The rise and rise of the cognitive elite

The rise and rise of the cognitive elite1Brains bring ever larger rewards: A special report on global leadersJan 20th 2011 | from PRINT EDITIONWHEN the financial crisis struck, says a prominent banker, the women he knows stopped wearing jewellery. “It wasn’t just that they were self-conscious about the ostentation. It was because it didn’t look good to them any more.” He goes on: “There were blogs that had my name, my family’s names, my address. There were death threats. You’d think this could be some pimply kid in a basement, but John Lennon met some pimply kid from a basement. And the kid shot him.”The crash sparked a wave of public ire against financiers, and against rich people in general. It also intensified the debate about inequality, which has risen sharply in nearly all rich countries. In America, for example, in 1987 the top 1% of taxpayers received 12.3% of all pre-tax income. Twenty years later their share, at 23.5%, was nearly twice as large. The bottom half’s share fell from 15.6% to 12.2% over the same period.Jan Pen, a Dutch economist who died last year, came up with a striking way to picture inequality. Imagine people’s height being proportional to their income, so that someone with an average income is of average height. Now imagine that the entire adult population of America is walking past you in a single hour, in ascending order of income.The first passers-by, the owners of loss-making businesses, are invisible: their heads are below ground. Then come the jobless and the working poor, who are midgets. After half an hour the strollers are still only waist-high, since America’s median income is only half the mean. It takes nearly 45 minutes before normal-sized people appear. But then, in the final minutes, giants thunder by. With six minutes to go they are 12 feet tall. When the 400 highest earners walk by, right at the end, each is more than two miles tall.The most common measure of inequality is the Gini coefficient. A score of zero means perfect equality: everyone earns the same. A score of one means that one person gets everything. America’s Gini coefficient has risen from 0.34 in the 1980s to 0.38 in the mid-2000s. Germany’s has risen from 0.26 to 0.3 and China’s has jumped from 0.28 to 0.4 (see chart 2). In only one large country, Brazil, has the coefficient come down, from 0.59 to 0.55.Surprisingly, over the same period global inequality has fallen, from 0.66 in the mid-1980s to 0.61 in the mid-2000s, according to Xavier Sala-i-Martin, an economist at Columbia University. This is1Cognitive elite：The cognitive elite of a society, according to Richard J. Herrnstein and Charles Murray, are those having higher intelligence levels and thus better prospects for success in life. The development of a cognitive elite during the 20th century is presented in their 1994 book The Bell Curve. In this book, Herrnstein and Murray propose that the cognitive elite has been produced by a more technological society which offers enough high skill jobs for those with a higher intelligence to fill. They also propose that by removing race, gender or class as criteria the main criteria of success in academic and professional life is becoming primarily based on cognitive ability. (From Wikipedia, the free encyclopedia)because poorer countries, such as China, have grown faster than richer countries.How much does inequality matter? A lot, say Richard Wilkinson and Kate Pickett, the authors of “The Spirit Level: Why Equality is Better for Everyone”. Their book cau sed a stir in Britain by showing, with copious graphs and statistics, that inequality is associated with all manner of social ills. After comparing various unequal countries and American states with more equal ones, the authors concluded that greater inequality leads to more crime, higher infant mortality, fatter citizens, shorter lives, more teenage pregnancies, more discrimination against women and so on. They even found that more equal countries are more innovative, as measured by patents earned per person.Mr Wilkinson and Ms Pickett suggest that equal societies fare better because humans evolved in small groups of hunter-gatherers who shared food. Modern, unequal societies are hugely stressful because they violate people’s hard-wired sense of fairness. The authors call for stiffer taxes on the rich and more co-operative ownership of companies. Pundits on the left applaud, but others are not so sure.Peter Saunders of Policy Exchange, a centre-right think-tank in London, thinks the book’s statistical claims are mostly bunk. He points to several flaws. First, Mr Wilkinson and Ms Pickett did not exclude outliers from their sample. So, for example, when they say that unequal countries have higher murder rates than equal ones, all they have really observed is that Americans kill each other much more often than do people in other rich countries, perhaps because they are better armed. For the rest of the sample the link between inequality and homicide does not hold.Likewise, their findings about life expectancy depend on the Japanese, whose longevity is more likely to be due to a healthy diet than to a flat income distribution. And their findings about teen births, women’s status and innovation depend on Scandinavia, a region with a mild and sensible culture that is equally evident among people of Scandinavian stock who live in America.Factors other than inequality are often more strongly correlated with the problems described in the book. In American states, for example, race is a far more accurate predictor of murder, imprisonment and infant-mortality rates, says Mr Saunders. He also chides the authors for ignoring countries that do not fit their theory, and for glossing over social problems, such as divorce and suicide, that are worse in more equal countries.This debate will probably never be resolved. The statistical problems are tricky enough. If you measure inequality of wealth rather than income, the global pecking order2changes. By this measure, Sweden is less equal than Britain, since fewer Swedes have private pensions. And if you measure consumption, the world seems a more equal place. The poor in rich countries often consume more than they earn, because they receive welfare benefits and use public services. The very rich often consume only a small portion of their income. Bill Gates is millions of times richer than the average person, but he does not eat millions of meals each day.2pecking order：强弱排序The philosophical questions are even trickier. It seems unfair that footballers, bankers and tycoons earn more money than they know what to do with whereas jobless folk and single parents struggle to pay the rent, notes Mr Saunders. Yet it also seems unfair to take money from those who have worked hard and give it to those who have not, or to take away the profits of those who have risked their life savings to bring a new invention to market in order to help those who have risked nothing. Different societies choose to deal with this conflict in different ways.It is hard to gauge3just how strongly people object to inequality. A recent poll by the BBC, a tax-funded broadcaster, found that many people in Britain think cashiers and care assistants should be paid more and chief executives and football stars less. Yet few Britons tip cashiers, boycott firms with fat-cat bosses or watch second-division football teams.The Pew Global Attitudes Project asks people in various countries whether in their view “most people are better off in a free-market economy, even though some people are rich and some are poor.” In Britain, France, Germany, Poland, America and even Sweden most people agree, but in Japan and Mexico most disagree. People in countries that have recently liberalised and are now booming are the most enthusiastic: 79% of Indians and 84% of Chinese say yes.Degrees of fairnessInequality jars less if the rich have earnedtheir fortunes. Steve Jobs is a billionairebecause people love Apple’s products; J.K.Rowling’s vault is stuffed with gold galleonsbecause millions have bought her HarryPotter books. But people are more resentfulwhen bankers are rewarded for failure, orwhen fortunes are made by rent-seeking4rather than enterprise.In the most corrupt countries the rulerssimply help themselves to public money. Inmature democracies power is abused inmore subtle ways. In Japan, for example,retiring bureaucrats5often take lucrativejobs at firms they used to regulate, a practiceknown as amakudari (literally “descent fromheaven”). The Kyodo news agency reportedlast year that all 43 past and present heads ofsix non-profit organisations funded by 3gauge[geidʒ] vt. 估计, 判断, 测量4寻租行为：按照寻租理论的鼻祖美国经济学家克鲁格的定义和阐述，寻租是指人们凭借政府保护而进行的寻求财富转移的活动。