Gini And The Economic Altar
Long ago the church wasn’t nearly as difficult to identify as it is today. The cardinals wore pointy red hats and the Pope had his black-crossed pallium. Any man with eyes could see the cathedrals that stretched into the sky and looked down on him with stone angels and statues of the saints. If a man were to walk through a medieval library, he would see all the dusty books that were to keep the church dogmas alive for generations to come. Nothing was hidden, nothing was stuffed into a magician’s sleeve. The Catholic world was a world that said: “Here is our God. Here is our creed. Now you decide.”
With the rise of Puritanism, a silent and very subtle paradigm shift occurred in Western civilization. The Puritans stressed that we have an inherent, gnawing guilt in our soul. We are mired in sin with no respite except for those that God has specifically chosen to save. There is no intention pure enough, no effort sincere enough to save a man. There are those who are inherently evil and those who are inherently good; the good ones tend to be those who think and act like the Puritans themselves, the evil ones are everyone else. In one fell swoop the Puritans rejected the cathedral for society; they rejected the private confessional for public condemnation. Society and its social complications became the new church.
This was, unfortunately, not a phenomenon that died when the West became secularized. Crypto-Calvinism is alive and well in our own era. A new church has been constructed around the dogmas of liberalism and the foremost dogma that is shouted from bull-horns in every school union and smugly assumed in newsrooms across the nation is none other than equality. We speak not of equality with a small ‘e,’ but an all-encompassing, religious equality with a capital ‘E.’ Equality is this era’s equivalent of God. The Abrahamic, bearded-man-in-the-sky paradigm of God has yielded to the open-armed, starry-eyed Goddess of the pagans. These days she is the one who looks down in silence as capitalists and white males are sacrificed on her altar.
We can see the new church at work most prominently on university campuses. Here the modern-day cardinals have shed their robes for khaki pants and a belt; the new dogmatists look through their black-rimmed glasses at a congregation of naïve students, scratch the scruffy beard on their chins, and preach their gospel of the great goddess.
The college cardinals have been trying for decades to infiltrate the last holy order available to free-thinking men: the hard sciences. Most men assume that mathematical subjects are pure logic and therefore timeless and unchangeable. Western traditionalists assumed that they would be safe in these studies. The feminists, the socialists, the race-baiters, and the radical queers broke down the doors of the humanities long ago and so their new theology was born.
The hard sciences persevered for a long time, but are now struggling to hold onto their traditions thanks to affirmative action hires, academic dishonesty, foundation shenanigans, and federal grant funding for ideologically approved studies. One look at the scorn heaped on biologists as esteemed as James Watson and Tim Hunt show just how soft hard science has become.
The saddest victims, however, are to be found among the social sciences. This excludes sociology, which has always been a picnic-ground for Marxists. Psychology, on the other hand, has shown some insight in brief starts and sputters. These days the traditionalists, the rationalists, or the skeptics to be found in psychology are facing the very heavy hand of the inquisitor. It is a toxic atmosphere. One wrong word, one overly-curious study, one unapproved idea and they are excommunicated.
But even psychology has not seen the worst. The worst abuse falls on the study of economics, which has been flayed like a stone-bearing mule. Ironically, the most mathematical study of the social sciences has been hit the hardest with new church theology. It was just too powerful for the church to ignore, since economics can impact everything from civic planning, to corporate investments, to government policies. If a Marxist approaches the president and pushes for equitable redistribution of wealth the president purses his lips and asks skeptically, “Equitable to whom?”
The cleverest way to trick a nation into embracing Marxism is to cloud it in technical jargon that comes with grand promises. Now if the same Marxist approaches the president and is introduced as an “expert economist” and he holds up graphs of intersecting lines labeled “labor demand”, “labor supply”, and “minimum wage”, and then explains to the president that this minimum wage will bring “equilibrium” to the job market and that he, the president, can promise his low-income voters free wage hikes — then it’s obvious what the president will do. Marxism was thus able to weasel its way into the market without even a shot fired.
