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The Return Of The Great Gatsby

THE RETURN OF THE GREAT GATSBY
A plutocratic elite has quickly emerged in the new economy which poses serious challenges to how we shape our common life

Politicians are anxious. They know there are growing concerns about the emergence of a new class of super-rich (the plutocrats) and the widening divide between them and the developed world’s urban poor, but they don’t know what to do about it, if anything. They know categories of rich and poor exist, but they are reluctant to put the two together in the same sentence, lest they look retro-Marxist. US think tanks appreciate that any funding bid for work which contains the words income or wealth inequality is unlikely to be successful. Poverty alleviation is smiled upon; asking questions about the wealth divide is not.

The signs are that this cannot continue, simply because a new gap has emerged between the plutocrats and the stagnant middle classes that the latter are becoming vocal over. It wasn’t meant to be like this: economic theories assumed that income inequalities would decrease in post-industrial societies as education became more widespread and the State played a bigger role in redistribution. Something else has happened instead but there is disagreement as to why.

Those who are content with the large disparity of wealth between the super-rich and everyone else argue from economic grounds for the new reality. The twin effects of globalisation and the technology revolution have enabled a talented and entrepreneurial elite to make exaggerated gains. During the industrial era, the owners of capital were made wealthy by their rent-seeking, but in this new economic age, the super-rich have been working hard to earn their money using the new tools which, unlike in the industrial era, are more widely available. In its most extreme form, this was summed up by Mikhail Khodorkovsky as follows: ‘if a man is not an oligarch, something is not right with him…Everyone has the same starting conditions, everyone could have done it’. This is an extraordinary statement from a Russian who was in the right place at the right time during the wholesale and decidedly murky transfer of assets in the immediate post-Soviet era.

Hopefully most plutocrats would dissent from such a view, but given that most feel they have made their money not through rent-seeking but by risk-taking, there can be a strong, lingering sense that they are worth what they earn, relative to others. Those who are uneasy with the growing income divide (one, incidentally, just as extreme within the so-called 1% as between the 1% and the 99%) point to political explanations for this divide. The financial clout of the plutocrats enables them to employ the best lobbyists and lawyers to defend their interests, while the political classes, themselves increasingly detached from their electorates, are both engrossed by and indebted to the plutocrats for their wealth creation.

In reality both economic and political explanations have some traction and mesh together to give us a position today where income inequality today in the US (with Britain following on) has attained the record levels achieved between 1910 and 1920.

Biblical sources are critical of the way great disparities of wealth undermine relationships and our common humanity. Wealth creation itself is a commendable goal and one rooted in the character of God; how we place structures around it determines whether wealth making enriches human relationships or undermines them. The parable of the rich man and Lazarus (Luke 16: 19-31) shows a man condemned not because of his wealth but because he tolerated the terrible gap between him and the wretched man at his gate without any sense that this was spiritually wrong. There was no relationship between the two; the indifference of the rich man, cocooned by his wealth, blinded him to this failing.

This parable does not tell us how to devise specific policies to ensure income and wealth disparities do not grow to a level that undermines our common humanity, but it suggests there is a point beyond which it does, and one that God takes note of. The risk in our analysis of this is to assume that the moral applies only to the very rich. We allow our own distorted view of life to exempt us from any judgement when the ownership of all wealth and possessions demands a spiritual response over our use of them.

There is little doubt that a new class of plutocrats is pulling away from everyone else and that their political power is just as formidable as their economic clout. Handling this outcome is the duty of a democratic society if this elite itself is not to determine its own rules. Many plutocrats have shown remarkable skill and effort in earning their rewards and also been generous in their re-distribution of it (notably via charity rather than tax). They are also presented with the unsettling spiritual challenge of being so rich. On the whole, like with the celebrity class they share some common ground with, the Church pretends in its prayerful common life that this class does not exist, or if it does, that is not important to our view of how God wishes to change this world. It does, it is and we need to wise up.

 

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