Posts Tagged ‘Inequality’

A superb piece from George Monbiot, covering a lot of ground about a system that some people are not even aware exists. It is important that people start to wake up to the this. We are sleep walking our way towards disaster, be it climate change, economic and social collapse or catastrophic war.


Neoliberalism – the ideology at the root of all our problems

Financial meltdown, environmental disaster and even the rise of Donald Trump – neoliberalism has played its part in them all. Why has the left failed to come up with an alternative?

Ronald Reagan and Margaret Thatcher at the White House.

 

Imagine if the people of the Soviet Union had never heard of communism.

The ideology that dominates our lives has, for most of us, has no name.
Mention it in conversation and you’ll be rewarded with a shrug.
Even if your listeners have heard the term before, they will struggle to define it.

Neoliberalism: do you know what it is?
Its anonymity is both a symptom and cause of its power. It has played a major role in a remarkable variety of crises:
the financial meltdown of 2007‑8,
the offshoring of wealth and power, of which the Panama Papers offer us merely a glimpse,
the slow collapse of public health and education,
resurgent child poverty,
the epidemic of loneliness,
the collapse of ecosystems,
the rise of Donald Trump.

But we respond to these crises as if they emerge in isolation, apparently unaware that they have all been either catalysed or exacerbated by the same coherent philosophy; a philosophy that has – or had – a name.

What greater power can there be than to operate namelessly?

So pervasive has neoliberalism become that we seldom even recognise it as an ideology. We appear to accept the proposition that this utopian, millenarian faith describes a neutral force; a kind of biological law, like Darwin’s theory of evolution. But the philosophy arose as a conscious attempt to reshape human life and shift the locus of power.

Neoliberalism sees competition as the defining characteristic of human relations. It redefines citizens as consumers, whose democratic choices are best exercised by buying and selling, a process that rewards merit and punishes inefficiency. It maintains that “the market” delivers benefits that could never be achieved by planning.

Attempts to limit competition are treated as inimical to liberty. Tax and regulation should be minimised, public services should be privatised. The organisation of labour and collective bargaining by trade unions are portrayed as market distortions that impede the formation of a natural hierarchy of winners and losers.
Inequality is recast as virtuous: a reward for utility and a generator of wealth, which trickles down to enrich everyone.
Efforts to create a more equal society are both counterproductive and morally corrosive. The market ensures that everyone gets what they deserve.

We internalise and reproduce its creeds. The rich persuade themselves that they acquired their wealth through merit, ignoring the advantages – such as education, inheritance and class – that may have helped to secure it.

The poor begin to blame themselves for their failures, even when they can do little to change their circumstances.

  • Never mind structural unemployment: if you don’t have a job it’s because you are unenterprising.
  • Never mind the impossible costs of housing: if your credit card is maxed out, you’re feckless and improvident.
  • Never mind that your children no longer have a school playing field: if they get fat, it’s your fault.

In a world governed by competition, those who fall behind become defined and self-defined as losers. Among the results, as Paul Verhaeghe documents in his book What About Me? are epidemics of self-harm, eating disorders, depression, loneliness, performance anxiety and social phobia.

Perhaps it’s unsurprising that Britain, in which neoliberal ideology has been most rigorously applied, is the loneliness capital of Europe. We are all neoliberals now.

The term neoliberalism was coined at a meeting in Paris in 1938.

Among the delegates were two men who came to define the ideology, Ludwig von Mises and Friedrich Hayek. Both exiles from Austria, they saw social democracy, exemplified by Franklin Roosevelt’s New Deal and the gradual development of Britain’s welfare state, as manifestations of a collectivism that occupied the same spectrum as nazism and communism.

In The Road to Serfdom, published in 1944, Hayek argued that government planning, by crushing individualism, would lead inexorably to totalitarian control.
Like Mises’s book Bureaucracy, The Road to Serfdom was widely read. It came to the attention of some very wealthy people, who saw in the philosophy an opportunity to free themselves from regulation and tax. When, in 1947, Hayek founded the first organisation that would spread the doctrine of neoliberalism – the Mont Pelerin Society – it was supported financially by millionaires and their foundations.

