Gilded Days Are Here Again

Are hipsters the new flappers? This is less of an absurd question when you discover, as many pundits did over the last week, that inequality in 2007 trounced the excesses even of the Gatsby era. The parallel was not lost on liberal bloggers, who played on variations of the redolent adjective "Gilded" in their headlines:

• "Even More Gilded," ran the headline on Paul Krugman's blog
• "More Second Gilded Age Blogging," wrote Brad DeLong
• "A Gilded Age," wrote Steve Benen in the most straightforward iteration
  

Reactions to the study, conducted by Emmanuel Saez at Berkeley, predictably focused on the brutality of the numbers. More striking, however, was how short the posts were, and the sense of futility permeating the liberals' protests. Steve Benen explained it most bluntly:

Any efforts to address this [inequality], of course, will be immediately met with cries of "socialism," "class warfare," and "welfare state." Today's conservatives see a chart like this and think, "It is as it should be."

Have liberals conceded the debate over inequality? Tim Fernholz's parenthetical disclaimer that he's not "suggesting we go as high as the [income tax] rates in the sixties and seventies" might suggest that. But when conservative Will Wilkinson made just that point in July, liberals rose against him in an attack on inequality as forceful as any since the outset of the recession.

• Inequality Doesn't Matter, Poverty Does, argued Wilkinson in The Week. "It appears that the commentators who fretted over income inequality so publicly for so long have simply stopped worrying about it."
• No, Inequality Drags Everyone Down, retorted Jonathan Chait in the New Republic. "Wilkinson is inadvertently bolstering the strongest liberal argument against inequality: it's inefficient."
• Wilkinson Makes the Case for Redistribution, said Matthew Yglesias at Think Progress. "This is also a strong argument for believing that redistributing money from wealthy or high-income individuals to the poor or to public services will be welfare-enhancing."
• But Utilitarian Arguments Are False, said Wilkinson in a follow-up post. "As far as I'm concerned, the main reason you can't just take my TV or take the money out of my wallet and give it to somebody who would get more out of it is that it's my TV, it's my money."

It's true that the anti-inequality jeremiads are rarer now than they were at the heyday of banker recrimination. But with even libertarians such as the Atlantic's own Megan McArdle admitting she's "disgusted" about the persistence of mammoth bonuses on Wall Street, the debate over inequality is hardly down and out.