Piketty’s data

[ALB]

LBird wrote:

… the gaps in Piketty's book …

What, apart from his non-socialist ideology, are these gaps? Are you saying that the facts and figures he has selected are biased or should be rejected? Do you agree with the criticism of the Financial Times and others who have challenged his figures on the degree of concentration of wealth ownership in recent years as overestimates? Or do you think he understimates it? What facts on the ownership of wealth would you select from your ideological point of view and how would you present them? 

[LBird]

Young Master Smeet wrote:

Piketty wrote a book called 'Sharks' in which he discussed the eating habits of sharks. He left out entirely their reproductive habits. Does that disqualify his description of the eating habits of sharks?

But this is your ideological opinion, YMS.In my ideological opinion, he wrote a book called 'Sharks' and discussed only the eating habits of nice, cuddly pussy cats.

YMS wrote:

I employ a team of ideology elves, who hammer at books all night when I'm not looking so I can awaken fresh as a daisy to some ready made conclusions each morning.

Yes, you do. The 'ideology elves' are the ruling class's thinkers, like Piketty. They hammer away, but you really are not looking, are you?Why not employ a different set of elves, like comrades here, and join them, and then we can all consciously 'hammer away' at building our own 'books and conclusions'?I notice you haven't answered my question about your chosen ideology? If you're a reformist, that's fine by me, we can agree to disagree. But then we'll know why we disagree, and realise that it's nothing to with 'raw data' or the need to only read what's written by Piketty (as opposed to 'reading into' what he didn't write).I know from our discussions about 'scientific method' that you seem averse to asking questions about ideology, both others' and your own, but we can't avoid it, from a Communist perspective, at least.If you're not a Communist, fair enough.

[alanjjohnstone]

I'm sure there are those who will eat toadstools and retort…"But they are nevertheless sooooooooooooo tasty and, anyways, they look much the same as mushrooms do…" 

[Young Master Smeet]

Quote:

In my ideological opinion, he wrote a book called 'Sharks' and discussed only the eating habits of nice, cuddly pussy cats.

Really, your objection hitherto was that he discussed capitalism without discussing exploitation: so the object of his study is capital (or, rather capitalists), aka sharks.  Ignoring reproduction, or the contaxt of sharks (that is exploitation) still means he's discussing sharks.Last I checked ideology has twenty seven and a half different meanings, so I'm not sure what you're asking me.  I'd say my main leanings come from an acceptance of the full implications of all yorkshiremen being liars…

[LBird]

ALB wrote:

What facts on the ownership of wealth would you select from your ideological point of view and how would you present them?

[my bold]Well, first of all, I'd point out that to concede that the rich 'own' the wealth that they've stolen from us, is a big ideological mistake.It's like conceding that, having stolen a TV from someone's house, that the burglar now 'owns' the TV.What's more, it allows every worker who 'owns' a TV, to feel some identity with someone who also 'owns' things, like a multi-national conglomerate, a shipping line, a string of car factories…We'd be better pointing out, from the start, that 'wealth' is the 'property' of all, and 'ownership of wealth' is an ideological construct aimed at undermining Communist ideas, and that the discussion should be about 'facts on the theft of wealth', not about its 'ownership'.Once we've established that, we could soon establish that Piketty's method ignores the vast majority of 'social products' that the rich have stolen, beyond the physical and monetary assets that he focusses on.You know far more than I do about 'economics', ALB, and you're better suited to point out what Piketty has 'selected through bias' and what 'figures should be rejected'.As for the FT, aren't they capitalists, who select what they want, too? I don't trust a word that they say! But that's because I'm a Communist, not because of their dodgy data arguments.Or do you subscribe to the 'real raw data, open to all, objectively' thesis? I don't, I'm afraid. But that's the basis of our 'scientific' disagreements, too, so I won't pursue it further, here.

[alanjjohnstone]

If the title of the book was "Sharks, their food cycle" no problems i'll accept its limitations ..but if it's title was "Sharks,their life cycle" , then i suggest the book has made some serious omission by not discussing how they reproduce.Remind me …What is the title of Piketty's book again?

