Distributive justice: Cognitive Preferences and Jarring Priorities

Abstract

In the wake of Thomas Picketty’s refocus on the concentration of income and wealth with the publication of “Capital in the 21st Century” in 2013, discussions about growing inequalities due to “r  >  g” have intensified. The widening chasm in incomes and wealth between the top 1% and the bottom 99% is due to pervert transfer of incomes from the poor to the rich. Burgeoning inequalities are also due to Schumpeterian entrepreneurship and innovations as well as crony capitalism. Cognitive preference aside, there is resistance to the Pigou-Dalton transfer principle embedded in the idea of a global system of progressive wealth tax. A realistic Marxian understanding of the matter-of-fact power associations and interactions in a free capitalist state shapes the world view. It deconstructs radical solutions and calls for furnishing the basics of an unpretentious life on an emergency basis to the deprived. After tracing the outcomes of the commonplace empirical constructs about the policy packages offered as an antidote to inequality, the paper identifies the trends in income and wealth in America and India. Finally it offers the Tertium Quid: While inequality reduction is as critical as ever, it is worth doing what is only feasible: diminish deprivations in food, shelter, education and health care on a firm timeline and special budget. This will enable more of the poor to achieve their potentials and that will contribute to disparity management.