Chapter 11
The Political Dimensions of Economic Division:
Republicanism, Social Justice and the Evaluation
of Economic Inequality
Michael J. Thompson
Introduction: The Problem
Economic inequality is one of the most salient and concrete expressions of
social power. It entails inequality of control—over resources, over people,
over the purposes and goals of the community itself. The idea that economic inequality is a matter of power, however, continues to elude the dominant
mainstream discussions of it as a social problem and social reality in the social
sciences and in political philosophy as well. The empirical investigation into
the dynamics and contours of economic inequality has ballooned in recent
years. These studies have benefitted from contemporary statistical models,
large datasets, and computer analyses to give us a generally consistent picture
of economic divisions. The results have been nothing short of staggering. Indeed, what Alderson and Nielsen have termed the “great economic U-turn,”
can now be seen to have come full circle.1 Whereas gains by labor unions and
the progressive democratic pressures of the public during the 1960s and 1970s
had led to a significant reduction in inequalities of wealth and income, the
1980s and onward have witnessed a return to the bloated inequalities of the
pre-Depression period. What we now call “neo-liberalism” is therefore a new
phase of economic inequality where economic elites have unbridled capacity
to control the economic resources and the ends toward which they are employed for society as a whole. Despite this, analyses of economic inequality
remain stuck in the liberal values that have consistently accompanied capitalist society. It is therefore crucial, in my view, that we seek to construct an
alternative set of values and evaluative categories that can help in sustaining
a critical account of economic inequality and the kinds of capitalist dynamics
that impel them.
1 See Arthur. S. Alderson and Francois Nielsen, “Globalization and the Great U-Turn: Income
Inequality: Trends in 16 OECD Countries.” American Journal of Sociology vol. 107 (5) 2002,
pp. 1244–1299.
© Koninklijke Brill NV, Leiden, 2018 | doi 10.1163/9789004357044_013
202
Thompson
In what follows, I would like to propose an understanding of economic inequality that is distinct from the more economistic thinking that so deeply
marks our policy and ethical debates. According to this “thin” understanding,
economic equality is an issue mainly of distributive justice alone; it concerns
the extent to which the gap between incomes and wealth can be narrowed
to the extent that individuals are allowed to have equal access to other personal and social goods—such as political participation, levels of consumption,
educational and employment opportunities, and so on. What I propose is a
different understanding of economic equality and inequality, one rooted in a
republican understanding of politics that relies on a “thicker” understanding
of the descriptive account of economic divisions. A republican conception
of politics, briefly stated, holds that the purpose or end of social institutions
should be to enhance and pursue the common interest of the society as a
whole. According to this view, inequality in the economy can be seen as the
extent to which certain members of the community are able to control the
common resources of the society as well as redefine the purposes and ends of
that society as a whole. As a result, economic inequality leads ineluctably to a
degradation of the common interest and the re-orientation of public, common
goods toward elite, particular interests.
Liberal-distributive theories of justice generally fail to penetrate into
this level of the structure of social life. In another sense, liberalism can be
seen to reinforce and even justify economic inequality based on market
principles.2 John Rawls, for instance, argues that the two basic principles of
justice—the equality of basic liberties and the “difference principle”—are
principle of distributing rights and duties throughout the basic structure
of social institutions.3 But in an attempt to achieve a “justice as fairness,”
there is no sense that we can conceive of a basic set of purposes or ends
toward which these institutions ought to be oriented. We are left unable
to judge the purposes and projects of individuals, even when they come
to steer the purposes of the rest of society as a whole. As I see it, a deeper understanding of the importance of economic inequality can be addressed by understanding how the activities and purposes by economic
actors come to affect the common interest of the community: whether or
not they violate the two conditions of public maintenance and equal power relations. Beyond the deontological concerns with equality of access
and opportunity, there is the more substantive issue of the consequences
2 Michael J. Thompson, The Politics of Inequality: A Political History of the Idea of Economic
Inequality in America. (New York: Columbia University Press, 2007).
3 John Rawls, A Theory of Justice. (Cambridge: Harvard University Press, 1971).
AQ3
the political dimensions of economic division
203
of the interests of private power and its ability to affect and shape social and
public life more broadly. Economic inequality is therefore an issue of power,
it concerns the issue of living according to the interests of a shared public
life, or according to the interests and power of private groups.
The Limits of the Contemporary Analysis of Economic Inequality
Thomas Piketty’s much-discussed recent study of economic inequality has
provoked many to look anew at the problem. Although Piketty is able to chart
the empirical contours of inequality, what is lacking from his empiricism is a
critical account of what makes inequality a normative problem. Indeed, the
mainstream approaches of modern economics basically confine themselves to
the utilitarian and welfarist problems of inequality. According to this account,
inequality may be unfair in the sense that some individuals are unable to attain a basic standard of welfare or that the overall sum of utility has not been
maximized. But these are very thin and minimal accounts of the problems of
inequality. The prime limitation seems to me to be that these positions are
defined by merely distributional concerns of personal forms of welfare and
utility. They are unable to grasp the deeper and more important concern: that
economic relations need to be seen as political relations, as relations of social power. What I would like to suggest is that inequality be evaluated not
according to the individualist account of welfare and utility or, as the liberal
approach to political philosophy would have it, an equality of opportunities or
basic primary goods, and instead conceive of inequality as a pathology of the
common good itself. According to this account, we should measure inequality
according to the extent to which it is able to reduce the overall good to which
members of the community as a whole have access. This common or public
good is the condition to be maximized, something I call the public maintenance maxim which holds that all resources should be put toward common,
public goods and purposes before they can be utilized for merely private ends.