With their help, he began to create what Daniel Stedman Jones describes in Masters of the Universe as “a kind of neoliberal international”: a transatlantic network of academics, businessmen, journalists and activists.

The movement’s rich backers funded a series of thinktanks which would refine and promote the ideology. Among them were the American Enterprise Institute, the Heritage Foundation, the Cato Institute, the Institute of Economic Affairs, the Centre for Policy Studies and the Adam Smith Institute. They also financed academic positions and departments, particularly at the universities of Chicago and Virginia.

As it evolved, neoliberalism became more strident. Hayek’s view that governments should regulate competition to prevent monopolies from forming gave way – among American apostles such as Milton Friedman – to the belief that monopoly power could be seen as a reward for efficiency.

Something else happened during this transition: the movement lost its name. In 1951, Friedman was happy to describe himself as a neoliberal. But soon after that, the term began to disappear. Stranger still, even as the ideology became crisper and the movement more coherent, the lost name was not replaced by any common alternative.

At first, despite its lavish funding, neoliberalism remained at the margins. The postwar consensus was almost universal: John Maynard Keynes’s economic prescriptions were widely applied, full employment and the relief of poverty were common goals in the US and much of western Europe, top rates of tax were high and governments sought social outcomes without embarrassment, developing new public services and safety nets.

But in the 1970s, when Keynesian policies began to fall apart and economic crises struck on both sides of the Atlantic, neoliberal ideas began to enter the mainstream. As Friedman remarked, “when the time came that you had to change … there was an alternative ready there to be picked up”.
With the help of sympathetic journalists and political advisers, elements of neoliberalism, especially its prescriptions for monetary policy, were adopted by Jimmy Carter’s administration in the US and Jim Callaghan’s government in Britain.

After Margaret Thatcher and Ronald Reagan took power, the rest of the package soon followed:
massive tax cuts for the rich,
the crushing of trade unions,
deregulation,
privatisation,
outsourcing and
competition in public services.
Through the IMF, the World Bank, the Maastricht treaty and the World Trade Organisation, neoliberal policies were imposed – often without democratic consent – on much of the world.

Most remarkable was its adoption among parties that once belonged to the left: Labour and the Democrats, for example. As Stedman Jones notes, “it is hard to think of another utopia to have been as fully realised.”

It may seem strange that a doctrine promising choice and freedom should have been promoted with the slogan “there is no alternative”.
But, as Hayek remarked on a visit to Pinochet’s Chile – one of the first nations in which the programme was comprehensively applied –

“my personal preference leans toward a liberal dictatorship rather than toward a democratic government devoid of liberalism”.

The freedom that neoliberalism offers, which sounds so beguiling when expressed in general terms, turns out to mean freedom for the pike, not for the minnows.

Freedom from trade unions and collective bargaining means;
the freedom to suppress wages.
Freedom from regulation means the freedom to poison rivers,
endanger workers,
charge iniquitous rates of interest and
design exotic financial instruments.
Freedom from tax means freedom from the distribution of wealth that lifts people out of poverty.

As Naomi Klein documents in The Shock Doctrine, neoliberal theorists advocated the use of crises to impose unpopular policies while people were distracted: for example, in the aftermath of Pinochet’s coup, the Iraq war and Hurricane Katrina, which Friedman described as; “an opportunity to radically reform the educational system” in New Orleans.

Where neoliberal policies cannot be imposed domestically, they are imposed internationally, through trade treaties incorporating “investor-state dispute settlement”: offshore tribunals in which corporations can press for the removal of social and environmental protections.

When parliaments have voted to restrict sales of cigarettes, protect water supplies from mining companies, freeze energy bills or prevent pharmaceutical firms from ripping off the state, corporations have sued, often successfully. Democracy is reduced to theatre.

Another paradox of neoliberalism is that universal competition relies upon universal quantification and comparison. The result is that workers, job-seekers and public services of every kind are subject to a pettifogging, stifling regime of assessment and monitoring, designed to identify the winners and punish the losers.
The doctrine that Von Mises proposed would free us from the bureaucratic nightmare of central planning has instead created one.

