The income inequality evident today has reached ethically unwarranted levels. In the Old and New Testament the Bible teaches us that disparity in wealth ought to meet the norms of justice and equity. Differences in income must be proportional to differences in the workers’ performance and the responsibilities they assume. Employers and trade unions have the duty to ensure that these boundaries are respected. The government's obligation is to take measures against the abuse of power monopolies, but it does not have to pursue income equality as such. Finally, where greed still rules society, Christians have the task to model a different life.
In die hedendaagse samelewing kan aansienlike inkomsteverskille nie eties verantwoord word nie. In sowel die Ou as Nuwe Testament leer die Bybel ons dat verskille in inkomste aan die norm van regverdigheid en billikheid moet voldoen. Inkomsteverskille moet in ’n sinvolle verhouding tot die verskil in prestasie en verantwoordelikheid staan. Werkgewers en vakbonde moet in hierdie opsig die nodige grense in stand hou. Die owerheid kan maatreëls instel teen die wanpraktyke van magsmonopolieë, maar nie teen inkomste-ongelykhede as sulks nie. Wanneer hebsug die botoon in ’n samelewing voer, is dit die taak van Christene om ’n eie lewenstyl te handhaaf.
In de hedendaagse maatschappij zijn de inkomensverschillen groter dan ethisch verantwoord is. Het Oude en Nieuwe Testament van de Bijbel leren dat financiële verhoudingen moeten voldoen aan de normen van rechtvaardigheid en billijkheid. Inkomensverschillen moeten in redelijke verhouding staan tot het verschil in prestatie en verantwoordelijkheid. Werkgevers en vakorganisaties moeten hier de verantwoorde grenzen bewaken. De overheid neemt maatregelen tegen misbruik van machtsmonopolies ten eigen bate, maar voor haar is nivellering niet een doel op zich. En als in de maatschappij de hebzucht nog de boventoon voert, is het de taak van christenen hier een eigen stijl te vertonen.
In January 2014 income inequality suddenly became a topic of widespread interest. Not only was it the most important subject broached by the World Economic Summit in Davos, it also occupied a central place in president Barack Obama's State of the Union address. Over the course of the last decades, income inequality has grown both in the developed as well as the developing parts of the world. The science of economics can explain this phenomenon and even justify it as well as point to its pros and cons. The leading principle for economics is that of utility. The question is, however, whether income inequality may also be evaluated from the perspective of good and evil − of what is and is not moral.
This article will address income inequality from an ethical perspective. The argument made here does not, after all, amount to a plea against all income inequality.
The question is, however, whether the disparity between incomes may become too great, and whether the discipline of ethics has anything to say in this regard. This article will argue that the income inequality in our present-day society has crossed the boundaries of what is ethically warranted and has, in fact, damaged the quality of society.
Following the method of theological ethics, the considerations in this article for distinguishing between what is good and bad will be largely informed by the wisdom offered in Holy Scripture. ‘If we believe in a reality consciously created by a living God, then that reality is itself stamped by that loving, caring God’ (Goudzwaard
Firstly, a description of the current status of income inequality will be offered, focusing in particular on the United States, the United Kingdom and the Republic of South Africa. Then the biblical perspectives offered in the Old and New Testament will be presented. On this basis an ethical standpoint, concerning a responsible income disparity, will be formulated. This article will also outline the guidelines for society that follow from this, examine the respective responsibilities of employers and employees, and inquire into the task and opportunities the government has for achieving a more just income distribution. The final section will demonstrate how the Christian church can model a different life.
If we disregard the emerging economies, By 2007, the year
In an article on ‘the rich and the rest’ on 20 January 2011, In America income inequality began to widen in the 1980s largely because the poor fell behind those in the middle. More recently, the shift has been overwhelmingly due to a rise in the share of income going to the very top − the highest 1% of earners and above − particularly those working in the financial sector. Many Americans are seeing their living standards stagnate, but the gap between most of them has not changed all that much.
Two years later, on 21 September 2013, Most of the growth is going to an extraordinarily small share of the population: 95% of the gains from the recovery have gone to the richest 1% of people, whose share of overall income is once again close to its highest level in a century. The most unequal country in the rich world is thus becoming even more so.