In this sense, inequality should be seen as the advancement of private ends
over public ones. It violates what I will basically refer here to as a republican
conception of social justice.
At the root of the liberalism is a set of ideas that, as I see it, stand in opposition to a kind of egalitarianism that would be just in an optimal sense.
Most importantly there is the notion that individuals are free to the extent
that they can secure freedom from the interference from the state in their own
chosen courses of life and in their affairs. It seeks a society that is structured, as
William Galston has put it, “to create and sustain circumstances within which
204
Thompson
individuals may pursue—and to the greatest possible extent achieve—their
good.”4 In particular, this doctrine holds that socio-economic affairs require
immunity from the state interference. From this basic principle derives to logics that, in addition to defining the general field of American political culture,
come into contradiction with the other. On the one hand, it allows for the development of an equality of rights between all individuals, assigning them an
equal weight in terms of the law and in terms of their basic access to protection
of the law. It seeks to promote the freedom of the individual. But the second
logic that stems from liberalism is that one can dispose of their property without the interference of the state since property is attached to the individual,
who is, according to the essence of this principle, to be free as an individual
from state interference.
Central to the liberal view on economic inequality, however is its ability to
constrain the opportunities and life chances of the poor. One manifestation
of this idea is found in the “difference principle” of Rawls which states that an
equal distribution of goods should be preferred unless an alternative scheme
can be shown to help the least disadvantaged. For Rawls, the key principle behind equality is the notion that each will have the adequate “primary goods”
to be able to pursue their own conceptions of the good. This becomes a core
structural element of liberal theories of equality: that behind it is a principle of
fairness that allows all to be able to follow their own interests and conceptions
of the good life. Hence, Brian Barry argues that any conception of social justice
must subsume liberal justice which holds that all must be treated equally. For
Barry, social justice consists of “the claim that the distribution of opportunities
and resources within a society … makes for a society’s being just or unjust.”5
Similarly, Amartya Sen argues that we should see inequality as affecting the
chances that poorer individuals possess to realize their capabilities and functionings.6 Poverty therefore reduces the capacity of the poor to be able to convert their functionings into capabilities. Equality must therefore be concerned
with taking into consideration the different needs that different individuals
may possess.7
These philosophical positions, despite the differences between them, all
possess a basic a priori assumption: that inequality reduces the ability of individuals to act on the choices and opportunities they have to live their lives.
4 William Galston, Liberal Purposes: Goods, Virtues and Diversity in the Liberal State. (New York:
Cambridge University Press, 1991), p. 183.
5 Brian Barry, Why Social Justice Matters. (Cambridge: Polity, 2005), p. 22.
6 Amartya Sen, On Economic Inequality. (New York: Oxford University Press, 1997).
7 See Amartya Sen, Choice, Welfare and Measurement. (Cambridge: MIT Press, 1998).
the political dimensions of economic division
205
These approaches basically focus on the relation between distribution as a
means to allow individuals to live an abstract conception of the good. But we
can instead choose to see economic inequality as a thicker phenomenon: one
which shapes the relations of power among individuals, but also the shape
and content of the social product or social wealth as a whole. The key to evaluating an unequal society, on this view, is to keep in view the extent to which
inequalities are not simply concerned with depriving individuals of primary
goods, opportunities, functionings, or whatever, but more importantly, how it
affects the social whole and the ends to which economic activities and resources are employed. One can easily imagine a society that fulfills an equality condition in liberal terms—according to those of utility, welfare, primary goods,
or whatever—without considering the extent to which the society that these
individuals have access to, toward which they work, and how the human and
natural resources are employed and utilized, all can still be for ends that are
not beneficial in a social, public sense. As I see it, economic inequality should
be judged precisely on this basis, and a more compelling, more robust theory
of social justice can be derived from understanding the ways that economic divisions reshape and reorient the utilization of collective resources and efforts
away from collective, public goods and ends.
The Mechanism of Inequality
Before proceeding to the specific ways that economic inequality creates the
conditions for injustice and the creation of alternative evaluative categories
that should be employed to judge economic inequality more generally, I would
like to outline what I see to be the basic mechanism of economic inequality
and the different forms it can take in market societies. This descriptive aspect
of my argument will be important in formulating the critical categories I will
use to open up a more compelling conception of social justice. As I see it, basic to the generation of inequality in market societies is the phenomenon of
unequal exchange (see Figure 11.1). An unequal exchange occurs for a multiplicity of reasons, but in its essence, it is defined as a surplus benefit gained
from extracting some benefit from another. Hence, anytime person A exchanges some good with person B, their exchange will result in A > B if A is able to
extract some benefit from B. We do not need to understand unequal exchange
in strict, zero-sum terms. According to this logic, the benefit gained by A is
exactly the amount lost by B. But this is an unrealistic and overly demanding
criterion. For one thing, the benefit needs to be a surplus benefit for A, but
need not be a total loss for B. Unequal exchange simply means that B is not as
206
Thompson
well as off after his exchange with A. Hence, in any capitalist relation between
a worker and an owner, the owner will pay a wage for the labor time worked by
the worker. The owner benefits by selling the product of the laborer for more
than what the laborer put into it in terms of wages.
