Over the past fifty years there has been a dramatic rise in income inequality in America. According to Psychologist Keith Payne, studies show that “the income gap between white and black families has remained more or less constant since the 1960s. In 1967 the average black family earned 55% of what white families earned. In 2011, that figure was 59%. In 2013, white families had 13 times the wealth of average black families and 10 times the wealth of Hispanic families.” The disparities outlined in the nine chapters of Payne’s book, The Broken Ladder: How Inequality Affects the Way We Think, Live, and Die offer a framework for understanding inequality through a series of studies conducted at the intersections of psychology, neuroscience and behavioral science.
Pairing anecdotes with research studies, the book makes a strong case for why all of us, regardless of race or social status should care about the negative impacts of inequality, and the many threats it poses to the health and wellness of individuals, communities and society as a whole.
Research buffs will enjoy the data-driven narratives that form the backbone of this book, while those who prefer anecdotal perspectives will find several personal stories that tie the research together and mover the main ideas along smoothly and persuasively. Each chapter builds common ground by delving into aspects of our shared cultural experiences as Americans. The topics are often challenging but the language is straightforward and easy to digest.
TED - Transcript
The chapters include the following titles:
- Lunch Lady Economics: Why Feeling Poor Hurts Like Being Poor
- Relatively Easy: Why We Can’t Stop Comparing Ourselves to Others
- Poor Logic: Inequality Has a Logic of Its Own
- The Right, the Left, and the Ladder: How Inequality Divides Our Politics
- Long Lives and Tall Tombstones: Inequality Is a Matter of Life and Death
- God, Conspiracies, and the Language of the Angels: Why People Believe What They Need to Believe
- Inequality in Black and White: The Dangerous Dance of Racial and Economic Inequality
- The Corporate Ladder: Why Fair Pay Signals Fair Play
- The Art of Living Vertically: Flatter Ladders, Comparing with Care, and the Things That Matter Most
“Racial inequality is qualitatively different from income inequality. Rich and poor exist among all racial groups and racial discrimination affects the lives of African Americans and other minority groups even when they are not poor. Although racial and economic inequalities are separate issues, they have been intersecting more and more often in recent years as racial inequality stumbles ever so slowly downward and income inequality steadily rises. In this chapter, we will discuss how widening inequality throws fuel on the fire of racial prejudice and how racial stereotypes are used to justify and preserve that inequality.”
This introduction to chapter 7, Inequality in Black and White: The Dangerous Dance of Racial and Economic Inequality, makes a strong case for how and why “economic anxieties fuel racial conflicts.” In the political climate we currently find ourselves in, it is not difficult to see the correlations. Payne references a poll given to both white and black research participants who were asked if they believed that discrimination was more of a problem for white or black people.
“Whites seemed to view discrimination as a zero-sum game. The less discrimination they perceived against blacks, the more they saw it turned against whites. The trend was so stark in the eyes of white respondents, that by the 2000s they judged discrimination against whites to be a bigger problem than discrimination against blacks. The data however, tell a very different story.”
Payne goes on to reference several findings that magnify how little progress has been made in creating economic equality between races. He points out data that show improvements in access to educational opportunities for people of color, but ongoing stagnation overall in upward mobility
“Although the gaps between black and white families have narrowed for high school graduation rates and more modestly for college graduation, those improvements have not translated into a lessening of the income gaps… Something is preventing gains in education from translating into reduced income and wealth gaps. One factor is home-ownership, which is much higher for white families. A second, closely related factor is inheritance. Once a family has accumulated some wealth, it can be used for buying a home or establishing other assets for the next generation, but in black and Latino families, where the average wealth is close to zero, each generation starts essentially from scratch.
Economists have identified several other factors that contribute to wealth gaps, including differences in incarceration rates and marriage and divorce rates. But it is impossible to understand these disparities without also understanding the role of racial discrimination, which creates a constant set of pressures on minority families. These imbalances in wealth, education and home ownership can serve as a kind of Rorschach test. If you believe that minority families are themselves to blame for their fates, then you can view these data as proof of it. And if you think minority families are the victims of discrimination and a systematic lack of opportunity, you can find support for that theory in the numbers as well. The problem is that the role of discrimination is very hard to isolate using statistics… Data on average wealth or home ownership can tell us that disparities exist but they can’t explain why. For that, we need to turn to people’s behavior.”
Payne introduces an experiment conducted by a sociologist named Devah Pager, who set out to test for real-world discrimination by studying the behavior patterns of potential employers in Milwaukee. She gave a black applicant and a white applicant the same script and identical credentials on a fabricated resume and sent them out to apply for a total of 350 randomized jobs.
“Did the results support the anti-white bias that the zero-sum survey respondents believed existed? Not even close. The white applicant was called back twice as often as the equally qualified black applicant. Similar studies have been repeated with the same result in New York, Chicago, Atlanta and other cities.”
Despite the gains of the Civil Right Movement in the 1960s, income inequality between blacks and whites has remained a problem for many decades and does not appear to be letting up any time soon. At least not without our direct participation and willingness to confront the racial biases, the rampant racism and discrimination that permeates almost every system or institution that might potentially create meaningful change in balancing inequities.