Neoliberalism was not conceived as a self-serving racket, but it rapidly became one. Economic growth has been markedly slower in the neoliberal era (since 1980 in Britain and the US) than it was in the preceding decades; but not for the very rich.
Inequality in the distribution of both income and wealth, after 60 years of decline, rose rapidly in this era, due to the smashing of trade unions, tax reductions, rising rents, privatisation and deregulation.

The privatisation or marketisation of public services such as energy, water, trains, health, education, roads and prisons has enabled corporations to set up tollbooths in front of essential assets and charge rent, either to citizens or to government, for their use. Rent is another term for unearned income.
When you pay an inflated price for a train ticket, only part of the fare compensates the operators for the money they spend on fuel, wages, rolling stock and other outlays.
The rest reflects the fact that they have you over a barrel.

Those who own and run the UK’s privatised or semi-privatised services make stupendous fortunes by investing little and charging much. In Russia and India, oligarchs acquired state assets through firesales. In Mexico, Carlos Slim was granted control of almost all landline and mobile phone services and soon became the world’s richest man.

Financialisation, as Andrew Sayer notes in Why We Can’t Afford the Rich, has had a similar impact. “Like rent,” he argues, “interest is … unearned income that accrues without any effort”.
As the poor become poorer and the rich become richer, the rich acquire increasing control over another crucial asset: money.
Interest payments, overwhelmingly, are a transfer of money from the poor to the rich.
As property prices and the withdrawal of state funding load people with debt (think of the switch from student grants to student loans), the banks and their executives clean up.

Sayer argues that the past four decades have been characterised by a transfer of wealth not only from the poor to the rich, but within the ranks of the wealthy: from those who make their money by producing new goods or services to those who make their money by controlling existing assets and harvesting rent, interest or capital gains.
Earned income has been supplanted by unearned income.

Neoliberal policies are everywhere beset by market failures. Not only are the banks too big to fail, but so are the corporations now charged with delivering public services. As Tony Judt pointed out in Ill Fares the Land, Hayek forgot that vital national services cannot be allowed to collapse, which means that competition cannot run its course.
Business takes the profits, the state keeps the risk.

The greater the failure, the more extreme the ideology becomes.
Governments use neoliberal crises as both excuse and opportunity to;
cut taxes,
privatise remaining public services,
rip holes in the social safety net,
deregulate corporations and
re-regulate citizens.

The self-hating state now sinks its teeth into every organ of the public sector. Perhaps the most dangerous impact of neoliberalism is not the economic crises it has caused, but the political crisis.
As the domain of the state is reduced, our ability to change the course of our lives through voting also contracts.
Instead, neoliberal theory asserts, “people can exercise choice through spending”.
But some have more to spend than others: in the great consumer or shareholder democracy, votes are not equally distributed. The result is a disempowerment of the poor and middle.
As parties of the right and former left adopt similar neoliberal policies, disempowerment turns to disenfranchisement.
Large numbers of people have been shed from politics.

Chris Hedges remarks that;

“fascist movements build their base not from the politically active but the politically inactive, the ‘losers’ who feel, often correctly, they have no voice or role to play in the political establishment”.

When political debate no longer speaks to us, people become responsive instead to slogans, symbols and sensation. To the admirers of Trump, for example, facts and arguments appear irrelevant.

Judt explained that when the thick mesh of interactions between people and the state has been reduced to nothing but authority and obedience, the only remaining force that binds us is state power.
The totalitarianism Hayek feared is more likely to emerge when governments, having lost the moral authority that arises from the delivery of public services, are reduced to “cajoling, threatening and ultimately coercing people to obey them”.

Like communism, neoliberalism is the God that failed.
But the zombie doctrine staggers on, and one of the reasons is its anonymity. Or rather, a cluster of anonymities.