[stuartw2112]

An alternative historyEngels: I've had an idea, Charlie old boy, that we should engage with this "political economy", perhaps read the books to see if there's anything to be learned, anything that might be useful for the socialist movement. Apparently these books are the high point of the development of a scientific understanding of the economy.Marx: Ha ha ha! What a waste of time. Don't you know political economy is ideological through and through? Nothing to be learnt there.Engels: It is of course ideological, but might we not have something to learn from it anyway? They have after all worked hard to understand the subject they're writing about, they are, are they not, clever men?Marx: Pah! What absolute rot. They're complete dicks. I approach the question as a Communist. So what I do is I read every sentence of the book with my ideological perspective, and if you do that, you quickly see that it's barely worth reading past the first chapter. I disagree with every sentence! It's not quite how I'd say it, you see. I've no idea what these books say, but I do know that it's what we all know anyway. Have we not eyes to see for ourselves? Engels: Hmmm…Marx: What's more, have you seen what political conclusions they come to? I can't possibly agree with that, and that's what they're pushing. It would have been better if they hadn't bothered with their stupid books. I'd much prefer it if we skipped history and politics altogether and just came out and said straight what we want, which is for everything to be lovely instantly.Engels: And you think this will be useful knowledge for the socialist movement?Marx: It's the only knowledge worth having! Why waste your time with all this academic twaddle and guff when we can just educate workers by presenting them directly with pretty pictures of the future?Engels: Hmmm. Well at least I won't have to support you while you spend years in the British Library then, so that's good. Beer?Marx: Beer! No no no, I've got this truckload of leaflets to hand out explaining my ideology to anyone who will listen. Coming?Engels: Hmm. I really must find some new friends…

[alanjjohnstone]

A serious question from me now to those who have read the book. YMS opened the thread in his very first message by stating due to Piketty we can now "reasonably confidently state that the top 10% own 70% of the wealth, and the top 1% own about 29%"Can i ask what are Piketty's projected figures about this share of ownership if his proposed tax rules were actually successful and fully implemented ? You still here, Stuart ?..i thought you said you had more important things to do ….like persuading your own new friends to change their policies to be more in line with your own. 

[LBird]

alanjjohnstone wrote:

A serious question from me now to those who have read the book.

I’ve got one, too, for those further into the mire than me, so far. I’ve read to the end of chapter one, where I found:

Piketty, Capital, p. 71, wrote:

…the principle mechanism for convergence…is the diffusion of knowledge. In other words, the poor catch up with the rich to the extent that they achieve the same level of technological know-how, skill, and education…

I’m baffled by this conclusion by Piketty. I can’t find any evidence in the chapter for this assertion.Within the UK, the proletariat is better formally-educated than ever before, and yet they haven’t ‘caught up with the rich’.From what I’ve already read in reviews, Piketty argues that the world wars were the context of ‘convergence’ (ie, the rich paid more in money than the poor (who paid in lives, though), and so there was ‘convergence’), so what does he mean by this strange assertion, above?

[ALB]

alanjjohnstone wrote:

A serious question from me now to those who have read the book. YMS opened the thread in his very first message by stating due to Piketty we can now "reasonably confidently state that the top 10% own 70% of the wealth, and the top 1% own about 29%"Can i ask what are Piketty's projected figures about this share of ownership if his proposed tax rules were actually successful and fully implemented ? 

Good question. He doesn't actually say but the implication is that it would stop the top 10% coming to own more than 70% and moving towards owning the 90% they did in France and Britain before WW!.He doesn't indicate what his ideal or achievable level of inequality would be but the share of the top 10% has never fallen at any time in any country below 50% of total wealth, not even in Sweden. Commenting on a graph on page 345 of "wealth inequality is Sweden, 1810-2010, he says;

Quote:

… the concentration of wealth in Sweden in 1970-1980 attained the lowest level of inequality observed in any of our historical series (with barely 50% of total wealth owned by the top decile and slightly more than 15 percent by the top centile). This is still a fairly high level of inequality, however, and what is more, inequality in Sweden has increased significantly since 1980-1990 (and in 2010 was just slightly lower than in France) [at just under 60 percent].

Also, these are figures for percentage shares not absolute amounts. One reason why the shares of the top 1 percent and the next 9% (a distinction Piketty also makes since in recent years the top 1% have done even better than the next 9%) have fallen since 1910 in the rise in the intervening period of the share of the middle 40% who have acquired wealth in the form of a paid-for house and some statistically significant savings in total. This hasn't affected or reduced or been at the expense of the actual amounts owned by the top 10%.As to the bottom 50%, Piketty writes of

Quote:

… the poorest half of the population, whose share of total wealth has always been miniscule (generally around 5 percent), even in Sweden (where it was never more than 10 percent) (p. 347).

People should read the book. It's a mine of information to use against capitalism and indeed to show the futility of the reforms Piketty advocates.

[ALB]

LBird wrote:

alanjjohnstone wrote:

A serious question from me now to those who have read the book.