“Statistically speaking, if you want to predict who is predisposed against welfare, you can mostly ignore their economic principles. What you really need to know is their prejudices. While it may not be surprising, that the average person views welfare in racially tinged terms, the truth is that welfare recipients are about evenly divided among white, black and Hispanic recipients. But when analyzed, depictions of welfare recipients on television and news magazines since the 1960s, studies found a clear racial bias. When welfare recipients were depicted as the deserving poor, they were mostly white but when they were portrayed as lazy and dishonest, they were overwhelmingly black. This cultural messaging linking welfare to lazy people in general, and lazy black people in particular, makes it difficult to discuss welfare without racial overtones.”
How do we reach out and help lift those who need support, when the resources to do so are constantly contested, or worse, nonexistent? How do we help empower people who have to live their lives battered by systems built and maintained by those far removed from the realities of the lives they impact and affect with their choices? How do we help people see and understand the roles they play in creating and sustaining inequality? The Broken Ladder provides an abundance of ways to think through the problems of inequity and offers, as a key step, the opportunity for self-reflection.
“Understanding implicit bias requires taking a more nuanced approach to the individuals we are easily tempted to label as racist or not racist. If you consider whether you yourself are biased and why, you will likely focus on your conscious thoughts and beliefs, your values and good intentions. Having reflected on what a fundamentally good person you are, you will conclude that implicit bias is other people’s problem. Although we would all like to believe ourselves to be members of the not-racist club, we are all steeped in a culture whose history and present is built on massive, racial inequality.”
The Broken Ladder: Book Review | YW Bostonhttps://www.ywboston.org/broken-ladder-book-review/
Inequality is Everyone's Problem
A pair of epidemiologists, Richard Wilkinson and Kate Pickett, wanted to know how economic factors impacted health and social problems in several developed nations. When they made a graph with one axis showing average income and the other showing an index of health and social problems, the countries formed an amorphous cloud with no discernible pattern. But when they swapped the average income for a measurement of inequality, a clear correlation appeared: regardless of income, the countries most likely to have health and social problems were the most unequal ones, with the United States of America worst off of all.
This information appears early on in The Broken Ladder by Dr. Keith Payne, a professor of Psychology at the University of North Carolina-Chapel Hill. His new book focuses on the psychological impact of economic inequality. He makes every effort to legitimize the conversation and include people who might otherwise disagree with his conclusions. Inequality, in Payne’s eyes, is massively detrimental to everyone in unequal societies, and everyone needs to know it.
Payne’s chapter on politics is both illuminating and confounding. After debunking the myth that the Republican Party’s voter base is poorer than the Democratic Party’s voter base (using analysis of the 2004 Presidential election), he moves on to how inequality is correlated with partisanship, measured by the frequency with which Congresspersons vote against one another (the short version: it’s very correlated). He says conservatives believe “that a society in chaos is the worst possible condition.” This, in reference to the tendency of Republicans to work towards the preservation of the status quo, seems a little outdated, at best. Payne does little to account for the causes of inequality in this chapter, but he ends it with a plea for peace.
In 2014, about a third of respondents [to a Pew Research Center poll] thought that members of the opposite party were not just mistaken, but were a threat to the nation’s well being… These trends are dangerous because when opponents become enemies, people can justify almost anything in responding to them.
Certainly, what the poll found is not indicative of a healthy political climate. And treating political parties like teams to whom one bears unwavering allegiance is bad. But calling one party a “threat to the nation’s well-being” is not inherently silly; it could be accurate. And The Broken Ladder is extremely good evidence of exactly that.
Payne’s writing on how inequality changes people’s decisions, beliefs, and even their health is eye-opening and efficient. Each piece is explained clearly, and he has a useful tendency to layer the information from the relevant studies in such away that it creates a narrative and intellectual flow. These sections are well crafted and informative, but perhaps the best chapter in the book is the one on racial inequality.
He starts by explaining the different perceptions that white people and black people have in terms of how much discrimination each race faces.
Whites seemed to view discrimination as a zero-sum game: The less discrimination they perceived against blacks, the more they saw it turned against whites. The trend was so stark in the eyes of white respondents that by the 2000s they judged discrimination against whites to be a bigger problem than discrimination against blacks.
Payne then cites a variety of studies on an array of subjects—job applications and prison sentencing among them—that prove conclusively that this is not the case, that black people still face much more discrimination than white people do. The barrage, for those who do not need to be convinced, can be arduous, but it has to be proved. He adds further nuance by highlighting studies that show when white people feel that their social or economic positions are diminishing for any reason, they act more racist. It is not tied, necessarily, to their material conditions, but their perceptions of their material conditions.
The last piece of Payne’s puzzle comes from a study he cites by political scientist Martin Gilens, which found that “the best predictor of wanting to slash funding for welfare recipients is racial prejudice.” Here is where the value of his evenhandedness becomes obvious. There are moments in the book when his concessions, for someone already convinced that inequality is major issue, can feel unnecessary. Without that approach, though, the argument he makes about racism might not be possible. A deliberate and detailed explanation of how racism impacts economic inequality is necessary, and the slow pace is necessary for it to land with everyone who reads the book.
The Broken Ladder is a clear and useful book about the gap between the society we have and a society we want. It’s an important step toward understanding how these complicated issue affect our country—alongside books like Matthew Desmond’s Evicted, which takes a more narrative approach to the issue, and Per Molander’s The Anatomy of Inequality, which analyzes it from an economic point of view.
