> "'Reducing inequality' ... would probably lead to reduced economic efficiency, as it necessarily reduces the incentives for efficient production."

this argument gets made a lot (for instance, re: the lower capital gains rate) because proponents want it to be true and its flaws are not immediately obvious, but it's unambiguously mistaken.

first, esteem from wealth is relative, and as long as there is a spectrum of wealth, the wealthiest will derive maximal esteem regardless of the absolute value of wealth. and that's the primary driver for the ambitious and greedy, not putting resources to highest and best use (which is at best a side effect). greater equality doesn't change that equation one iota.

second, it's plain to see that large accumulations of wealth are fairly unproductive, simply illustrated by the localized real estate bubbles driven by both wealth seeking safe harbor and PE-backed landlords seeking unproductive rents.

in fact, there seems to be a central optimum. relative to now, wider dispersion of wealth (less wealth disparity) seems to provide the best bang-for-buck when it comes to efficiency, putting more potential to work rather than mostly relegating it to the menial sidelines.

This argument seems to be ignoring the propensity of wealthy people in redistributionist environments to send false signals about their own level of wealth. E.G. Stalin commanded the wealth of a global superpower, but he dressed in uncomfortable military uniforms to signal solidarity with a poor majority. That kind of 'wealth falsification' seems likely to cause its own inefficiencies not present if wealth is considered the result of better serving the market.

> "Reducing inequality" is very different from democracy, and would probably lead to reduced economic efficiency, as it necessarily reduces the incentives for efficient production.

They are absolutely bound together. Ensuring that every person has the same power in the political process means that everyone has the time and energy to pay attention and be educated on what's going on the world, and that nobody has so much wealth that they can use it to buy influence. The trend towards more inequality while the working class has less and less political power is painfully obvious, especially in the United States.

See also "Rules for Rulers" from CGP Grey for an animated treatment

https://www.youtube.com/watch?v=rStL7niR7gs

> As an autocrat, your top priority is to compensate those who keep you in power, which requires wealth extraction from the productive

That cost is insignificant when the ruling nomenclature is a relatively small portion of the population and when basic workers rights are not respected. Especially in manufacturing stuff on a pipeline in huge quantities, a totalitarian system can be much more effective output-wise, at the cost of disregarding any environmental and human condition externalities.

The cost of compensating the “selectorate” is actually more related to regime organization (i.e. military dictatorship vs. rigged elections) than to work conditions.

This cost can be extremely high, as the autocrat has to pay off enough people to ensure that rivals cannot achieve an advantage.

Most totalitarian leaders use fear and repression as tools for maintaining the power structure. Defecting members of the nomenclature and their families are imprisoned and tortured. With modern methods of surveillance and control, that doesn't require a huge army of trusted agents, as was the case in the Eastern bloc, for example.

Even extremely repressive regimes will bribe the selectorate; as an example, you can look at North Korea (or Maoist China), where the peasants were starving and beaten, but the party officials have/had new cars.