Inequality seems to be the prime concern of Right Thinking People everywhere. But almost no one is drawing out the connections between inequality and envy. As Henry Hazlitt wrote in 1972, “[t]here can be little doubt that many egalitarians are motivated at least partly by envy, while still others are motivated, not so much by any envy of their own, as by the fear of it in others, and the wish to appease or satisfy it.” Indeed, contemporary discussions of income and wealth distribution, progressive taxation, the “long-run return to capital,” and the like would greatly benefit from careful study of great works like Helmut Schoeck’s Envy and Bertrand de Jouvenel’s Ethics of Redistribution. Murray Rothbard’s “Freedom, Inequality, Primitivism and the Division of Labor” should be required reading as well.

An important point coming out of this literature is that envy is generally strongest when inequalities are small, rather than large. Huge inequalities of wealth, income, or consumption are considered irrelevant; smaller inequalities are seen as remediable through state action. As noted yesterday by Peter Schiff, consumption inequality is probably far lower today, in Western countries, than in most societies in human history. The average Roman didn’t think often about Crassus, but the average American — part of the global 5% — thinks a lot about the wealthier Americans across town.

As Hazlitt noted, de Tocqueville saw modest inequality as the driving force behind the French Revolution. “The most popular theory of the French Revolution is that it came about because the economic condition of the masses was becoming worse and worse, while the king and the aristocracy remained completely blind to it. But de Tocqueville, one of the most penetrating social observers and historians of his or any other time, put forward an exactly opposite explanation.” Hazlitt quotes the French historian Emile Faguet:

Here is the theory invented by Tocqueville. . . . The lighter a yoke, the more it seems insupportable; what exasperates is not the crushing burden but the impediment; what inspires to revolt is not oppression but humiliation. The French of 1789 were incensed against the nobles because they were almost the equals of the nobles; it is the slight difference that can be appreciated, and what can be appreciated that counts. The eighteenth-century middle class was rich, in a position to fill almost any employment, almost as powerful as the nobility. It was exasperated by this “almost” and stimulated by the proximity of its goal; impatience is always provoked by the final strides.

The surge of interest in inequality among today’s pundit’s and politicians is likely driven by the fact that inequality, in the sense that matters to most people in Western countries, is far lower than its historical average.

The Best of Peter G. Klein