Piketty’s data
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robbo203 wrote:There is an interesting critique of Picketty here which I have just come acrosshttp://www.bloombergview.com/articles/2015-03-27/piketty-s-three-big-mistakes-in-inequality-analysisRognlie seems to think the problem of increasingly inequality lies with landlordism. Any comments?
A discussion here on the above on Michael Roberts blog…https://thenextrecession.wordpress.com/2015/03/23/piketty-update-graduate-takes-on-a-super-star-and-comes-up-with-a-comforting-conclusion/
robbo203 wrote:http://www.bloombergview.com/articles/2015-03-27/piketty-s-three-big-mistakes-in-inequality-analysisRognlie seems to think the problem of increasingly inequality lies with landlordism. Any comments?Henry George rides again ! Though that's seems to be more the interpretation put on what Rognlie wrote by the author of the article, Noah Smith, who seems to be a Georgist (see for instance some of his other articles, eg this).All the same, it is interesting that so many of those in the Sunday Times Rich List are either the landed aristocracy owning land in London (eg the Duke of Westminster) or jumped up property speculators. But of course their gains come from capitalists not from directly exploiting workers, so we'd be talking about increasing inequality within the owning class. As if we should care about that.
New book by Piketty. Review by Michael Roberts:
Karl Marx is unique nobody can be compared with him. Das Kapital is more than enough to understand capitalism and all its reformist attempts. I stick to my gun
“We’re getting more and more used to a situation in which private money can buy everything, from political parties to media to individuals,” he says, noting that the very people who offer hundreds of thousands of euros for an hour-long lecture are also those who, in the name of “economic rationality”, refuse to pay their cleaners a living wage.
The central thesis of his earlier book was that private wealth was destined to outstrip economic growth, meaning that, without progressive taxation, the rich were bound to get richer and richer, leaving the rest of society ever further behind. Some of his assumptions and conclusions had their critics, but the quality of writing and breadth of vision was almost universally admired.
Piketty is not a Marxist, though it’s untrue, as is sometimes said, that he has never read Capital. Whereas Marx believed that the history of society is the history of class struggles, Piketty argues that human progress is the product of the struggle for equality and education in which ideology plays an instrumental role. “What I mean,” he says, explaining his differences with Marx, “is that your class position is not enough to determine your view of what’s the best system of property, education, taxation. We need ideas and ideologies and we need to take them seriously.”
The problem with many leftwing ideas is that they have often been wonderful in theory and rather a letdown in practice. Piketty notes that not only was Soviet communism a disaster in itself, but it also undermined the appeal of leftwing thought in general. Just about its only success, he suggests, was in helping to contain capitalism. He attributes the fall of the Soviet Union to the unleashing of “hypercapitalism” across the globe, though in truth that development had already been under way for a decade before the USSR’s demise.
The point that he repeatedly comes back to is that between 1950 and 1980 nearly all western democracies had high levels of taxation, and yet it was a period of economic growth. While this may be true, recent attempts to impose high tax rates have not enjoyed success.
One notable failure was Francois Hollande’s imposition of a 75% supertax in France, which was said to have led to falling tax revenues, capital flight and a brain drain before being withdrawn. “They did not really try it,” he says with a dismissive Gallic shrug.
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