When people care enough about something to do it well, those who do it best tend to be far better than everyone else. There’’s a huge gap between Leonardo and second-rate contemporaries. A top-ranked professional chess player could play ten thousand s against an ordinary club player without losing once. Like chess or painting or writing novels, money is a very specialized skill. But for some reason we treat this skill differently. No one complains when a few people surpass all the rest at playing chess or writing novels, but when a few people make more money than the rest, we get editorials saying this is wrong. Why The pattern of variation seems no different than for any other skill. What causes people to react so strongly when the skill is money I think there are three reasons we treat money as different: the misleading model of wealth we learn as children; the disreputable way in which, till recently, most fortunes were accumulated; and the worry that great variations in income are somehow bad for society. As far as I can tell, the first is mistaken, the second outdated, and the third empirically false. Could it be that, in a modern democracy, variation in income is actually a sign of health When I was five I thought electricity was created by electric sockets. I didn’’t realize there were power plants out there generating it. Likewise, it doesn’’t occur to most kids that wealth is something that has to be generated. It seems to be something that flows from parents. Because of the circumstances in which they encounter it, children tend to misunderstand wealth. They confuse it with money. They think that there is a fixed amount of it. And they think of it as something that’’s distributed by authorities (and so should be distributed equally), rather than something that has to be created (and might be created unequally). In fact, wealth is not money. Money is just a convenient way of trading one form of wealth for another. Wealth is the underlying stuff—the goods and services we buy. When you travel to a rich or poor country, you don’’t have to look at people’’s bank accounts to tell which kind you’’ re in. You can see wealth — in buildings and streets, in the clothes and the health of the people. Where does wealth come from People make it. This was easier to grasp when most people lived on farms, and made many of the things they wanted with their own hands. Then you could see in the house, the herds, and the granary the wealth that each family created. It was obvious then too that the wealth of the world was not a fixed quantity that had to be shared out, like slices of a pie. If you wanted more wealth, you could make it. This is just as true today, though few of us create wealth directly for ourselves. Mostly we create wealth for other people in exchange for money, which we then trade for the forms of wealth we want. Because kids are unable to create wealth, whatever they have has to be given to them. And when wealth is something you’’ re given, then of course it seems that it should be distributed equally. As in most families it is. The kids see to that. "Unfair," they cry, when one sibling (兄弟姐妹) gets more than another. In the real world, you can’’t keep living off your parents. If you want something, you either have to make it, or do something of equivalent value for someone else, in order to get them to give you enough money to buy it. In the real world, wealth is (except for a few specialists like thieves and speculators) something you have to create, not something that’’s distributed by Daddy. And since the ability and desire to create it vary from person to person, it’’s not made equally. You get paid by doing or something people want, and those who make more money are often simply better at doing what people want. Top actors make a lot more money than B-list actors. The B-list actors might be almost as charismatic, but when people go to the theater and look at the list of movies playing, they want that extra oomph (吸引力) that the big stars have. Doing what people want is not the only way to get money, of course. You could also rob banks, or solicit bribes, or establish a monopoly. Such tricks account for some variation in wealth, and indeed for some of the biggest individual fortunes, but they are not the root cause of variation in income. The root cause of variation in income is the same as the root cause of variation in every other human skill. The second reason we tend to find great disparities of wealth alarming is that for most of human history the usual way to accumulate a fortune was to steal it: in pastoral societies by cattle raiding; in agricultural societies by appropriating others’’ estates in times of war, and taxing them in times of peace. In conflicts, those on the winning side would receive the estates confiscated from the losers. In more organized societies, the ruler and his officials used taxation instead of confiscation. But here too we see the same principle: the way to get rich was not to create wealth, but to serve a ruler powerful enough to appropriate it. But it was not till the Industrial Revolution that wealth creation definitively replaced corruption as the best way to get rich. In England, at least, corruption only became unfashionable when there started to be other faster ways to get rich. Thirdly, one often hears a policy criticized on the grounds that it would increase the income gap between rich and poor. As if it were an axiom (公理) that this would be bad. It might be true that increased variation in income would be bad, but I don’’t see how we can say it’’s axiomatic. Indeed, it may even be false, in industrial democracies. In a society of serfs (农奴) and warlords, certainly, variation in income is a sign of an underlying problem. But serfdom is not the only cause of variation in income. A 747 pilot doesn’’t make 40 times as much as a checkout clerk because he is a warlord. His skills are simply much more valuable. I’’d like to propose an alternative idea: that in a modern society, increasing variation in income is a sign of health. Technology seems to increase the variation in productivity at faster than linear rates. If we don’’t see corresponding variation in income, there are three possible explanations: (a) that technical innovation has stopped, (b) that the people who would create the most wealth aren’’t doing it, or (c) that they aren’’t getting paid for it. If you suppress variations in income, whether by stealing private fortunes, as feudal rulers used to do, or by taxing them away, as some modern governments have done, the result always seems to be the same. Society as a whole ends up poorer. If I had a choice of living in a society where I was materially much better off than I am now, but was among the poorest, or in one where I was the richest, but much worse off than I am now, I’d take the first option. If I had children, it would arguably be immoral not to. It’’s absolute poverty you want to avoid, not relative poverty. If, as the evidence so far implies, you have to have one or the other in your society, take relative poverty. You need rich people in your society not so much because in spending their money or they create jobs, but because of what they have to do to get rich. I’m not talking about the trickle-down effect here. I’m not saying that if you let Henry Ford get rich, he’’ll hire you as a waiter at his next party. I’m saying that he’’ll make you a tractor to replace your horse. You need rich people in your society basically because of_______________.