Those interested in explaining recent growing inequality might find it useful to look at Peter Turchin's War and Peace and War: The Life Cycles of Imperial Nations and his explication of the Matthew principle. Turchin's analyis is based on his earlier mathematical modelling in his Historical Dynamics: Why States Rise and Fall. Turchin argues that there is a particular point in the secular cycle at which inequality begins to increase and that to those that have are given more. He links this to a growing population pressure and hence competition for resources, particularly amongst elites. Relative equality is a feature of low density population and ease of obtaining resources eg England after the Black Death had killed a third of its population. Turchin finds this pattern repeated in a number of historical cases although there is an issue of the extent to which this analysis can be applied to our current circumstances.

Egalitarianism has been done to death. It is one of those overused and abused words wielded like a blunt instrument to convince already numbed and disinterested people that they are not ‘nice’ if they don’t agree with the users gripe about ‘inequality’. And, most of us want to be thought of as nice, concerned people, don’t we?

Yes, settlers in Australia decided that the new society wasn’t going to be like the old European one. Jack was to be a good as his master; he would have equality under the law; he would have a moral worth equal to any; he would – eventually - have the right to suffrage and, further down the track, his female counterparts would have all discrimination against them removed.

Andrew Leigh, however, uses his version of egalitarianism to jump straight into distribution of incomes. He presents statistics about the take of Australia’s top earners (boring to most of us, but undoubtedly correct) and advises that these incomes are very similar to other liberal, free enterprise democracies such as Britain, Canada and the United States. Hardly surprising, as these countries are, also like Australia, meritocracies where incomes are ‘distributed’ according to effort.

Mr. Leigh rounds off by saying that “the evidence suggests that cutting the top marginal rate increases the income of share of the very richest”. Talk about the bleeding obvious!

So, what is his point?

He doesn’t come out and say so, but if he is hinting that income inequality in Australia means that egalitarianism doesn’t exist, he is using the definition of egalitarianism bleats about equality for all irrespective of merit. It took Russia 90 years to work out that no such Utopia can prosper.

Not boring to me.

Sure, there is some degree to which income is distributed according to merit. But merit is but one contributing factor. The richest Australian, for instance, and his father before him, enjoyed much of their wealth through the fortune of inheritence. Maybe the senior consolidated his wealth and built on it - but wealth begats wealth as poverty begats poverty.

Sure again, we've heard this old kernell of truth often enough that those of us who are relatively wealthy - I certainly am - may roll our eyes and begrudge spending our time on the subject. Its much nicer to hear that we are the desserving beneficiaries of our wealth.

But this doesn't negate the reality that while many of us who enjoy relative wealth have worked hard for our position - we haven't necessarily worked harder than many of our fellow citizens who aren't enjoying prosperity. Of if we have, then not necessarily sufficiently harder to justify the proportion of additional wealth that we enjoy.

Maybe some of us were lucky. Maybe we made the right decisions about where to focus our efforts. Maybe we benefitted from good direction from parents and mentors. Maybe we were blessed with able bodies and minds that served us well. Maybe we were blessed with characters that could overcome our adversitites well.

Andrew Leigh's point was that focussing on tax reform at the top end is an idea ill conceived. The top end is doing increasingly well. He could have stretched the analysis to show that when Australian CEOs argue the need for gigantic salaries to be competitive - that there's only really 3 countries in that competition: Australia, the USA, and the UK. Top end salaries in other countries are way below the level of these three. Perhaps Australia shoudl let the UK and USA fight it out and instead benefit from the next level down who are busy building their "merit" in order to get into that market.

Not boring to me - and hardly Communism.

The Magic of Statistics -

If I stood with one foot on hot coals and the other in a bucket of ice, on average, I'd be very comfortable indeed.

When it comes to real estate, affordability has never been worse for the coming generation.

What chance, for instance, would a couple of married ex-Uni students have of ever saving for a home and raising a family while servicing a combined HECS debt as house prices rise ever higher?

Cheaper technological trinkets are one thing but it's the traditional essentials that seem to be getting further and further out of reach for most people.

These are the sort of things that change societies.

I don't mind how much egalitarian society is, as long as I am more equal than everybody else.

"Lies and statistics" is a more apt title that the author might think. The income data assessment is based on gross pre-tax income and therefore quite useless as a measure of actual income received by households. 47cents in the dollar plus Medicare levy tends to suppress the dollars actually received by those in that tax band!