I’ve got one, too, for those further into the mire than me, so far. I’ve read to the end of chapter one, where I found:

Piketty, Capital, p. 71, wrote:

…the principle mechanism for convergence…is the diffusion of knowledge. In other words, the poor catch up with the rich to the extent that they achieve the same level of technological know-how, skill, and education…

I’m baffled by this conclusion by Piketty. I can’t find any evidence in the chapter for this assertion.Within the UK, the proletariat is better formally-educated than ever before, and yet they haven’t ‘caught up with the rich’.

Isn't he talking here about poor countries (rather than poor people within countries) and trying to explain the high rate of growth of a country like China and why it will eventually slow down too?

LBird wrote:

From what I’ve already read in reviews, Piketty argues that the world wars were the context of ‘convergence’ (ie, the rich paid more in money than the poor (who paid in lives, though), and so there was ‘convergence’), so what does he mean by this strange assertion, above?

The interesting thing here is that he offers an argument that should appeal to the likes of the ICC (though I don't suppose they'll be any more recognisant of him than Alan or you!): that in the period 1910-1950 the rate of growth was more rapid in Europe to make up for the destruction of capital in the world wars and the devaluation through inflation of capital invested in national debts. According to his basic thesis, a higher rate of growth means a lower share of income from capital in total income and so a slowing down in the concentration of wealth ownership.He is in fact saying that this period was exceptional and that the normal course of ownership concentration was that up to 1910 and which he says we are seeing in operation again. He writes:

Quote:

In the twentieth century it took two world wars to wipe away the past and significantly reduce the return on capital, thereby creating the illusion that the fundamental structural contradiction of capital (r > g) had been overcome.

This is on page 572 so, if you've only reached page 71, you've another 500 pages to read before you get to this.

[LBird]

ALB wrote:

Isn't he talking here about poor countries (rather than poor people within countries) …

Well, here's the quote again, fuller:

Piketty, Capital, p. 71, wrote:

To sum up, …the principle mechanism for convergence at the international as well as the domestic level is the diffusion of knowledge. In other words, the poor catch up with the rich to the extent that they achieve the same level of technological know-how, skill, and education…

[my bolds, were '…' last quote]Once again, I can't find any evidence within the chapter for this summary assertion by Piketty.Perhaps it's one of his own fish which got away. Lousy choice of tackle, method, pond, and furthermore poor execution of those choices by Piketty?

[alanjjohnstone]

 "He doesn't actually say …"Isn't this rather odd.Every review i read (and many on this thread) applaud him for his skill with figures and statistics yet the most important political information….what will be the actual result of his proposals, he fails to provide any estimated figures. Not even a speculative GINI for the future? Is he supposing that people take his solution on trust of what you call an implication?You assumed right that it was indeed the reason of my question – to determine just what degree of social/wealth inequality is acceptable to Piketty (and his tax supporters) and what he considers to be "unfair" or potentially damaging to the health of capitalism.Again without Piketty's contribution, the 1% had already been sub-categorised to the 0.1% and even the 0.01% in ownership proportions analysis. Oh i am sure more than the ICC will eventually share my own and LBird's less than generous appreciation for Piketty. "I've counted the number of spots on your body…but not sure if its the chicken pox or the smallpox or even the measles but at least we now know how many spots there are …i recommend that the treatment is scraping them all off so you'll look unblemished." I'm looking forward to all the forthcoming articles that utterly discredit Piketty's political views and economic "solutions"i read this in a review. (or more accurately a review of reviews) “Notwithstanding its flaws, Piketty has succeeded in making everyone ponder on the right questions,” writes Lawrence Summers, the former US treasury secretary and Harvard University president"http://www.livemint.com/Opinion/Zng1Rz4mHbvjVAdR4Zy3nJ/The-Piketty-cheatsheet-Six-mustreads-on-Thomas-Piketty.htmlI am not at all sure this is accurate…i already mentioned earlier , my scepticism about Piketty began when i found he wasn't addressing any of my questions which i sought answers for. I began to wonder, in fact, if he was serving as a diversion from the real questions about society that needed to be asked.i think Lbird may be right…you ask the questions that will fit in with your answers and that is because of the ideas you already hold in your head…ideology. Wasn't Marx already a socialist before he began his study of economics?  I  think many members of the party were, too,  before we got round to reading Value Price and Profit. 