This same trend has been noted by the well-known theologian and social activist Ronald Sider. He considers it (Sider … very disturbing […] that the gap between rich and poor is increasing again in very wealthy countries, especially the U.S. and U.K. − the two wealthy market economies with the greatest reliance on the market. In the U.S., the gap between the rich and poor has grown enormously in the last thirty-plus years. (p. 139ff.)
The same trend can be observed within individual companies. Joseph Stiglitz ( … the huge gap between CEO pay and that of the typical worker − more than 200 times greater − a number markedly higher than in other countries (in Japan, for instance, the corresponding ratio is 16 to 1) and even markedly higher than it was in the United States a quarter century ago. (p. 26)
This dramatic growth in income inequality occasioned the International Labour Organization to issue a warning in June 2013 (Babones
Stiglitz (
In respect to the UK, which has already been mentioned in passing above, Skidelsky and Skidelsky ( In Britain, the basic pay of CEO's in FTSE top companies was 47 times an average worker's pay in 2000; by 2010, it was 81 times. Since the late 1970s, the income of the richest fifth has increased […] four times as fast [
The middle class, who has always formed the very basis for social stability, increasingly has to forego financial growth.
South Africa is characterised by sharp inequalities in the distribution of income, property and opportunities, mainly to the detriment of black people, as an inheritance of the apartheid period. After the introduction of a democratically elected government in 1994, political and human rights transformations have taken place, but no such transformation has yet taken place in the socio-economic sphere. The precarious situation in which large numbers of black people and those of mixed race find themselves has become more burdensome. Sampie Terreblanche ( While the income of the richer income groups - and especially the richer 25 per cent of the black people − increased quite dramatically over the last eight years [
In spite of this, Terreblanche ( … South Africa's high aggregated level of income inequality increased between 1993 and 2008. The same is true of inequality within each of South Africa's four major racial groups. A major drive of this situation was shown to be the increased share of income going to the top decile. (p. 32)
Income inequality is often defended with the argument that it stimulates people to work harder and perform better. Restricting this inequality, so it is argued, would weaken this stimulus and come at the cost of economic growth and labour opportunities. There is a kernel of truth in this, and this is also why this article does not plead for a total levelling of incomes.
There is in any case also a negative side to the disparity, and this negative side becomes all the worse as the disparity widens. When incomes are too disparate, this is detrimental to the work ethic in a company. It negatively impacts productivity and innovation. The negative effects extend also to society as a whole. According to Paul Krugman ( … incompatible with real democracy. Can anyone seriously deny that our political system is being warped by the influence of big money, and that the warping is getting worse as the wealth of a few grows ever larger?
Meeks ( The more the few gain power and privilege through property rights at the expense of the many, the more democracy is injured and no longer counted on as the shape of our future. (p. 5)
Sacks ( Typically, financial deprivation goes hand in hand with social poverty: depressed neighbourhoods, atrophying communities, high crime, drug-dealing, failing schools and overextended social services. (p. 108)
Oxfam International ( Some economic inequality is essential to drive growth and progress, rewarding those with talent, hard earned skills, and the ambition to innovate and take entrepreneurial risks. However, the extreme levels of wealth concentration occurring today threaten to exclude hundreds of millions of people from realizing the benefits of their talents and hard work. Extreme economic inequality is damaging and worrying for many reasons: it is morally questionable; it can have negative impacts on economic growth and poverty reduction; and it can multiply social problems. (p. 2)
Basing themselves on 30 years of scholarly study, Richard G. Wilkinson and Kate Pickett (
If people are content when they see that they can live a decent life from the fruit of their labour, society looks altogether different compared to the way it would if these same people abandon themselves to the pursuit of infinite profits. Therefore, many agree that the great increase in income inequality is not a positive development. What is lacking, however, is a sense of leadership in society (i.e. an ‘invisible hand’) to head it in a better direction. This makes personal responsibility all the more important, fed by values that are higher than mere personal interest. Where personal responsibility fails, there social partners and lawmakers have their own responsibilities they must assume.
The disadvantages we noted above already speak volumes. Nevertheless, we can dig even deeper by examining what values and norms ought to apply in this area. Values and norms are important for the quality of human society. Theological ethics views the Bible as an authoritative norm for values and norms. It further adds that living according to biblical norms is important for going through life with a clear conscience.
