Title: Limitarianism
Rating: 4 Stars
As long time readers of this site knows, the blog title is kind of a joke. This is now, I believe, the fourth time that I've used this title for a post. Maybe sometime I'll get tired of the joke, but apparently I have not reached that point.
This book asks the question, how much is enough? Now, if you believe in the neoliberal ideal that government needs to get out of the way and that it's each person's God given right to pursue all the wealth that they can accumulate, no matter what the cost, your answer might be, to quote an early MTV slogan, that too much is never enough.
Well, the author, Ingrid Robeyns, has been thinking about and asking this question for over ten years. Given that she's Dutch and has, in her past, been awarded a prize given in the name of Emma Goldman, it's probably not too surprising that she has a different take.
It's fair to say that she hasn't wasted that time. Her book makes several compelling arguments that our current method of just letting anyone amass untold riches in an uncontrollable manner is not only bad economics, but it's bad socially, environmentally, and even bad for the person doing the amassing. The US is, unsurprisingly, the poster child for this reckless mismanagement of wealth.
Let's talk about how bad the problem is in the US. It's interesting how the average American underestimates the problem. They understand that inequality exists, but they do not understand the extent of it. When asked to give an estimate, their average estimate is that the top 20% has 36% of the wealth while the bottom 20% has 11%. In actuality, the top 20% has 84% of all of the wealth while the bottom 40% (not just the 20%) has virtually no wealth. The top 1% alone has 32% of all of the wealth.
This isn't just a US problem. Between October 2020 and October 2022, for every dollar that the bottom 90% increased in wealth, the average billionaire received 1.7 million. Globally, billionaires alone own 50% of all wealth.
So, what's the big deal? Why is this a problem?
First of all, having the number locked away in a small number of personal accounts leaves that much money less to face existential crises like climate change. Governments are hamstrung in creating the moonshot programs needed to avoid potential catastrophe.
Having this money concentrated is undemocratic. The concept of one person / one vote is laughable when, because of decisions like Citizen's United, the ultra rich can spend tens of millions of dollars making sure that their vote is amplified way out of proportion.
What does a person do to acquire such a fortune? In many cases, the money is the product of crimes, be they past or in the present. Even now, if you scratch below the surface, there are fortunes that had a basis in slavery or stolen land. There are fortunes still being spent that were a product of support Nazi Germany.
How legitimate is the wealth of those not obviously based upon crime? Take Jeff Bezos, for example. Set aside for the moment that Amazon was in part funded by his parents. Bezos is work over 150 billion dollars. How much of that worth did he actually earn? How many packages has he delivered? How many lines of Amazon Web Services code has he written? It's a fact that if it wasn't for the hundreds of thousands of people that have worked for him over the past 30 years he wouldn't have even a fraction of of his net worth.
We as a society generally believe people such as Jeff Bezos and Elon Musk deserve their vast riches. That has certainly not always been the case. Over the past 45 or so years, neoliberalism has established itself as the dominant political theory. Before that, US citizens had the general idea that we are all in this together and that as you become more successful, you owe society a much greater share of your earnings.
Vast amount of wealth does not lead to happiness. One example is the declining value of money. To give an obvious example, giving $1,000 to a person with $500 in their checking account would make a huge impact to them while giving $1,000 to a person with a $10,000,000 net worth is meaningless. On a larger scale, buying your fifth Lamborghini or your third mansion simply does not provide the same level of satisfaction.
What about the philanthropists that promise to give away all of their wealth? On the one hand, that's certainly better than those that will just pass it down to enrich their likely deeply unhappy, unfulfilled children.
On the other hand, how did they make their billions? Robeyns gave the example of someone who has successfully given away their entire net worth, worth some eight billion dollars, and now live quietly in a two bedroom apartment. That seems laudable but then you learn that they built up their fortune through sophisticated tax evasion schemes. The bulk of the money that they donated probably should have been collected as tax revenue.
Why do we think that it's OK for billionaires to arbitrarily decide how to donate their billions? Who elected them? Is having three men drop billions of dollars on space tourism really the most effective way to spend these apparently excess funds? Such people are accountable to no one.
The overriding argument that neoliberals will always drag out is that it's their money to do what they will. Well, let's unpack that. How much money would these billionaires have if there was no legal property rights, paved roads, public education, law enforcement, public utilities, and everything else that makes up a functioning government? Where would Bezos be if the government hadn't developed the internet? Where would Musk be if NASA didn't exist?
The fact is that the lone genius inventing in isolation and building a fortune purely by the sweat of their brow is imaginary. Their property wouldn't exist without a functioning government, so why can't the government have the larger voice in how to dispose of it?
So, what's the path forward? I'm just going to provide a set of bullet points. Feel free to check out the book if you want more detail.
Key Actions:
- Dismantle neoliberal ideology
- Reduce class segregation
- Establish a balance of economic power
- Restore the government's fiscal agency
- Confiscate dirty money
- Make the international economic architecture fair
- Limit executive pay
- Halt the intergenerational transmission of wealth
Easy enough to do right?
Since the book is called Limitarianism, what should be the limit? Well, it's a question that would need a lot of thought and analysis but Robeyns suggests a net worth upper limit of $10,000,000.
I don't know about you, but I think that I could probably live with that limit.
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