And who paid these “expert economists” to go around hawking their wares? They did not do it for free.
So why does modern economics seem so legitimate; how can its critics deny the graphs, the equations, and the time honored principles that have been embraced by governments all across the developed world? To outside eyes, economics seems as mathematical as the rotation of the earth or the chemical changes that occur during photosynthesis. But all is not what it seems. The problem with modern economists is that they play with logic, like a magician who uses scientific principles to craft an illusion. If we were to pull back the sleeves of these economists, we would discover that they have been playing games of deception.
Gaps in logic provide the space for modern economists to dance their silly rain dances. Academics in particular are guilty of playing with deductive premises to support a foregone ideological conclusion and so the math they provide to support their position was built on pillars of sand all along; it only has validity if we accept the faulty premises that underlie its conclusion. So what is to be done when we’ve discovered the deception? We have to knock down those mountains of bad math and start from scratch.
Nothing exemplifies this more in modern economics than the Gini coefficient. If you are well acquainted with the tactics of the new church, alarm bells should begin to ring in your head the moment you hear that the Gini coefficient is used to measure “income inequality.” As of 2016, if you visit Wikipedia, you will see that the page for every major nation has a Gini coefficient listed in its information box, wedged between statistics like population estimates and GDP figures, as if the Gini were a perfectly legitimate way to measure a nation’s “inequality.”
Let’s pick apart the Gini coefficient by starting with its origins. Corrado Gini was an Italian mathematician who was fascinated with ranks and measurements, specifically of people. Not too surprisingly, he was drawn to Benito Mussolini’s brand of fascism and helped the fledgling dictator by serving as president of Italy’s Central Institute of Statistics. In 1927, Gini wrote The Scientific Basis of Fascism and throughout the 1930s he bounced between several different eugenic and sociological societies.
Given the left’s supposed hatred of fascism, it is surprising that the Gini coefficient is still so widely cherished by left-leaning economists. We find out, however, that after the fall of fascist Italy, Gini joined a radical group that called for all democratic nations to be annexed by the United States and a world government administered from Washington should be put in their place. At this juncture, we see Gini for what he really is — a man who spurns national determination, a man who embraces one-world feelgoodery, a man who wants to lock arms with an unwieldy, bureaucratic, nightmarish state. At this point, Gini’s spiritual connection to Marxism should become much more apparent.
Let’s delve a little deeper now into what the Gini coefficient actually is. As stated previously, the purpose of the coefficient is to measure income or wealth inequality within a given nation. The intention underlying this formula serves a useful function in statistics: a nation like China may have an outrageously high GDP but when you consider that there are over a billion people in China, we see that that its GDP per person is three times lower than that of America’s. To call China a wealthy nation based on its GDP alone would be a serious misstep. The purpose, then, of the Gini coefficient is to measure how wealth is distributed throughout a nation. But here’s the interesting part: it does not even use a nation’s GDP or population totals as variables in its formula.
I realize that, so far, none of this seems very objectionable. It’s when we get down to the details that the whole business starts to get tricky and dim. The Gini coefficient assigns a rating to a nation, between 0 and 1, where the lower the rating the more “equally” the nation’s wealth is distributed, while the higher the rating the more “unequally” the nation’s wealth is distributed. Keep in mind that logical premises can be played with to cook up all sorts of nonsensical conclusions. This is where the new church’s sleight of hand is at play. Consider that on the Gini scale, the 0 point, the most equal distribution of wealth, represents a nation where all of its citizens receive the exact same income. Let that premise simmer in your skull awhile.
The goddess Equality has beckoned to Corrado Gini from the far shore: all things must be equal in all ways. All fields must be leveled, all buildings razed, and all income curves must be flattened. The goddess spoke and Gini listened.
It should not take anyone a long time to figure out the flaw in Gini’s most fundamental assumption. Gullible eggheads and academics may be fooled but the rest of us have more sense between our ears. Equality of opportunity is not the same as equality of outcome. A society in which everyone receives equal pay would be the most unequal society imaginable.
