How best to argue for equality: fairness, social outcomes or economic outcomes?

It’s interesting that when progressives argue in favour of redistribution or other policies for greater equality, we tend to base our arguments either on normative ideas about fairness, or on the better social outcomes that we think result (look at The Spirit Level for an example of the latter).

In these straightened times, however, it might be that we’d reach more people with our arguments if we based them a little more on the contribution that much more inclusive growth might be able to make towards economic recovery.

This is the central thrust of an argument put forward by Nick Hanauer, one of the earliest investors in Amazon (who hence has more than a few cents to rub together), in a TED talk that’s now circulating samizdat-style on the web thanks to TED’s decision not to post it online; they thought it was too politically controversial. Here are some highlights from the transcript:

It is astounding how significantly one idea can shape a society and its policies. Consider this one: If taxes on the rich go up, job creation will go down.


Anyone who’s ever run a business knows that hiring more people is a capitalist’s course of last resort, something we do only when increasing customer demand requires it.  In this sense, calling ourselves job creators isn’t just inaccurate, it’s disingenuous.

That’s why our current policies are so upside down. When you have a tax system in which most of the exemptions and the lowest rates benefit the richest, all in the name of job creation, all that happens is that the rich get richer.


Another reason this idea is so wrong-headed is that there can never be enough superrich Americans to power a great economy. The annual earnings of people like me are hundreds, if not thousands, of times greater than those of the median American, but we don’t buy hundreds or thousands of times more stuff. My family owns three cars, not 3,000. I buy a few pairs of pants and a few shirts a year, just like most American men. Like everyone else, we go out to eat with friends and family only occasionally.

I can’t buy enough of anything to make up for the fact that millions of unemployed and underemployed Americans can’t buy any new clothes or cars or enjoy any meals out. Or to make up for the decreasing consumption of the vast majority of American families that are barely squeaking by, buried by spiraling costs and trapped by stagnant or declining wages.

Read the whole thing.