William Watson Ethical Capitalism Summary

The Problem of “Ethical Capitalism”: A Book Review of The Inequality Trap: Fighting Capitalism Instead of Poverty by William Watson

This book review will define the problem of “ethical capitalism” and economic inequality in America in The Inequality Trap: Fighting Capitalism Instead of Poverty by William Watson. Watson’s (2015) evaluation of the current economic crisis in the United States is based on the current findings of Thomas Piketty’s study on the exponentially growing problem of economic inequality in the United States. This study provides a platform for Watson’s (2015) criticism of an “anti-capitalist focus on inequality, which should focus more on the ethical premise of “good” and “bad” inequality in this type of economic system.

Watson (2015) tends to veer away from a focus on the 1 per cent as the core problem in capitalism, since they have been demonized as “financiers” and stock market predators. Watson then counters the argument of Piketty’s claim of a focus on the upper classes as the problem to capitalism, but how it brings greater divisions in society: “Why do we make of this occupational Who’s Who of the 1 per cent? Does it help in evaluating what Thomas Piketty calls “The moral hierarchy of wealth” (Watson, 2015, p.82). In this passage from the chapter, “Who Are the 1 per cent?”, Piketty’s study is perceived as a “bias” against the rich, since it does not acutely define how the “1 per cent” became

This is one reason why “bad” capitalism should not be blamed, nor the majority of “good” members of the 1 per cent that appear to be resolving poverty. This argument is not only attempting to distract the reader from the problem of highly concentrated wealth in the upper-classes, but it rationalizing wealth as a “reward system” for capitalist that are deemed as being productive. For instance, a successful “inventor” should be able to make lots of money, since they have produced something of value. However, individuals that do not “produce” anything of great value should not receive as great a reward. This is also true of 1 per centers, such as fraudulent bankers and stock traders, that steal from the people. In this case, Watson (2015) is being a capitalist apologist by claiming that doctors, lawyers, and other members of the 1 per cent are not “financiers”, and therefore, they are “good” capitalists. More so, the government is seen as a barrier to increased economic prosperity for the poor by providing welfare and job training. In the absence of government, who will train