The Bible offers no direct answers to present-day economic questions, but it points us in a certain direction where we must nevertheless be careful to take into account the changed circumstances in which we live (Meeks Such books as Proverbs and Ecclesiastes in particular clearly demonstrate that, in order to know good and evil, you should also simply open your eyes and look at the reality around you. You do not have to derive everything in one way or another from the Bible […] A large part of the Christian life is a matter of practical wisdom, which is entirely amenable to a certain realism. (p. 82, [
The Old Testament does not oppose wealth as such, but rather views it as a blessing from God. It does, however, warn us about the dangers the pursuit of wealth involves and condemns those who try to become rich at the cost of the poor:
‘Do not slave to get wealth; be sensible, and desist. Before you can look around it is gone!’ (Pr 23:4−5).
‘No one who loves money can ever have enough, and no one who loves wealth enjoys any return from it. This too is futility.’ (Ec 5:10).
‘Woe to him who builds his palace on unfairness […] giving [
The prophet Amos denounces those who live in wealth whilst oppressing the poor (Am 3:9−10; 3:12, 4:1).
Employers are commanded to give their labourers an honest wage and to pay them on time (Dt 24:14−15).
Numerous regulations in the Mosaic Law are intended to protect the poor and to prevent the accumulation of wealth. ‘The laws that spring from the Torah are meant to preserve the political and economic equality that Yahweh means to create as deliverer of Israel’ (Meeks
The British theologian Christopher Wright ( Do we not still need the severity of the Old Testament's strictures against the subtle, as well as the blatant, idolatries of our age and cultures? [
In the New Testament a number of the Old Testament directives reappear. For instance, the apostle Paul warns those who want to be rich against the temptations into which they may fall, and for the foolish and harmful desires that plunge them into ruin and destruction (1 Tm 6:9). The New Testament also includes the warning not to hold back wages (Ja 5:4). Jesus warns his disciples not to pursue riches: ‘You cannot serve God and Money’ (Mt 6:24). Worries about material things may not rule our life (Mt 6:31−34; Lk 12:29−32). Paul places the money-grubber on the same level as the adulterer (1 Cor 5:11, 6:10; Eph 5:5). Those who work must receive a living that allows them also to have something to share with the needy (Eph 4:28; 2 Cor 9:8).
The parable of the workers in the vineyard (Mt 20:1−16) is important for the topic this article addresses. The owner of the vineyard hires labourers at different times of day – the first works for 12 hours, the last only for one hour. In spite of this, they all receive what had been agreed upon with the first. For the owner the compensation was not set by labour performance, but he wanted to give each of them a living wage (Van Bruggen
‘Equality’ (Greek:
Teunis van Spanje ( With his use of the word
Against this backdrop, the wealth seen in the Western world indeed raises many questions.
What lessons can we draw from the biblical data above? First of all, performance and efficiency ought not to be the only determining factors when it comes to income levels. It is also important to meet non-economic norms, like justice. If we measure society today by that norm, it is evident that self-interest has been given greater power than God's will actually allows. In order to withstand this power of attraction, it is necessary to develop norms that are based on justice and equity, and at the same time to respect the differences between individual people. Concretely this means that:
account must be taken of what people need for their livelihood;
account must be taken of differences in performance;
the goal ought to be for all to develop their talents maximally.
Those who respect these norms can have a clear conscience.
The first norm points to the minimum: those who devote themselves fully to the labour process as salaried employees, have a right to an income by which they can support themselves and their children, and further have something to give away. It is a matter of social justice.
Some claim that need ought to be the only criterion. This notion was defended in particular by the followers of Karl Marx. The programme of the Socialist Workers’ Party of Germany pled for a just distribution of workers’ wages. The programme further explained that the final goal was for society to be able to proudly fly in its mast the motto: ‘[
Difference in people's needs, however, is only one aspect of justice, and also other differences should be taken into account. Not everyone is equal in talent, zeal, persistence, execution of plans and willingness to sacrifice. Similarly, one person may have greater responsibilities than another, or incur greater costs in his or her education. Such differences may, to a reasonable degree, be expressed in different incomes. The clause
The norm of equity does not demand that all differences as such be eradicated, but rather all unjust differences. Incomes may differ more than equity warrants by the abuse of power, for example as the result of a monopolising position or unfair discrimination according to sex, race or ethnicity. This must be resisted. Rich and poor are soon divided, not only by a difference in welfare, but also in power. For that reason the economic order must be structured such that the basic positive rights of the poor are honoured as much as possible without encroaching more than is necessary upon the economic freedom of the others.
