"I am a manufacturer of economic inequality."

Paul Graham writes:

Since the 1970s, economic inequality in the US has increased dramatically. And in particular, the rich have gotten a lot richer. Some worry this is a sign the country is broken.

I'm interested in the topic because I am a manufacturer of economic inequality. I was one of the founders of a company called Y Combinator that helps people start startups. Almost by definition, if a startup succeeds its founders become rich. And while getting rich is not the only goal of most startup founders, few would do it if one couldn't.

I've become an expert on how to increase economic inequality, and I've spent the past decade working hard to do it. Not just by helping the 2400 founders YC has funded. I've also written essays encouraging people to increase economic inequality and giving them detailed instructions showing how.

So when I hear people saying that economic inequality is bad and should be eliminated, I feel rather like a wild animal overhearing a conversation between hunters. But the thing that strikes me most about the conversations I overhear is how confused they are. They don't even seem clear whether they want to kill me or not.

The most common mistake people make about economic inequality is to treat it as a single phenomenon. The most naive version of which is the one based on the pie fallacy: that the rich get rich by taking money from the poor.

Usually this is an assumption people start from rather than a conclusion they arrive at by examining the evidence. . . .

we grow up in a world where the pie fallacy is actually true. To kids, wealth is a fixed pie that's shared out, and if one person gets more it's at the expense of another. It takes a conscious effort to remind oneself that the real world doesn't work that way. . . .

Even people sophisticated enough to know about the pie fallacy are led toward it by the custom of describing economic inequality as a ratio of one quantile's income or wealth to another's. It's so easy to slip from talking about income shifting from one quantile to another, as a figure of speech, into believing that is literally what's happening....

Economic inequality is sufficiently far from identical with the various problems that have it as a symptom that we'll probably only hit whichever of the two we aim at. If we aim at economic inequality, we won't fix these problems. So I say let's aim at the problems.

For example, let's attack poverty, and if necessary damage wealth in the process. That's much more likely to work than attacking wealth in the hope that you will thereby fix poverty. And if there are people getting rich by tricking consumers or lobbying the government for anti-competitive regulations or tax loopholes, then let's stop them. Not because it's causing economic inequality, but because it's stealing.

How to know if you're intellectually honest

Paul Graham writes:

Let's start with a test: Do you have any opinions that you would be reluctant to express in front of a group of your peers?

If the answer is no, you might want to stop and think about that. If everything you believe is something you're supposed to believe, could that possibly be a coincidence? Odds are it isn't. Odds are you just think whatever you're told.

The other alternative would be that you independently considered every question and came up with the exact same answers that are now considered acceptable. That seems unlikely, because you'd also have to make the same mistakes. Mapmakers deliberately put slight mistakes in their maps so they can tell when someone copies them. If another map has the same mistake, that's very convincing evidence.

Graham doesn't use the phrase "intellectual honesty," but that's what he's getting at. Oddly, there are some people (including Matthew Yglesias) who deny that there's any such thing as "intellectual honesty," unless it's used as a synonym for just plain "honesty." I think that's a big mistake.

How to think: Minimize your identity?

Paul Graham says (via Stuart Buck at Overcoming Bias):

I think what religion and politics have in common is that they become part of people's identity, and people can never have a fruitful argument about something that's part of their identity. ...

Which topics engage people's identity depends on the people, not the topic. For example, a discussion about a battle that included citizens of one or more of the countries involved would probably degenerate into a political argument. But a discussion today about a battle that took place in the Bronze Age probably wouldn't. No one would know what side to be on. So it's not politics that's the source of the trouble, but identity. ...

If people can't think clearly about anything that has become part of their identity, then all other things being equal, the best plan is to let as few things into your identity as possible.

What do you think? Good solution, too drastic, or just ridiculous?

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