In Enlightenment Now, Pinker makes a crucial counterpoint—the distinction between relative and absolute prosperity: “Total wealth today is vastly greater than it was in 1910, so if the poorer half own the same proportion, they are far richer, not ‘as poor’.” Put simply, people can be much richer in absolute terms despite a relatively smaller share of total wealth.
Pinker makes another important point about what happens when a society starts to generate substantial wealth: “An increase in absolute inequality (the difference between the richest and the poorest) is almost a mathematical necessity.” Conceptually and mathematically, then, Piketty misses the mark—though the problems don’t stop there.
In general, discussions on the distribution of wealth are based on a logical error equating inequality with poverty. According to Pinker, this “confusion of inequality with poverty comes straight out of the lump fallacy—the mindset in which wealth is a finite resource.” Helpfully, Pinker reminds us how the Enlightenment revolutionized our understanding of economics. First, by teaching us that wealth is created; and second, by showing that we can make more of it.
This simple but powerful insight often confuses the inequality crowd. They tend to lump poverty and inequality together, which is a clear category error. “Inequality itself is not objectionable,” Pinker says, “what is objectionable is poverty.”View Article