Angus Deaton On Inequality - The War On Poverty Has Become A War On The Poor' - Inequality - The Guardian
Angus Deaton On Inequality - The War On Poverty Has Become A War On The Poor' - Inequality - The Guardian
Angus Deaton On Inequality - The War On Poverty Has Become A War On The Poor' - Inequality - The Guardian
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Inequality
Angus Deaton on inequality: ‘The war on
poverty has become a war on the poor’
The Nobel prize winner and author of new book Economics in America argues
economists must get back to serving society
Chris McGreal
Sat 7 Oct 2023 08.00 BST
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10/22/23, 6:56 PM Angus Deaton on inequality: ‘The war on poverty has become a war on the poor’ | Inequality | The Guardian
“If you need an ambulance, you are not in the best position to find the
best service or to bargain over prices; instead, you are helpless and the
perfect victim for a predator,” he writes.
The results are clear. Real wages have stagnated since 1980 while
productivity has more than doubled and the rich cream off the profits.
The top 10% of US families now own 76% of wealth. The bottom 50%
own just 1%.
The time has come, Deaton argues, for economists to get back to serving
society.
“The discipline has become unmoored from its proper basis, which is
the study of human welfare,” he writes.
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10/22/23, 6:56 PM Angus Deaton on inequality: ‘The war on poverty has become a war on the poor’ | Inequality | The Guardian
New Jersey. Ronald Reagan was in the White House and the Chicago
school held sway over policy in both the US and Margaret Thatcher’s
Britain.
But while the impact of Thatcherism came under intense scrutiny in the
UK, Deaton was surprised to discover that American economists were
largely uninterested in how their policies contributed to inequality and
hardship.
Deaton ticks off the list of Nobel prizes for economics won by the
Chicago school’s highly regarded minds, including Milton Friedman and
George Stigler. He does not doubt what he calls their intellectual
contributions.
Deaton and Case then wrote a bestselling book, Deaths of Despair and
the Future of Capitalism, highlighting the part played in reducing life
expectancy by the US economic system, not least its lamentable health
industry in killing staggering numbers of patients while making
Americans poorer.
For all of Deaton’s attachment to his adopted country, his British roots
and upbringing cut the lens through which he interprets the US.
Deaton said that at the heart of the difference between his two nations
lay opposing views about the role of government. After growing up in a
country where many people saw the state as “a friend in times of
trouble”, he was appalled to hear his American colleagues proclaim that
“government is theft”.
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10/22/23, 6:56 PM Angus Deaton on inequality: ‘The war on poverty has become a war on the poor’ | Inequality | The Guardian
The way poverty is measured means that the war on poverty can
never be won by sending money to the poor
“The way poverty is measured means that the war on poverty can never
be won by sending money to the poor. This statistical stupidity, which
the politics makes so hard to fix, is a constant source of mischief and
misunderstanding.”
Put another way, Deaton said, “the war on poverty has become a war on
the poor”.
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10/22/23, 6:56 PM Angus Deaton on inequality: ‘The war on poverty has become a war on the poor’ | Inequality | The Guardian
“One of the things I’ve learned is that the deepest forms of inequality
are these sort of personal inequalities where not everyone is given equal
value as a human being. That is the inequality that is so worrisome in
America today. To have high status, to have access to good jobs, to be
recognised valuable member of society, you have to have a four year
college degree,” he said.
“If you don’t, you don’t get to be part of the ruling class. You don’t get to
participate in Congress. You don’t have access to good jobs. You’re
excluded from the successful cities, and all sorts of bad stuff happens to
you.”
“That’s the difference with Britain where they always knew they had a
class system. But the US has moved to something much closer to the
class system,” he said.
“With the right policies, there is a chance that capitalist democracy can
work better for everyone, not just the wealthy. We do not need to
abolish capitalism or selectively nationalize the means of production.
But we do need to put the power of competition back in the service of
the middle and working classes. There are terrible risks ahead if we
continue to run an economy that is organized to let a minority prey on
the majority,” he writes.
Deaton sees other reasons for hope too. He said the huge popularity of
the French economist Thomas Piketty’s book, Capital in the Twenty-
First Century, which argued that inequality is a feature not an accidental
consequence of capitalism that can be offset only through government
intervention, is evidence that even in the US the debate is shifting.
“I think Americans are learning that there’s more than one way of
thinking about the world,” he said. “One of the things I’ve been arguing
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10/22/23, 6:56 PM Angus Deaton on inequality: ‘The war on poverty has become a war on the poor’ | Inequality | The Guardian
is that all of us, including me, were a little too ready to accept the
arguments that markets can solve things. We should have known.”
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