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kottke.org posts about Thomas Piketty

Capital and Ideology

posted by Jason Kottke   Sep 16, 2019

French economist Thomas Piketty has come out with a new book. The 1200-page Capital and Ideology is a followup to Capital in the 21st Century, a surprise bestseller when it was released a few years ago. The book just came out in French (English readers will need to wait until March) so details are still sparse, but The Guardian has a short preview.

Among the proposals in the book are that employees should have 50% of the seats on company boards; that the voting power of even the largest shareholders should be capped at 10%; much higher taxes on property, rising to 90% for the largest estates; a lump sum capital allocation of €120,000 (just over £107,000) to everyone when they reach 25; and an individualised carbon tax calculated by a personalised card that would track each person’s contribution to global heating.

In an interview with the French weekly news magazine L’Obs, Piketty made no apologies for the impact his ideas would have on the stock market. He said: “[Yes], it will also affect the price of real estate that is crazy in Paris, and it will allow new social groups to become owners and shareholders.”

Branko Milanovic, an expert on global inequality, has written an early review.

This part of the book looks empirically at the reasons that left-wing, or social democratic parties have gradually transformed themselves from being the parties of the less-educated and poorer classes to become the parties of the educated and affluent middle and upper-middle classes. To a large extent, traditionally left parties have changed because their original social-democratic agenda was so successful in opening up education and high-income possibilities to the people who in the 1950s and 1960s came from modest backgrounds. These people, the “winners” of social democracy, continued voting for left-wing parties but their interests and worldview were no longer the same as that of their (less-educated) parents. The parties’ internal social structure thus changed — the product of their own political and social success. In Piketty’s terms, they became the parties of the “Brahmin left” (La gauche Brahmane), as opposed to the conservative right-wing parties, which remained the parties of the “merchant right” (La droite marchande).

To simplify, the elite became divided between the educated “Brahmins” and the more commercially-minded “investors,” or capitalists. This development, however, left the people who failed to experience upward educational and income mobility unrepresented, and those people are the ones that feed the current “populist” wave. Quite extraordinarily, Piketty shows the education and income shifts of left-wing parties’ voters using very similar long-term data from all major developed democracies (and India). The fact that the story is so consistent across countries lends an almost uncanny plausibility to his hypothesis.

Reading Capital in the Twenty-First Century

posted by Jason Kottke   Apr 29, 2014

Last week, I noted on Twitter that a 700-page academic book by a French economist topped the best sellers list on Amazon. Well, Thomas Piketty’s Capital in the Twenty-First Century is still #1 on Amazon, even though the hardcover is currently out of stock. If you’re curious about this anti-Kardashian moment in our culture but don’t want to dive in fully, you can read the book’s introduction on Harvard University Press’s site.

The distribution of wealth is one of today’s most widely discussed and controversial issues. But what do we really know about its evolution over the long term? Do the dynamics of private capital accumulation inevitably lead to the concentration of wealth in ever fewer hands, as Karl Marx believed in the nineteenth century? Or do the balancing forces of growth, competition, and technological progress lead in later stages of development to reduced inequality and greater harmony among the classes, as Simon Kuznets thought in the twentieth century? What do we really know about how wealth and income have evolved since the eighteenth century, and what lessons can we derive from that knowledge for the century now under way?

Or you can try Vox’s short guide to Capital or HBR’s Capital in a Lot Less than 696 Pages.

It is massive (696 pages) and massively ambitious (the title is a very conscious echo of Karl Marx’s Das Kapital). It came out in France last year to great acclaim, which meant that those in the English-speaking world who pay attention to such matters knew that something big was coming. Over the past few weeks it has become one of those things that everybody’s talking about just because everybody’s talking about it. That, and it really is important.

Is it worth reading? Martin Wolf of the Financial Times called it “enthralling”; a couple people I know have described it as “a slog.” I’d liken it to a big river — muddy and occasionally meandering, but with a powerful current that keeps pulling you along, plus lots of interesting sights along the way. There are endless numbers and (ugly but generally understandable) charts, but also frequent references to the novels of Balzac and Austen, and even a brief analysis of Disney’s The Aristocats. Regular people can read this thing; it’s just a matter of the time commitment. You should definitely buy it, if your place on the income distribution allows it. It looks good on a bookshelf, plus every copy sold makes Piketty wealthier, allowing us to discover whether this alters his views about inequality.