Gross Inequality & Social Contract

Updated June 25, 2018

Why is economic inequality such a significant problem?

  • Because it is half of the social contract.When one half of the social contract is broken, don’t be surprised when the other half is broken.

Social Contract

Social Contract implicitly keeps inequality at bay. Jean-Jacques Rousseau 1762.

The social contract has a history back to Plato, but its modern form arose in Jean-Jacques Rousseau book published in 1762.

  1. Follow the laws of the land
  2. Work hard and you can get a decent job.

Part 1 is a responsibility of the population. Those people who have things want the law to protect their property and life. Those who don’t have things are expected to ignore the rule of Might Makes Right. They are not to hit an old person on the head and take their wallet just because they are young and vibrant. Considering all the opportunities available to them, the rule of law usually prevails. But following the rule of law is only half of the social contract, the impetus to follow it flows from the rewards that a decent job provides – income, life style, and respect.

Part 2 is the responsibility of society. If some of the have-nots come to believe that they are being denied the chance of a decent job, then their motivation to honor their responsibilities under the social contract is severely undercut.

The social contract is not an enacted law, but a psychological reality needed by successful societies.

Increasing Income Inequality

I won’t gild the lily. According to Fortune Magazine in 2015, Top CEOs make more than 300 times the average worker. That is an extreme disparity. As recently as 1965, CEO pay was 21 times in 1965.

A huge proportion of profits in the past 50 years have been taken by the CEOs. They have not been shared with the average worker.

Broken Social Contract

CEO pay is one indication that hard work is not being properly rewarded. If we consider minimum wage workers, those working hard trying to move up the ladder, their decline in income is noticeable to anyone knowing the history of the federal minimum wage .

Just from a selfish perspective, the haves should be concerned.
If society breaks the promise of a good road ahead, why should we be surprised that those left behind no longer follow the law?

Read Flash Mob and the Social Contract for two recent incidents testing the social contract. One where it held, the other where it broke.


EEvery child should be taught the social contract, the relationship between opportunity and respect for law. If opportunity is denied, respect for law is diminished.

Honoring the responsibilities and the rights of the social contract is essential to a fair and stable society.

Image of cover for Principles of Politics in the public domain via WikiCommons

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