The Limitations of Ownership in Addressing Wealth Inequality

Ownership-based economies have long been seen as a solution to wealth inequality. However, a deeper analysis reveals that the concept of ownership, while providing short-term utility, does little to fundamentally address the pervasive issue of wealth disparities. This essay explores the inherent limitations of ownership in solving wealth inequality and highlights the role of economic policies in perpetuating these disparities.

The Shallow Benefits of Ownership

At a superficial level, ownership can provide immediate utility to individuals by granting them what they need for the present. However, when we delve into the broader economic context, ownership becomes a complex and often contentious issue. Ownership inherently involves the distinction between different states of access, which can lead to inequality. This is because not all states of access or possession are seen as equally warranted or beneficial under various philosophical measures.

The Antithesis of Ownership-Based Systems

Ownership is fundamentally at odds with the principle that "everyone has what they need." Contrary to competitive or capitalistic systems, where the focus is on individual accumulation and competition, an ownership-based approach emphasizes possession and control over resources. This creates a system in which exclusivity is central, leading to disparities between those who own and those who do not.

Economic Policies and Inequality

The gap between ownership-based systems and more egalitarian approaches is stark when we consider government policies. For instance, homeowners who live in houses without a mortgage benefit greatly from government policies that do not levy taxes on this form of wealth. On the other hand, renters are more heavily taxed, particularly through sales and FICA taxes, which start at the first dollar earned.

Moreover, the benefits of home ownership are further exacerbated through tax deductions. The mortgage interest tax deduction primarily benefits those in the upper middle class, while low-income individuals face significant barriers to entering the housing market. They often lack the down payment or creditworthiness required to secure a mortgage, effectively locking them out of the advantages of homeownership.

Addressing Inequality Through Policy

To truly address wealth inequality, it is crucial to implement policies that promote social stability and support for all members of society. One approach is to provide a financial safety net that allows individuals to accumulate assets without being constrained by immediate financial obligations. This could include initiatives such as:

Guaranteed minimum living income (GMLI) Publicly funded universal housing Accelerated savings plans for lower-income individuals

These policies, while necessitating some financial investment, could meaningfully reduce inequality. For example, a modest financial safety net could provide people with the reserves they need to navigate life’s challenges, fostering a more resilient and stable society.

The Role of Powerful Interests

Despite the potential benefits of such policies, powerful special interests stand in the way of change. Insurance companies, banks, landlords, and payday lenders all benefit from the current system, which is heavily skewed in their favor. The elimination of these distortions in the tax system would require significant political effort and resistance from those who stand to lose from change.

In conclusion, while ownership-based economies have their uses, they are not a sustainable solution to wealth inequality. The key to addressing these disparities lies in comprehensive economic policies that promote social stability and equitable access to resources. Until we can disentangle the interests of powerful stakeholders, meaningful progress in reducing wealth inequality will remain elusive.