Inequality can seem intractable, but these writers are steering us in the right direction. It is no doubt difficult to situate the problem of inequality in such a fraught political landscape, with a President so intent on hurting so many, but keeping an eye on a long-term vision of a more egalitarian society is necessary, too. Keeping Payne’s book on your bedside table is a good place to start.
In 2016 Oxfam made the almost unbelievable announcement that the richest 62 people in the world had as much wealth as the poorest half of the global population.
That was then. In 2017 a new Oxfam report showed that things had changed—for the worse. Today just eight people are worth as much as the poorest 3.6 billion people.
It’s not easy to put that contrast into perspective, but consider that those eight rich people could easily fit into one of their private jets, while the entire population of North, Central and South America is only about one billion—in other words, those eight have more wealth than three times the number of people in this entire hemisphere.
Never has there been such inequality in the world.
Today just eight people have as much wealth as the poorest 3.6 billion people.
Poverty is horrible enough. To cite just one example: UNICEF estimates that almost six million children under the age of five died in 2015—approximately 11 children every single minute.
Poverty plus inequality is even worse, as Keith Payne shows in his important book, The Broken Ladder: How Inequality Affects the Way We Think, Live, and Die.
Payne, a professor of psychology at the University of North Carolina, begins by showing how we (and our primate cousins) are hard-wired to react to perceptions of relative status and inequality. Next, he cites many studies which explore what’s known as the “fundamental attribution error”—in this case, assuming that another person’s successes and failures are mostly their own doing.
“The college graduate is smart. The drug addict is weak willed. The person shopping with food stamps is lazy. One reason it is so prevalent is that it is simply easier to think about people than situations.”
This problem was dramatically revealed in Phillip Zimbardo’s (in)famous Stanford Prison Experiment, in which college students were randomly assigned to be either “guards” or “inmates” in a pretend jail. The experiment had to end early because normal young people were so negatively affected by their roles in this oppressive situation: the “guards” became brutal and even sadistic, while the “prisoners” were traumatized.
As Payne underlines, most attitudes and actions are, most of the time, “shaped by particular situations” rather than by individual disposition. Moreover, most of the time we not only have very little control of situations, we have almost no control over our thoughts and feelings—99% of which are unconscious to begin with.
He notes that “emotion can be even more powerful than thoughts” and he documents how the constant psychological stress of problems such as poverty, racism and inequality can cause one’s body to get stuck in fight-or-flight mode “for weeks, months or years”—a very unhealthy state which can lead to inflammation, heart attacks and many other dangerous medical conditions.
A dramatic example of the power of unequal situations was shown in the Whitehall study of British civil servants. There is a very clear hierarchy of power, so much so that “even the difference between the highest-status government officials and those just one rung below was linked to increased mortality” (as well as more medical problems, disease, and so on). These differences exist even though all of the subjects “have decent government jobs and the salaries, health insurance, pensions and other benefits that are associated with them”.
The developed countries with the most economic equality have fewer health and social problems.
Payne adds: “The workplace is where most people experience inequality most directly on a daily basis,” an observation that would not have surprised Karl Marx.
The unhealthy consequences of inequality hold true around the world. For example, Payne cites findings from The Spirit Level: Why Equality Is Better for Everyone (authored by Richard Wilkinson and Kate Pickett), which indicate that those developed countries that have the most economic equality (e.g. Japan, Sweden and Norway) have fewer health and social problems when compared with those with the greatest inequality—and it is the United States that both has the most inequality and is the most unhealthy of all.
In fact, The Lancet just published a new study by Wilkinson and Pickett which concluded:
“For at least 40 years, research evidence has been accumulating that societies with larger income differences between rich and poor tend to have worse health and higher homicide rates. More recently, this has been contextualized by findings that more unequal societies not only have higher rates of poor health and violence, but also of other outcomes that tend to be worse lower down the social ladder, including teenage births, lower math and literacy scores, obesity and imprisonment.”
Regarding such income inequality, Payne mentions that, in 2012, the average CEO in the US “earned” about 350 times the average worker’s income. Attempts to justify such disparities are usually based on the claim that these executives add more value to their corporations than regular workers. Does that mean that these CEOs work 350 times harder than average, or are 350 times smarter?
Apparently neither: “In one comprehensive analysis of thousands of corporations over nearly two decades…only about 5 percent of the performance differences…could be attributed to the CEO.”
Aside from a few ideological biases (e.g. the author believes that countries like the USSR and China were “communist”), The Broken Ladder is filled with valuable social, psychological and economic insights that ought to be shared widely to help people understand the injustice of rampant inequality and deal with the legion of problems that it brings.
Income inequality is changing how we think, live, and die
Researcher Keith Payne has found something surprising: When people flying coach are forced to walk past the pampered first-class flyers in the front of the plane, the likelihood of some sort of air rage incident rises sharply.
In his 2017 book The Broken Ladder, Payne, a social psychologist at the University of North Carolina, argues that humans are hardwired to notice relative differences. When we’re reminded that we’re poorer or less powerful than others, we become less healthy, more angry, and more politically polarized.
I reached out to Payne because his argument seems to lead to a counterintuitive conclusion: American society would be more be more stable if we had more poverty and less inequality. I reached out to him to see if that’s what he’s come to believe after writing his book.
A lightly edited transcript of our conversation follows.
Sean Illing
Tell me what you think we least understand about the social costs of inequality.