Do we dare imagine a nation where an open-heart surgeon takes home the same pay as a janitor? One job requires nearly a decade of dedicated study, an unwavering hand, a stout set of nerves, and the ability to think quickly lest a patient die; the other job requires a broom. What may be termed equality of outcome would certainly not be equality to the surgeon who spent his youth learning the scalpel when he could have just taken up a broom and gotten paid the same wage. Now multiply the scale of this nightmare by several orders of magnitude: a pharmaceutical chemist taking home the wages of a street sweeper; an electrical engineer receiving the same pay as a prostitute. Nothing could be more unequal. Nothing could be more unfair.
Yet this is what Gini asks us to accept as his central premise. He asks us to accept the madness that “equality” means unequal work should make for equal wages. He asks us to embrace an idea of equality that benefits the most careless sweepers and penalizes the most capable surgeons. Not one shred of “equality” can be found in the Gini coefficient, and yet, if we were to research the mathematical formula in university textbooks; if we were to consult with professional economic analysts and think-tanks we would see a world that embraces the Gini coefficient as one of the many perfectly legitimate methods of evaluating a nation.
No amount of expert judgment can save a house from tumbling down if the foundation was laid on sand; no amount of complex calculations can save a coefficient from spitting out nonsense if its conclusions were based on a faulty premise.
Another glaring flaw with the Gini coefficient, less fundamental but still just as much of a flaw, is that the Gini does not differentiate between relative values of wealth. This can lead to laughable results. The United States had a Gini rating of 0.45 in 2007 while the noble nation of Kyrgyzstan snagged a rating of 0.33. Remember that lower ratings indicate less ‘inequality’ and therefore we are led to believe that this former Soviet state in central Asia, where nearly 40% of the nation lives in dire poverty and 30% of its GDP comes from remittances sent by migrant workers in Russia, is less unequal than the United States. If that is Gini’s definition of “equality” I will gladly take the comfortable “inequality” of the United States, where even the poorest people eat like royalty and can drive cars to work.
The only reason why Kyrgyzstan rates so well using the Gini coefficient, along with other nations like Niger and Timor-Leste, is that these nations are so skilled at sharing misery equally with all of their citizens. So, in the end, what we are left with is a metric that measures the exact opposite of what was intended; rather than measuring wealth distribution, we have a metric that measures how equally a lack of wealth is distributed. We have a formula that will tell us how inadequately the hardest working members of a society are being compensated for their sweat and expertise. Rather than pleasure, we have a measure of pain.
This must be why Marxists love measurements like the Gini coefficient so much. This must be why new church economists, in their ecstatic worship of the goddess Equality, have invented so many methods of evaluation that serve no purpose other than to confirm their own church dogmas. The cardinals in academia are able to feel smug and self-secure while the priests in newsrooms have another means to evangelize the new gospel of national self-loathing.
“Look!” they proudly proclaim, “The USA has the most inequality in the Western world!” And when the priests point to a page full of bewildering mathematical calculations, the people just shrug their shoulders and accept the statement at face value since there seems to be math behind it. If these people were to dig a little deeper, if they were to set aside the foregone conclusion and examine the premises first, they would discover that the statement is not so clear-cut. They may even find that the statement was utter nonsense from the beginning.
If you are currently working in academia, or God save you, in economics, proceed with caution! The cardinals and the bishops of the new church come with smiles but are supremely intolerant of those who are quick enough to question their premises. The more you test their dogmas, the more they will test you; and these are testy times already. But one thing that you need not even bother scrutinizing is the Gini coefficient. It’s far too easy to poke holes in its façade; so easy, in fact, it’s clear that the only reason economists use it is purely for ideological purposes.
The Gini coefficient is a meaningless metric that exemplifies the spirit of our age — a mad dash toward equality without ever asking whether equality is possible, or even desirable in a fair society.
