I’m late to the party with Thomas Piketty’s Capital in the Twenty-First Century. What can I say, I don’t read that quickly. The work is formidable in length and impressive in its breadth of research. If nothing else, every page is a shining example of social science that puts data first and doesn’t draw any broad, satisfying, unsubstantiated conclusions.
Since the English publication was released in April, Piketty has become a sort of academic rock star- it seems every publication I follow on Facebook has devoted at least a few stories to his conclusions, and the impact his analysis of inequality. It’s reached the point that some are just marveling at the media attention, in some sort of feedback loop that you often see with faux media controversies on an increasingly information-starved CNN.
There is a clear division between Piketty the social scientist and Piketty the public policy advocate. The conclusion establishes that these two selves should be linked- pure critique isn’t enough. If the research supports a conclusion, it should be advocated with conviction. His devotion to social science research methods is admirable; as a sociology student his example is a good one to follow. Waves have been made regarding his data and graphs, but even critics have dismissed potential errors as insubstantial. His decades of work on inequality shine. In 2013 I took a semester of economic history, focusing on the United States. From that, I have seen how the topic can be written in a dreadfully murky and technical manner. Piketty writes with confident clarity, and his use of French and British novels to illustrate the pre-industrial political economy is a welcome break from data-driven analysis.
That last quarter is the issue though. Some points Piketty makes are beyond dispute. Absolutely, countries need to share banking data to keep the rich from hiding their assets. But the global tax on capital raises the question: is that a systemic solution? His view of the 20th century is that the world wars radically changed the views on government and led to a more rigorous tax system. That’s self-evident. Yet much has been undone, in the United States the shift has been obvious. Taxing the rich by a few extra percent has paralyzed the federal government for most of Obama’s presidency, and those attempted increases are less than half of what it was in the 1940s and 50s.
Yes, a global tax on capital would solve serious economic issues. It could dig developed countries out of a ludicrous and unnecessary sovereign debt crisis, and reassert the social state that has done amazing things for hundreds of millions of people. But what’s to stop it from being undone by international conglomerates, especially in a system of otherwise free trade? And can the masses be mobilized once again for the same kind of solution?
Richard Wolff, a Marxist economist I mention from time to time, has a strong leftist critique of Capital in the Twenty-First Century. His monthly economics lecture in New York is available on YouTube, and he devotes quite a bit of time on Piketty (here’s the video, marked where he begins to talk about the book). Perhaps taxation and regulation are not the ultimate solution. The issue with modern capitalism isn’t its 21st century flavor of widespread inequality, the issue is with capitalism, period. Without a change in the class system today, inequalities of capital will always exist, and likely get worse immediately after policies are enacted to address that. A serious omission is the mass movement needed to get such changes implemented- without such discussion, the global tax on capital and movements against tax havens are simply commonsense, good ideas. They are not achievable ones simply by making sense.
Wolff joins other critiques (Jacobin did at least a half dozen pieces over the past two months) in pointing out a key issue, namely the power of the elite to block or roll back legislation that reduces their wealth and influence. Piketty points out that a robust democracy is needed, but ignores the many roadblocks that exist in the modern world. And even if democracy can elect a better government, it still needs to avoid the corrosive influence of money, and its own newfound power. As Bakunin said, “men do not make positions,;positions . . . make men.” To create change, the political system needs to go through a radical change, alongside capitalism. The huge success of what Thomas Piketty has to say indicates that people understand things are profoundly broken, but may be hesitant to speak of a deeper cause than modern policy changes.
Whatever your takeaway from the Occupy movement was (and is), the enduring legacy goes beyond the branding of 1% vs. 99%. It got people, many with no prior background in activism, talking about capitalism. Outside of universities, real discussions about capitalism are rare in the United States. I was born into a capitalist system, but that doesn’t mean it’s above critique. We emerge from old traditions constantly, casting aside religious and social customs constantly. If developed countries can ditch organized religion, they can ditch capitalism too. In the times of Roman Catholic supremacy, the idea that religion was an option, and not an obligation, merited execution. Now that view is accepted and even normal in some regions.
All and all, I am glad I overcame my slow reading and finished the book. One of his conclusion at the very end is dead on, that economics needs to realize it has more in common with sociology and political science than physics and mathematics. That being said, I think the leftist critique is valuable. Not to say everything I’ve read from that angle is correct, but that it puts the impetus on Piketty and his supporters to flesh out the policy side of the research. How does democracy save us, and what forms will it need to take? On what ground do the working and middle classes fight the elite for control of economic policy? Can these policy ideas form a systemic solution to inequality?
I don’t know the answers, and Piketty isn’t so sure either. That’s okay, and he often does state his research and conclusions have clear limits. But for his ideas to be picked up and carried to fruition through toil and struggle, they need to work in the long-term. There are a finite number of difficult paths regular people can go in order to create change. Money is scarce, so is time and will. To see inequality spike back up a few decades down the road would be devastating. And if the 99% gives up hope, the world is truly lost.