The invisible doctrine of the invisible hand is promoted by invisible backers. Slowly, very slowly, we have begun to discover the names of a few of them. We find that the Institute of Economic Affairs, which has argued forcefully in the media against the further regulation of the tobacco industry, has been secretly funded by British American Tobacco since 1963. We discover that Charles and David Koch, two of the richest men in the world, founded the institute that set up the Tea Party movement.
We find that Charles Koch, in establishing one of his thinktanks, noted that
“in order to avoid undesirable criticism, how the organisation is controlled and directed should not be widely advertised”.

The words used by neoliberalism often conceal more than they elucidate. “The market” sounds like a natural system that might bear upon us equally, like gravity or atmospheric pressure. But it is fraught with power relations.
What “the market wants” tends to mean what corporations and their bosses want.

“Investment”, as Sayer notes, means two quite different things.

One is the funding of productive and socially useful activities,
the other is the purchase of existing assets to milk them for rent, interest, dividends and capital gains.

Using the same word for different activities “camouflages the sources of wealth”, leading us to confuse wealth extraction with wealth creation.

A century ago, the nouveau riche were disparaged by those who had inherited their money. Entrepreneurs sought social acceptance by passing themselves off as rentiers. Today, the relationship has been reversed: the rentiers and inheritors style themselves entrepreneurs. They claim to have earned their unearned income.

These anonymities and confusions mesh with the namelessness and placelessness of modern capitalism:

The anonymity of neoliberalism is fiercely guarded.
Those who are influenced by Hayek, Mises and Friedman tend to reject the term, maintaining – with some justice – that it is used today only pejoratively. But they offer us no substitute.
Some describe themselves as classical liberals or libertarians, but these descriptions are both misleading and curiously self-effacing, as they suggest that there is nothing novel about The Road to Serfdom, Bureaucracy or Friedman’s classic work, Capitalism and Freedom.

For all that, there is something admirable about the neoliberal project, at least in its early stages. It was a distinctive, innovative philosophy promoted by a coherent network of thinkers and activists with a clear plan of action. It was patient and persistent. The Road to Serfdom became the path to power.

 

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http://www.salon.com/2015/03/05/i_found_myself_turning_into_an_idiot_david_graeber_explains_the_life_sapping_reality_of_bureaucratic_life/

“I found myself turning into an idiot!”:

David Graeber explains the life-sapping reality of bureaucratic life

The activist-academic and Occupy Wall Street champion tells Salon about his new book on the bureaucratic state
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TOPICS: DAVID GRAEBER, OCCUPY WALL STREET, INEQUALITY, BUREAUCRACY, ANARCHISM, CONSERVATISM, LIBERALISM, POLITICAL PHILOSOPHY, BARACK OBAMA, TONY BLAIR, NEOLIBERALISM, MEDIA NEWS, BUSINESS NEWS, NEWS, POLITICS NEWS

“I found myself turning into an idiot!”: David Graeber explains the life-sapping reality of bureaucratic life
David Graeber (Credit: AP/Michelle Mcloughlin)
David Graeber, a professor of anthropology at the London School of Economics, is a man who wears many hats. He’s an academic, of course — and a respected one at that. But he’s also an author, an activist and political anarchist. But his most unique attribute may be this: He’s an honest-to-God public intellectual in an era when such figures are few and far between.
Graeber proved as much with “Debt: The First 5000 Years,” his ambitious tour de force overview of the role debt has played throughout the history of civilization and into the present day. And while it may be the case that, in the years since “Debt” was first released, Graeber has come to be best-known for his role within the Occupy Wall Street movement, he is still, fundamentally, a writer and a thinker who tries to grapple with some of life’s biggest and most unwieldy ideas. On that score, his latest release, “The Utopia of Rules: On Technology, Stupidity, and the Secret Joys of Bureaucracy,” stands as proof.

Recently, Salon spoke with Graeber over the phone to discuss the book and his views on the bureaucratic phenomenon. Our conversation also touches on why Graeber thinks it was a mistake for the left to abandon a more thorough critique of bureaucracy, how bureaucracy can be a response to a deep-seated, psychological need, and why it is that it so often makes us both act and feel, well, “stupid.” This interview has been edited for clarity and length and can be found below.

