Andrew Blackman at Wall Street Journal asked several economists for ideas on “what to do about inequality?” As you can imagine, I argued with the question.
Just the rambling though of an old hermit, I believe in a flat tax. Pick a precentage and apply it to all. The Federal tax should fit on a 3 × 5 index card.
"To provide opportunity, start by getting out of the way"
Imagine a medieval king losing a castle to siege and his first thought is, "Ban beseigers!" Any king that dumb would lose followers in droves. His first thoughts would be, "How did they conquer my castle?" Did they have better siege weapons, was the castle poorly sited, did the castle not have enough supplies on hand, did they not get a messenger out to ask for help?
The first reaction of politicians is invariably "Punish success, steal their money" when it ought to be "What can we do to make more people successful?"
In Asimov's Foundation series of a galactic empire slowly collapsing from inertia and corruption, one general successfully begins reversing losses. The Emperor recalls him for being too successful; there can be only one power center in a dictatorship, and just like Stalin, a strong emperor will fear and destroy successful generals, while a weak emperor will attract strong generals looking to start a new dynasty.
Is that what the US is becoming, an empire whose aspiring rulers can't abide successful innovators who don't need their bureaucracy?
"Is that what the US is becoming, an empire whose aspiring rulers can't abide successful innovators who don't need their bureaucracy?"
Trump and MAGA voters don't have this problem, but Biden, Obama and the rest of the Democrat base do. The bureaucracy is not composed of Republiacns as anyone who has ever lived in or near Washingtion DC can tell you. It is 100% solid Democrat - it is planned that way.
Take off your blinders, TDS is an equal opportunity affliction.
Trump's tariffs say he is playing favorites.
His shares in businesses say he is picking favorites.
He sold export licenses to NVIDIA and AMD in exchange for an illegal export tax. So much for his national security justification for the ban he sold out.
He has golden shares in US Steel with operational veto rights in exchange for approving their merger.
He shows no signs of appreciating free markets. He doesn't trust innovators, and he makes them kneel to his supremacy.
I don’t have an argument with your basic position … but I am curious about your views on “money as speech” … and the practical influence that provides the very rich with disproportionate political power?
If I can dare to give the answers that I suspect John would give, here we go:
1. The rich do not have homogenous policy preferences. For every billionaire pushing for "rightwing" policies, there is one (or, in reality, probably more than one) pushing for leftwing ones. They largely cancel each other out.
2. The role of money in politics is greatly overstated. We have several recent, dramatic examples: Hillary Clinton greatly outraised Donald Trump in 2016, Michael Bloomberg spent over $1bn to get the primary votes of American Somoa, Tom Steyer spent a fortune in his failed presidential bid and will likely now see little political ROI in his bid for the CA governship, etc. (In fact, far from big money being a problem in politics, our current problem is the opposite: the role of internet-enabled mass donations, in small amounts, which are one of the major reasons for the populist stupidity we are currently seeing.)
3. As a good libertarian, John would say that the best way to get money out of politics is to get the politics out of money by shrinking the size and scope of the government. As the old saying goes: "If the politicians dictate what can be bought and sold, then the first thing to be bought will be the politicians."
Following up to my earlier response, Tom Steyer just finished 3rd in the California governor's race. The latest figures are that he spent $209mn on ads versus $11.7mn by the winner of the race, Xavier Becerra.
I repeat: the role of money in politics is greatly overrated.
Good points, John. One thing that I like to point out in these discussions is the role of the marginal dollar for these billionaires. I think that the common conception is that these are spent on a yacht -- nope, they already have one of those - or a penthouse (ditto). In reality, the marginal dollars are usually spent on some kind of moonshot charity (think of Bill Gates and malaria) or investment (think of Musk/Bezos with space, Gates with small modular reactors, etc). So the real question is who do we want these marginal dollars directed by: some of the world's most successful and sophisticated allocators of capital or Elizabeth Warren? It's an easy choice.
Opportunity and inequality explained, what a marvelous piece of reasoning to show the summary of the entire political spectrum, as well as the psychology of those espousing each!
