Professor Cowen is a Libertarian nut who, I think -- in his weird "slavery was bad for white people too" post -- has just inadvertently made one of the best cases that income inequality actually destroys wealth. Here's a sampler:
I would suggest that most living white Americans would be wealthier had this nation not enslaved African-Americans... For instance it is generally recognized that freer and fairer polities tend to be wealthier for most of their citizens.Strangely, as a Libertarian, Dr. Cowen shouldn't believe that unfair wages destroy wealth. In fact, Dr. Cowen has been very anti-Thomas Piketty recently -- and Piketty's new book is all about the hazards of wealth inequality. So which position does Cowen actually hold? That wealth inequality is bad, or that it's good?
More specifically, many American whites benefited from hiring African-American labor at discrimination-laden discounted market prices, but many others lost out because it was more costly to trade with African-Americans. That meant fewer good customers, fewer eligible employees, fewer possible business partners, fewer innovators, and so on, all because of slavery and subsequent discrimination. The wealth-destroying effects are surely much larger here...