Is wealth inequality a problem?

18 October 2017
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Why is wealth inequality such a pressing moral problem? As in many other pieces by others, Professor Ben Turok (Daily Maverick, 26 July 2017) offered no explanation – it is merely accepted as fact. If wealth was gained because of force or fraud used against others, then the burden of proof rests on Professor Turok and others who agree with his view. Any charge that a person has become wealthy because of theft or fraud must be taken very seriously because our is supposed to be a country based on democracy and equality before the law. If there is no evidence that the accused person became wealthy through immoral means, then any such charge falls flat. The shift from ‘that person has wealth’ to ‘therefore they must be a criminal’ is a shocking weakness in reasoning.

In the article, the case of the Guptas is the only example of inequality that is immoral. Through pay-offs, underhand dealings and fraud which all of this exemplifies, the Guptas bought their way into the corridors of power. They negated any competition by using fraud to buy their influence and in so doing they have entrenched the kind of inequality that must be exposed and punished. Government-entrenched inequality is immoral. For inequality critics to try and equate businessmen who voluntarily trade with others, with people who use shady political dealings and fraud to improve their standing, is dishonest and, seemingly, merely a means to score political points.

Wealth is the result of man’s mind at work. A person looked at the world around them, weighed up the opportunities present, evaluated their talents, abilities, time and resources available, formulated how they could best be used to improve his life, and then acted to make their values real. Wealth creation is a moral process because it is up to each one of us to use our minds to survive and thrive in this world.

Through myriad legislations, stifling interventions and controlling minimum wage edicts, government removes the agency and dignity of people who should be free after decades of colonialism and apartheid. Freedom does not mean handouts; it means that anyone can try, to the best of their ability, to better their life in ways no government bureaucrat or ivory-tower academic could even imagine. It means that they can engage in business with others and improve their life and thus increase inequality.

Inequality in the economy is the result of people succeeding at providing goods and services needed and desired by others. To trade with another, you have to appeal to their reason; you cannot force them to trade with you.

If I were to accept the premise offered by the inequality critics that wealth is fixed, then I would also have to accept that it is communally produced, and that one group forcibly takes the biggest slice of the wealth pie. Fortunately, for every one of us, wealth is not fixed – the wealth of individuals is constantly shifting as they make their individual choices and try to live their lives as they deem best.

With the rise of the ‘app economy’, even more inequality will develop in the years to come. The result of more options will be more inequality and more people become wealthier. My most fervent hope is that government will realise that its mandate is not to run people’s lives; that it will step back, cut regulations and allow people to trade voluntarily, honestly and freely with each other.

Chris Hattingh is a researcher at the Free Market Foundation


This article was first published in Thegremlin.co.za on 1 October 2017

 

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