Keith Payne
One big misunderstanding is that when people start talking about inequality, their minds go straight to poverty, but poverty’s only half of the equation. Inequality is about the size of the gap between the wealthy and the poor. It’s obviously important to be concerned about poverty and to alleviate the suffering that accompanies it, but that’s still only half the problem.
Sean Illing
What’s the other half of the problem?
Keith Payne
What people underappreciate is how having extreme inequality driven by the high end of wealth also causes trouble for society and for people’s well-being. Poverty is a related but separate problem. The presence of extreme inequality destabilizes a society in ways that are hard to understand but absolutely devastating.
Sean Illing
Let’s get into that. What sorts of problems spring from these wealth gaps?
Keith Payne
For starters, it produces serious health problems, and not subjective problems but objective health problems, like chronic diseases, obesity, drug and alcohol problems, and, ultimately, shorter life expectancies. You see comparatively higher rates of these health issues in countries with the most income inequality, and that’s after controlling for average income.
Sean Illing
I know what you mean when you say “controlling for average income,” but can you make that clear for people who don’t have a background in statistics?
Keith Payne
Sure, it means that if you take two people who make the same income, but one lives in a very high-inequality place and one lives in a low-inequality place, the person in the high-inequality location is more likely to deal with these chronic diseases, more likely to deal with these drug and alcohol problems, more likely to actually die sooner than the same person living in a low-inequality environment.
The high-inequality countries also have more crime, more incarceration, more school dropouts — things that we normally associate with poverty, but in wealthy developed countries, they’re actually more closely linked to inequality than to poverty rates.
Sean Illing
It seems obvious that wealthier people with more resources and better access to medical care will be healthier than poor people. But when you compare across societies, you find that the average person in a high-inequality society like America is less healthy than the average person in a low-inequality society like Sweden or Norway. How do you explain this gap?
Keith Payne
The perception of inequality around us has a couple of different effects. One is that it makes the average person feel poorer, [in] comparison to those who have more. And the second is that it raises our expectations. It raises our standards for what we think it is to be normal. Now, that all seems very subjective, but when you perceive yourself as poor compared to other people, that sets off a chain of events that translates into physical outcomes.
Sean Illing
That’s what I’m getting at: What’s the pathway from subjective perceptions of one’s relative poverty to actual physical health problems?
Keith Payne
One pathway is stress. If you perceive yourself as relatively low on the social ladder compared to others around you, it’s stressful, and the body treats that stress in the same way it treats a physical threat. So if you get the fight-or-flight response, you get immune responses that in the short term are good, but if they go on over the long term, over weeks or months, they can cause health problems.
Another pathway is that feeling lower on the status ladder compared to other people changes the way we approach decision-making in our own minds. It makes us riskier in our decisions; we focus more on the short term as opposed to the long term. So you have more people playing the lottery, taking payday loans, making questionable choices to try to get ahead economically. The long-term effects of these choices are usually bad — economically, emotionally, and physically.
Sean Illing
You also find that high-inequality societies are more polarized, more chaotic, and more dysfunctional. What accounts for this?
Keith Payne
What you find is that people who perceive themselves as having low status in a society often search for meaning in various ways, and one form that takes is believing in conspiracy theories. People disillusioned by their status in society look for various kinds of patterns around them, ways to justify their place, and that often takes irrational forms like conspiracy theories. Other times, it takes more normative forms like enhanced religious devotion.
Feeling lower status also has the effect of leading people to feel that the system is rigged against them. And so you hear a lot in the news about lower-education white voters feeling left behind as a function of the current economy and the kind of political consequences that has.
This feeling of being left behind is a real thing, but it’s not necessarily traceable to the fact that factories have gone overseas and that robots are replacing jobs. That’s clearly part of it, but the resentment is far worse when it happens in a society where people with higher educations and good social connections are getting wealthier and wealthier. It’s not hard to see how that can create political problems.
Sean Illing
Is it fair to say that economic inequality produces more political tribalism?
Keith Payne
I would call it more polarization, but you can call it political tribalism. And it happens on the left and the right. Again, people look for ways to make sense of a world that seems unfair, and often they do that by retreating into tribal identities — whether it’s political or religious or ethnic or whatever.
Sean Illing
A lot of the psychological problems you point to stem from our tendency to measure ourselves in terms of our social status. But humans have done this since we started living in groups, and certainly since the emergence of private property and individual rights. We’re just hardwired to detect relative differences. Is there something unique about what we’re seeing now?
Keith Payne
There’s nothing new about this psychological tendency to measure ourselves against others; that’s no different than it was 100 years ago or 1,000 years ago. What’s different today is the scale of the inequality around us, which is about as high as we’ve seen since we started keeping records of it.
Sean Illing
Do you think we would be healthier and happier if we had more poverty and less inequality?
Keith Payne
I think there’s a case to be made that trading off some measures of wealth, like the gross domestic product, would be worth it for the benefits that come with reduced inequality. The problem now isn’t that there’s too much wealth; it’s that nearly all of the increases are going to the wealthiest members of society.
Even if by some miracle we doubled everyone’s income tomorrow, that would only increase the inequality because when you double the income of millionaires, they get a lot richer than when you double the income of somebody making $20,000.
Usually, there isn’t a trade-off between more wealth and less inequality, because if you look across countries, the countries with lower levels of inequality actually have greater levels of social mobility. It’s easier to climb up that economic ladder if you’re in a place where inequality is on a human scale, as opposed to the astronomical levels of inequality that we see in America.
