Introduction to Equal is Unfair
The current political fixation on income inequality absolutely baffles me. For the life of me, I can’t understand why politicians (mainly socialist Democrats) spend so much time ranting about wealth inequality. Then, as if their rants against capitalism weren’t bad enough, they set out to “fix” the wealth inequality “problem” through idiotic ideas such as wealth taxes and raising the minimum wage. Those proposals infuriate me, yet I had been surprised that little had been written from the conservative or libertarian perspective as to why they would be so destructive. Luckily, I stumbled across Equal is Unfair by Don Watkins and Yaron Brook.
It is a great book on why the ideology of socialism always fails because it is based on the false song of equality of outcome rather than real American ideal, which is equality of opportunity.
In Equal is Unfair, Watkins and Brook show why the fight against income and wealth inequality is so misguided. The view that they and I share is that we’ve all heard the same tired tropes about the disappearing middle class, the death of the American dream, and overly high CEO pay for so long that many of us have begun to accept those arguments. That is unfortunate because every single one of those arguments is wrong. Equal is Unfair shows why.
Summary of Equal is Unfair
Watkins and Brook spend most of Equal is Unfair discussing why leftist policy “solutions” to address income inequality are so wrong. Perhaps the best summary of their work is found on the inside cover of the book. The four bullet points included are:
- Why CEO’s make so much money- they deserve to
- The minimum wage hurts the people it purports to help
- Middle-class stagnation is a myth
- Sweden’s history reveals the dangers of forced equality
And while the book is about far more than those points, they are a good starting point with which you can see the general theme of the book. That theme is that we should focus on equality of opportunity, not wealth inequality.
America is the Land of Opportunity
One of the salient points Watkins and Brook make in Equal is Unfair is that America was envisioned by the Founders as a land of endless opportunity. The upside of that is that anyone with talent and/or a strong work ethic can build up a fortune. The downside for some is that the untalented and lazy tend to not make all that much money. But frankly, that’s what is just. Why should the successful be forced to subsidize the lives of lazy idiots?
Watkins and Brooks prove their point about America being the land of opportunity masterfully. They tie in writings of the Founding Fathers and modern examples of how economic opportunity in America is so pronounced compared to almost every other nation.
And in their view, taking advantage of that opportunity is the American dream. Bernie Sanders’s American dream might be some sort of Venezuelan, socialist hellscape, but for capitalists like Watkins and Brook, the American dream is living one’s life out the way you want to live it.
Despite what the far-left Democrats might say, America is the land of opportunity. We always have been. Unfortunately, that is starting to change as the talons of socialism sink into America and rip out the beating heart of our system: free-market capitalism. We conservatives need to fight back against and attempt to reverse that process and empower the entrepreneurs that made society great.
Liberal Policies are Destroying Economic Opportunity
After discussing the conditions necessary for economic progress and why America is the land of opportunity, Watkins and Brook discuss how leftist policies are destroying that opportunity.
Taxes, especially the death tax, destroy the ability of small businesses to grow. Political interference in business leads to corporatism, cronyism, and destroys the ability of big businesses to innovate. New entitlements lead to large segments of the population taking an income hit by starting to work!
Those problems are all ridiculous and are the sort of thing that could only ever happen in a nation with a huge and ineffective bureaucracy. The booming Trump economy shows what happens when businesses are left even slightly unfettered and are able to invest and reinvest as they see fit.
Economic opportunity is not inevitable, even in America. To exist, the proper societal conditions must be met. Over-regulation and over-taxation, both of which are meant to “even the playing ground” for the poor, just stifle opportunity. Businesses can’t hire, invest, or grow if they are being taxed to death, which translates to fewer opportunities for advancement for the poor. The only equality is equality of poverty. That’s evening the playing field, but not in a way that benefits the poor, nor is it fair to anyone involved. Hence why equal is unfair.
Conclusion to my Summary of Equal is Unfair
Overall, Brook and Watkins use Equal is Unfair to show exactly what you’d expect; attempts to create a more equal society end in disaster. Yes, capitalism leads to economic winners and losers. But that system of incentivizing the best and brightest to innovate and produce creates a better situation for everybody. As could be expected, the rising tide of capitalism lifts all boats. And in Equal is Unfair, Watkins and Brook prove just that.
Analysis of Equal is Unfair
I was very excited to read Equal is Unfair. Yaron Brook, one of the co-authors, is the Executive Director of the Ayn Rand Institute. As a huge fan of Atlas Shrugged and The Fountainhead, I was interested to see how one of Rand’s acolytes would apply the lessons from those books to real life and the modern economic and political landscape.
On the other hand, the government’s attempts to “close the gap” and end income inequality are very often quite problematic. The death tax destroys the ability of families to keep investing in small businesses. Raising taxes lowers both consumer spending and investing. Those three things alone are disastrous for the economy.
When the cost of countless other regulations, taxes, and entitlement programs is factored in, the cost is utterly staggering. Just think of all the money that could be used productively by the private sector that is instead in the hands of ineffective bureaucrats and their government programs.
Finally, I like how Brook and Watkins tear down so many leftist myths in Equal is Unfair. The middle-class is not stagnating, big business is not bad for the country (although corporatism is), and taxes do not lead to a more productive economy. In fact, the exact opposite is true; taxes are utterly destructive to an economy that would otherwise be healthy.
If you liked Atlas Shrugged, Capitalism and Freedom, or The Road to Serfdom, then you will certainly enjoy Equal is Unfair. Its authors use modern and historical economic data to show why the lessons learned in those books about the virtue of capitalism and the path to the American Dream are still true.
Furthermore, like their other book, Free Market Revolution, it’s easy to read. While it is full of information and economic theory, Watkins and Brook have a writing style that makes reading about such subjects enjoyable rather than painful. Especially if you agree with them that capitalism is the solution, not socialism.
Frankly, we should all agree with that statement. Americans are rich only because of free-market capitalism. And make no mistake, compared to the rest of the world, Americans are rich. That is not despite of economic inequality. It is because of it. Because there is wealth inequality, entrepreneurs and other risk-takers have an incentive to try their hand at creating a business and becoming incredibly wealthy. If it were not for that incentive, no one would risk it. Remember that the next time you are debating someone who holds the belief that wealth inequality is a bad thing. It is not. It is a great thing.