By William Letwin
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Additional resources for Against Equality: Readings on Economic and Social Policy
Once we reject the assumption that the utility of income is the same for all persons, then the view that redistribution of income from richer to poorer increases and ultimately maximises the community's total utility is shown to be untenable. No longer can it be said that, in a hypothetical community of two whose incomes are £3000 and £13,000, the AGAINST EQUALITY: READINGS 33 total utility of the two persons would be improved by moving to £4000 and £12,000, and so on until each has £8000. Instead we must now admit the possibility that a redistribution away from equality - say toward £2000 and £14,000 - would bring about the highest total utility.
He must accept the latter as superior - unless he maintains that the latter alternative is unthinkable because it represents an impossibility, logical, psychological or moral. This would be tantamount to asserting that no person, or at least no moral person, could tolerate a situation in which he received a higher psychic income than anybody else. But to assert this would merely beg the whole question at issue, for if nobody can tolerate inequality, then it could only come about by malign accident; or, if it is said that no moral person can tolerate inequality, then this is merely to assert that inequality is immoral by definition.
Consider two men, one of whom earns £3000 and the other £13,000. Then shifting £1000 from the richer to the poorer increases the total utility available to the latter by more than it diminishes the utility available to the former, and so increases the total utility enjoyed by the two. Successive shifts of £1000 each have similar effect, even though the increase in utility is less marked in each successive step; and the upshot is that the total utility of the two persons is maximised at the point where redistribution has made their incomes exactly equal.