Sean Illing
A free society is going to produce unequal outcomes, and that’s fine so long as those inequalities don’t explode to epic proportions. So how do we negotiate these tensions?
Keith Payne
You put it well. That’s the trade-off we face. I don’t think there’s one optimum level; each society has to sort this out for itself. What works for Norway might not be the solution for America.
But the argument isn’t that everyone should be the same, or be equally successful. The argument is that democratic societies have got to negotiate these trade-offs and find the right balance between free markets and a progressive taxation system or a safety net that helps to even out the winners and losers in a way that preserves equality of opportunity but doesn’t allow society to become destabilized by inequalities.
I’m not a policy person, so I don’t have the answers. But we have enough data to know that this is something we ought to do if we want to keep our societies stable and healthy.
Insecurities driven by poverty foster "us-versus-them" divisions, and "provoke us to embrace simplistic beliefs, extreme ideologies, and prejudices that provide easy answers, but do so by sabotaging the healthy functioning of civil society," Payne said.
When asked what values they treasure, survey respondents stress love, faith, loyalty, honesty and integrity.
"And yet," Payne writes, "no one ever mentions something that we know to be true, both from scientific studies and from simply being human: 'I crave status.'"
That instinct, he said, is prevalent even at the highest levels of income and wealth, where luxury cars and prestigious homes are perceived as necessities.
"We are unconsciously comparing what we have to what someone else has -- our friends, our neighbors, that handsome couple in the magazine -- and we are aware only of the conclusion our brain has silently computed: Compared to that, this isn't sufficient."
One of the most prominent story types of 2016 election coverage involved dropping in on Southern and Rust Belt communities that supported Donald Trump and probing the people and their towns for answers. The economic "anxiety" of the white working class emerged as an explanation for why an ill-tempered real estate magnate had become the champion of voters who might in other years have been turned off by his conspicuous affluence, lackadaisical faith and combative demeanor, to say nothing of his "Access Hollywood" tape. Trump voters, it was said, have been left behind economically by globalization and the technological divide and have seen their economic prospects plummet in recent years.
Some of that lined up with reality. But when the data emerged, another picture emerged of a key Trump voter bloc — still overwhelmingly white, but not necessarily economically insecure. A majority of Americans who make more than $50,000 a year voted for Trump, compared to a majority of those who make less who voted for Hillary Clinton. The narrative then shifted to racism, as data also showed it drove Trump voters to the polls.
As a new book by social psychologist Keith Payne explains, the narratives aren't mutually exclusive or necessarily contradictory. In “The Broken Ladder: How Inequality Affects the Way We Think, Live and Die,” Payne explains the research that shows that inequality can predict outcomes previously associated solely with poverty, such as higher infant mortality rates, lower life expectancies and higher rates of obesity. Areas with a larger wealth gap tend to have more of these problems than those with more homogeneous standards of living.
Even more relevant to the question of "economic anxiety" is the research that shows perceptions of inequality are just as important as actual numbers. When people feel poor — regardless of whether or not they objectively are — they exhibit risk-taking behavior and act in their short-term interests. When they feel richer, they practice delayed gratification and plan ahead.
"We have to look at ordinary middle-class people and ask why it is that, regardless of actual money, so many of them feel that they are barely getting by, that they are living paycheck to paycheck to paycheck, that the neighbors know something they don't, and that if they could just earn a little more, then everything would be a bit better," he writes.
These perceptions have real outcomes, according to Payne. People who locate themselves on a lower "rung" of perceived affluence are more likely to suffer from depression, anxiety and chronic pain, and it's more probable that they will make bad decisions, underperform at work, suffer health issues like obesity and heart problems, and even believe in conspiracy theories.
Contrary to the "bubble" argument, it's also not true across the board that poor people vote Republican and the affluent vote liberal. Higher incomes result in a higher probability of voting GOP. But feeling poor — or well-off — plays a role.
"The tendency for the rich to vote Republican is stronger in poor states than in rich ones," Payne writes. "If you are a wealthy Mississippian, you are much more likely to vote Republican than if you have the same wealth in New York or Connecticut." Social comparisons — a six-figure income makes you feel more well-off in Tunica than in Manhattan — affect how people think about politics and therefore how they vote.
Payne's book encourages us to look beyond bank statements at how people think and feel as a better predictor of behavior. The incomes of the poor and middle class, when adjusted for inflation, have been fairly stagnant since 1980, while the wealth of the 1 percent continues to rise. Feeling poor — and the anxiety that goes along with that — is relative.
“Even though the subjective experience of poverty or subjective experience of wealth and subjective experiences of inequality are what drives so many of these effects, the consequences are not just subjective,” Payne told me. “The subjective perception is important, but we can’t lose track of the fact that it ends with objective outcomes.”
I spoke with Payne by phone last week, after the House of Representatives voted to repeal and replace the Affordable Care Act with the support of many constituents who simultaneously rely on Obamacare and have called for its repeal.
You’ve just written a book about inequality, and you’re from Kentucky. What did you think about J.D. Vance’s “Hillbilly Elegy?”
I thought it was a really interesting memoir. Even though I grew up in western Kentucky and he’s writing about eastern Kentucky, I recognized a lot of the experiences he talks about and the mentality of people. I thought it was excellent [as] a memoir of personal experience. I was a little surprised toward the end when the author seemed to throw up his hands and say, “But in the end there is nothing do about these problems.” I would disagree with that implication.