John is wrong about inequality. Excessive inequality threatens democracy because a small number of individuals can gain too much political power and influence. Also, we have to compete with the wealthy for goods, services and assets (Gary Stevenson's arguments). Most major scientific and technological discoveries happen at the universities, where scientists are not paid much. One of the major scientific achievements in U.S. history: development of the nuclear weapons, was a Government project. Top tax rate in the 40s and 50s was over 90% and the economy did not collapse. Consider a tax-friendly and wealthy state of Texas: One in ten children under six are uninsured. So yes, the answer is tax the billionaires more. Two main reasons are to collect tax revenue and to prevent them from gaining too much influence. Sweden ranks higher in innovation that the U.S. even though taxes there are larger.
You are decades behind on your thinking, but this I would like to hear you justify: Sweden ranks higher in innovation that the U.S. In what way is Sweden more innovative than the US?
Hmmm. This is what WIPO is: "WIPO leads the development of a balanced and effective global intellectual property ecosystem to promote innovation and creativity for a better and more sustainable future." Which is odd. Switzerland is #1 and China is #10? Leaving the USA out, how is Switzerland, a tiny mountain country more innovative than a country that has transformed a poor workshop into a colossus in a single generation? I've never been to Switzerland but I've been the China and I live in the US. I just don't think a Euro patent office is a great indicator of innovation. Europe has missed out on a whole generation of innovation now encompassed by Google, Amazon, Meta, Apple, Microsoft, and on and on. Yet, Switzerland is more innovative? Come on. And further, its the socialist governments that are doing it? Europe is a museum continent now and will be more so in the future. Other than beer and wine and Spotify, I don't think there are any Euro products in my life. Young Europeans should flee. But, I do love the beer, wine, and Spotify.
You seem to be interested in the subject. If you like doing your own research, type in Google "how much wealth has been transferred to the top 10% since 1979 and why"
"the economy didn't collapse." Innovation and growth did. I suggest you read Bastiat's The Parable of The Broken Window. "That Which Is Seen, and That Which Is Not Seen"
Well, the Government is us. We partially control it through voting. Who would you rather like to run our country? Chevron, JP Morgan? If so, just vote accordingly.
Governments take money from me without my consent, by threat of force, and use it for many purposes that I deem malign and in many other ways that are beyond my reckoning.
The only way Bezos, Musk, or any other iconic capitalist boogeyman can get money from me is by offering goods or services for a price I'm willing to pay.
I worry about them too. But you have to go one step further. Are they entrenched because of popular support or perhaps because a small number of very wealthy individuals and/or corporations finance their campaigns and pay for their political ads?
John, one more thing. I asked Google the following question to which I got an AI response: "would policy recommendations of John Cochrane be beneficial for the middle class". Try it, if you care : )
I suggest you try asking the same question about Bernie Sanders to Google AI and you’ll see the limitations of asking that question to that particular LLM.
Then I suggest you ask that same question to ChatGPT. You might be surprised with the results.
Inequality produced by fair competition does not necessarily threaten democracy. But when inequality accumulates to the point where it can reshape the conditions of competition itself, it does threaten democracy — and it also ends fair competition.
Cochrane’s argument rests on one premise: market competition is fair, and wealth is simply the outcome of that fair competition.
But the real problem is precisely this: once wealth accumulates to a certain scale, it is no longer merely the result of competition. It becomes a force capable of rewriting the rules of competition.
His logic works well for the first-generation entrepreneur: innovation, risk-taking, consumer welfare creation, and then enormous financial reward. That kind of inequality does not necessarily threaten democracy.
The problem begins in the second stage, when wealth enters campaign finance, lobbying, think tanks, media, schools, zoning, tax design, regulatory exemptions, occupational licensing, antitrust enforcement, and the judicial system.
At that point, wealth is no longer just the prize of the market. It becomes a tool for redrawing the boundaries of the market itself.
As I argued in my essay on fairness and efficiency, the key issue in America is not whether “the rich are evil.” The key issue is the institutional feedback loop.
Educational advantage is entrenched through school districts, private schools, alumni networks, and donation systems. Housing markets protect asset owners through zoning and local politics. Tax systems are tilted toward asset owners through capital gains treatment, estate planning, trusts, and lobbying. Market entry barriers are raised through platform monopolies, acquisitions, patents, and regulatory capture. Political systems become more dependent on wealth through campaign finance and media influence.
Cochrane is right that simply hating the rich does not create opportunity.
But he is wrong because he underestimates how wealth converts market success into institutional power.
What a democratic society really needs to guard against is not every rich person. It is the moment when accumulated wealth becomes rule-setting power — and fair competition is quietly replaced by inherited advantage, regulatory capture, and political inequality.