What was it that made you want to devote so much time to writing about bureaucracy?

I’d actually written a couple of these essays beforehand, but I realized that bureaucracy was sort of a theme that kept popping up in all sorts of different things that I was working on … Also there wasn’t a very interesting existing literature on it. Part of it comes from my academic work and my political work — both constantly bumping into themes of bureaucracy, and not having a book like that that I could read. (You often write books you would have liked to have been able to read.)

The more time went on, the more I realized [bureaucracy] was also politically important. The fact that the discourse of the way we talk about bureaucracy, the political issue of bureaucracy, used to be a big left-wing issue back in the ’60s, and now it’s sort of been abandoned to the right — I think the political consequences of that have been disastrous.

How so?

Because, in a way, the left began against bureaucratization of life. It’s about freedom. The mainstream left, which is barely left at all at this point in traditional terms … has really embraced a combination of market and bureaucracy, an equal synthesis of the worst aspects of capitalism and the worst aspects of bureaucracy.

Nobody really likes it. It’s this kind of constant compromise in principles, which creates this [policy] mish-mash that basically nobody would come up with or promote as a program in itself. The very fact that people vote for these guys — Blair, Obama, etc. — at all just shows the enduring power of the appeal of leftist ideas. And because it’s a horrible program, the right-wing grabs all the popular rebellion votes.

So in terms of mixing the bureaucratic and the capitalist in a way that gets you the worst of both, the high-profile policy that came to my mind most immediately was the Affordable Care Act. Is that a good example?

Yeah, pretty much. You can’t tell if it’s public or private; and it’s partly government regulated profit-taking, forcing you into a profit-making enterprise [whether you like it] or not. And it creates completely unnecessarily complicated layers of bureaucracy.

This brings to mind a concept you call “the Iron Law of Liberalism.” Mind telling me a bit more about that and its significance?

There was this liberal fantasy in the 19th century that government would dissolve away and be replaced by contractual market relationships; that government itself is just a feudal holdover that would eventually wither away. In fact, exactly the opposite happened. [Government has] kept growing and growing with more and more bureaucrats. The more free-market we get, the more bureaucrats we end up with, too.

So I kind of looked around for a counter-example: Is there an example of a place where they did market reforms and it didn’t increase the total number of bureaucrats … I couldn’t find any. It always goes up. It went up under Reagan.

The idea that free-market policies create bureaucracies is pretty counterintuitive, at least for most Americans. So why is it the case that laissez-faire policy creates bureaucracy?

Part of the reason is because in fact what we call the market is not really the market.

First of all, we have this idea that the market is a thing that just happens. This is the debate in the 19th century: market relations creeped up within feudalism and then it overthrew [feudalism]. So gradually the market is just the natural expression of human freedom; and since it regulates itself, it will gradually displace everything else and bring about a free society. Libertarians still think this.

In fact, if you look at what actually happens historically, this is just not true. Self-regulating markets were basically created with government intervention. It was a political project. Certain assumptions of how these things work just aren’t true. People don’t do wage labor if they have any choice, historically, for example. So in order to get a docile labor force, you have to create police and [a] large apparatus to ensure that the people you kick off the land actually will get the kinds of jobs you want them to … this is the very beginning of creating a market.

Basically, we assume that market relations are natural, but you need a huge institutional structure to make people behave the way that economists say they are “supposed” to behave. So, for example, think about the way the consumer market works. The market is supposed to work on grounds of pure competition. Nobody has moral ties to each other other than to obey the rules. But, on the other hand, people are supposed to do anything they can to get as much as possible off the other guy — but won’t simply steal the stuff or shoot the person.

Historically, that’s just silly; if you don’t care at all about a guy, you might as well steal his stuff. In fact, they’re encouraging people to act essentially how most human societies, historically, treated their enemies — but to still never resort to violence, trickery or theft. Obviously that’s not going to happen. You can only do that if you set up a very strictly enforced police force. That’s just one example.

Stipulating that the bureaucratic state inexorably grows in response to free-market policy, why should it bother us? It’s annoying, sure; but are there costs bigger than that?