You mean the implication that it’s an inherent cultural issue that keeps people poor and unhealthy and unstable, that there is nothing that you can really do without changing people’s entire perceptions of who they are?
That’s right. People are exquisitely sensitive to their contexts. Both economic policy and history show that if you change the economic context in which people live, then they start to behave differently and think differently. I think the reason that people sometimes get into the self-destructive patterns of behavior that “Hillbilly Elegy” talks about is that they are responding in what is a reasonable way to their immediate circumstances. If you change those circumstances, people’s thoughts and behaviors change too.
People tend to look around and say, “Well, whatever the baseline is, whatever the default is, you know, that’s just normal.” But of course the conditions that are leading to the growing inequality that we see around us today are the result of policies, and policies are the result of choices.
Different places, whether it’s different states or different countries, make different choices. As a result, they have different levels of inequality. And you can see that reflected in people’s lives.
I think people are responding to their environments, and their environments are the products of choices.
One of the media’s big obsessions has been the struggle to understand how Donald Trump became president. One of the themes that emerged from this is the “economic anxiety of the white working class.” When that narrative is countered with actual statistics — when it turns out that a lot of Trump voters are relatively well off, especially if you compare their incomes to working-class minority Clinton voters — how come those two things don’t really align with each other?
Subjective perception is incredibly important. Think about how much it takes to feel like you are getting by OK today as opposed to 100 years ago. It takes much more. Think about how much it takes to feel like you are getting by OK in America as opposed to, say, in Bangladesh. It’s very different. And in the same way, it takes more to feel like you are getting by if you are in a context in which some people are really getting ahead. It feels like other people are all passing you by. That feeling of being left behind is something that a lot of journalistic accounts of the 2016 election have pointed out as a major motivator for people who voted for Donald Trump, and I think that’s probably right.
But the feeling of being left behind isn’t inconsistent with the idea that people actually have above-average incomes, [as] Trump voters [did] on average. If you look at how incomes have changed over the last 50 years or so, the bottom two-fifths are making — with inflation, in adjusted dollars — almost exactly the same as they were making in the late 1960s. That hasn’t changed.
What’s changed is that the top 5 percent, the top 10 percent, the top 1 percent have been making drastically more over time. Making the exact same amount today as maybe your grandparents’ family made in the ’60s feels like you are being left behind, because other people are getting so far ahead.
What is it that makes some people think, well, the enemy, so to speak, is that 1 percent, or that fraction of the 1 percent, who are getting wildly ahead while the rest of us are being held back? While other people think, well, the enemy is other people around me who I perceive are getting unfair advantages? There’s a big divide there between progressive and conservative voters, in terms of who they see as their economic opponents.
The changes in the economy that have led to this growing inequality are actually very complex and very abstract. So there are things like globalized patterns of trade, technology, robotics and policies that have not changed tax rates, or redistribution policies, in ways that keep up with the growing wealth at the top; that’s all very abstract and complex. Ordinary people, when they’re thinking about their lives and they’re thinking about politics, don’t typically focus on abstractions as explanations.
And so there are different competing narratives out there. Some, like you said, focus on the 1 percent as the concrete cause of these problems. Other competing narratives [include] maybe it’s immigrants coming in and taking our jobs, or maybe it’s environmentalists trying to destroy jobs in coal country, those sorts of things. Those are very concrete. There is an identifiable person who’s the bad guy. And so all of those [narratives] are going to have an advantage in terms of people’s minds as being plausible explanations. There is somebody doing something that’s leading to my particular condition.
Is it the 1 percent on Wall Street that are the bad guys, or is it immigrants coming in and taking jobs? Which one seems more plausible to you is going to depend on how much those different narratives fit with the worldviews that we already have. Those are conditioned by the social networks we’re a part of, the places we live in and things like levels of education and all of those background factors that predispose some people to resonate more with the liberal version of the story and others to resonate more with the conservative version of the story. But all of those are pretty concrete oversimplifications compared to what’s driving inequality on a macroeconomic level.
Do you think it’s possible for Americans to come together to address those abstract issues of inequality, or is that just beyond the scope of a country of our size and geographical diversity, with the historic racial issues that we’ve had?
In a representative democracy, the way this works is that individual citizens don’t necessarily have to have complex mental models of economic policy, right? Policy elites who actually focus on these issues, whether it’s in government or in think tanks and places like that, they are the ones who grapple with the more complex issues. I think it’s a shame that the experts are allowing themselves to be polarized and partisanized along with the electorate. Ordinary voters vote for politicians, whose job is to be an intermediary between the expert policy [theorists] and explain it to ordinary people. Unfortunately, the voters and the politicians, as well as the experts, are only listening to their own side. I think a lot of responsibility rests on both the politicians and the experts to listen to the evidence.
One concrete manifestation of these theoretical and economic models that’s changing in front of our eyes is health care. Republican voters on one hand are saying, “I love having health insurance now; it’s saved my life” and on the other are saying, “But I’m still going to vote for the guys who are promising to do away with it.” But coverage of pre-existing conditions is a concrete thing; a person with a household budget and awareness of their own health can put their hands around that issue.
