True, Cowen isn’t advocating a complete caste society — but it’s actually not clear why, since he is suggesting that we’ll be happier as a society if people stay comfortably in the class into which they were born.
He compares my position to this poem:
The rich man in his castle,
The poor man at his gate,
God made them high and lowly,
And ordered their estate.
Uh, no. What I wrote was that for fixed levels of income there was no gain per se from having a higher rate of mobility churn, if not accompanied by higher standards of living. I also wrote that the best way to get useful upward mobility was to have a high rate of economic growth and spread across many income classes. Think of it as the difference between positive-sum notions and metrics of mobility vs. zero- or negative-sum notions and metrics. Read my first point:
If the general standard of living is rising (and I am more than willing to admit problems in this area for the United States), mobility takes care of itself over time. I find it more useful to focus on slow growth, if indeed that is the case. Just look at income growth for non-wealthy families and that is more useful than all the mobility measures put together.
Or read my follow-up post:
I see two big and very real problems: slow income growth for many income classes and a problem with excessively high returns to finance at the very top.
Let’s put it this way. Paul Krugman is a great economist. But of all the people in my RSS feed, in terms of his quality and skill as a reader, he is not in the top 90 percent.