Economists, I think, often tend to have a different way of looking at things. They ask particular sorts of questions and often arrive at different kinds of answers than us non-economists. For us, economic work often can seem to take place in a world unto itself. Sometimes, though, what economists argue and and call out resonates across fields and disciplines. What is so interesting is that economists arrive there through their own, specialized path. While we may not be able to check all of their math, we do grant them the ability to “prove” what many of us believe. Economics can be a very influential social science.
Those kinds of observations recurred frequently to me while reading Jonathan Rockwell’s fascinating new book, A Republic of Equals: A Manifesto for a Just Society. Rothwell is the chief economist at Gallup, an organization that knows more than few things about data. He’s extremely smart. In fact, the book is a testament to his analytic skills, across the board curiosity, and sharp writing. Equally important, though, are Rothwell’s human-focused values. He comes across as a truly decent person, a scholar who wants to argue for a better society, a researcher who wants to prove that economics can guide us to a more equitable, fair and just society. This is a book that is grounded in the hope that we can make things better for more. That sentiment, in and of itself, makes for a worthwhile read.
Rothwell roots his book in the current discontent across the political spectrum, anger based on rising inequality and unfairness. It has led to a loss of faith in markets and in democracies. It has heightened racism and xenophobia. Rothwell asserts that the common liberal argument – “it’s corporate greed” doesn’t hold up to rigorous analysis. On like lines, he asserts that the common argument from the right – “talent deserves the money” does not withstand analysis. Roth believes in markets and wants to carve a different way to address the problem.
Ignoring issues of wealth (Picketty), Rothwell looks at who actually comprises the top one percent of earners in America. He discovers that very few of them are movie stars, athletes, and celebrities. Few are technology innovators and relatively small numbers work on the international stage. Instead, more than half are clustered in administration, education, health, real estate, legal services, and finance. They are not all executives, either, of multinational corporations. Most work in what we would think of as local endeavors. These high-earners, Rothwell boldly asserts, are vastly overpaid relative to their smarts and impact on the nation’s overall economic growth.
From that provocative beginning, A Republic of Equals wanders over a great deal of provocative terrain. Rothwell pulls on Rawls, Plato and Cicero, supported by several economists, to establish the inherent benefits of a just and more egalitarian society. He measures market efficiency when it comes to compensation, across nations and over time, to ascertain where and how there are inefficiencies and subsequent unfairness. Rothwell’s conclusion is both analytically rigorous and readily apparent to those who think outside of economics: “The chief problem with labor market inequality is not the market per se. Rather, it is the way that political power operates to control and effect markets.” For most of us who follow the news with any consistency, attention to political power often seems far more relevant than the prerogatives of a market.
In the heart of the book, Rothwell devotes several chapters and a great deal of analysis to proving the economic inefficiencies and intellectual shabbiness of systemic racism and classism. He makes strong arguments about how limiting access to public and private goods, such as education, health care and housing, cannot in any way be based on science or social science. His arguments are compelling and well-crafted. His work consistently circles back to a recurring theme – it is politics and power that are shaping our inequality, not the markets. Rothwell hammers the point repeatedly. Merit – genes, intelligence, work ethic – cannot explain how are why elite professionals, the one percent, are earning so much. The answer lies in their ability to obtain and influence political power.
The conclusion of the book calls for reforms in key areas. Rothwell wants to see more institutions that operate for the pubic good, for more access across the board to healthcare and education, better regulation of the finance industry and the loosening of intellectual property laws. He has several suggestions for legislation and executive actions that would limit racism. These reforms, which many would identify as “liberal”, are based on research and Rothwell’s faith in preserving markets and their ability to maximize efficiency.
A Republic of Equals makes for a very interesting read, in both what is argued and, surprisingly, what is not covered. While I learned a great deal in the volume, I also left wondering more about a different, messier question. If all these reforms would lead to greater economic productivity and opportunity, if we are all smart, rational actors who can see what truly benefits a country, why do societies consistently have markets that are distorted to benefit a small number? That is a question that may elude economic methods, but remains quite pertinent to Rothwell’s thought-provoking book.
David Potash