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Statistics, studies, and books by some of today’s leading intellectuals and journalists seem to paint a bleak picture of modern society — one so bleak that it raises profound concerns.

But in their critics, there’s a large obstacle preventing them to assess their claims objectively: The fact that they have a perspective on wealth that assumes that economic inequality is unfair.

Critics of economic inequality often use the analogy of a pie to discuss the uneven distribution of wealth, and there are two assumptions that I hear repeatedly that I’d like to specifically counter:

1. The “fixed pie” assumption

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Inequality critics describe economic success as if it was a zero-sum game. For example,

There’s only so much wealth to go around. Therefore, inequality is proof that some gained at someone else’s expense.

The fallacy here is that it totally ignores production. When people constantly create more wealth, the pie is constantly expanding, then one person’s gain doesn’t have to come at anyone else’s expense.

This is especially true when it comes to the technological advances human society has made during the last decade.

Of course, you can get richer by stealing someone else’s piece of the pie, but a rise in inequality doesn’t mean that someone has been robbed or is worse off than before.

The reason for this is simple: Inequality is not the same thing as poverty.

If the income distribution in the US is more unequal than Nicaragua, Guyana, and Venezuela, the critics seem to forget (or deliberately leave out) the fact that almost all Americans are rich compared to the citizens of those countries.

If the incomes of the poorest doubled while the incomes of the richest tripled it would definitely increase inequality — but every single person would be better off.

It’s important to remember that inequality does not mean deprivation. It means difference, and there’s nothing evil or questionable about that.

2. The “group pie” assumption

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In another critical viewpoint of inequality, I often hear this argument:

The top 10% no longer takes in 1/3 of our income, it takes half.

The fallacy here is that one has to assume that wealth is a pie that is created by society as a whole, which in turn has to be divided equally across the board.

The problem here is that wealth is not actually a pie belonging to a nation as a whole. What wealth is, is particular values created by particular individuals or groups, and belonging to those particular individuals.

Wealth is not distributed by society. It is created and traded by the people who produce it.

The creators. The innovators.

If society were to distribute it, it would have to seize it from the people who created it.

Conclusion

We need to take a hard look at our assumptions of wealth. Looking at it wrong would lead us to believe the critics who present their views on economic inequality. Especially those who want to fight “big tech”.

If we look at wealth as something individuals create, then there’s no valid reason to believe that we should all be equal economically.

Look at the actual individuals that make up society. It’s needless to say that human beings are unequal in almost every respect. We’re different in size, strength, intelligence, work ethic, ambition, moral character.

These differences will result in different economic conditions, but there’s no reason to ring the alarm because of it.

If wealth is something individuals produce, then economic equality shouldn’t be an ideal.

In fact, if we intend to prosper in a world with economic liberties, then the opportunity of obtaining that prosperity goes hand in hand with economic inequality.