It is worth noting that these ethical insights are not specifically Christian. This article refers in this context to the Aristotelian virtues of wisdom, courage, temperance and modesty.
If these norms are neglected, results are sure to follow. Excessive income inequality that many experience as unjust, damage the cohesion of society and lead to fragmentation as well as social and moral indifference. It was not without reason that the document
This is why the reformer, John Calvin, gave so much attention to economic questions when he sought to establish a Christian society in Geneva. He not only mobilised himself for the creation of labour opportunities, but also strove to ensure that those who did normal work would receive sufficient compensation. He pled repeatedly for wage increases. When the city council established upper income limits in order to combat inflation, the pastors were opposed. In the interest of a harmonious society, Calvin urged that salary contracts be used and that people have the opportunity to seek arbitration in case of conflict (Biéler
When we speak of personal incomes, we have to distinguish between profit incomes gained by someone who engages in business at his own risk and whose incomes therefore fluctuates, and incomes gained on the basis of a labour contract, which are essentially guaranteed, although they may still include certain variable elements.
There is no ethical objection to a high profit income, provided that the profit was gained honestly without, for example, the exploitation of the employees. This is the reward for the risk assumed. At the very most one might ask, especially if the entrepreneur provides goods or services that are socially beneficial, whether these goods or services might not be offered at a lower price so as to make them more readily accessible, with the entrepreneur being content with the possible decrease in profit, which may follow as a result. A monopoly position does not justify unreasonable profits. For the rest, the entrepreneurs may be encouraged to distribute liberally to those in need from their growing wealth.
This article will focus on incomes based on labour contracts. Within a single company, there may be great differences − as mentioned earlier, the disparity has been growing over the last 20 years. Theological ethics does not have the task to establish quantitative norms. Nevertheless, should our point of departure not be that the difference between high-paid and low-paid employees should be proportional to their respective contributions in the company's production? Also, can a 1:1000-ratio, for example, then still be justified? In his commentary on Isaiah 65:23, Calvin writes that the boss − morally speaking − does not have a greater right of disposal than his employees over the fruits of their common labour. Both live by the grace of God. Similarly, in a sermon on Deuteronomy 15:11−15, he remarks that the Bible may not provide a quantitative key for the distribution between lords and servants, but that equity and justice should still function as the golden rule (Biéler
Therefore, if the good performance of a company is reason enough to provide extra compensation for the top executives, the same ought to apply to the rest of the personnel. After all, they all worked together in producing the attained results.
As already stated, ethics must be very careful in establishing strict quantitative norms. We do want to propose one consideration, however. Income inequality should be allowed to be greater in business than for functions paid from the public coffers, for which taxes are of course levied on the government's authority.
Yet, because greed often exercises a greater power over people than the voice of their conscience does, the business community would do well to develop codes in every sector for what might be considered reasonable there, whilst the supervisory board is charged with the responsibility to enforce these codes.
Norms are respected by way of self-regulation, social pressure and government legislation. On a more fundamental level, the moral quality of acts depends on the dominant values and convictions harboured by the people themselves. By means of participation in public debate, Christians can influence these values. Rules become less necessary as these norms incite people to good behaviour, and as they appropriate these values and the resulting norms for themselves. If economic activity is not carried out in accordance with the norm of justice, the government has the call to exercise its authority. After all, it has the task to restrain lawlessness amongst men (cf.
Legislation protects the acquisition and possession of property, even when that property is obtained in morally questionable ways. The rich especially benefit from this protection. It is just as necessary, however, to protect the poor against the power of the rich, for ‘an equitable distribution will not emerge naturally from the free working of the market alone’ (Sacks
For this reason, some have favoured the establishment of maximum incomes. Accordingly, the so-called ‘Declaration of Tilburg’ (
In the ‘Declaration’, it should be noted that a private rule for life has been turned too hastily into a duty enforced by authority. Yet, life is too variegated for imposing a universal income maximum, and too complicated for setting maximum incomes for each and every sector. Nor would it on a practical level be viable to establish a maximum net income by levying a tax of 100% on the income of high earners above a certain level, since people will always devise ways to circumvent that. Too much government legislation can lead to the erosion of our own sense of moral responsibility. If laws and rules are to be effective, it is necessary that they be embedded within a moral structure. Quite rightly, Douma (
The government therefore has a twofold task. In the upper echelon it will have to oppose the abuse of an economic power position, whilst, at the other end of the spectrum, it must safeguard a minimum subsistence by establishing minimum wages by law and/or social regulation. The government need not aim at levelling incomes as such. At the same time, the way it levies taxes and social premiums (i.e. according to the ability-to-pay principle) will still have a levelling effect.
