Thomas Piketty’s Capital in the Twenty-First Century

I recently plowed through this voluminous tome. Due to its length, I imagine more people have read about it than have actually read it. Still, it was worthwhile.

If you just want the gist of Piketty’s arguments, you might focus upon the Introduction and Conclusion. If you are up for more – including the thorough and exhausting statistical case – the whole tour might be worth the journey.

Piketty creates a compelling case, buttressed by exhaustive assembled historical evidence, that the growing worldwide (and domestic) inequality is not only dangerous, but inherently structural. His argument shows it is built-in to capitalism. Thus regulation and intervention is not only desirable, but necessary to save capitalism from itself (much as FDR did in the United States following the Great Depression).

Piketty’s mechanism to save capitalism from itself involves policies decidedly unpopular with some of today’s “deciders,” though necessary to save them from a fate similar to that Karl Marx might have imagined for their forbears who “sold the rope.” Indeed, the concentration of wealth leads to a concentration of political power and deprivation to those without power such that the system cannot be maintained without significant repression (a la Mussolini, Hitler, Franco) — or it will collapse in violent revolution.

Piketty recommends a tax on capital, including wealth itself as well as inheritance. The irony is that while this is unpopular with those it impacts, it would increase their quality of life as it increased the common good.

The difficulty is that for this to be done effectively, it necessitates much international cooperation, lest nations and regions are played against each other in a bidding war to the bottom.

This is an important book: for citizens and theologians, as well as economists! After all, we don’t want to live in a world where the many suffer (and the earth itself cries out) just so a few can live in regal splendor.

Of course, there are those who think Piketty does not go far enough (see below). For those of us who are persons of faith that bears a certain resonance. We are not inevitably tied to any earthly system, especially one in which “the past devours the future.” Instead, we are looking to the future in hope, with the redemptive possibilities for all creation which God calls us to work towards. (And we need hope, when one considers the trends Piketty reveals!) The recent Papal encyclical regarding the challenge of Climate Change is evidence of Christian hope!

For some more commentary on and summary of the arguments of Piketty’s Capital in the Twenty-First Century, you might check out the following — or even read the book!
The Guardian: Thomas Piketty’s Capital: everything you need to know about the surprise bestseller.

Piketty’s Capital, unlike Marx’s Capital, contains solutions possible on the terrain of capitalism itself: the 15% tax on capital, the 80% tax on high incomes, enforced transparency for all bank transactions, overt use of inflation to redistribute wealth downwards. He calls some of them “utopian” and he is right. It is easier to imagine capitalism collapsing than the elite consenting to them.

For the case that perhaps what Piketty advocates is not enough, see The Compelling Conclusion About Capitalism That Piketty Resists in Truthout.

The excesses of capitalism are not simply a question of bad management and a political unwillingness to properly regulate it by imposing the right sort of checks and balances, but symptoms of a fundamentally and irretrievably flawed system that tends toward destruction of human and other life.

Happy reading!

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