“How to respond to Thomas Piketty’s inequality alarmism”
Piketty, for those you who don’t know, is leftist/socialist French economist who has put together a modern-day version of Marxist market principles, which of course are a critique of capitalism and the garden variety Fabian concern over “income inequality” — which rejects the whole “rising tide raises all boats” idea championed by such proto-TEA Party extremists as, eg., John F Kennedy.
And, according to an interview he gave recently, he’s had the ear of the White House, Mr Lew, and the Democrat Party for quite some time now. A socialist. Proposing socialist principles. Who rejects capitalism. And is evidently the economist with the most influence with Democrats.
Which means the way to respond to Mr Piketty’s alarmism is to ask him if the relative income inequality in, say, Cuba and North Korea and parts of Africa are making those countries Utopian paradises? And then bitch slap him and walk away.
Jim Pethokoukis, though, takes another, more urbane tack, one that grants Piketty more respect as an intellectual than I believe is deserved. Which I might not be saying were this the late 19th century, and we hadn’t yet witnessed the historical reality of anti-capitalist, anti-free market economic systems, and the inevitable totalitarianism and police state apparatuses that come along with them.
Not to mention the gulags, or gas chambers, or killing fields, or mass graves.
[...] Piketty [is a first-rate scholar whose magnum opus is well worth reading, whatever your ideological inclination. His thesis is straightforward. At its center are observations and forecasts about the return on capital, economic growth, and the relationship between the two. Some economists, such as Paul Krugman and Martin Wolf, think Piketty’s probably got the story right. Others, including AEI’s Kevin Hassett, Tyler Cowen, and Joshua Hendrickson, take the other side of the trade.
Yet even if Piketty is wrong, there is reason to believe technology and globalization might sharply increase immobility, as well as boost income and wealth inequality–and lead to long-term wage stagnation for the vast majority of workers. The good news here is that many of the most realistic responses — even Piketty thinks his own end-game policy agenda is utopian — are intrinsically good ones. Since slow economic growth worsens inequality, we should want to pursue policies that might boost birthrates (tax relief for parents) and innovation (remove regulatory barriers to entry).
Indeed, Piketty has said as much. If capital ownership is becoming too concentrated, then we should try to broaden it (universal savings accounts) and turn more workers into owners. Cowen highlights “deregulating urban development and loosening zoning laws, which would encourage more housing construction and make it easier and cheaper to live in cities such as San Francisco and, yes, Paris.” And, of course, both primary and secondary education need a strong dose of disruptive innovation to meet the changing needs of students and workers.
If policymakers start giving such ideas greater thought, then Piketty’s book, right or wrong, will have performed an immensely valuable service.
From where I sit, this is precise NOT how to respond, generally-speaking, to Piketty’s inequality alarmism, if only because we know that it isn’t “inequality” that drives leftist dogma, but rather a rejection of true diversity, economic liberty, individual autonomy, and a free market. They want concentrated power, an ability to control and manipulate the masses, and to essentially run the world as their own social Petri dish.
So rather than dignify Piketty’s boring retread of socialist economics, what we need do is simply point to the numerous examples of countries that have followed that lead — who have sought radical egalitarianism, which leads to equality of misery and is a necessary rejection of liberty, which by its very nature ensures certain inequalities of outcome (because it is the product of individual choice and individual industry, not to mention an entire matrix of additional personal decisions) — and not that they have either failed, are failing, or are becoming police states, with more and more centralized governmental power.
Like, for instance, our own country.
Now, I understand and agree with Jim’s more general point — that the questions Piketty raises allow for conservative and free-market answers to find voice in the conversation — but the truth is, that presumes that the left is interested in good faith economic arguments. It’s not. It’s interested in entrenched centralized power and control and promoting a permanent ruling class. It is liberal fascism’s end game, because in order to run paradise, some pigs are going to of necessity have to be more equal than others.
Concentration of capital, as Mark Levin pointed out last evening, is occurring, but more and more that concentration is taking place in the federal government. Taking money from the private sector and creating disincentives to move capital around. Obamacare is a further deterrent, because venturing out on one’s own to start a business could lead to a loss of health care, etc.
And it was intended to do so: socialist economic policy is not a legitimate engagement in intellectual debate; instead, it is an attempt to re-distribute wealth, gain enormous power of citizens turned subjects, and entrench the progressive trajectory that has so long been chipping away at our constitutional system and the protections of our natural rights t was devised to secure.
So, sure, if you want to join the debating society, by all means, expound upon the flaws in Piketty’s thinking. Me, I’d rather just tell him to go fix France first before worrying about us.
(h/t to geoff B, who brought Piketty’s influence to my attention weeks ago; I just never go around to writing about it)