
Look at how clever I am!
Beyond this definitional move, Matthews has another problem. What he has done is create a hypothetical world (let’s call it Future World) that’s pretty great. But then added in a condition that it was quite unequal. He asks us to compare Future World against a hypothetical Present World that only differs from the real present world in that it has less inequality. So you see, you’d prefer Future World against hypothetical Present World. So that proves inequality is not the biggest issue.
But as with his move in paragraph one, this is also going to sink the unemployment argument he and Ezra are pushing. Suppose everything in Future World is as Dylan describes it, but it also has 7 percent unemployment. Now compare that against hypothetical Present World that only differs from the real present world in that it has lower unemployment. So you see, you would prefer Future World against this hypothetical Present World. So it appears I have taken Matthews’ methodology and proven unemployment is not the biggest issue.
These intuition pumps are silly.