I really think that bureaucracy is a way of crushing the human imagination. It also makes people stupid. And that was the thing that really impressed me about my first major encounter with bureaucracy — I found myself turning into an idiot! I was filling out the form wrong, I was making the obvious mistake that anybody with any degree of intelligence wouldn’t do, and constantly being told: “But you did it wrong!” And that experience of wandering around and feeling like an idiot and incompetent in life, is the necessary clunkiness of living under a bureaucratic regime.

You also write in here, though, that there is a kind of appeal to bureaucracy, at least in the abstract. What do you mean when you say that?

Because it’s like a machine; you don’t have to worry about other people, you don’t have to do all that work of interpretive labor … you just press a button and things will appear. You can just go to the store and give them your money, and you don’t have to explain why you want this or why you need it. That’s a total separation of means and ends.

And on a deeper level … there’s this dream of a world where you actually know what the rules are, and that has a deep appeal. And this is why I called the book what I did. The phrase “Utopia of Rules” actually applied, when I first coined it, to games. Why do we enjoy games? Well, one reason we enjoy games is because it’s one of the only situations we ever experience in life, perhaps the only experience, where we know exactly what the rules are.

There’s always rules [in life], but usually they’re not spelled out; everyone has a slightly different idea of what they are, there’s all these ambiguities, it’s sort of complicated and then people break them all the time anyway. Life is this endless game of trying to figure out what the rules are and nobody quite understands. Then, [with bureaucracy], you create this imaginary situation, totally bounded in time and space, where everybody knows exactly what the rules are, people actually do follow the rules, and even people who follow the rules can win — which is very unusual in real life.

So there’s two fantasies or freedoms you can imagine: one based on play and one based on games. Play is like pure creativity; in fact, it sort of generates rules. It’s like the ultimate power. But pure creativity is scary on a certain level. On the other hand, pure rule-bound game is a stifle and boring. So there’s a kind of constant tension between those two principles that seems to play in every aspect of human existence. Bureaucracy is seizing on one of those impulses and riding it as far as it can go.

 

 

 

I came across a jaw-dropping programme on BBC Radio 4 that was almost totally hijacked by middle class pseudo-poor.

The presenter asked her listeners about changes they’d had to make because of economic hardship and the low wages they were paid. Instead of hearing hardship tales of queuing at food banks all the callers I heard HAD money in their banks.

The first caller I heard’s name was Angela and austerity really wasn’t fun because her sons’ deposit on a house had used some of her money.

The second caller was Ben who loved to travel overseas but he could only have two holidays and not the usual three!

Is the BBC now openly in league and on-message with Tories who think they’re “hard up” when they can’t send Tristrum to Daddy’s old private school? Has Aunty Beeb turned a blind eye to the reality of the many, now that the hands that hold her purse-strings are attached to Tory grandees?

The third caller was Roger and was proud of all he’d saved into his pension from his working days – now he could have all that he craved. When fourth caller, an old dear called Geraldine (who was worried friends would scoff because she couldn’t go to Harvey Nicks) rang, I was so fucking riled I reached for the OFF switch!

But! But! But…. then a BBC intern on the switch board must’ve got it wrong (they surely would have lost their job if it wasn’t for the fact they were trust-funded and working for free?) THEY LET A REAL PERSON ON-AIR!?!?
and before they shut her up;

  • She explained that she survived on just one lowly meal a day,
  • She heats it on a one ring stove.
  • Her days are very grey,
  • She was living in a wheelchair in a second storey flat,
  • When the lift breaks down she can’t get out,
  • She has a broken back.

On the occasions that she’s ventured outdoors in the last 2 years she’s endured some nasty comments from her neighbours who she fears.

They tell her that she’s lucky that she has a disability, she’s lucky that she cannot walk as “now you live for free”. They say she has no worries unlike the rest of the English, who have to pay their bills and tighten belts just so they can manage. She told the BBC that this was all a new phenomenon.

