Why does (in)equality matter?

By Luke Lu

Why does (in)equality matter?[1]

There has been recent public debate regarding issues of meritocracy, widening wage gaps and the kind of moral imperative our society should develop. Some like Dr Tommy Koh have proposed how we may learn from Nordic countries, others have proposed shock(ing) therapies, and PM has weighed in by suggesting a middle ground that we may tread. Even the discontent with regard to rising COE and housing prices has, to some extent, to do with equality or the lack thereof, when people perceive certain lifestyles and goods to be financially out of reach. I am not here to suggest solutions to these teething issues, but will just like us to take a step back and consider why the issue of (in)equality matters to us all in the first place.

Before we begin, I have to qualify that this piece is not a political op-ed critiquing any policy or ideology. It is simply arguing for the need to be concerned with (in)equality. I will like to think that the issue has some moral bearing for us, no matter where your political inclinations lie or what political party you support. Like Amartya Sen[2], I believe that all political ideologies with moral legitimacy tend to have some commitment to the equal worth of individuals. What differs is the extent to which they are committed in pursuit or maintenance of equality.

Ed Miliband categorises the arguments for equality into procedural and consequential arguments. The procedural set deals with how people end up with certain outcomes in life. If we assume and believe that all we enjoy in life today is the deserved result of our own efforts, then not much can be said about why inequality is a problem. The procedural arguments are hence important in showing that there are more factors at play other than individual effort, and are a direct rebuttal to those who claim that their private success is entirely down to themselves. The consequential arguments contend that there may be certain negative implications due to inequality, and that high levels of inequity is actually detrimental to the social fabric.

Procedural arguments

First, it may be obvious that much of our social outcomes tend to be based on different and unfair starting points. It is no coincidence that a disproportionate number of students who do well enough in school to earn scholarships, are of better socioeconomic backgrounds. Even PSC has admitted this[3]. Yes, there are those from humble families who do succeed, but any statistical study will show that they are the exception to the rule. One will be naïve to think that the child of working professionals will not be advantaged in terms of opportunities and life chances, compared to a child born to a family struggling to make ends meet.

Second, luck plays an important role as well. Many a time, it is not the result of one’s hard work or brilliantness that allows one to succeed, but the arbitrary way in which life deals you cards. To cite an example, a university graduate who enters the workforce in times of economic crisis will definitely have a harder time finding a job that pays well. This is not to say that success has nothing to do with putting in effort. It does. But success has also to do with whether you are publishing a book in lean times, promoting a play at the height of SARS or selling property during an economic boom, all of which circumstances are utterly out of our control.

Even if we account for equal starting points and pure luck, there is a further reason why people’s success is not entirely down to their own efforts. Miliband, citing William Gates Sr[4], remarks that:

Success is a product of having been born in this country, a place where education and research are subsidised, where there is an orderly market, where the private sector reaps enormous benefits form public investment. For someone to say that he or she has grown wealthy in America without the benefit of substantial public investment is pure hubris.

It thus follows that individual success is always due to larger social institutions and public goods that allow for this success to be possible. If you have established a company and worked hard to expand its operations with revenue the envy of many, this is also only possible with a stable socio-political landscape without civil unrest, an educated workforce with a good work ethic, a sound legal and judicial system with a regulated business environment. In effect, all of society can claim some small part to contributing to your success, since all of us paid taxes and played our civic role to enable these public goods and institutions to be made available. Indeed, the moral argument may be that all individuals owe something back to society.

Consequential arguments

Let us now consider the potential ramifications of inequality.

The first has to do with one’s relative position and status to others. It is about self-respect and self-worth. It may be true that Singapore is better than other countries in terms of eliminating absolute poverty. We have also come a long way from the 1960s in economic development. The trouble is, there is the notion of relative poverty. Owning a personal computer may not be an issue of life and death, but it is a definite issue when one’s life chances is circumscribed by the kind of material goods you possess. Imagine a student who cannot afford a computer and who has no access to the internet at home. Will he/she be disadvantaged compared to his/her classmates? This has a further psychological effect on the individual when he/she realises that the majority of Singaporeans do have access to the internet. It is quite pointless to tell someone of lower income levels that he/she is in a better situation than others living in abject poverty or 1960s Singapore, when he/she is excluded from the socioeconomic lifestyles and benefits that most Singaporeans enjoy today. The same politics of envy and discontent comes into play when people are talking about a Chery QQ that costs 60k these days.

Building on the previous point, higher levels of unequal wealth and incomes will then mean concomitant divisions within our society in terms of communities, housing and schools, where the rich and poor will lead increasingly segregated lives and lifestyles. We may already be seeing some of these symptoms in the association between certain elite(-ist) schools and the students (and parents) who populate them. In the long term, this has serious knock-on effects for the meaning of citizenship and the articulation of what it truly means to be Singaporean.

Last of all, economic inequalities may have other side effects that we may be uncomfortable with. Miliband calls these ‘spill-over’ effects of excessive wealth disparities, where specific areas of life become too closely linked to affluence.  Political office is one arena where we should prefer candidates to compete based on ability and ideology, rather than the amount of money they have. We may also (I hope) be supportive of the idea that healthcare provision should always be allocated based on medical need, rather than who can afford it. What we may wish to be normative, however, is certainly not, in countries with existing high levels of economic inequity.

I do hope that this article has argued convincingly why we should all be interested in issues of (in)equality, and how it is really to everyone’s benefit that we should have a less unequal society. The next logical question to ask then is what sort of equality we want and how we may achieve this in Singapore.


[1] The arguments set forth here were first outlined in Edward Miliband (2008), “Does Inequality Matter?”, In Anthony Giddens and Patrick Diamond (eds), The New Egalitarianism, Polity Press. I have simply adapted them to suit our local context.

 

[2] Amartya Sen (1995), Inequality Rexamined, Havard University Press.

 

[3] PSC media response (2008), Equal chances for all / Scholarships and the cut of relative merit, http://www.pscscholarships.gov.sg/content/pscsch/default/outreach/media/press_release/media_reponse_Sep2008.html

 

[4] William H. Gates Sr and Chuck Collins (2003), Wealth and our Commonwealth: Why America should tax accumulated fortunes, Beacon Press.