Today’s essay is the final of four in a series by James E. Hartley on what literature can teach us about economics. You can read the first, second, and third here.
Nobody ever stopped him in the street to say, with gladsome looks, “My dear Scrooge, how are you? When will you come to see me?” No beggars implored him to bestow a trifle, no children asked him what it was o’clock, no man or woman ever once in all his life inquired the way to such and such a place, of Scrooge. Even the blind men’s dogs appeared to know him; and when they saw him coming on, would tug their owners into doorways and up courts; and then would wag their tails as though they said, “No eye at all is better than an evil eye, dark master!”
But what did Scrooge care! It was the very thing he liked.
(Dickens, A Christmas Carol)
Over the course of this series of essays, we have been exploring why it is that people object to an unequal distribution of wealth. We saw in the first essay, that the objection is not limited to concern for people living in poverty. In the next two essays, we saw that while there are related complaints about the sources of great wealth, such complaints are not well-grounded. So, what is it? Is it that wealthy people are inherently more wicked?
Once again, we turn to literature to guide us. Consider Charles Dickens’s A Christmas Carol. If one is looking for an exemplar of the despicable rich, one can do no better than Ebenezer Scrooge. The first description of him is “a squeezing, wrenching, grasping, scraping, clutching, covetous, old sinner!”
If this portrait of Scrooge is underneath the complaints about unequal wealth, it is not hard to understand the problem. Do people like him really deserve to be the wealthiest people in town? Why should Scrooge be able to lord himself over his clerk, the impossibly charming Bob Cratchit? In the depths of winter, Bob is working next to a fire that amounts to nothing more than a single coal because Scrooge refuses to let him add another. The entire set-up of this story is designed to raise the complaint about the horrible distribution of wealth in Victorian England.
But, Dickens is clever. As everyone knows, A Christmas Carol ends on such a happy note that it can only be described as Dickensonian. After the ghostly visitors, Scrooge is a reformed man. The final description of Scrooge: “He became as good a friend, as good a master, and as good a man, as the good old city knew, or any other good old city, town, borough, in the good old world.” You would love to know this reformed Scrooge; you would enjoy having dinner, even Christmas dinner, with him.
What is so clever about this ending? Scrooge is every bit as rich at the end of the story as he was at the beginning of the story. If the Scrooge at the beginning of the story is the example of what is wrong with wealth inequality, then why doesn’t the story end with Scrooge losing his wealth?
Bad Scrooge, Good Scrooge
If Scrooge is any indication, it is not the source of wealth or the existence of wealth that rouses our opprobrium. The difference between Scrooge at the outset and Scrooge at the end is neither how wealthy he, is nor how he earned his wealth. He doesn’t become poor or change jobs and yet we move from abhorring him to loving him. What changes? The only difference between Scrooge at the beginning and end of the story is what he does with his wealth. Scrooge learns to be charitable.
The masterful Dickens sets up the contrast beautifully. As the story begins, we learn that Scrooge is a very unpleasant person, someone not worthy of emulating and someone with whom you would rather not spend time. Scrooge is not just a terrible person; he is a terrible rich person. His riches seem to be the source of his badness.
The defining scene comes early, as Scrooge is in his office and two “portly gentlemen, pleasant to behold” come in. The conversation is worth quoting at length both because it is illustrative and because, well, it is Dickens at his best:
“At this festive season of the year, Mr. Scrooge,” said the gentleman, taking up a pen, “it is more than usually desirable that we should make some slight provision for the Poor and destitute, who suffer greatly at the present time. Many thousands are in want of common necessaries; hundreds of thousands are in want of common comforts, sir.”
“Are there no prisons?” asked Scrooge.
“Plenty of prisons,” said the gentleman, laying down the pen again. …
“Oh! I was afraid, from what you said at first, that something had occurred to stop them in their useful course,” said Scrooge. “I’m very glad to hear it.”
“Under the impression that they scarcely furnish Christian cheer of mind or body to the multitude,” returned the gentleman, “a few of us are endeavouring to raise a fund to buy the Poor some meat and drink, and means of warmth. We choose this time, because it is a time, of all others, when Want is keenly felt, and Abundance rejoices. What shall I put you down for?”
“Nothing!” Scrooge replied.
“You wish to be anonymous?”
“I wish to be left alone,” said Scrooge. “Since you ask me what I wish, gentlemen, that is my answer. I don’t make merry myself at Christmas and I can’t afford to make idle people merry. I help to support the establishments I have mentioned—they cost enough; and those who are badly off must go there.”
“Many can’t go there; and many would rather die.”
“If they would rather die,” said Scrooge, “they had better do it, and decrease the surplus population. Besides—excuse me—I don’t know that.”