Shrinking the government solves the regulatory capture and political inequality "problems". You need examples of "inherited advantage". Musk? Bezos? Buffett?
Yes sir. When the "deciders" in government and our nations oligarchs are holding hands, as is now the case, corruption flourishes and becomes the only route up, it's then that ordinary citizens become peons.
This is the one place that Trump and Bernie agree: the system is rigged!
JHC’s solution of reducing the power of government would better solve the problem - and increase rather than decrease the abundance and growth that has made us all so rich - than any targeting of billionaires you can come up with.
"It’s easy to reduce income inequality: Imprison the billionaires."
Democrat Party voters are way past that stuff. They want them mudered not imprisoned. You are talking about Radical Low Economic Information voters. These people want Socialism/Communsim and say so in every poll.
Communists shoot their enemies. Everyone else they can imprison after they take power.
The person struggling to make ends meet doesn’t think much about inequality statistics. She thinks about the inequality between the compensation she gets and the compensation she wants. The primary focus of public policy should be the removal of the barriers that impede her progress, many of which are created by misguided or corrupt government policies.
Andrew Blackman at the Wall Street Journal in 2026 asks the same question that Phil Donahue asked Milton Friedman nearly 50 years earlier, in 1979: https://youtu.be/cJJMWc-OHp0?si=6gXaCw_Os00bnk-O
John, Bang on! Some thoughts. Inequality exists and that is a good thing. Inequality exists among those with different skills, intelligence and ability to assume and innovate. Without those innovators inequality would be greater. Bill Gates’ net worth is estimated to be $180 billion. Gates’ accumulated wealth didn’t happen in a week, but over many years. Microsoft’s market cap is $2.5 trillion. I suggest the beneficiaries of Gates’ innovation(s) are the stockholders, Microsoft employees, and consumers who use the myriad products and services Microsoft provides. Let’s not forget, the taxes all paid by employees, shareholders and consumers that go to state and federal coffers.
Howard Schultz, another billionaire innovator and risk taker, envisioned transforming Starbucks from a coffee bean retailer to a coffeehouse experience. Over the years Schultz expanded Starbucks from 11 stores to more than 35,000 globally. The benefits and training available to store employees provide a path from a barista to shift manager to managing and running their own outlet. Other benefits include, even for part time employees, college tuition and health insurance. I estimate total employee benefits for a barista approaches $50,000. It seems Mr. Schultz’s policies have given employees the way from less to more. If one considers transfer payments from the top 5% of earners and billionaires , I suspect transfer payments to those drawing entitlements, reduce inequality. The lowest two-fifths incomes receive a disproportionate share of transfer payments. Because higher-income people pay most of the taxes, failure to subtract these taxes overstates their income. Both factors cause income inequality to be overstated. US income mobility is robust. The majority of people, over their lifetimes, move from one income quintile to another. Still, government agencies have incentivized people to be more dependent on tax-payer provided welfare. Apologies for the long winded post.
Now you could have answered that crony capitalism via government is bad, so eliminating all the various powers government has to convey favor on some people would reduce the inequality that is bad.
Beyond that, we want *more* inequality of the Jeff Bezos, Sam Walton, Bill Gates, Steve Jobs type.
“Even in a perfect world, where everyone was equal, I’d still own the film rights, and be working on the sequel.” —Elvis Costello, “Every Day I Write the Book”
Just the rambling though of an old hermit, I believe in a flat tax. Pick a precentage and apply it to all. The Federal tax should fit on a 3 × 5 index card.
Taxes are only a means to being in control. The last thing they want is simple taxes which lessen their control.
Fairtax.org, which The Grumpy Professor has written about before is the way to go
A percentage of what? “Taxable income, as specified by our current tax code” is not a good answer.
"To provide opportunity, start by getting out of the way"
Imagine a medieval king losing a castle to siege and his first thought is, "Ban beseigers!" Any king that dumb would lose followers in droves. His first thoughts would be, "How did they conquer my castle?" Did they have better siege weapons, was the castle poorly sited, did the castle not have enough supplies on hand, did they not get a messenger out to ask for help?
The first reaction of politicians is invariably "Punish success, steal their money" when it ought to be "What can we do to make more people successful?"