Markets
Equal Exchange
Unequal Exchange
Sufficiency
Asymmetrical
Information
Manipulation
Exclusion
Deception Ascriptive
Extraction
Bidding Exploitation
Power
Dispossession
Figure 11.1 Breakdown of market forms in terms of type of exchange and their features
But the worker still received wages at the end of the day. In other words, the
total benefit received by the owner is not equal to the total loss from the
laborer. Therefore, there can be unequal exchange without person A receiving all of the benefit that person B has lost within an exchange. In this case,
A and B can still be unequal within a dynamic model of overall growth. If we
denote the benefit received, k, at different time periods, t, for each agent, the
simple expression of unequal exchange given above, A > B, would be rewritt
t
t
t
ten as: (AkA1 > B k1B) → (Ak2A > B k2B ) where growth of the overall condition gives us
t1
t1
t2
t2
(k A + k B) < (k A + k B ) but the structural relation of unequal exchange cont
t
t
t
tinues in any subsequent exchange (k A1 < k A2) and (k B1 < k B2). This means that
unequal exchange can, and indeed does, persist beyond any kind of zerosum logic. B can be better off than he was before his interaction with A, but this
does not mean that B has not been extracted from and that surplus benefit has
the political dimensions of economic division
207
not been absorbed by A. In this case, we can see that unequal exchange can
coexist with an increasing benefit to both parties and that a rejection of the
argument of unequal exchange is not countered based on a rejection of the
simplistic zero-sum logic.
An equal exchange is when each person in the exchange relation are able
to receive roughly equal benefit from one another without surplus gain being
received by either party. Hence, in any equal exchange, the outcome between
persons A and B must result in A ≅ B. The outcome of any equal exchange relation is therefore sufficiency; it is the condition that emerges from any relation
of equality.8 The essential mechanism of economic inequality is therefore unequal exchange. But this entails unpacking the kinds of unequal exchange that
can manifest itself in socio-economic relations. Inequalities of income and
wealth are not sufficient in themselves to account for the contours of inequality that exist. At the core of the mechanism of unequal exchange is the capacity
of privately controlled surplus to exercise other forms of power over others.
In this sense, the reality of economic inequality cannot be simply understood
through the micro-social relation of interpersonal exchange since patterns of
individual micro-interactions migrate into larger social processes, institutions,
practices, and so on—quantity turns into quality.9 Rather, it is the product of
certain logics of social action that are patterned, legitimated and often times
necessitated by social-structural form and the norms and constraints it imposes on social actors.
Unequal exchange can occur in three different scenarios that we find frequently in modern capitalist-market societies. These are extraction, asymmetrical information and exclusion. These are not exhaustive, and they can
overlap, but they are analytically distinct categories. According to the first, I
can extract benefit from you when I exploit you or when I dispossess you from
something. In an exploitive relation, I gain benefit from you by extracting
surplus from your labor or from some capacity that you possess. But in dispossession, I am able to accumulate surplus by taking away things you already
possess or things which were previously public and are now absorbed into
private control. This can be done by changing laws, cutting entitlements and
8 It should not be deduced from this that any condition of equal or sufficient exchange need
result in economic stagnation. Economic growth does not necessitate the kind of unequal
exchange characteristic of extractive/capitalist forms of market structure.
9 This view is against those who see inequality as emerging from micro-market interactions.
For this argument, see James Child “Profit: The Concept and its Moral Features.” In Ellen
Frankel Paul, Fred D. Miller and Jeffrey Paul (eds.) Problems of Market Liberalism, (New York:
Cambridge University Press, 1998).
208
Thompson
so on so as to transform property rights and to disenfranchise a group from
accessing and utilizing that good.10 But I can also exclude you from certain
goods, opportunities, services, social networks, relations, and so on. Social
networks, circumscribed by class relations, can act as exclusionary boundaries to access certain jobs and the like. Municipalities can erect tax barriers
that keep out certain racial (what we can call “ascriptive exclusion”) or class
groups, thereby restricting access to certain kinds of public goods (education,
sanitation, and so on).
Unequal incomes and wealth can also lead to inequalities in bidding
power, where groups and individuals are excluded through the inability to
access certain kinds of goods and services. This inequality of bidding power leads to a differentiated market for many kinds of goods and services
creating a multi-tiered society quality of education, public goods and social networks are structured according to the bidding power of individuals. Similarly, phenomena such as gentrification and the transformation of
public space succumb to the interests of those that can afford to invest in
property and controlling shares in them. Lastly, asymmetrical information
is an unequal exchange that can occur because of the incapacity of certain
individuals and groups to be able to understand the nature of the exchange
or the value of the objects being exchanged. I can get you to purchase an
item that you may not need; I may persuade you to purchase something
for a price that far exceeds its worth; or I may be able to manipulate you in
other ways to get you to sell something, to enter into a contractual relation,
or whatever, that is not in your best interest and from which I stand to gain
at your expense. This is the situation of manipulation where A possesses
more information about a transaction or good than B and uses that in some
sense to cheat or otherwise benefit from that inequality of information.11
10
11
For a fuller account of what he terms “accumulation by dispossession,” which includes
“the commodification and privatization of land … conversion of various forms of property rights to the commons; commodification of labor power and the suppression of
alternative forms of production and consumption,” see David Harvey, A Brief History of
Neoliberalism (New York: Oxford University Press, 2005), 159 and passim. It should be
noted that this can also include transforming previously public entitlements into the private realm, such as the privatization of public education, the move from pension funds to
retirement accounts, the elimination of health and other kinds of public insurance, and
so on. All of these are done for the purpose of extraction, but they are, in essence, distinctive forms of unequal exchange.
See George Akerlof and Robert Shiller, Phishing for Phools: The Economics of Manipulation
and Deception. (Princeton: Princeton University Press, 2015).
the political dimensions of economic division
209
But it can also lead to more fundamental problems of deception, which is
the capacity to manipulate demand and tastes based on the intentional manipulation of facts (such as health or environmental impact of particular
goods or products, and so on).
