In January 2015 Oxfam published a report showing that the wealth share of the richest one percent of people in the world will, on current trends, exceed fifty percent by 2016 (Oxfam Issue Briefing, Wealth: Having It All and Wanting More, 2015). Many people will react to such statistics with anger or concern, calling for urgent action to reverse such massive injustice through global and national redistribution. James Otteson sees things very differently, for his fear is that growing inequality may lead people to doubt that neoliberal capitalism is the best of all possible systems. He therefore seeks to assuage any such anxiety by a reassurance that, until 1800, the average income of all human beings was only at the level that the World Bank now defines as extreme poverty. Furthermore, it was, he maintains, capitalism that brought about “the only considered and sustained means ever discovered to alleviate poverty” and its performance has been “nothing less than spectacular” (189). Apparently, we do not need to worry that some have much less than others, for only absolute conditions matter, and, as long as we avoid any temptation to introduce “socialist-inclined” policy, we can realistically imagine a time “in the not-too-distant future where effectively no one lives at historical levels of poverty” (189).

Otteson's main goal is to provide a plausible theoretical rationale for his argument, taking the late G. A. Cohen as a paradigmatic theorist of socialism and Adam Smith as the representative of capitalist thought. In fact, however, his ambition is to demolish not just the case for socialism, but also any attempt to interfere with the market. His targets thus include such left-leaning liberals as John Rawls and Michael Sandel and all practical attempts to regulate capitalism for social purposes. His main argument is that all progress depends on freedom, defined in terms of respect for human beings as “moral agents with two principal and defining features: autonomy and independent judgment” (95). It is therefore a mistake to believe that justice has anything to do with distribution: this is the wrongheaded idea of “social justice.” It is necessary to draw a distinction between “beneficence” and justice. If an individual wants to give something to charity to alleviate poverty, s/he is entitled to do so, but the state has no obligations to do this. Its concern is to provide the “thin justice” proposed by Adam Smith. The role of government is essentially to devise and enforce a system of legal protection for property rights, to maintain security for individuals, and to defend the country. However, this exclusion of beneficence from the realm of the state is not, he insists, because of any indifference to the lives of the disadvantaged—quite the contrary. It is simply that the whole society benefits from a decentralized system (that is, capitalism), in which those who create wealth make the economic decisions. Any attempt by public authorities to regulate this decentralized system for social ends will damage wealth creation and ultimately, therefore, be worst of all for the poorest sections of the community. And he claims that empirical evidence from across the world demonstrates that socialism of any kind has invariably led to impoverishment, and “socialist-inclined” regulation within the United States has always had a negative impact on economic performance. But Otteson also wants to assure us that his concern is not solely about dry economic facts, but also about morality. In his view, the attempt to redistribute or regulate on behalf of the poor is to make several ethical mistakes. First, it fails to respect the need for individual poor people to make their own choices, thereby undermining their moral autonomy. Second, it treats them as an abstract collective category of people who are, in an arbitrary manner, taken to have a particular entitlement. Third, the wealthy are as individual as the poor, have equal moral agency, and therefore morally deserve respect: “Redistribution, as well as other methods of centralized restriction, denies them this respect. It is therefore unfair” (187). Redistribution and regulation for social purposes are thus both economically disastrous and morally wrong.

Let us consider this topsy-turvy world of James Otteson. When I think of the current relationship between the so-called Troika and Greece, I see powerful centralized agencies of international capitalism forcing extreme hardship on the majority of the Greek population by insisting on massive cuts in social expenditure. Otteson presumably sees a decentralized system allowing Greek citizens to regain their moral agency, with social spending reduced in real terms by over 27 percent between 2009 and 2013 (Manos Matsaganis, The Greek Crisis: Social Impact and Policy Responses [Friedrich-Ebert-Stiftung, 2013]). At the same time, because he terms all levels of government “centralized systems,” he regards any initiatives by local, regional, or state authorities to provide regulatory frameworks for any social purposes, such as seeking to enhance educational opportunities for the disadvantaged, as ultimately catastrophic. He also insists that every attempt to implement socialist policy “on any scale larger than a family or very small group” has led to regression “as the inexorable result of socialism's unfolding centralist logic” (194). All initiatives in facilitating co-operatives or other forms of decentralized socialism are therefore swept aside without any evidence.

In fact, he provides very little historical, social, or political context for his discussion of the failures of socialism and successes of capitalism, and his definitions of each are sketchy. He thus jubilantly declares that recent market-based reforms in Sweden have led to a resumption of economic growth, but he fails to mention that, from his own perspective on regulation, the Swedish social-welfare system is still extremely “socialist inclined.” His only mention of Cuba is to assert that the “accumulating costs of mismatch and misallocation” of socialism explain why its “economy has stagnated and declined” (85). Rather than discuss the fact that Cuba has improved very markedly in value and rank in the Human Development Index since 1980 and is now in the “very high human development category,” he obviously finds it more convenient to follow a right-wing report and simply omit that country on the grounds that trustworthy data could not be obtained (notes on 149 and 199, citing Robert Lawson, Joshua Hall, and James Gwartney, Economic Freedom of the World Report, 2013). In general, he relies on such like-minded sources for his evidence but, when more adventurous, his conclusions are not always reliable. Thus in a note he claims that an international comparative study of lifetime inequality shows “perhaps surprisingly, that inequality is actually less for people in the United States than for people in more socialist-inclined Western Europe” (135). In fact, it does not do so: it shows that the United States is still the most unequal, but that the differences between the countries are very slight when the comparison is for lifetime inequality, rather than for earnings in a single year. The authors also propose policy measures to reduce such inequalities, which are precisely of the “socialist-inclined” variety loathed by Otteson (J. Audra Bowlus and Jean-Marc Robin, Journal of the European Economic Association 10, no. 6 [2012]: 1236–62).

There is an urgent need for a probing analysis of the difficulties facing socialism in the current era. Few would now defend the centrally planned economy of Soviet-type systems, but it is also clear that social democracy has been in retreat in the face of an internationalized form of capitalism since the end of the Cold War. Many people, both inside and outside the traditional left, are searching for democratic ways to confront the burning issues of poverty and inequality, both globally and within states. They will receive no help from Otteson's ideological tract.