The Rich And The Rest

Nicholas Kristof contends that economic inequality makes America a banana republic. Will Wilkinson combats this notion:

As a general rule, Mr Kristof is right. A lack of social cohesion and abundance of socio-political stability does tend to coincide with a high level of inequality. But that's because a high level of inequality is generally the result of one group of people dominating and marginalising another, which is not a recipe for widespread amity and fellow-feeling.

More relevant to the American case is the fact that a great deal of ethnic and cultural diversity tends to dampen the general sense of solidarity and social cohesion, and this in part explains why Americans demand less progressive redistribution than do voters in smaller, more homogeneous countries. However, I have yet to see any evidence that America's unusual quantity of stupendously large fortunes threatens to unweave its social fabric. America's "war on drugs", its failing urban schools, its treatment of undocumented immigrants, its monstrous incarceration rate... surely these "corrode the soul" of the nation. If only retarding America's spiritual corrosion was so easy as letting the Bush tax cuts expire! If only it was so easy as nicking half of every damn plutocrat's stash! 

Reihan is also up in arms.