Why be charitable when there is plenty of prison space to go around? After this passage, what redemption is possible for Scrooge?
Scrooge meets one of these gentleman at the end of the story, and immediately goes up to him offering an astonishingly large gift to this enterprise to help the poor and destitute. The reader’s heart is warmed. Similarly, Scrooge tell Bob Cratchit that he is not only going to give Bob a raise but also, in a perfect small detail, he tells Bob to build a roaring fire and get a brand new coal scuttle. Wealth inequality, therefore, seems like less of a problem when the wealthy are generous.
The Gospel of Wealth
Andrew Carnegie reflects on how wealth inequality benefits everyone in his short essay “The Gospel of Wealth.” Suppose wealth is created because of the ingenuity and hard work of some set of people. Moreover, when those people get more wealth, they are able to use it to generate even more wealth by expanding the scope on which they can apply their particular genius and work ethic. The creation of this wealth is a benefit to all. But, suppose also, that as the wealth is created, a large amount of it accrues to these innovative and entrepreneurial people.
Carnegie notes the difference between the creation of wealth and the distribution of wealth. Surely, Carnegie argues, a society should do all that it can to encourage the creation of wealth. But, when extraordinary wealth is created, it inevitably ends up being distributed unequally. We should not discourage this wealth creation, but we should think more carefully about the final disposition of the wealth.
Carnegie notes three possibilities for the disposition of vast fortunes: first, the wealth could be given to heirs; second, the wealth could be appropriated by the government and used for public purposes; or third, the wealth could be voluntarily given away during the earner’s lifetime. All too often, Carnegie notes, the debate is entirely about the relative merits of the first two possibilities. Carnegie does not like either of those options. The heirs of the person who earned the wealth are rarely good stewards of the wealth after they inherit it. One should not bequeath great wealth on the idle and feckless. Similarly, the government has not proven itself to be a good steward of public resources.
The final option, however, has enormous benefits for society. If the talented earn vast fortunes and then set out to distribute those fortunes in ways which will genuinely benefit the poor, then who would complain? “Even the poorest can be made to see this, and to agree that great sums gathered by some of their fellow-citizens and spent for public purposes, from which the masses reap the principal benefit, are more valuable to them than if scattered among them through the course of many years in trifling amounts.”
Now imagine a society in which everyone who is wealthy acted in the manner suggested by Carnegie. Pick your least favorite billionaire and ask yourself if your opinion would change if you knew that before the person died, all of that that person’s wealth, all of it, would be voluntarily given to things which benefited the poor. Things that benefit the poor does not have to mean cash grants; Carnegie, for example, built public libraries in small towns across the country. If every rich person acted like that, would anyone still be concerned about the distribution of wealth in a society?
If this is right, then there is a massive unstated assumption at the heart of the debate about wealth. If one assumes that the wealthy are shallow, selfish people unconcerned about the welfare of others, then the fact that these morally reprehensible people have acquired great wealth will seem like a societal problem. If on the other hand, the wealthy were all kindly benevolent people who are creating wealth through investment and hard work and then will give all that wealth away to help others, then great wealth suddenly does not seem like such a problem. In the latter case, we might actually prefer the greater inequality because the good for the poor will be greater than if the wealth were more evenly distributed.
Why has this underlying feature of the debate about the distribution of wealth been so obscured in the public debate? If the problem is not inequality per se or that wealth has been acquired by improper means but rather that the stereotypical wealthy person is not using the wealth to help others, then why do we talk about the wealth distribution instead of talking about the lack of charity among the rich?
I am afraid the answer is simpler than we would like to admit. Imagine someone living in the wealthiest country in the history of the world, someone whose wealth vastly exceeds the dollar a day level which defines global poverty. Now ask: if we are worried about wealth inequality because we don’t think the wealthy are using their wealth to help others, then it seems worth asking, who are the wealthy people? Can I, the writer of this essay, and you, the reader of this essay, afford to give $20 more than we are giving to something which will genuinely benefit those less fortunate? Would any of us really argue we cannot do that? It is an uncomfortable question, to be sure.
As C.S. Lewis put it in Mere Christianity:
I do not believe one can settle how much we ought to give. I am afraid the only safe rule is to give more than we can spare. In other words, if our expenditure on comforts, luxuries, amusements, etc, is up to the standard common among those with the same income as our own, we are probably giving away too little. If our charities do not at all pinch or hamper us, I should say they are too small. There ought to be things we should like to do and cannot do because our charitable expenditure excludes them.
The next time you are involved in a discussion about the wealth distribution, no matter which argument you take, why not consider increasing your own private charitable efforts just a bit. Embrace your inner reformed Scrooge.