From this brief discussion of the different dimensions of unequal market exchange, we can see that markets are not simply relations of exchange, but also
mechanisms of social power. They are structural relations between individuals
and groups that allow for the exercise of different kinds of inequality and control. Of course, not all market relations are this way. If I purchase a house from
you for a fair price, or any other purchase where you do not gain at my expense,
then sufficiency is the result. But the dominant mode of economic life governed by accumulation and capital mitigates against these kinds of exchange.
Ideological defenders of the market therefore seek to confuse by casting all
market relations in terms of the equal exchange model, obfuscating from view
the more prevalent forms of unequal exchange that predominate economic
life. The reality of unequal exchange is more than simply a plausible outcome
of economic relations, it is the express purpose of capitalist forms of economic
life. Unequal exchange also undermines the basic thesis that pro-market writers hold: that markets enable choice and allow the expression of individual
agency. As my theoretical analysis demonstrates, the opposite will more likely
be the case: that unequal exchanges will form patterns of inequality, of power and of the constriction of choice (Singer 1978), instead leading to the institutionalization of unequal power relations.12 But even more, theorists who
hold that markets are in some basic sense expressions of “spontaneous order”
must be seen to be holding to an ideal understanding of markets at best and
a theoretically deficient understanding of them at worst.13 In the end, these
three broad forms of unequal exchange, extraction, exclusion and asymmetrical information, lead to denser structures of inequality. These structures of
inequality, as we should see them, may have unequal exchange as their basic
starting point and generative mechanism, but they themselves come to take on
their own dynamics. It is for this reason that we must turn to look at the ways
that these structures of inequality violate the republican conception of social
justice that I am outlining here.
12
13
Peter Singer, “Rights and the Market.” In John Arthur and William H. Shaw (eds.) Justice
and Economic Distribution. (Englewood Cliffs: Prentice-Hall, 1978), pp. 198–211.
For an example of this view and an attempt to fuse it to a theory of justice, see John Tomasi “Political Legitimacy and Economic Liberty.” Social Philosophy and Policy, vol. 29 (1)
2012, pp. 50–80.
210
Thompson
Economic Inequality and the Contours Social Injustice
Since unequal exchange cannot simply be conceptualized as a logic between
isolated actors nor in terms of a micro-relation between individuals, we should
instead see that unequal exchange is embedded in the institutional structures of
society. Once this becomes the case, inequality can no longer be seen as a purely
economic phenomenon but is now a distinctly political one. This means that
unequal exchanges are not simply about the inequality of benefits, opportunities, or anything of that sort, but rather inequalities of power—power over the
resources, people and purposes of the community as a whole. In this sense, economic inequality violates the principle of social justice by allowing for the unequal power of certain segments of the community over what could otherwise
be utilized by the community as a whole according to the common or public interest. This criterion needs to be elaborated since it is the first major step beyond
the liberal understanding of social justice. As I see it, goods within any society
can be broadly categorized as those that essentially benefit all, or the public as a
whole on the one hand and those that benefit a particular individual or group at
the expense of another, a group or the community as a whole. I will call the first
kind of good a common or public good and the second a pleonexic good.14
The important point here is that any pleonexic good can only be produced
through the logic of unequal exchange or by in some sense exploiting or extracting some benefit from another. It is a structural relation between agents
that places emphasis on the capacity of one agent to control in some sense the
actions or capacities of another agent for the former’s surplus benefit. In this
sense, pleonexic goods entail pleonexic social relations; they necessitate that
unequal exchange grant certain parties more power in society than others by
which is meant more control over the decisions of what to produce and how;
capacities to consume and utilize resources (natural and human) that according to their particular needs and ends; and the capacity to shape the aims and
goals of the society as a whole.15 Pleonexic goods and relations therefore, when
they go unchecked and begin to proliferate throughout the economy, polity
14
15
I derive the term “pleonexic” from the Greek πλεονέξια which means “tο want more than
what one needs.”
Marx therefore maintains that under the private control of economic resources and
modes of production is a perversion of the true nature of modern social production,
which is truly collective and socialized. However, the benefits of this process of socialized
production flow to those who own and control capital. Hence, capital is, for Marx, “not a
personal, it is a social power,” Karl Marx, The Communist Manifesto (New York: Vintage,
1959), pp. 21. The political moment therefore is the conversion of the private control of
the political dimensions of economic division
211
and society, lead to a condition of oligarchic wealth which refers to the way that
surplus is used to serve the ends of particular segments of the community (i.e.,
the wealthy) as opposed to the interests of the community as a whole. Since
any society produces some degree of surplus, we can judge the extent of social
justice within any community by evaluating how it manages and utilizes this
surplus. Whenever surplus is controlled by the few for the interests of the few,
we have a condition of oligarchic wealth. Oligarchic wealth is not only a kind
of social wealth, it also entails a particular kind of socio-economic and political structure to sustain it: there are certain institutions, certain norms, practices, laws, and so on, that will be required to sustain and to enhance oligarchic
wealth. The first and most important among these is the need to defend that
wealth and the income gained from it.16
Comparing pleonexic and common goods means understanding the ways
that unequal versus equal exchanges are privileged. In Figure 11.2, I compare
the ways that two different benefit schemes can be shown to differ based on
the kinds of goods that are pursued. Both curves α and β represent the frontier
of benefits that different kinds of exchange/production relations can offer to
two different agents, A and B. Pleonexic goods result in an unequal benefit for
A and B. Hence, for α we can see that line y1 delineates benefit for person A
over person B, and y3 delineates benefit for person B over person A. However,
line y2 represents an equal benefit for both A and B. Even under conditions of
economic expansion and growth, giving us the curve β we can see that z1 and z3
both delineate pleonexic relations or goods and z2 again a common good. Figure 11.2 therefore is meant to show how, in a simplistic sense, common versus
pleonexic goods can be understood as bestowing not simply unequal benefit,
but benefits that are tied to others. It is not simply a matter of person A getting
a different amount of benefit from person B; what is essential in this concept
is that the production of these goods, the purpose of their production and the
kinds of relations that spring from them determine the distribution of benefit.
