History professor Peter Baldwin has a piece on the similarities between America and Europe. One interesting bit, quoted by Reason (via Instapundit), observes:
Income is more disproportionately distributed in the US than in Western Europe. In 1998, for example, the richest 1 per cent of Americans took home 14 per cent of total income, while in Sweden the figure was only about 6 per cent. Wealth concentration is another matter, however. The richest 1 per cent of Americans owned about 21 per cent of all wealth in 2000. Some European nations have higher concentrations than that. In Sweden-despite that nation’s egalitarian reputation-the figure is 21 per cent, exactly the same as for the Americans. And if we take account of the massive moving of wealth offshore and off-book permitted by Sweden’s tax authorities, the richest 1 per cent of Swedes are proportionately twice as well off as their American peers.
I think this underscores the fact that America is the nation of new money, while Europe (or Sweden at least) is about old money. In America, the land of opportunity, an entrepreneur can start a business that makes his or her fortune, and literally millions do. Opportunity leads to income inequality, because most people (due to lesser talent or inclination) will not become entrepreneurs. In Europe, great wealth tends to be inherited to a much greater extent. You can see this in the numbers above; how else can you get wealth inequality without income inequality?
What this illustrates is that income equality shouldn’t even be a goal. All income equality does is keep people from becoming rich. It bars the gates to affluence. Instead, the goal ought to be freedom, to place no obstacles in front of any person’s right to realize his or her potential. Naturally, some people will become rich. That’s a good thing.
POSTSCRIPT: Yes, I realize that by using Baldwin’s numbers to highlight a difference rather than a similarity I am missing his point.
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