That she’d only suffered this abuse since the days of David Cameron. Since the red tops blame the weak and poor for taking too much money and the bankers who started the mess still live the life of Riley!
The presenter cut her off quickly, so missing the real story – her journalistic instinct crushed by corporate mediocrity.

But it was too late, I’d listened and heard the truth of modern Britain: Our values are so perverted that it’s not the Billionaire super-rich, city bankers or tax dodgers… it’s the weak in Britain, that are now the villains.

BBC Radio 4: Home of the pseudo-poor.

Let us not play the populist media game of diverting us from what really matters; inequality. This is the great trick of the “Society of the Spectacle”.

I’ve heard about, and now downloaded this new book that has taken America by storm and is No.1 in Amazon books. I, being tight and anti-capitalist, pilfered the book using The Pirate Bay 😉

Review programme about the book https://vimeo.com/92308666
Book Title: Capital in the Twenty-First Century Book Author: Thomas Piketty
Description
Product Details
Book Title: Capital in the Twenty-First Century
Book Author: Thomas Piketty (Author), Arthur Goldhammer (Translator)
Hardcover: 696 pages (This pdf version has 605 pages, including the covers)
Publisher: Belknap Press; First Edition edition (March 10, 2014)
Language: English
ISBN-10: 067443000X
ISBN-13: 978-0674430006
================================
Book Description
What are the grand dynamics that drive the accumulation and distribution of capital? Questions about the long-term evolution of inequality, the concentration of wealth, and the prospects for economic growth lie at the heart of political economy. But satisfactory answers have been hard to find for lack of adequate data and clear guiding theories. In Capital in the Twenty-First Century, Thomas Piketty analyzes a unique collection of data from twenty countries, ranging as far back as the eighteenth century, to uncover key economic and social patterns. His findings will transform debate and set the agenda for the next generation of thought about wealth and inequality.
Piketty shows that modern economic growth and the diffusion of knowledge have allowed us to avoid inequalities on the apocalyptic scale predicted by Karl Marx. But we have not modified the deep structures of capital and inequality as much as we thought in the optimistic decades following World War II. The main driver of inequality–the tendency of returns on capital to exceed the rate of economic growth–today threatens to generate extreme inequalities that stir discontent and undermine democratic values. But economic trends are not acts of God. Political action has curbed dangerous inequalities in the past, Piketty says, and may do so again.
A work of extraordinary ambition, originality, and rigor, Capital in the Twenty-First Century reorients our understanding of economic history and confronts us with sobering lessons for today.
================================
Reviews
A seminal book on the economic and social evolution of the planet… A masterpiece. (Emmanuel Todd Marianne)

The book of the season. (Telerama)

Outstanding… A political and theoretical bulldozer. (Mediapart)

An explosive argument. (Liberation)

In this magisterial work, Thomas Piketty has performed a great service to the academy and to the public. He has written a pioneering book that is at once thoughtful, measured, and provocative. The force of his case rests not on a diatribe or a political agenda, but on carefully collected and analyzed data and reasoned thought. The book should have a major impact on our discussions of contemporary inequality and its meaning for our democratic institutions and ideals. I can only marvel at Piketty’s discipline and rigor in researching and writing it. (Rakesh Khurana, Harvard Business School)

This book is not only the definitive account of the historical evolution of inequality in advanced economies, it is also a magisterial treatise on capitalism’s inherent dynamics. Piketty ends his book with a ringing call for the global taxation of capital. Whether or not you agree with him on the solution, this book presents a stark challenge for those who would like to save capitalism from itself. (Dani Rodrik, Institute for Advanced Study)

Anyone remotely interested in economics needs to read Thomas Piketty’s Capital in the 21st Century. (Matthew Yglesias Slate 2014-02-10)

The book aims to revolutionize the way people think about the economic history of the past two centuries. It may well manage the feat…It is, first and foremost, a very detailed look at 200 years’ worth of data on the distribution of income and wealth across the rich world (with some figures for large emerging markets also included). This mountain of data allows Piketty to tell a simple and compelling story…The database on which the book is built is formidable, and it is difficult to dispute his call for a new perspective on the modern economic era, whether or not one agrees with his policy recommendations… We are all used to sneering at communism because of its manifest failure to deliver the sustained rates of growth managed by market economies. But Marx’s original critique of capitalism was not that it made for lousy growth rates. It was that a rising concentration of wealth couldn’t be sustained politically. Ultimately, those of us who would like to preserve the market system need to grapple with that sort of dynamic, in the context of the worrying numbers on inequality that Piketty presents. (The Economist 2014-01-09)