Of course, it would be absurd to argue that all benefit schemes must be
wholly equal. One person may have more need for healthcare than another,
therefore receiving more benefit from the healthcare system than another.
16
capital to social control, “into the property of all members of society, personal property is
thereby not transformed into social property. It is only the social character of the property
that is changed. It loses its class character,” Marx, Communist Manifesto, 22. Marx is here
outlining a republican conception of social justice insofar as he is stating the need for the
accountability of the social product to society as a whole.
See the important discussion by Jeffrey Winters, Oligarchy. (New York: Cambridge University Press, 2011).
212
Thompson
A
β
Benefit for
Person A
z1
z2
α
y1
y2
z3
y3
y1
y2 z1
y3
z2
z3
B
Benefit for
Person B
Figure 11.2 Pleonexic and common good benefit schemes
But healthcare satisfies a republican conception of justice only once we can
show that the highest quality of healthcare is potentially available for all
equally as any other.17 The key issue here is that benefits be seen as not being
extracted from one individual or group in order to be converted or in some
way transferred to another individual or group. The key here is that the
resources, labor and capacities of society ought to be used for social ends
and not extracted by private persons for their particular ends and projects.
What is essentially common about the common interest or common goods
is therefore that they seek to promote the development of each individual
within the community as an individual, but an individual who is mutually
related to others, an individual who is part of a structure of interdependent
relations and that these interdependent relations ought to promote the
17
This is why Marx’s concept of justice must be seen as moving beyond any liberal, “bourgeois,” form of right: “one worker is married, another not; one has more children than
another, and so on and so forth. Thus, with an equal performance of labor, and hence and
equal share in the social consumption fund, one will in fact receive more than another,
one will be richer than another, and so on. To avoid all of these defects, right instead
of being equal would have to be unequal.” Karl Marx, “Critique of the Gotha Programme,”
in Karl Marx and Friederich Engels on Philosophy and Politics, (New York: Vintage,
1959), p. 119.
the political dimensions of economic division
213
good of all and not be the basis for the particular ends and gain of private
interests and projects.18
But in circumstances of economic inequality, this is precisely what takes
place: unequal benefit is the essence of unequal economic relations. We can
contrast this with democratic wealth which is the condition that holds when
the economic efforts of the community are oriented toward public or common
needs rather than particular needs. In this sense, democratic entails the object
of what social and economic institutions seek to provide for, not simply a matter of a means of decision making. Hence, although any valid thesis concerning social justice must, I think, take into account the democratization of the
workplace, the meaning behind democratic wealth is not a decision-making
one, but refers to the character of the goods produced and the means by which
they are produced.19 A society characterized by democratic wealth is therefore
one where the production of wealth is done according to democratic means
(i.e., without exploitation, without other forms of unequal exchange) and the
purpose is to fulfill democratic, i.e., common goods and purposes of need by
the community. Democratic wealth also does not allow there to be barriers to
entry based on income.
Indeed, common goods are common because all members of the community
have equal access to them. A society that places emphasis on democratic wealth
over the production and consumption of pleonexic goods therefore is closer to
18
19
In her interesting reconstruction of T.H. Green’s conception of the common good, Avital
Simhony argues that “the common good ethic forges a non-dichotomous moral framework which aims to occupy a moral terrain of human connectedness where one’s good
and the good of others are intertwined, where one’s fundamental interest in one’s own
development is not pitted against one’s interest in the development of others.” Avital Simhony, “T.H. Green’s Complex Common Good: Between Liberalism and Communitarianism.” In A. Simhony and D. Weinstein (eds.) The New Liberalism: Reconciling Liberty and
Community. (New York: Cambridge University Press, 2001), p. 73.
In this sense, Daniel Bell’s comment that “If there is any meaning to the idea of workers’
control, it is control—in the shop—over the things which directly affect his workaday
life: the rhythms, pace, and demands of work; a voice in the setting of equitable standards of pay; a check on the demands of the hierarchy over him. These are perhaps ‘small’
solutions to large problems, what Karl Popper has called ‘piecemeal technology,’ but look
where the eschatological visions have led!” Daniel Bell “Work, Alienation and Social Control.” In Irving Howe (ed.) The Radical Papers. (New York: Anchor Books, 1966), pp. 89–98.
1966: 93). Bell’s fear of Soviet models of collectivism should not confuse the issue at
hand here: namely that it is not simply control over the workplace, but having the entire
economic system accountable to public needs and goods that needs to be central to any
substantive theory of social justice.
