Positional Competition And The Politics Of Massive Failure

Ilyana Kuziemko and Michael Norton argue that something they call “last place aversion” has driven support for redistributive policies down during the recession. Their take, based on General Social Survey data, is that while rich people always have a certain aversion to redistribution that during the recession, people with below-average incomes have seen a spiking interest in keeping the poor down.

Brad Plumer counters that “even if Kuziemko and Norton are right and the idea of income redistribution is becoming less appealing, it’s still the case the specific policies to curb inequality garner very broad support.” He cites overwhelming public support for higher taxes on the rich and notes that “the millionaire tax, in fact, is especially popular among those making at least $100,000.” These seem to me like two sides of the same coin. People don’t really care very much about inequality, but do care a lot about their relative social position. The status anxiety of relatively affluent people is mostly directed at high earners, but people of modest means have a different set of concerns.

I really do think it’s worth emphasizing that the reason people are getting interesting in things like the 99 Percent Movement is that we’re living through massive systemic failure. If we were looking at full employment and rising middle class wages, I think activism around inequality would be a distinctly niche issue. I seem to recall that the big critique of global capitalism circa 1999 had something to do with sea turtles. But today living conditions are deteriorating so people are demanding that elites, broadly construed, do something about it. This isn’t about the gini coefficient per se, it’s about the fact that people were asked to swallow a wide range of social trends in the name of economic growth and got a turd sandwich instead.