Saturday, July 19, 2014

Where would we be without capitalism and globalization?

I just read a fine article in the New York Times written by professor Tyler Cowen of George Mason University (HT Don Boudreaux). The gist was that while inequality is major in today's political discourse, in reality it's declining when viewed through a global lens. Of the reader comments I skimmed, not a single contributor shared my favorable view of the article.

Here's a relatively tame one that kinda sums up the overall sentiment of the comments:
OK, I think I've got the message. Rather than try to reduce income equality in the US--for example, by ending special tax breaks for billionaires--we should keep in mind that even though the average American worker's real-dollars income is stagnant or falling, the global economy will very gradually improve if we peons just suffer quietly and let billionaires take an ever-larger share of American's income.

I assure you the commenter has not read much any of Cowen's work. Had she, she'd not have presumed he is at all in favor of extending special tax breaks to billionaires.

We can take this one in myriad directions, but in the interest of time this morning allow me to make one very simple, and obvious, point:

I recently found myself in conversation with a bright and delightful 15 year-old who comes from an economically-challenged American family, we'll call her Mary. Mary and her 4 siblings are being raised by Mom and Dad who don't work outside the home. She mentioned that they might move her grandmother in, and if they do her mom would receive an extra $240 per month. When talking about the dynamics of living in such tight quarters---sharing her bedroom with two siblings, and thinking she'll have to squeeze Grandma in there somewhere---she mentioned that her sister is not at all happy right now because her older brother's tablet broke, so he confiscated his little sister's laptop and won't give it back. Mary doesn't understand why her brother is always on her sister's laptop because usually all he wants to do is play on his X-Box. Mary's on her third smart phone this year by the way.

My intent in sharing my conversation with Mary is not at all to complain about incentives---about the technological luxuries afforded to many Americans who receive government assistance. And while it doesn't address the alleged stagnation of the "average American worker's" income, I'd just like to pose one basic question: where would we (on whatever rung of the economic ladder we rest) be without capitalism and globalization?



  1. […] Reading the New York Times, Mazorra finds evidence that popular myths die hard. […]

  2. I left a comment Cowen's article in the New York Times and when submitted it a message came up stating "Your comment is awaiting moderation" or some such. That was two days ago. It never appeared. My comment included no swear words and attacked no one; it just agreed and expanded on a couple of Cowen's points. I can only conclude that the Times is censoring comments, excluding those that don't comport with popular Upper West Side sentiments.