AQ1
214
Thompson
realizing what I am calling here the public maintenance maxim: or that criterion of social justice where common goods are given priority over other kinds
of goods.20 A society therefore wastes its resources (natural as well as human)
whenever it invests or expends them on pleonexic goods in place of those
goods and purposes which satisfy common or public ends, or those goods that
would be beneficial to all.21
Now we can see that unequal exchange, which I pointed to as the primary
mechanisms of economic inequality, produces pleonexic goods and relations at
the expense of common of public goods. I have also shown that the former lead
to the condition of oligarchic wealth and the unequal control over the resources,
surplus and collective decisions of the goals and aims of the society. Now, since
this condition necessarily leads to hierarchical structures of social relations,
we should consider how this social-structural context affects other dimensions
of social life. Economic inequality also leads to other kinds of anti-democratic
pathologies within society. The main variable here is unequal control over economic and therefore social resources. The more unequal a society becomes in
terms of income and wealth, the more that the control over other, non-economic
institutions and resources becomes imperative to maintain wealth-defense.
Material power, conferred by unequal control of resources and the income that
it generates, therefore is capable of shaping political power seen as the power
over the legal and coercive powers of the state. As a result, economic divisions
not only confer unequal political power on those that benefit from economic
resources, it also allows them unequal influence to the political system itself.
Oligarchic forms of inequality therefore lead to the erosion of democratic
practices, institutions and attitudes within the community. Economic inequality therefore undermines the very powers and resources that have the ability to
combat it. Since economic inequality can only be undone by redistributional
measures (of income, legal rights over property, power over the capacities of
production of the economy, and so on), it is crucial that de-mobilization of
democratic practices be successful. The more unequal a society becomes, the
less active non-wealthy (especially poor) citizens become politically. They are
less inclined to vote, less inclined to discuss politics and be aware of political
concerns, and less likely to participate in political groups and parties.22 At the
20
21
22
Elsewhere I have explored this idea, see my paper, “The Limits of Liberalism: A Republican Theory of Social Justice.” International Journal of Ethics vol. 7(3) 2011, pp. 1–18.
See my paper, “On the Ethical Dimensions of Waste.” Archiv für Rechts- und Sozialphilosophie vol. 101(2) 2015, pp. 252–269.
See Frederick Solt, “Economic Inequality and Democratic Political Engagement.” American Journal of Political Science vol. 52(1) 2008, pp. 48–60.
the political dimensions of economic division
215
same time, parties become less responsive to the poor and middle class and
increasingly beholden to the wealthy.23 Policies are therefore shaped by economic elites and their distended influence over elected officials and the kinds
of policies that they enact and support.24 Oligarchy now morphs from control
over economic resources to control—either direct or indirect—of others sectors of society. Now, social policy, educational imperatives, regulation, cultural
production, and so on, all become shaped and influenced by economic elites.25
But in addition to the erosion of political activity among non-elites, especially among the poor, inequality has an effect on the political culture more
generally and the social psychology of individuals. As hierarchical relations
become more predominant, individuals become more predisposed to hierarchical attitudes and world-views. They begin to internalize the legitimacy of
social divisions and hierarchical power relations, seeing them as natural and
their place within that hierarchical scheme as justified.26 In place of critical
attitudes toward elites, the ego becomes domesticated by consistent exposure
to authority leading to penchant for accepting and respecting authority.27 In
addition, authoritarian attitudes toward racial groups become heightened as
economic inequality feeds social and psychological feelings of anxiety.28 What
all of this leads to is a general de-democratization of society.29 Civil society fragments, the attitudes of individuals becomes less critical, more affirmative of
23
24
25
26
27
28
29
See Larry Bartels, Unequal Democracy: The Political Economy of the New Gilded Age. (Princeton: Princeton University Press, 2008).
See E. E. Schattschneider, The Semi-Sovereign People: A Realist’s View of Democracy in
America. (New York: Holt, Rinehart and Winston, 1960) as well as Claus Offe, “Participatory Inequality in the Austerity State: A Supply-Side Approach.” In Armin Schäfer and Wolfgang Streeck (eds.) Politics in the Age of Austerity. (Cambridge: Polity, 2013), pp. 196–218.
See Henry Kariel, The Decline of American Pluralism. (Stanford: Stanford University Press,
1961).
See Robert Lane, “The Fear of Equality.” American Political Science Review vol. 53(1) 1959.
pp. 35–51 as well as Jim Sidanius and Felicia Pratto, Social Dominance: An Intergroup Theory of Social Hierarchy and Oppression. (New York: Cambridge University Press, 1999).
See Frederick Solt, “The Social Origins of Authoritarianism.” Political Research Quarterly
65(4) 2012: 703–713.
See Jim Sidanius and Felicia Pratto, “Racism and Support of Free-Market Capitalism: A
Cross-Cultural Analysis.” Political Psychology vol. 14 (3) 1993, pp. 381–401 as well as Edward J. Rickert, “Authoritarianism and Economic Threat: Implications for Political Behavior.” Political Psychology, vol. 19 (4) 1998, pp. 707–720.
See Armin Schäfer, “Liberalization, Inequality and Democracy’s Discontent.” In Armin
Schäfer and Wolfgang Streeck (eds.) Politics in the Age of Austerity. Cambridge: Polity,
2013) pp. 169–195.
AQ2
216
Thompson
the hierarchical structure of the community, and the legal, political and cultural superstructure of society increasingly reflects the interests of elites and
less the common needs of the community itself. This is the terminus, in many
ways, of the original mechanism of basic unequal exchange that I outlined
above. Economic inequality is therefore more than merely an issue of maximizing the benefits to the least well off; more than about distributional justice
in terms of income and opportunity. It forces us into a deeper set of questions
and concerns over its effects and goods that social life ought to provide. In the
remainder of this paper, I will therefore focus on an alternative scheme for understanding social justice in republican, rather than liberal, terms.
