Traditional free-market liberals generally pride themselves on their biological, or at least psychological, realism, following Adam Smith in the belief that humans are fundamentally self-interested, if not actually greedy, beings, and that self-interest has to be taken into account and put to use in any effective society and economic system. Now that their critics seem to be incorporating research in evolutionary biology to an encouraging degree (though whether they are interepreting the findings correctly is a different question entirely), I have noticed a bit of a strange drift towards tenuous psychological claims and social-constructivist claims in a couple of free-market defenses themselves. In one, this year’s Nobel laureate in economics, Edmund Phelps, tries to comparatively assess the economic systems of the Anglophone world and Continental Europe. Although he asks the question as to whether at some point continued gains in wealth and economic growth are valuable, he seems to assume implicitly that the comparison can essentially be reduced to these terms. I don’t think even the most die-hard defender of social democracy would deny that Americans have a higher average income than Europeans; that’s just a fact. Usually the defense, and a not invalid one either, is that the greater range and quality of state-provided or -guaranteed social services makes the society as a whole, and especially the poorer members, better off. And in fact, on other measures of quality of life, for example average health, European countries generally score a lot higher than the U.S. Phelps also seems to be aware that wealth is not the sole measure of quality of life, but his alternative justifications for more time spent working and earning money, as in America, seems to hinge on dubious non-empirical claims such as: “The American application of this Aristotelian perspective is the thesis that most, if not all, of such self-realization in modern societies can come only from a career. Today we cannot go tilting at windmills, but we can take on the challenges of a career. If a challenging career is not the main hope for self-realization, what else could be?” Um, I don’t know, but if we really want to be tolerant liberals, we should probably let people find out for themselves. I think a more pressing, and objectively verifiable, question about the social democracies is not whether they are providing a high standard of living for their people but whether with the general lack of economic dynamism it will be sustainable into the forseeable future. I know that the vaunted tuition-free university systems in most of the European countries, for example, are, if not bankrupt, under increasing financial strain, especially in comparison with American universities.

At the end, Phelps urges us to see entrepreneurs as the victims in a society that does not facilitate entrepreneurship, even if poor people benefit. I am rather skeptical that entrepreneurship is intrinsically prejudicial to the interests of the poor, but if it were than it seems to me the case would be a lot more complicated. Because Phelps doesn’t seem to acknowledge that some people’s desires are not compatible with others’. The desires of thieves or arsonists cannot be reconciled with the interests of the rest of society, so they have to be excluded. I am not saying by any means that entrepreneurs as a class fall into this category, but if one is willing to sanction a group’s activities even if it is detrimental to the well-being of another, which Phelps is apparently willing to grant hypothetically, then it has be determined whether the harm is only incidental or intrinsic.  That distinction to me often represents the line between what can be tolerated and what has to be suppressed. The other article responds to a claim made from several sources recently that income inequality is inherently bad because it is detrimental to the psychological well-being of humans who, evolved as status-seeking beings, are wounded by the seeing themselves as less well-off than others. There is evident psychological truth in this view, although it is equally evident that even its proponents, like the British politician Richard Layard (a member of the British nobility, it should be noted!), believe that it can be to some extent transcended, or they would not be presenting policy proposals for how to fix the problem. Nor does Will Wilkinson, the author of the article, really contest the biological evidence of this phenomenon, even though he throws out some pro forma arguments about how humans and rhesus monkeys are in fact different and results from research on one are not necessarily extrapolable to the other. His basic argument is that, even if status-seeking is a fixed element of human existence, the forms of status are not, and in an ever-expanding world the number of high-status positions can be multiplied without limit. In one sense this is obviously false, in that no matter how many status groups there are, one still has to have status relative to someone else or it becomes meaningless, like everyone in a class getting gold stars.  On the other hand, this view has merit insofar as it shows that, once again, wealth is not the only measure of status. One of the many ways in which Layard and his ilk are either naive or disingenuous is in seeming to believe that if perfect equality of wealth were achieved humans would either stop seeking greater status or would be stymied in their quest. But people are not equally intelligent, or athletic, or attractive. They would find other ways of one-upping each other. Wilkinson recognizes this. But it is unclear if he recognizes that there is at least one inflexible fixed measure of status, which is of course…reproductive success! Poets, economists, pop singers and politicians may define their status within different niches, but the odds are that they will not all be equally successfiul in getting girls or boys. And there is a rather high probability that people will find themselves competing across niche boundaries for a mate, which is where all the tidy non-competitiveness breaks down. And especially at these times, I doubt that a “high-status” poet will even be able to convince himself that he has a truly high status in the world.  Not that I have any policy proposal at the bottom of this. If you think about the basic tradional needs of humanity, like food, shelter and mating, there seems to be a radical and ever-increasing asymmetry between food and shelter, which are relatively easy to obtain for most people today, at least in the developed world, and mating, which seems to be just as difficult to secure as ever. And the reason, as I see it, is that our environment is the source of food and shelter whereas we are the source of mating to each other. We can make collective progress relative to the environment because it is relatively unchaning, but we can’t make collective progress relative to our selves, so the growth of societal knowledge and expertise has not been of much use. But at least we can make ourselves more beautiful.