The common thing is that people don’t always connect the way that they view individual cases to the way that they view policies about how entire systems work. So for Republicans right now, there is a conflict between [their individual cases], especially for lower-income people who would benefit from Obamacare, and the messages that they’re getting otherwise from Republican leaders.
But also, the general worldview that is more popular among the right says that America is a well-functioning meritocracy in which everybody earns what they get and their rewards are just. That’s a much more frequently endorsed worldview on the right than the left. So that creates a conflict for people, especially [those] who would actually benefit from benefits like [affordable] health care.
In terms of the psychology of it, it’s not surprising that we focus on one issue at a time and then say to voters, “Well, you know, if you hope to repeal Obamacare, it’s going to hurt you. Now, do you still want to vote for Republicans?” One issue isn’t going to flip somebody’s entire worldview because we are so polarized and sorted into not only political issues, but also urban and rural, highly educated and less educated, more religious and less religious; all of these things go together in a package and no single issue is going to flip somebody from one camp to the other just because it is inconsistent with all of the rest.
What people do in those situations, both on the left and the right, is engage in what psychologists call “motivated reasoning” to reduce that cognitive dissonance. So, any single issue is unlikely to flip somebody’s entire worldview, so that means they have to reconcile, usually by some sort of post-talk reasoning.
Such as reconciling the belief in the sanctity of the American meritocracy, yet also feeling a deeply unfair sense of inequality. Those seem to be at odds with each other. If you really believe in the meritocracy, then you should then believe that your position in life is exactly what you deserve. It’s what you’ve earned. It’s what you’ve worked for. But that’s not actually how people are reacting to the growing inequality in our country, right?
Right. If you believe in that “just world” theory — that the world is generally a fair and just place where people get what they deserve and deserve what they get — then you will tend to assume that whatever people have is what they deserve, unless you think somebody’s cheating. Now, both sides think somebody’s cheating, but it’s different cheaters.
In one of [author and sociologist] Arlie Hochschild’s books, she talks about a narrative on the right that imagines people standing in line waiting for their just reward, and other people keep cutting in front of them. In that narrative, it’s often immigrants or African-Americans who are getting special benefits and cutting in line. That’s a very common view.
In general, if people don’t feel like they’re getting outcomes that they deserve, it’s easy to find somebody [they believe is] cheating to blame it on. On the left, that is often Wall Street or other kinds of big corporations that are rigging the system.
So who’s right?
I think both of those narratives are oversimplified stories, but I think there is good empirical evidence that shows that the kinds of economic policies we vote for have influences on the amount of economic inequality that there is. So, the kinds of higher taxation and redistribution — policies that characterize Western Europe — result in less income inequality than the low-taxation, low-redistribution policies in America. The economies and policies that are in places like Utah, Iowa and Vermont end up having less inequality than Mississippi, Alabama, New York and California.
In terms of who’s right, I think if we care about inequality as a problem — and I think we should, because it predicts lots of poor life outcomes — then the right thing to do is to make decisions that reduce inequality, or at least limit its growth. Usually that means more progressive taxation. Usually it means strengthening a safety net for the poor, not reducing it, and it sometimes could mean rules that limit inequality at the top, like rules discouraging or capping excessive pay for CEOs. I’m not a policy person. I’m not an economist. So I don’t want to recommend specific policies to people. The point I want to make is that we shouldn’t see political decisions as disconnected from our daily lives because they affect our incomes, not only in terms of our own incomes, but those we compare to.
Let’s circle back to the narrative that blames immigrants and African-Americans for jumping the line, so to speak, thereby cheating white Americans out of their meritocratic due. You have a whole chapter on racial inequality in the book. Can you talk about how the perception that we’re in a post-racial culture now affects inequality, and even keeps people who are in the same economic class from working together to combat inequality?
The perceptions of how racial inequality has changed over time are dramatically different if you ask white Americans and black Americans. If you ask white and black Americans how much discrimination against black people there was in the 1950s, both white and black Americans say, yes, it was a terrible problem — there was a terrible amount of discrimination against black people in the 1950s and 1960s.
But if you ask how those things have changed over time, those perceptions diverge dramatically. Black Americans see a very slow decrease in anti-black racism over time, and they think that anti-white racism is basically nonexistent — in the ’50s, as today. But if you ask white Americans those same questions, they think anti-black racism has declined precipitously and is at very low levels today, and at the same time white Americans perceive anti-white bias to be increasing in proportion to the degree that anti-black bias has been decreasing.
One poll found that if you ask white Americans those questions about how big a problem anti-black racism is and anti-white racism is, they perceive that by the 2000s, there is actually more anti-white bias than anti-black bias, which is just astounding compared to real economic data or real behavioral data showing that if white and black job applicants apply for the same job using the exact same résumés for the purposes of a study, and they’re exactly equally qualified, black applicants are called back at a rate about half as often as white applicants. There are very high current rates of ongoing discrimination, but average white Americans aren’t tuned into that.
Where do you think white Americans get this idea that they are the ones who are being racially discriminated against?
Yeah, that’s a good question. First of all, social networks are incredibly segregated still, so few white Americans know very many black Americans and still fewer know them in terms of close personal relationships. So, that’s part of it. Most white Americans just don’t see the experiences of black Americans on a daily basis. When discrimination happens, it’s usually covert, so nobody’s announcing it. Black Americans are more likely to actually experience it on a day-to-day level and white Americans are less likely to witness it.