In Asimov's Foundation series of a galactic empire slowly collapsing from inertia and corruption, one general successfully begins reversing losses. The Emperor recalls him for being too successful; there can be only one power center in a dictatorship, and just like Stalin, a strong emperor will fear and destroy successful generals, while a weak emperor will attract strong generals looking to start a new dynasty.
Is that what the US is becoming, an empire whose aspiring rulers can't abide successful innovators who don't need their bureaucracy?
"Is that what the US is becoming, an empire whose aspiring rulers can't abide successful innovators who don't need their bureaucracy?"
Trump and MAGA voters don't have this problem, but Biden, Obama and the rest of the Democrat base do. The bureaucracy is not composed of Republiacns as anyone who has ever lived in or near Washingtion DC can tell you. It is 100% solid Democrat - it is planned that way.
Take off your blinders, TDS is an equal opportunity affliction.
Trump's tariffs say he is playing favorites.
His shares in businesses say he is picking favorites.
He sold export licenses to NVIDIA and AMD in exchange for an illegal export tax. So much for his national security justification for the ban he sold out.
He has golden shares in US Steel with operational veto rights in exchange for approving their merger.
He shows no signs of appreciating free markets. He doesn't trust innovators, and he makes them kneel to his supremacy.
Move to Cuba.
Paint squirrels.
I don’t have an argument with your basic position … but I am curious about your views on “money as speech” … and the practical influence that provides the very rich with disproportionate political power?
If I can dare to give the answers that I suspect John would give, here we go:
1. The rich do not have homogenous policy preferences. For every billionaire pushing for "rightwing" policies, there is one (or, in reality, probably more than one) pushing for leftwing ones. They largely cancel each other out.
2. The role of money in politics is greatly overstated. We have several recent, dramatic examples: Hillary Clinton greatly outraised Donald Trump in 2016, Michael Bloomberg spent over $1bn to get the primary votes of American Somoa, Tom Steyer spent a fortune in his failed presidential bid and will likely now see little political ROI in his bid for the CA governship, etc. (In fact, far from big money being a problem in politics, our current problem is the opposite: the role of internet-enabled mass donations, in small amounts, which are one of the major reasons for the populist stupidity we are currently seeing.)
3. As a good libertarian, John would say that the best way to get money out of politics is to get the politics out of money by shrinking the size and scope of the government. As the old saying goes: "If the politicians dictate what can be bought and sold, then the first thing to be bought will be the politicians."
Billionaire speech is the worst.
…except for government deciding who gets to speak how much.
That is infinitely worse.
Following up to my earlier response, Tom Steyer just finished 3rd in the California governor's race. The latest figures are that he spent $209mn on ads versus $11.7mn by the winner of the race, Xavier Becerra.
I repeat: the role of money in politics is greatly overrated.
Good points, John. One thing that I like to point out in these discussions is the role of the marginal dollar for these billionaires. I think that the common conception is that these are spent on a yacht -- nope, they already have one of those - or a penthouse (ditto). In reality, the marginal dollars are usually spent on some kind of moonshot charity (think of Bill Gates and malaria) or investment (think of Musk/Bezos with space, Gates with small modular reactors, etc). So the real question is who do we want these marginal dollars directed by: some of the world's most successful and sophisticated allocators of capital or Elizabeth Warren? It's an easy choice.
It’s insane how envy has become a political virtue
Some of us regard "Thou shalt not covet" as the most powerful of the Ten Commandments.
Join Garrett Jones’ Tenth Commandment Club!
https://reason.com/2014/04/26/living-with-inequality-2/
Ethan, I suspect the "virtue" of envy is a mask for their fears and limited abilities.
No, it’s just a way to get political power.
Yeah, now that I think about.
Opportunity and inequality explained, what a marvelous piece of reasoning to show the summary of the entire political spectrum, as well as the psychology of those espousing each!
Thank you John!
The zero sum instinct is deeply ingrained in human culture. Read "Envy: A Theory of Social Behavior" by Helmut Schoeck.
John is wrong about inequality. Excessive inequality threatens democracy because a small number of individuals can gain too much political power and influence. Also, we have to compete with the wealthy for goods, services and assets (Gary Stevenson's arguments). Most major scientific and technological discoveries happen at the universities, where scientists are not paid much. One of the major scientific achievements in U.S. history: development of the nuclear weapons, was a Government project. Top tax rate in the 40s and 50s was over 90% and the economy did not collapse. Consider a tax-friendly and wealthy state of Texas: One in ten children under six are uninsured. So yes, the answer is tax the billionaires more. Two main reasons are to collect tax revenue and to prevent them from gaining too much influence. Sweden ranks higher in innovation that the U.S. even though taxes there are larger.
