The Square and the Tower image

The Square and the Tower

I was four hundred pages into Niall Ferguson’s The Square and the Tower before it paid off. I don’t usually give books that long, but I’ve enjoyed lots of Ferguson’s writing before, and I wanted to see where this one was going. For the most part, it’s a bitty bricolage, with sixty short chapters describing the way networks have shaped our world—all the usual suspects are there, from the Illuminati and the Cambridge spies to Facebook and al-Qaeda—and no clear narrative arc beyond “networks are important, and they often beat hierarchies,” which I’m guessing we already knew. But then, in a discussion of social media on page 402, this:

Nevertheless, few people foresaw that the giant networks made possible by the Internet, despite their propaganda about the democratisation of knowledge, would be so profoundly inegalitarian. A generation mostly removed from conflict—the baby-boomers—had failed to learn the lesson that it is not unregulated networks that reduce inequality but wars, revolutions, hyperinflations and other forms of expropriations (emphasis added).

This, it seems to me, is remarkably similar to the argument of Thomas Piketty in Capital in the Twenty-First Century, even though in many ways Piketty and Ferguson are at opposite ends of the political spectrum. Piketty’s argument is that, in normal circumstances, inequality grows, because the rate of return to wealth grows faster than economic output (the famous r > g); this can be curtailed for a while, whether by significant disruptions (depressions, wars, and the like), rapid technological and/or demographic expansion, or significant increases in the size of the state (welfare societies, higher taxes, and so on), but all other things being equal it will tend to reassert itself. Consequently, Piketty explains, the last hundred years of diminishing inequality have been exceptions to a general trend, given the exceptional circumstances of the period between 1914 and (say) 1965. We are now heading back towards increased inequality, and we need to work out what to do about that.

Ferguson would no doubt disagree about the best solution to all this—and possibly even over whether a solution was needed and/or desirable—but his diagnosis of the problem is almost identical. Without wars, revolutions, hyperinflations, depressions, or forcible expropriations (which can of course include the growth of the state), inequality will generally rise, and we are kidding ourselves if we think it won’t. Not an especially cheery conclusion, but probably one which resonates with those who know what Scripture says about the poor.

Ultimately, the market increases the gap between rich and poor, and only calamity or coincidence can stand in its way. It is therefore up to the Church, as it always has been, to “seek justice, correct oppression; bring justice to the fatherless, plead the widow’s cause” (Isaiah 1:17).

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