When 'Plenty' Isn't Everything

The Torah's Answer to Income Inequality

What is the most urgent economic issue of our time? There are a lot of candidates, including inflation, debt and housing. But according to many of our leaders, there is one that surpasses them all.

In 2013, President Obama said that income inequality is “the defining economic challenge of our time.” In 2016, then Senator Kamala Harris said exactly the same thing. Income inequality is in the 2024 Democrat Party platform, discussed after the Land Acknowledgment.

(Image Credit: Hyejin Kang via iStock)

It is not just Democratic politicians who are very concerned with “income inequality.” It is the subject of concerned research papers and speeches of the intellectual engines that power the party and its policies – including the Center for American Progress, the Brookings Institute, the Urban Institute and the Council of Economic Advisors.

There is a single best place to look for guidance on this issue – or any other. This is the Torah. So: What does the Torah teach us about income inequality?

We can start with the story of the estranged brothers Jacob and Esau – which was read in synagogues on Saturday. Jacob and Esau, in an extraordinary and suspenseful sequence, reunite after years of bitter estrangement. Jacob, in a bid to appease the presumed anger of Esau, offers him an enormous amount of valuable animals and objects.

Esau refuses them, saying: “I have plenty.” Jacob implores Esau to accept the gifts saying, “I have everything.”

Esau’s reply seems gracious, and it is. But when we contrast it to Jacob’s response, it reveals an ideology. Esau is speaking of quantity, whose value exists in comparison to others. Jacob, by contrast, speaks of completeness – indicating that he does not assess wealth by comparison. His assessment of his financial state has nothing to do with what others have but with his own sense of attainment.

This is just the beginning – the foundation – of the Torah’s insights into contemporary discussions of income inequality. Throughout its subsequent four books, the Torah reflects a deep, comprehensive and pervasive concern with uplifting the poor. Deuteronomy 15 provides a clear command regarding our financial obligation to the needy: "If there is among you a poor man... you shall not harden your heart or shut your hand against your poor brother, but you shall open your hand to him."

Exodus 22 and Deuteronomy 27 provide an equally clear command regarding our moral and psychological obligation to the needy. If one loans his friend money with collateral, he is prohibited from entering the borrower’s home to retrieve it – as doing so would compromise the dignity of the borrower.

The Torah articulates its concern for the financial and psychological welfare of the poor in Leviticus 19. Landowners are commanded to leave a corner of their field for the poor – who can come, whenever they wish, and harvest for their own benefit. Unlike handing out food to poor people, this law ensures that the poor have food (the financial condition) – but also get the dignity to work for it, without having to beg or even ask the landowner (the psychological condition).

The Torah is also concerned with economic mobility. The laws of indentured servitude require that servants be liberated after six years – and in a highly specific way intended to provide him with opportunity: “You shall furnish him liberally out of your flock, out of your threshing floor, and out of your winepress.” And the prohibition on charging interest in Exodus helps ensure that the needy have the maximum opportunity to improve (rather than deepen) their financial position.

It is safe to say that there is no text as insistently and carefully devoted to uplifting the poor. But to understand what the Torah thinks about income inequality, we need to ask what it thinks about the rich. All of our patriarchs – Abraham, Isaac and Jacob – are specifically described at some point as “very wealthy.” And God sees part of his role being that of a human wealth creator: “Remember the Lord your God, for it is He who gives you the ability to produce wealth.”

What, therefore, can we deduce about the Torah’s philosophy of income inequality? The Jacob/Esau narrative encourages us to assess ourselves internally – and not through comparison...thereby eviscerating the formula for and thus the logic of income inequality. A concern about “income inequality” is replaced by a deep concern for the poor – which has nothing to do with comparisons to anyone else and everything to do with sustenance, dignity, mobility and opportunity.

How is the United States doing according to this logic? Economists divide American households into five quintiles based on income levels. The vast majority of Americans have higher inflation adjusted incomes than their parents – with 93% of those who were reared in the bottom income quartile doing better. And most goods are cheaper as well. In 2014 – one technological generation ago – an article in the Huffington Post showed that the entire contents of a Radio Shack advertisement from 1991 (valued at $5100 in 2012 dollars), exists in the pockets of most people at a fraction of the cost .

Of course, this is no grounds for complacency. American public policy should always be focused on how wealth can be generated for everyone, and on how opportunities for the poor can be created and expanded. It is a tragic irony that the Democrat Party platform of 2024 – the one that begins with a land acknowledgment – attacks school choice and opportunity scholarships and discourages charter schools. These institutions are proven to increase opportunity for the poor – and providing access to them for the poor would be an expression of equality (as the rich can already send their children wherever they want).

The last word (at least for this condensed discussion) on income inequality can belong to logic – always a close friend and ally of the Torah. If a rich person loses money, income inequality is reduced. Is that good for society?

Or: Let’s imagine an entrepreneur who starts what becomes a very successful business. He will have created a product or a service valued by lots of people, jobs (providing financial security, professional growth and emotional fulfillment to employees), wealth (for shareholders and employees), tax revenue and all kinds of ancillary benefits (most basically: businesses near his offices and employees will be created and positioned to thrive).

In this case, the entrepreneur and his partners will have also made fortunes, exacerbating income inequality. Will this entrepreneur’s success constitute the “defining economic challenge of our time”? It seems more like the defining opportunity of our time – as Jacob (but not Esau) would have recognized.

(‘The Reconciliation of Jacob with Esau’ by Julius Schnorr von Carolsfeld, 1860. Image Credit: ZU_09 via iStock)