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THE NEW GILDED AGE

STANFORD UNIVERSITY PRESS

Contents

Introduction: Poverty and Inequality in a New World David B. Grusky and Tamar Kricheli-Katz.....................1Rich and Poor in the World Community Peter Singer...............................................................19Global Needs and Special Relationships Richard W. Miller........................................................39(Some) Inequality Is Good for You Richard B. Freeman............................................................63Inequality and Economic Growth in Comparative Perspective Jonas Pontusson.......................................88Rising Inequality and American Politics John Ferejohn...........................................................115Unequal Democracy in America: The Long View Jeff Manza..........................................................131A Human Capital Account of the Gender Pay Gap Solomon Polachek..................................................161The Sources of the Gender Pay Gap Francine D. Blau..............................................................189A Dream Deferred: Toward the U.S. Racial Future Howard Winant...................................................211Racial and Ethnic Diversity and Public Policy Mary C. Waters....................................................230Notes............................................................................................................247Index............................................................................................................287

Chapter One

Peter Singer

SAVING A LIFE

Bob is close to retirement. His proudest possession is a very rare vintage car, a Bugatti, worth two hundred thousand dollars. Its rising market value means that he will be able to sell it and live comfortably after retirement. It also is something that he puts a lot of time into maintaining, polishing, and taking out for drives in the country. Unfortunately, it is so expensive that no one will insure it for him. He takes a risk every time he drives it, but he thinks it's worth doing; he doesn't like the idea of the car just being a museum piece. One afternoon Bob takes the Bugatti out and drives it to a place where he often likes to park. It is a good spot for going for a walk, along a disused railway siding. He parks his Bugatti, and walks up the siding, normally a pleasant, quiet stroll. But today, as he comes to the point where the disused siding meets a major line, he looks up and he notices, to his surprise, that there is a train coming down the line. He is surprised because no trains are due at this time. When he looks more closely he sees that, in fact, this is a runaway train; there is no one in it. And he looks further down the main line, and there he sees, to his horror, a small girl playing just inside the tunnel that the train is heading towards. The child is too far away to warn of the danger. It seems very likely that she is going to be killed by the runaway train. What can Bob do? He looks down and sees a switch near him. If he throws it (though it's a little rusty, he can throw it with some effort), it will divert the train down the disused siding, thus saving the child's life. But, if the train goes down the disused siding, given the speed at which it's traveling, it will almost certainly crash through the rotten old barrier at the end of the siding. And what will it do? It will pile straight into his precious, uninsured Bugatti and, undoubtedly, destroy it.

Peter Unger tells this story in his book Living High and Letting Die. He forces us to face the question: What should Bob do? Should Bob throw the switch, saving the child's life and destroying his Bugatti? Or, should he not throw the switch, almost certainly condemning the child to death, but saving his Bugatti?

When I tell this story and ask this question, almost everyone immediately responds that Bob should throw the switch and save the child's life. If it comes to a choice between the almost certain loss of a child's life and the loss of your most precious possession (something worth two hundred thousand dollars and a significant part of your net assets), almost everyone thinks you should choose to save the child's life. And I think that's right. The question I want to explore is, what does that say about what we ought to do in other situations where we can save children's lives?

Unger's story of Bob's Bugatti is a modified version of a story that I told many years ago in an article, "Famine, Affluence and Morality," first published in 1972. My story involved noticing that a small child had fallen into a shallow pond and was in danger of drowning. You realize that you could walk into the pond and save the child's life. No one else seems to be around to save the child. The cost to you, since the pond is a shallow one, is simply that you are going to ruin your shoes and the nice two-hundred-dollar suit that you are wearing and be late for a meeting. In this Drowning Child case, as in the case of Bob's Bugatti, almost everyone says, "Obviously you should save the child's life." In both of these cases the child was close enough to us for us to be able to see her and save her. In terms of closeness, the drowning child in the shallow pond is somewhat closer, because you actually wade in and fetch out the child with your bare hands. But note that Bob's greater distance does not lessen his duty to rescue the child from the train. In general, greater distance as such would be an arbitrary basis for denying that a child whose life is in danger ought to be rescued.

Now suppose that the child in danger is in some remote part of the world in a developing country. Every day, according to UNICEF, about 21,000 children die from poverty-related causes. Among these causes of child death are starvation and malnutrition (getting enough in terms of calories, but not a balanced healthy diet). Not eating enough, or not eating the right food, might contribute to being at higher risk of having certain diseases, which a healthy child could resist. The risk is further magnified by an unsafe water supply, which can convey diseases again and again. While growing up in these conditions, many millions of children lack even the most minimal health care. They cannot even obtain oral rehydration therapy, which essentially consists of some salts that you give to a child suffering from diarrhea so that the child can better survive. Other children die from measles, because they were not immunized against that disease, or from malaria, because they did not have bed nets to sleep under. These are just some of the causes that lead to those thousands of deaths daily of children from poverty-related causes. Just as much as the pool and the train in my earlier stories, they are threats to children's lives.

I focus on children, but this is just a way to simplify the argument. If I were to talk about adults, people would say such things as "Why couldn't they have gotten a job?" In fact, often that's not a realistic solution, but talking about children eliminates that argument. Clearly, children are not responsible for the poverty that they are in.

How much does it really cost to save a child's life in the third world? It's very hard to put a figure on this. In oral rehydration therapy, for example, the actual...