We hear it often, don't we, especially from the neo-liberal right. 'We don't believe in equality of outcome', we believe in 'equality of opportunity', and 'as long as we all get the same opportunities that's all we can do, after that it's what we each make of the opportunities'. The idea is described as 'Social Darwinism', described via a simple Google search as:
Social Darwinists believe in “survival of the fittest”—the idea that certain people become powerful in society because they are innately better. Social Darwinism has been used to justify imperialism, racism, eugenics and social inequality at various times over the past century and a half
But I argue that equality of opportunity is a myth, it has never existed. I have two underlying arguments for this position:
- The flawed underlying assumptions of the market, and
- The inevitable bias and prejudice of human nature
The assumptions of the market:
Those who proclaim the power of the market and its efficacy in solving our economic problems I suggest most often do not know let alone understand the underlying assumptions on which their market theory is built. The market concept began life with what is called 'perfect competition'. That is the basis for the market and for it to work, a series of assumptions are made about the world, all founded on a rationalist view of the world, of life, and of society. The assumptions are:
- Homogeneous product: that is, all producers sell identical products, you cannot tell the difference between an item from producer 1 and producer 1001
- There are many sellers, in fact so many that the entry or exit of any one producer will have no noticeable impact on total production, and so on price
- There are no barriers to entry or exit for any producer
- All market participants have perfect knowledge, that is, everyone (both buyers and sellers) knows everything they need to know to participate in the market
- All resources (physical resources, natural resources, human resources) are perfectly mobile. Pick up your factory building and move it from Tamaki Makaurau to Bluff, shift those 47 whānau from Whanganui a tara to Māwhera, instantly transform the oil refinery to producing flour, you get the picture
- All producers are price takers, that is, they cannot determine market prices
- Consumers have market sovereignty, that is, the choices of consumers send signals to producers that then determine what is produced. So persuasive advertising doesn't exist in this world.
All of these factors ought to mean that there are no power imbalances. Consumers and producers carry equal weight of power. Workers and employers carry equal weight of power. The rich and the poor carry equal weight of power.
Now, I don't know about you, but I've yet to see any part of the world where all of those assumptions exist, well where any of them exist actually.
Economics then morphs the model to what it calls imperfect competition (also covering the extremes of oligopoly, duopoly, and monopoly), and to the concepts of market failure (presumably those states where the market assumptions begin to break down). The economics of market failure is the real killer. It would for example suggest that government intervention is warranted whenever producers do not meet the full costs of their production, as the market requires all costs to be factored into production if we are to attain 'allocative efficiency' in the market. So economics would espouse 'polluter pays' policies, which would see farmers paying all of the costs for their methane and CO2 emissions, and drivers paying all of the pollution costs of driving their cars. We have entered the dark world of spill over costs or externalities.
I have yet to se the right wing market pundits proclaim such an idea.
We can go a step further and say that the model assumes rational behaviour from all market participants, and that's several hundred years of economic theory right there.
This brings me to the second issue.
Human bias and prejudice:
Regardless of how we are raised, regardless of our world or life experiences, every one of us carries bias and prejudice in our heads. I understand that there is an evolutionary psychology argument that we have evolved to fear difference purely because it might represent a threat to our 'group' and its survival.
In a column in the NZ Listener (January 28-February 3 2023) Marc Wilson in a Psychology column titled 'Us and them' wrote:
"According to the American Psychology Association's APA Dictionary of Psychology 'prejudice' has two closely related meanings. The second is shorter: "any preconceived attitude or view, whether favourable or unfavourable." The lengthy first definition feels like a more specific elaboration of the second: that prejudice comprises negative emotional, cognitive, and behavioural attitudes towards people based upon their membership of some group. Racism then is prejudice based on racial grouping etc."
I suggest that for those with sufficient money to live comfortably, there may well be a prejudice against those who struggle financially. "Lazy ***'s", "Need to get off their """"s", "I managed to get rich from hard work, there's no reason why they can't do the same".. I suspect we've heard them all. I wrote this poem when thinking about this issue:
So what? The free market is a nonsense. There is no such thing in the real world, so the idea that the free market gives the best allocative solutions to our economic problem is a nonsense. Further, all societies are riven with bias and prejudice. It's an implicit part of the 'human condition'. This means that everyone does NOT get a ' fair suck of the sav', everyone does NOT have equal opportunity.
In short, thinking that all we have to do is give everyone equal opportunity is an utter nonsense.
We come back to the ultimate question: what sort of society do we want to live in? I believe it was Gandhi who was reputed to have said "we can judge the quality of a society by the way it treats its most vulnerable members"?
Putting our faith in the free market will, I reckon, result in inequality as everyone does NOT get equal opportunity. The free market as portrayed in text books is a myth, yet all too often those on the right worship it as a 'utopia', holding firm to the belief that it actually exists.
Equal opportunity is. a'myth'. What sort of society do we want to live in?