The Dutch ethicist, Pieter Roscam Abbing, published a lengthy book entitled
Roscam Abbing ( It is appropriate to make the pursuit of social justice the primary concern, to entrust that pursuit to the government, and to give the government the power it needs to be successful in this pursuit. […] It is in itself appropriate to make the goods of production the property of the community, and it is improper to reject this on ethical grounds. (p. 424)
Roscam Abbing is only interested in the
Roscam Abbing ( Especially in countries that are ruled by communism this potentially viable socio-economic system is still fatally mixed with the altogether reprehensible one-party political system and with a horrendous historical-materialist worldview. (p. 529)
For this reason he wanted more scholarly research to be carried out.
Roscam Abbing did not sufficiently consider whether the
Justice will never be perfect in human society. Even the government has only limited means available to stem the tides of greed and selfishness. This is why personal ethic remains indispensable as the final keystone. Christians have the calling to lead as examples, even if this has the consequence that they must forego a state of wealth that may indeed have been within their reach as human beings. They do this because they attach greater value to a clear conscience than they do to material riches. For what does anyone gain by winning the whole world at the cost of destroying himself (Lk 9:25)? By living such a life, they reflect something of the coming Kingdom of God, and show how valuable the virtue of modesty is, which is in fact important for all of society: ‘Without transforming its own economy, the church cannot have much effect in its society's economy’ (Meeks The role of the church is not merely to make policy recommendations to the state, but to embody a different sort of politics, so that the world may be able to see a truthful politics and be transformed. The church does not thereby withdraw from the world but serves it, both by being the sign of God's salvation of the world and by reminding the world of what the world still is not. (p. 404)
The church is a community of faith where people learn to overcome their own interests and to break through group interests.
Where the government's social codes and laws reach the end of their possibilities, their church members can begin to address each other if greed manifests itself amongst them. Ronald Sider (
Those who enjoy a high income do not necessarily need to refuse it. They should, however, be well aware of the temptations that follow as a result.
The author declares that he has no financial or personal relationship(s) that may have inappropriately influenced him in writing this article.
The considerations in this article are for practical reasons restricted to income inequality. For an economic critique of capital inequality, see Piketty (
This is, however, done by J-J. Rousseau (
‘Absolute equality is not a meaningful social goal’ (Niebuhr
‘After all, those who work hard should be rewarded, and have to be, if they are to make the efforts and the investments from which all benefit. Some inequality is indeed inevitable’ (Stiglitz
Goudzwaard
Along with the USA, the greatest income inequality is found in South Africa, Brazil and China.
‘… as our economic system is seen to fail for most citizens, and as our system seems to be captured by moneyed interests, confidence in our democracy and in our market economy will erode along with our global influence’ (Stiglitz
See also Stiglitz (
In 2001, the richest 20% received 72.2% of the total income; the poorest 60% received 10.6% (Terreblanche
‘I and, as far as I know, more progressives - do not argue for full equality. We realize that that would weaken incentives. [
Cited via a column in
Biblical quotations are all taken from The Revised English Bible.
Calvin writes in his commentary on Genesis 30:29: ‘
‘I feel absolutely confident, however, that the biblical understanding of “economic equality”, or equity, demands at least this:
‘It was Aristotle who imprinted upon the Western mind the idea that the essence of justice was equality […
A good example is the Bill and Melinda Gates Foundation.
‘[
Recently, the Netherlands has enacted a maximum income of ca. €230,000 (130% of the salary of ministers) for those whose salary comes from public funds.
In Japan the ratio in business is 16:1 (Stiglitz
This is comparable with the Code-Tabaksblat in the Netherlands (Wikipedia
‘A basic market framework plus the right kind of private and governmental activity to empower the poor is the best alternative known today. But that is very different from a pure laissez-faire of libertarian approach that rejects almost all government intervention in the economy’ (Sider
Jesus once stated hyperbolically: ‘It is easier for a camel to pass through the eye of a needle than for a rich man to enter the kingdom of God’ (Lk 18:25; cf. 1 Tm 6:9-10).