You are decades behind on your thinking, but this I would like to hear you justify: Sweden ranks higher in innovation that the U.S. In what way is Sweden more innovative than the US?
WIPO 2025 Global Innovation Index:
1) Switzerland
2) Sweden
3) USA
https://www.wipo.int/en/web/global-innovation-index/2025/index
Hmmm. This is what WIPO is: "WIPO leads the development of a balanced and effective global intellectual property ecosystem to promote innovation and creativity for a better and more sustainable future." Which is odd. Switzerland is #1 and China is #10? Leaving the USA out, how is Switzerland, a tiny mountain country more innovative than a country that has transformed a poor workshop into a colossus in a single generation? I've never been to Switzerland but I've been the China and I live in the US. I just don't think a Euro patent office is a great indicator of innovation. Europe has missed out on a whole generation of innovation now encompassed by Google, Amazon, Meta, Apple, Microsoft, and on and on. Yet, Switzerland is more innovative? Come on. And further, its the socialist governments that are doing it? Europe is a museum continent now and will be more so in the future. Other than beer and wine and Spotify, I don't think there are any Euro products in my life. Young Europeans should flee. But, I do love the beer, wine, and Spotify.
You seem to be interested in the subject. If you like doing your own research, type in Google "how much wealth has been transferred to the top 10% since 1979 and why"
"the economy didn't collapse." Innovation and growth did. I suggest you read Bastiat's The Parable of The Broken Window. "That Which Is Seen, and That Which Is Not Seen"
It is government that has too much influence, not “billionaires”, all due respect.
Well, the Government is us. We partially control it through voting. Who would you rather like to run our country? Chevron, JP Morgan? If so, just vote accordingly.
Governments take money from me without my consent, by threat of force, and use it for many purposes that I deem malign and in many other ways that are beyond my reckoning.
The only way Bezos, Musk, or any other iconic capitalist boogeyman can get money from me is by offering goods or services for a price I'm willing to pay.
I am not an anarcho-capitalist, and so I do believe in some government.
But for the general case, voting on taking money from others at the point of a gun is not cool.
I did say in general, not that there are zero cases I’d support.
Chevron and their ilk haven’t “run” our country in decades (if they ever did).
JP Morgan and their ilk only “run” our country to the extent they get government to grant them special favors, like the bailouts in 2007-2009.
I worry a lot about a small number of individuals gaining too much entrenched political power. They're called politicians.
And yet it till happens!
I worry about them too. But you have to go one step further. Are they entrenched because of popular support or perhaps because a small number of very wealthy individuals and/or corporations finance their campaigns and pay for their political ads?
John, one more thing. I asked Google the following question to which I got an AI response: "would policy recommendations of John Cochrane be beneficial for the middle class". Try it, if you care : )
I suggest you try asking the same question about Bernie Sanders to Google AI and you’ll see the limitations of asking that question to that particular LLM.
Then I suggest you ask that same question to ChatGPT. You might be surprised with the results.
I did it for you here:
https://chatgpt.com/share/6a2817c2-650c-83ed-a77d-ad32aa70754f
Thank you. I think asking AI questions like that can be a good starting point.
If you adjust for the fact that all AIs have some left-leaning bias (go look that up if you don’t believe me), then I agree.
So well said.
Inequality produced by fair competition does not necessarily threaten democracy. But when inequality accumulates to the point where it can reshape the conditions of competition itself, it does threaten democracy — and it also ends fair competition.
Cochrane’s argument rests on one premise: market competition is fair, and wealth is simply the outcome of that fair competition.
But the real problem is precisely this: once wealth accumulates to a certain scale, it is no longer merely the result of competition. It becomes a force capable of rewriting the rules of competition.
His logic works well for the first-generation entrepreneur: innovation, risk-taking, consumer welfare creation, and then enormous financial reward. That kind of inequality does not necessarily threaten democracy.
The problem begins in the second stage, when wealth enters campaign finance, lobbying, think tanks, media, schools, zoning, tax design, regulatory exemptions, occupational licensing, antitrust enforcement, and the judicial system.
At that point, wealth is no longer just the prize of the market. It becomes a tool for redrawing the boundaries of the market itself.
