From today's Daily Reckoning:
Why has collectivism - not individualism - triumphed almost everywhere, we ask? Individualism - a genuinely free market - clearly delivers more goods and services than a collectivized economy. People may not really care about liberty, but surely they care about money?
Why is it that even in the U.S. of A, where getting rich is practically the national religion, the government intervenes (in the name of the people, of course) in countless ways - from fixing key lending rates to setting the terms of employment contracts.
Part of the answer comes to us from Helmut Shoeck, who wrote a book 40 years ago called, Envy. Money isn’t everything, said Shoeck. In fact, in some ways it is less than nothing. People envy people who are richer than they are mostly because it confers status...not because it has any inherent benefits.
This comes from the peculiar nature of wealth. After you have the basics - adequate food, clothing, healthcare and shelter, wealth only matters in a relative way. Even if you are a multi-millionaire, for instance, you will be relatively poor in a neighborhood of billionaires. Since it is relative wealth that counts, you will be almost as satisfied - and maybe even more satisfied - to see your neighbors taken down a notch than to see yourself with a few more million.
Envy is such a powerful emotion that all societies eventually have to deal with it. In primitive societies, a rich chief might have been required to host a giant banquet. In the Middle Ages, laws were enacted forbidding people from showing off their wealth - the sumptuary laws. People were given a place, or rank, in society and expected to dress accordingly. Sometimes they forced everyone to wear the same drab clothes - as in China during the Mao years - and sometimes they just took everyone’s property away - as in most communist counties. In the West, taxes were imposed.
Britain and the Scandinavian countries even had marginal income tax rates over 100% for a while.
People seem to hate the idea that their neighbors are having a better time in life than they are. It makes them favor controls, regulations, taxes...in short, it makes them favor a collectivist society.