“Equality” is a term that people uss a lot of nowadays – too much, some would argue. This week in Forbes, the Acton Institute’s managing director, international Alejandro Chafuen writes about equality and its relationship to freedom. Not all agree on which factors of equality are most important – equality of opportunity, income equality, equality before the law, and so on – but however we define it, freedom and equality cannot be separated. Dr. Chafuen’s analysis incorporates much from a new book by Spanish economist Daniel Lacalle, Freedom or Equality:
Seven years have passed since Thomas Piketty wrote Capital in the Twenty-First Century, which launched a major discussion about inequality. The debates will not end any time soon. There will always be a need for new analyses from economists who offer proven solutions to help create wealth and opportunity for society as a whole. One positive effect of Piketty’s book is that it made economists aware that, to avoid leading to wrong conclusions, the analysis of equality had to become more nuanced, such as including the impact of transfers, taking into account wealth inequality, and paying attention to family structure.
There is greater consensus among economists concerning the importance of equality before the law than concerning equality in wealth and income. Measurements of rule of law and transparency, such as the WJP Rule of Law Index and the Corruption Perceptions Index, show that in most countries today, respect for equality before the law gets a failing grade. If the rules of the game are not fair, it is difficult to argue that the results of the game are fair or that we should not care about justice of outcomes. I have shown in other studies and articles that the growth of the regulatory tyranny, a term I prefer over “administrative state,” has led to the growth of corruption and cronyism. This has led to unjust inequalities, which should be seen as a result not of free markets but of an unequal distribution of economic freedom.
(Photo credit: A sign at a Black Lives Matter protest in London on June 6, 2020. Socialist Appeal. CC BY 2.0.)