[alanjjohnstone]

Another review, or more accurately from its last paragraph, more a "How Piketty's Plan Can Save The World"http://dissidentvoice.org/2014/07/capitalism-a-system-of-patrimonial-wealth/But on reflection, i beginning to suspect that Piketty simply threw that in as a passing after-thought and of little importance to himself having seemingly not bothered to provide any supporting evidence for it or extrapolate its effect, simply guessing what tax burden the rich could bear. But as i said …it is his apparent conclusion people are seizing upon. After all, as the writer of the review dismissively says "Marx’s critique was necessarily more abstract, more a criticism of capitalist market theory than of capitalist practice."…even though Capital's sub-title is "Critique of Political Economy" and concentrated heavily upon the production process as much as the circulation department. But i never ever read Vol 2 or Vol 3 or all the Theory of Surplus Value and the notes of the Grundisse…

[LBird]

alanjjohnstone wrote:

i think Lbird may be right…you ask the questions that will fit in with your answers and that is because of the ideas you already hold in your head…ideology.

It’s become clear since Einstein that this sequence really is the ‘scientific method’. Of course, this contradicts entirely the supposed basis of ‘science’(especially ‘physics’), from Newton onward, by which humans were supposed to have unmediated access to ‘reality’ through passive sense-based observation. That was the myth of positivism, that ‘physics’ produced a ‘truth’ which reflected ‘reality’. And this myth was supposed to provide the basis for all attempts to make other scientific disciplines more like physics, that is, more ‘objective’. Hence, in history, for example, von Ranke’s now notorious plea to historians, to stop moralising and “simply to show how it really was (wie es eigentlich gewesen)” (see Carr, What is History, p.. Of course, we now know that ‘morals’ can’t be removed from either history or physics (or, indeed, economics). Humans (and their ideologies, morals, beliefs, etc.) are at the heart of the scientific method. There is no simple ‘raw data’ to passively examine, not even in physics.So, to sum up the two methods, the mythical scientific method is:1 raw data2 neutral collection3 neutral presentation (ie. the ‘facts’)4 theories, implications, lessons drawn (the only ‘active’ stage)Based on this mythical method, some regard Piketty’s book as representing the third stage (ie. the ‘facts’ or ‘raw data’). Thus, anyone can read the ‘facts’ or ‘raw data’ and draw their own conclusions. For this bourgeois method, the ideology begins with the fourth stage, and thus the arguments are about which ideology is correct for interpreting the ‘raw facts’.It’s bollocks, comrades.The proper scientific method (and it always has been this, the positivists were pretending otherwise) is:1 raw data (ie. everything, everywhere, at every time)2 human social consciousness (including ideology and theories)3 selection from ‘everything, etc.’ based on human parameters4 presentation of pre-chosen ‘facts’ (allegedly ‘raw data’, but in reality ‘pre-cooked data’)5 implications, lessons drawn (the second ‘active’ stage)Now, we can see that Piketty’s book represents the fourth stage (ie. the ‘cooked data’). If one merely ‘accepts’ Piketty’s data, one is already being bullshitted. Criticism must start, for the scientific method, at stage 2. Piketty’s ideological beliefs must be consciously criticised, prior to reading his book, to allow the scientist to understand Piketty’s selection parameters, and thus why he’s actively picked some ‘data’ and (often unconsciously) rejected most of the other data (which is favourable to Communist ideology).As ajj has perhaps come to realise, “you ask the questions that will fit in with your answers and that is because of the ideas you already hold in your head…ideology”Piketty asked the questions (selected the ‘raw data’) that fitted in with his answers (to fit his preconceived ideas) that is because it’s the human condition (the ideas we already hold in our heads). Humans are social and cultural products, not simply sense-based registers of all external data.Piketty is a reformist, who selected from ‘everything’ (ie, the world we live in) the ‘facts’ that suit his reformist ideology. Not surprisingly, the conclusions that he draws are reformist solutions to reformist problems.No-one can read Piketty ‘un-ideologically’. The book is ideological, and one’s reading of it is ideological. The proper scientific method demands that we expose our ideologies, both in writing and reading, to others. As Einstein insisted, knowledge is relative to ‘the enquirer’ (conceived as a society, or perhaps for Marxists, a mode of production/social formation) As Communists, we can do this; but the bourgeoisie can’t. They have to maintain the pretence that they and their books are not ideological, and that they simply deal with the ‘real world’ of ‘hard facts’.It can’t be done in physics, and it can’t be done in economics.Human understanding, and thus meaning, are at the heart of science.The real world doesn’t present itself to humans unbidden.Piketty is a used-car salesman. Kick the tyres before buying, comrades.

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