As I argued in my essay on fairness and efficiency, the key issue in America is not whether “the rich are evil.” The key issue is the institutional feedback loop.
Educational advantage is entrenched through school districts, private schools, alumni networks, and donation systems. Housing markets protect asset owners through zoning and local politics. Tax systems are tilted toward asset owners through capital gains treatment, estate planning, trusts, and lobbying. Market entry barriers are raised through platform monopolies, acquisitions, patents, and regulatory capture. Political systems become more dependent on wealth through campaign finance and media influence.
Cochrane is right that simply hating the rich does not create opportunity.
But he is wrong because he underestimates how wealth converts market success into institutional power.
What a democratic society really needs to guard against is not every rich person. It is the moment when accumulated wealth becomes rule-setting power — and fair competition is quietly replaced by inherited advantage, regulatory capture, and political inequality.
Read more | Follow China as a System
Shrinking the government solves the regulatory capture and political inequality "problems". You need examples of "inherited advantage". Musk? Bezos? Buffett?
Yes sir. When the "deciders" in government and our nations oligarchs are holding hands, as is now the case, corruption flourishes and becomes the only route up, it's then that ordinary citizens become peons.
This is the one place that Trump and Bernie agree: the system is rigged!
JHC’s solution of reducing the power of government would better solve the problem - and increase rather than decrease the abundance and growth that has made us all so rich - than any targeting of billionaires you can come up with.
This is the best public choice statement I've read in a very long time.
"It’s easy to reduce income inequality: Imprison the billionaires."
Democrat Party voters are way past that stuff. They want them mudered not imprisoned. You are talking about Radical Low Economic Information voters. These people want Socialism/Communsim and say so in every poll.
Communists shoot their enemies. Everyone else they can imprison after they take power.
The person struggling to make ends meet doesn’t think much about inequality statistics. She thinks about the inequality between the compensation she gets and the compensation she wants. The primary focus of public policy should be the removal of the barriers that impede her progress, many of which are created by misguided or corrupt government policies.
Andrew Blackman at the Wall Street Journal in 2026 asks the same question that Phil Donahue asked Milton Friedman nearly 50 years earlier, in 1979: https://youtu.be/cJJMWc-OHp0?si=6gXaCw_Os00bnk-O
John, Bang on! Some thoughts. Inequality exists and that is a good thing. Inequality exists among those with different skills, intelligence and ability to assume and innovate. Without those innovators inequality would be greater. Bill Gates’ net worth is estimated to be $180 billion. Gates’ accumulated wealth didn’t happen in a week, but over many years. Microsoft’s market cap is $2.5 trillion. I suggest the beneficiaries of Gates’ innovation(s) are the stockholders, Microsoft employees, and consumers who use the myriad products and services Microsoft provides. Let’s not forget, the taxes all paid by employees, shareholders and consumers that go to state and federal coffers.
Howard Schultz, another billionaire innovator and risk taker, envisioned transforming Starbucks from a coffee bean retailer to a coffeehouse experience. Over the years Schultz expanded Starbucks from 11 stores to more than 35,000 globally. The benefits and training available to store employees provide a path from a barista to shift manager to managing and running their own outlet. Other benefits include, even for part time employees, college tuition and health insurance. I estimate total employee benefits for a barista approaches $50,000. It seems Mr. Schultz’s policies have given employees the way from less to more. If one considers transfer payments from the top 5% of earners and billionaires , I suspect transfer payments to those drawing entitlements, reduce inequality. The lowest two-fifths incomes receive a disproportionate share of transfer payments. Because higher-income people pay most of the taxes, failure to subtract these taxes overstates their income. Both factors cause income inequality to be overstated. US income mobility is robust. The majority of people, over their lifetimes, move from one income quintile to another. Still, government agencies have incentivized people to be more dependent on tax-payer provided welfare. Apologies for the long winded post.
You wasted an excellent opportunity to make a well-substantiated argument in the right-libertarian tradition.
1,000 cheers!
Now you could have answered that crony capitalism via government is bad, so eliminating all the various powers government has to convey favor on some people would reduce the inequality that is bad.
Beyond that, we want *more* inequality of the Jeff Bezos, Sam Walton, Bill Gates, Steve Jobs type.
“Even in a perfect world, where everyone was equal, I’d still own the film rights, and be working on the sequel.” —Elvis Costello, “Every Day I Write the Book”