The following is a guest post from New York University political scientist David Stasavage.
In his Monkey Cage post of March 28, David Williams answers this question by using the work of Jean-Jacques Rousseau. As a firm believer that commercial societies would witness an inexorable increase in inequality, Rousseau in his “Discourse on Political Economy” wrote of the corrupting influence of inequality and “luxury” and of the need to levy taxes on the rich to curb the problem. Rousseau’s stance has obvious relevance for the problems we face in the U.S. today with inequality on the rise and many calling for government to use the tax system to do something about it.
Rousseau’s text was originally published in Denis Diderot’s famous Encyclopedia as the entry for “Political Economy.” As it so happens, in that same work there’s another, more nuanced, text that provides a starkly different view of luxury and inequality and which can also provide lessons for today. Jean-François de Saint-Lambert was commissioned by Diderot to write the article on “Luxury” for the encyclopedia. The interest of such a text was obvious; at the time the pundits of the day were fiercely debating the virtues and vices of “luxury” and its potentially corrupting effect on nations. Take our 21st century debates, substitute the word “inequality” for “luxury,” and you get a sense of the tone.
Saint-Lambert was among the first to move the debate in a new direction. He suggested that luxury itself was not the problem; what mattered was how luxury was generated. If luxury was earned thanks to institutionalized privilege, or by those who had gamed the system, then it would inevitably have a corrupting influence. The effects for the nation would be disastrous. In Saint-Lambert’s own words:
When wealth is acquired without work or through abuses, the newly wealthy promptly enjoy their quick fortunes, and right away they get used to idleness and frivolous pursuits. They become odious to the majority of their fellow citizens to whom they have been preferred unjustly, and whose enrichment they have prevented.
Now in cases where luxury is instead acquired through industriousness, Saint-Lambert argued that it would not have these nefarious effects. He thought that luxury must be made to serve a “spirit of community,” and it could do so as long as it was acquired in this latter manner. In our modern terms, we might say that Saint-Lambert was emphasizing the importance of fairness.
It is certainly possible to use Saint-Lambert’s text as a simple apology for inequality in the United States today. On paper we have a political and economic system that is based on equality of opportunity to a much greater extent than in France under the Ancien Regime. Scratch a bit beneath the surface, though, and we see a different lesson for our current system. For the same reasons that Saint-Lambert thought it unhelpful to simply denounce luxury, the better objective may be to ask how inequality today is generated rather than simply lamenting it. Saint-Lambert reminds us that not all inequality is created equally. The real question is to what extent the sources of today’s inequality resemble a modern version of the “abuses” that Saint-Lambert identified in Ancien Regime France.