Commentary Magazine


Money: Who Has How Much and Why by Andrew Hacker

Money: Who has how Much and why
by Andrew Hacker
Scribner. 288 pp. $25.00

For nearly twenty years, social critics stretching from Left to Right have been warning that the United States is sliding toward a future in which the rich will lock themselves in gated communities while the ever-more numerous poor have to compete for a living with workers in China earning 30 cents a day. Economic statistics have lent some credence to these dire predictions. While the number of affluent households in America has more than doubled since the late 1970’s, average individual income has been rising only slowly. In the meantime, the ranks of the super-rich have been bulging: thousands of decimillionaires, hundreds of centimillionaires, dozens of billionaires.

But is this the whole story? In The House of Morgan (1990), Ron Chernow’s brilliant history of an American banking dynasty, there is a photograph of J. Pierrepont Morgan stepping out of his Madison Avenue brownstone early in the second decade of the 20th century. Wearing a silk-lapeled frock coat and a glossy top hat, Morgan is charging forward furiously, his walking stick raised over the head of a photographer who has snapped his picture without permission. Morgan is not just richer than other people; he is the Morgan of Morgan’s Bank, the man who holds the destinies of kingdoms and empires in his hands. He is mightier, grander, more titanic than other mortals. To this day, when we think of the very rich, his name, and those of his friends and enemies of three-quarters of a century ago, still come to mind: the Carnegies, the Rockefellers, the Vanderbilts, the Fricks, the Goulds.

Somehow one doubts that their epigones today will leave so long a shadow. They, too, are richer than everyone else; but grander, they certainly are not. Who, indeed, could be less awe-inspiring than the American multimillionaire of the 1990’s? There they were on the cover of Newsweek this past August: David Geffen in a T-shirt, Steven Spielberg in a baseball cap, Bill Gates in his rectangular nerd glasses.

The reappearance of great fortunes in the United States has coincided, as Christopher C. DeMuth pointed out in the October COMMENTARY (“The New Wealth of Nations”), with the emergence of a hyperaggressive egalitarianism in all the noneconomic corners of American life. Students call teachers by their first names, and there can be scarcely a boss who is still referred to by his secretary as “Mister.” Companies have done away with executive washrooms, reserved parking spots, offices with doors—anything reminiscent of hierarchy or privilege.

Even more strangely, as wealthy people become more numerous, their cultural power seems to dwindle. When almost everybody was poor, Americans aped the mannerisms of the rich. Gangsters wore tuxedos; movie studios taught former Ziegfeld girls to speak in the broad tones of old Greenwich and Park Avenue. But some time in the late 1950’s (by Tom Wolfe’s reckoning), the American middle class stopped looking up for its cultural clues and started looking down. The children of the affluent now walk through the doors of their expensive private schools affecting the look of drug dealers, and advertising executives impress their clients by phrasing their pitch in the argot of the street.

What is going on here? Is the country engaged in some vast exercise in self-deception, insisting on the equality of everyone and everything whether they are equal or not? Or have Americans decided that so long as no student gets higher grades than the student next to him, or no Little League team wins more games than any other, then it does not matter that some people earn $1 million a year while others get by on $10,000? Have they decided, in other words, that economic inequality is the only inequality they will tolerate?

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What makes me think this latter explanation may be close to the truth is the evolution of the contemporary political Left away from its traditional economic preoccupations. It is striking, for example, how little effort the Clinton administration has put into economic redistribution and how much into attacking other forms of perceived inequality, especially racial and sexual. In fact, in an especially rich irony, this zeal for social and cultural egalitarianism may be exacerbating economic inequality, for it has degraded the quality of American education just when it has become urgent that American workers know how to read well, calculate accurately, and deal intelligently with customers and colleagues.

Of course, some on the Left are still agitated about economic inequality. House Minority leader Richard Gephardt will try, as Senator Tom Harkin tried before him, to make it a national issue when he runs for President in 2000. The themes and melodies of the old Democratic populist economics can still be heard in the speeches of Jesse Jackson (as they can be heard on the Right in those of Patrick J. Buchanan). And there still remain intellectuals, economists, and writers preoccupied with the issue.

Of these, one of the most cogent is the political scientist Andrew Hacker. In the argument over the state of the American economy, Hacker’s latest book, Money, offers one of the best briefs for the prosecution.

Hacker is a diligent gatherer of statistics. Assembling his own tables from raw census materials and other data, he presents a fascinating tale of how things are getting worse for many people in contemporary America (informing us, for instance, that the proportion of Americans living in trailer homes more than doubled between 1970 and 1990). Unfortunately, he is much less keen to tell the equally fascinating story of how much better off many other Americans are than they used to be. As in his earlier book about race, Two Nations (1992), Hacker shows himself here a card-carrying member of that tradition of gloomsaying which positively requires seeing people on the edge of disaster everywhere. To hear him tell it in Money, doctors, lawyers, and professionals of all kinds can soon expect to suffer the same drop-off in earnings that has already struck longshoremen, steelworkers, and janitors.

Above all, Hacker wants to convince his readers that the American distribution of income is not merely lopsided but actively and irredeemably foolish. The very fact that Americans “probably spend more time commenting on absurdities and outrages [in our economic system] than remarking on how equitably it works” suggests, to Hacker, “how far we are from allocating incomes and earnings in ways that can be called even remotely rational.” But though it is obvious to him that paying a starting teacher $23,000 and a young investment banker $93,000 is irrational, he offers no grounds—not only no convincing grounds, but no grounds at all—by which to assess the correctness of this view. A reader either shares it or not.

And here, perhaps, lies an answer to the mystery of why, if economic inequality has in fact been rising, the much-predicted revival of “progressive” politics has failed to appear on schedule. Nothing in this world is more natural than to resent people who earn more than we do. Most of us, however, have learned to regard this resentment as a vice. For it to be transformed into a political program, we would have to begin to see our resentment as, instead, a high-minded reaction to injustice.

That, indeed, was the emotional function of socialism: to systematize and ennoble ordinary resentment, and then to mobilize it in the name of a different system of social and economic rewards. With the collapse of socialism both as a system and as a coherent idea, it no longer signifies anything to attack the over-all distribution of income as “irrational” (though particular inefficiencies and distortions are of course another issue). One may dislike this overall distribution as a matter of raw emotion, but in the absence of a credible alternative vision of a modern economy, like the one once supplied by socialism, the kind of argument Hacker is striving to make ceases to be intellectually sustainable. It is, quite literally, meaningless.

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“I once played a cruel trick on a wasp.” So begins a great essay by George Orwell describing how, as a boy, he cut a wasp in half as it was dining on sugar, and how the wasp lived for a moment or two before realizing what had happened to it. That image—of a wasp unaware that its brain had been severed from its body—seemed to Orwell to describe the plight of post-religious man, carrying on his life as before, condemning some things as “immoral” and praising others as “right” without stopping to consider that he was meting out praise and blame by reference to a system of values in which he himself had ceased to believe.

Whether or not this is an accurate description of post-religious man, it strikes me as an astute portrait of post-socialist man. So long as it remains so, intellectuals of the Left like Andrew Hacker, for all their astonishing success in discrediting every other form of human difference, will be left to mutter and fulminate when the subject turns to money and class.

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