Republicanism: An Alternative Scheme
to Evaluate Economic Inequality
Now that I have explored the mechanisms of inequality as well as the pathologies that stem from it, I would like to outline what I see to be a more compelling
set of concepts, both normative and descriptive, that can offer us a more critical engagement with economic inequality. To go back to my opening discussion, I think it is important for anyone critical of economic inequality not only
to understand its true nature and mechanisms, but also to see that liberalism
has so dominated the political philosophy we use to gauge and evaluate it that
we require a new set of concepts to oppose it. According to the alternative conceptual scheme I am laying out here, any condition of social justice must be
one where common or public goods are promoted over pleonexic goods. This
is because, as I have sought to demonstrate, pleonexic goods and the kinds
of relations that produce them entail the social and political pathologies of
oligarchic wealth and the unequal, anti-democratic control over the purposes
and goals of the society as a whole. It follows that a society characterized by
social justice would need the thicker kinds of goods that common goods support. I will point to three of these principles here and argue that they are essential features of a republican theory of social justice. These three principles are
(i) the distributive principle that deals with equality of access to the social product; (ii) the qualitative principle which deals with the quality of the goods and
services to which these individuals have access; and finally (iii) the directionality
principle which deals with the public orientation of economic activities and
the extent to which they fulfill public or common ends and needs as opposed
to private or particular ends, interests and needs. In the end, these three principles can be used to give us a richer and more robust account of the extent of
social justice within any society.
the political dimensions of economic division
217
The centrality of the state in securing freedom and broader social ends of a
modern community was at the heart of the Progressive philosophy and social
theory during the late nineteenth and early-twentieth centuries ultimately culminating in the New Deal and its reorganization of the relation between polity
and economy.30 Basic to this reformation was the argument that the state had
a responsibility to the public, seen as an ontologically distinct from individuals
and their various individual relations with one another. The idea of a public,
or common interest or of a public good means that there is some set of goods
and interests that can be beneficial to all outside of their various arbitrary
preferences and which ought to be protected, even at the expense of violating
some of the liberties of individual or corporate bodies. Isolating a res publica,
a common interest, means that we seek to understand and to determine that
set of goods that are beneficial to all in either an immediate, developmental, or
potential sense. A good is beneficial in an immediate sense when it has a direct,
positive effect in the life of any individual. An immediate good is the access to
resources needed for life (food, shelter, free time, protection from harm, and
so on). A good is developmental when it serves to cultivate the capacities and
abilities of individual agents. Education, cultural institutions, civic groups,
libraries, and so on, all provide developmental goods that serve the growth
of individual capacities, skills, and so on. Lastly, there are potential goods by
which I mean those goods that are of potential benefit for any individual. In
this sense, healthcare, unemployment insurance, disaster relief, environmental protections, and so on, can all be seen as potential goods that an individual
would be able to access, but is neither developmental nor immediately needed
by everyone at any given moment but could potentially be needed by any individual or group.
These kinds of goods can be present in different forms and different degrees
in many different economic models. But the republican approach to social justice that I am advocating here argues that these goods are essential features of
common or public goods and that any society that seeks to maximize social
justice must also maximize access and the quality of these kinds of goods. The
central concern here is that economic inequality and the pleonexic goods and
relations that it produces detract from the ability for the community to provide
for itself these kinds of goods in their fullest capacity. Any pleonexic good or
relation detracts from a common good because the unequal exchange that lies
30
For a discussion, see the excellent study by Brian Stipelman That Broader Definition of
Liberty: The Theory and Practice of the New Deal. (Lanham: Lexington Books, 2012),
pp. 263–307.
218
Thompson
at its base is subtracted from the common fund of access of the community as
a whole and is captured by the particular interest of the owner of that surplus.
Economic inequality is therefore not simply a matter of distributive justice, a
matter of violating the condition of “fairness.” Rather, it is a deeper pathology
in that it reorganizes the efforts and aims of the community as a whole.
What I mean by “resources” are human capacities, skills, and so on as
well as natural and social resources. Most centrally, we can begin to understand the common interest and make it something tangible and concrete once we are able to see that the resources that are employed, the ends
and purposes to which our institutions are oriented, and the kinds of social
relations that are structured for people do not violate the unequal power
relations condition—i.e., that no single or corporate individual or agent is
able to utilize the resources of individuals or society for their own arbitrary
preferences. Hence, a republican conception of social justice requires that
the state take, to some significant degree, a non-neutral position with respect to the ends or purposes to which public forms of resource utilization
take place. Indeed, it necessitates that the ethical neutrality of the state be
re-programmed to protect, promote, and to enhance common goods and to
diminish pleonexic goods.
On this view, the public maintenance condition and the power relations
condition come together to provide us with a principle that helps to determine
the common interest of a modern public. Since traditional understandings of
the common interest or common good derive from their origins in pre-modern
political communities, we often mistake it for a conservative doctrine. Similarly, the more modern formulation of this concept made by utilitarianism is also
mistaken in that it sees the common good as that which meets the preferences
of the good of the maximum amount of individuals. But the idea of the public
and common interest that I see as attractive is one that demarcates a set of
those goods that are, in some way, shared by all who live within social life. The
public cannot be reduced to the sum total of individual preferences, nor can
it be understood as a social contract between rational individuals. Rather, the
public and its interest is, following Aristotle, ontologically prior to individuals
and their arbitrary interests. It is necessary therefore to articulate the kinds of
common goods and the kinds of social structures that are most adequate to a
shared reciprocally formed life among others. The public, in this sense, is not
simply made of “other people,” it is, in its essence, a particular logic of social
relations, of social structure itself.
