Inequality 7: Roger Federer, Manny Pacquiao and Free Market

Sports Illustrated recently released its "Fortunate 50" richest athletes around the world. Here is their 20 highest-earning international athletes. The Philippines' most famous person and athlete, Manny Pacquiao, is no. 2!

The amount stated is for salary/ winnings + endorsements. In the Top 20 richest international atheletes outside the US), Paquiao is the only boxer. He earns bigger than the heavyweight or super-heavyweight champions. Two are tennis superstars (Roger Federer and Rafael Nadal), three are F1 drivers (Fernando Alonso, Lewis Hamilton and Michael Schumacher, yey, Schumi!).

Soccer has the most number of rich superstars, there are 8 of them in the top 20: (Lionel Messi, Cristiano Ronaldo, Wayne Rooney, Kaka, David Beckham, Ronaldinho, Carlos Tevez, Frank Lampard).
NBA superstars are 3 (Yao Ming, Dirk Nowitzki, Pau Gasol), baseball has 2 (Ichiro Suzuki, Miguel Cabrera), and motorcycle racing has 1 (Valentino Rossi).

Meanwhile, here is SI's 50 highest-earning American athletes this year.

Money in golf does not come much from winnings, but from endorsements.

A friend in facebook, a self-confessed Marxist-socialist, posted the earlier link in his wall. I commented that it just shows one beauty of capitalism (hehe, alam ko dami galit sa mga friends ni bonn just to mention the "virtue of capitalism"). Those who really excel in their field are super-compensated. And here's another virtue of capitalism: those "super-compensated" are also super-solicited by so many charities, foundations, friends, relatives, clans, etc. And that diffuses the wealth of the super-compensated. Bill Gates for instance did not spend all his money for himself, he put up a super-huge foundation that grants money sometimes bigger than the grants by USAID or WB. Warren Buffet also gives several billion $ of his own money to the Gates Foundation.

He commented that capitalism "is the system that is causing suffering, impoverishment, and misery of billions and billions of people in the world", but that "there is a way to organise capitalism - its production and distribution - to improve the lot of billions of people in the world." And finally added, "we have an experience of modifying capitalism just like the Keynesian welfare state which is far more acceptable to my values than the Hayekian-Friedmanian life of misery and selfish individualism."

Imagine that statement, "billions and billions of people", including the billion plus in China, another billion plus under near-socialist India. I reminded him that facebook is also a product of capitalism, does fb also causes lots of capitalist exploitation?

And the reference to ‎"Keynesian welfare state", like Denmark where he currently works that he's beginning to criticize more ofen now. That welfare state of 4 or 5 million people which does not want to open its border to people victimized by socialism or other statist capitalism somewhere. A welfare Keynesian state will always be allergic, even paranoid, to open its economy to "billions of people" that socialists and welfare statists wish to help.

Another friend commented about small or micro capitalism. I also like "people's capitalism" or micro capitalism. If being an employee forever sucks, then employees who are ambitious and hard-working enough should start becoming an entrepreneur, to become job creator themselves. But look at how the governments of the Philippines and other countries treat entrepreneurship with lots of bureaucracies and taxes to pay even before one can start a business. Statism and envy of entrepreneurship are the cousins of socialism.

Global capitalism, or nation-based capitalism, or even micro-capitalism aka people's capitalism, will always result in inequality. Even among siblings raised in the same house by the same parents and went to the same school, etc., will have inequality in performance someday -- academically, financially, economically. And this leads us to individual freedom, individual ambition and responsibility, vs. its other side, individual irresponsibility, dependence and lack of high personal ambition. And that explains why some guys are super-rich while others are super-poor.

If you is too focused on equality, then good examples will be N. Korea, Myanmar, Congo, Zimbabwe, etc. People there are generally equal, equally poor, except the leaders of their socialist or near-socialist state.

If one will focus on greater wealth creation, then one must accept inequality as one inevitable result. Give three people one hecare of land each, contiguous to each other. One may develop an organic farm (no tractor, no factory, environment preserved, yeah). One may develop it as housing for the squatters. One will develop it into a compound of high-rise condo buildings. See the huuuuge inequality later.

By writing the inevitable result of inequality in a free society, I was mistaken for advocating or valuing inequality per se. Wrong. I value individual freedom or liberty, period. The individual's freedom to ambition soooo high, freedom to work so hard to realize that ambition, and that individual will soon become a super-rich entrepreneur or capitalist. The freedom to move across islands, across countries and continents, is part of that individual freedom.

(These pictures of airplanes I took while inside various international airports in some my recent foreign trips). Incidentally, it is those global multinational capitalist enterprises that allow such international mobility -- the multinational airlines, hotels, and those huge capitalist enterprises like facebook, google, youtube, yahoo, facilitate information gathering by people before and during their international mobility. Inequality is an outcome, not advocacy, of individual freedom. Government coercion like socialism and big statism is the main enemy of individual freedom.
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See also:
Inequality 1: Rich Getting Richer is Good, August 29, 2009
Inequality 2: To Each According to his Needs... September 01, 2010
Inequality 3: Freedom, Free Market and Inequality, February 14, 2011
Inequality 4: Why Inequality is Good, May 10, 2011
Inequality 5: Comments to Why Inequality is Good, May 11, 2011
Inequality 6: On Social and Class Dominance, May 13, 2011
Hayek 3: Inequality and Progress, May 19, 2009