People want to believe that the world is fair and just, and if that is not contradicted by seeing racial discrimination in front of you, it’s often the easiest thing to believe that it’s just not a problem.
I can understand where the myth that racism is over because it’s not the 1950s any more comes from. Where I’m losing them is the idea that anti-white discrimination is significant and growing, especially with the rise of the alt-right, with actual neo-Nazi groups having legitimate political influence today, when they seemed completely marginal and on the fringe 20 years ago. That strikes me as a dangerous delusion. How do you go from “I think everyone is OK and racism is over” to “I’m the one being racially discriminated against,” despite a lack of empirical evidence?
I agree. It is a delusion and it’s a dangerous delusion. Part of the source of that comes from the fact that for whites, the two perceptions are correlated.
What I mean by that is that for whites, the more progress they see for African-Americans, the more they also think that anti-white bias is increasing. And so they see it as a zero-sum game. This is from research by psychologists Sam Summers and Michael Norton that I’m drawing on. For white Americans, if they see more diversity in their workplace, for example, and more diversity in their neighborhood than there was 20 years ago, they assume that that must have been because of some kind of affirmative action policy that discriminated against whites. Those two things are linked together in the minds of many white Americans: If African-Americans are making progress, it must be at the expense of whites.
It’s a difficult problem, how to advance the interest of diversity and inclusion without also alienating people who feel that it’s coming at their expense.
So where do we go from here? We live in a wildly unequal society, in a country that is really polarized on how to fix that, or even whether or not it is an issue to fix. If you had to pick one key cultural or psychological thing that has to change in the minds of Americans to move us forward, what would it be?
Well, it’s a great question. I think one of the things that would help in terms of understanding racial inequality is having greater contact across racial lines. Not just, “Oh, I know a guy at work.” One factor that seems effective at reducing people’s implicit racial biases is having close personal contact across racial lines. Cross-race marriage in your family, for example, if you have in-laws. . . . One study showed that [in an experiment using faces] white Americans showed faster fear-learning whenever black faces were paired with electric shock than white faces, as if there was already a pre-existing level of fear there. And it was slower to extinguish when the shocks went away. But that didn’t happen for people who had had interracial dating relationships in the past. Those kinds of close personal relationships, rather than just formal relationships — like having somebody [of another race or ethnicity] in your workplace — are more powerful. But at the same time that’s not the kind of thing that easily changes.
Right, and on an institutional level, it’s not the sort of thing that can drive policies that are more attuned to addressing racial inequality. Donald Trump can appoint Ben Carson to all the Cabinet positions that he wants, but that doesn’t mean that Trump is necessarily invested in policies that are going to address ongoing racial inequality in the country.
It’s important to understand people’s beliefs and their emotions, but when it comes to trying to actually reduce prejudice and reduce discrimination, I think a more effective short-term strategy, rather than trying to change people’s hearts and minds, is trying to structure situations well, so that when people are making decisions like who to hire, who to admit to colleges and so forth, their decisions are made in a way that minimizes the potential for bias. Let’s assume that most people who are hiring or making admission decisions would like to be fair, but people are vulnerable to all sorts of unintended biases. There are strategies that we can take.
Some of them are things like blinding résumés, so you don’t know who the person is who’s applying until you’ve already looked at their qualifications. Things like specifying the criteria that are important up front, so you don’t look at a job candidate and perhaps feel uncomfortable and then decide, “Oh well, this person is not a good fit,” without ever specifying what a good fit means. There are a lot of mental gymnastics that people go through that can be taken out of decision processes that would minimize the potential for bias.
And the other thing that is important is recognizing that bias is so pervasive. Evidence on implicit bias shows that it’s widespread. We should realize that the baseline condition is not equality; it is bias. So if we don’t do anything, if we are just passive and assume a colorblind competition process [without actually creating one], then the outcome is going to be disparities. So that means we have to take other kinds of affirmative steps, like actively trying to increase the inclusiveness and representativeness of job applicant pools, for example.
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The levels of inequality in the world today are on a scale that have not been seen in our lifetimes, yet the disparity between rich and poor has ramifications that extend far beyond mere financial means. In The Broken Ladder psychologist Keith Payne examines how inequality divides us not just economically; it also has profound consequences for how we think, how we respond to stress, how our immune systems function, and even how we view moral concepts such as justice and fairness.
Research in psychology, neuroscience, and behavioral economics has not only revealed important new insights into how inequality changes people in predictable ways but also provided a corrective to the flawed view of poverty as being the result of individual character failings. Among modern developed societies, inequality is not primarily a matter of the actual amount of money people have. It is, rather, people's sense of where they stand in relation to others. Feeling poor matters--not just being poor. Regardless of their average incomes, countries or states with greater levels of income inequality have much higher rates of all the social maladies we associate with poverty, including lower than average life expectancies, serious health problems, mental illness, and crime.
The Broken Ladder explores such issues as why women in poor societies often have more children, and why they have them at a younger age; why there is little trust among the working class in the prudence of investing for the future; why people's perception of their social status affects their political beliefs and leads to greater political divisions; how poverty raises stress levels as effectively as actual physical threats; how inequality in the workplace affects performance; and why unequal societies tend to become more religious. Understanding how inequality shapes our world can help us better understand what drives ideological divides, why high inequality makes the middle class feel left behind, and how to disconnect from the endless treadmill of social comparison.