Economic inequality must therefore be recast in a thicker sense that distributive understandings of justice allow. In this sense, I follow Plato rather than
Aristotle: in place of questions of distributive justice, I believe the structural
the political dimensions of economic division
219
idea of justice organized around the common needs and ends of the society as
a whole, as the non-metaphysical layer of Plato’s text lays it out, is in fact the
thesis that underpins a theory of justice that can be used to explode the sterile
categories of liberalism.31 Because the structure of liberal theory must allow
for the individual (personal or corporate) to be free from the interference of
the state and the community as whole, it simultaneously allows for the power
of private interest to co-opt the power of the state and the common interest
as well.
Inequality in the sphere of economic life therefore constitutes a violation
of both the public maintenance condition as well as the equal social power
condition by (i) depriving an individual of a right to any set of immediate, developmental, or potential goods; and (ii) by leaving him prey to the extractive
power of other individuals. The basis of economic inequality in a deeper sense
is therefore more than an issue of the distribution of “basic goods” made possible by liberal theories of social justice.32 Economic inequality is not a matter
of desert; it is more importantly a matter of whether individuals participate in
an economy that promotes the maximum possible in the way of public goods
to which they have access. At the same time, it means creating and defending
forms of economic life that reduce the ability of private persons and groups
to obtain extractive power over other individuals.33 Inequality is therefore the
ability for private individuals and groups to steer the efforts of society and its
human and natural resources toward the arbitrary preferences of elites rather than toward public, common ends. In this sense, the common interest is
diminished in two senses: first, by allowing for a society where an individual
does not have access to the complete set of social goods that any community
can provide; and second, by forcing individuals into forms of work and life that
is directed by private concerns.
31
32
33
This is also the principle of social justice that underwrites any valid theory of socialism.
As Henry Pachter points out, reverberating with Plato’s theory of justice in the Republic:
“In the socialist economy, capital goods, once created, enter into the consumption funds
of the society, to be drawn upon as the need occurs.” Henry Pachter, “Three Economic
Models: Capitalism, the Welfare State, and Socialism.” In Irving Howe (ed.) The Radical
Papers. (New York: Anchor Books, 1966), p. 53.
See the more extensive defense of this liberal theory of social justice by Barry, Why Inequality Matters.
I take the distinction between “extractive” and “developmental” power from C.B. MacPherson, Democratic Theory: Essays in Retrieval. (Oxford: Oxford University Press, 1973) as
well as the more developed discussion of this idea in my paper, “The Two Faces of Domination in Republican Political Theory.” European Journal of Political Theory (in press).
220
Thompson
Conclusion: Economic Inequality and the
Republican Theory of Social Justice
From the argument I have been exploring here, I think we can begin to distill
the sketch of an argument that can serve as a means to move beyond the
contradiction in liberal theory I have pointed to and toward a more compelling theory of justice, one along broadly republican lines.34 Since economic inequality is a central mechanism of social power, it represents a basic
and pervasive impediment to a richer reality of justice. A republican approach to economic equality must, I think, therefore be embedded within
a different paradigm of social justice for it to break out of the sterile liberal categories that continue to define current debates. Economic inequality
therefore becomes more about the ability of private persons to obtain and
protect their power to utilize and employ the resources of the community
toward their own projects and ends. The ways they are able to adapt other
institutions—the state, education, culture, and so on—erodes the capacity
of those non-economic institutions to provide a countervailing force within
the economic sphere by blunting active citizenship and streamlining educational institutions toward instrumentalized ends fashioned by the business
community.
The infiltration of these interests into the other spheres of social life also
infects the state and its ability to defend those common purposes.35 It also,
however, affects the logics of social movements which become increasingly
unable to formulate concrete forms of resistance to the imperatives of private
power. By directing their attention toward the state as the object of dissent,
many social movements and their theorists fail to understand the progressive
potential of the state, rendering their power more diffuse than economic elites
34
35
I mean to define an understanding of republican political theory that in contrast to thinkers such as Philip Pettit, Republicanism: A Theory of Freedom and Government. (New York:
Oxford University Press, 1997); John Maynor, Republicanism and Modern Political Theory.
(Cambridge: Polity, 2003); Richard Dagger “Neo-Republicanism and the Civic Economy.”
Politics, Philosophy, and Economics vol. 5 (3) 2006, pp. 151–173; Frank Lovett, “Domination and Distributive Justice.” Journal of Politics vol. 71(3) 2009, pp. 817–830; and Frank
Lovett and Philip Pettit, “Neorepublicanism: A Normative and Institutional Research Program.” Annual Review of Political Science vol. 12 (2009), pp. 11–29.
In this sense, the very legitimacy of the state, in a progressive sense, can be seen to rest on
its ability to promote a social structure that is just in the deeper sense in which I am advocating here. See the discussion by Milton Fisk, The State and Justice: An Essay in Political
Theory. (Cambridge: Cambridge University Press, 1989), pp. 65–138.
the political dimensions of economic division
221
and, in the process, ineffective in more concrete terms.36 Perhaps a republican
understanding of the nature of economic life and inequality can help to reconstruct a more radical, more substantive form of resistance as well as a normative understanding of the kinds of public life that should be defended from the
assault by private interest.
36
In a curious way, it is the need for a concentration of political power that can affectively
countervail the powers of concentrated economic power. See Grant McConnell, Private
Power and American Democracy. (New York: Vintage, 1966) as well as Kariel, The Decline
of American Pluralism.