Piketty, a prominent economist, explains the tendency in mature societies for wealth to concentrate in a few hands. (Amy Merrick New Yorker 2014-02-06)

Defies left and right orthodoxy by arguing that worsening inequality is an inevitable outcome of free market capitalism…[It] suggests that traditional liberal government policies on spending, taxation and regulation will fail to diminish inequality…Without what [Piketty] acknowledges is a politically unrealistic global wealth tax, he sees the United States and the developed world on a path toward a degree of inequality that will reach levels likely to cause severe social disruption. Final judgment on Piketty’s work will come with time–a problem in and of itself, because if he is right, inequality will worsen, making it all the more difficult to take preemptive action. (Thomas B. Edsall New York Times 2014-01-28)

It is a great work, a fearsome beast of analysis stuffed with an awesome amount of empirical data, and will surely be a landmark study in economics. (The Week 2014-02-20)

Groundbreaking…The usefulness of economics is determined by the quality of data at our disposal. Piketty’s new volume offers a fresh perspective and a wealth of newly compiled data that will go a long way in helping us understand how capitalism actually works. (Christopher Matthews Fortune.com 2014-02-26)

A sweeping account of rising inequality…Eventually, Piketty says, we could see the reemergence of a world familiar to nineteenth-century Europeans; he cites the novels of Austen and Balzac. In this ‘patrimonial society,’ a small group of wealthy rentiers lives lavishly on the fruits of its inherited wealth, and the rest struggle to keep up…The proper role of public intellectuals is to question accepted dogmas, conceive of new methods of analysis, and expand the terms of public debate. Capital in the Twenty-first Century does all these things…Piketty has written a book that nobody interested in a defining issue of our era can afford to ignore. (John Cassidy New Yorker 2014-03-31)

It seems safe to say that Capital in the Twenty-First Century, the magnum opus of the French economist Thomas Piketty, will be the most important economics book of the year–and maybe of the decade. Piketty, arguably the world’s leading expert on income and wealth inequality, does more than document the growing concentration of income in the hands of a small economic elite. He also makes a powerful case that we’re on the way back to ‘patrimonial capitalism,’ in which the commanding heights of the economy are dominated not just by wealth, but also by inherited wealth, in which birth matters more than effort and talent. (Paul Krugman New York Times 2014-03-23)

A landmark book…which brings a ton of data to bear in reaching the commonsensical conclusion that inequality has to do with more than just blind market forces at work. (George Packer New Yorker blog 2014-03-25)

Bracing…Piketty provides a fresh and sweeping analysis of the world’s economic history that puts into question many of our core beliefs about the organization of market economies. His most startling news is that the belief that inequality will eventually stabilize and subside on its own, a long-held tenet of free market capitalism, is wrong. Rather, the economic forces concentrating more and more wealth into the hands of the fortunate few are almost sure to prevail for a very long time. (Eduardo Porter New York Times 2014-03-11)

Piketty’s new book is an important contribution to understanding what we need to do to produce more growth, wider economic opportunity and greater social stability. (David Cay Johnston Al Jazeera America 2014-03-23)

The blockbuster economics book of the season, Thomas Piketty’s Capital in the Twenty-First Century, argues that the great equalizing decades following World War II, which brought on the rise of the middle class in the United States, were but a historical anomaly. Armed with centuries of data, Piketty says the rich are going to continue to gobble up a greater share of income, and our current system will do nothing to reverse that trend. (Shaila Dewan New York Times Magazine 2014-03-30)

Rarely does a book come along…that completely alters the paradigm through which we frame our worldview. Thomas Piketty’s magisterial study of the structure of capitalism since the 18th century, Capital in the 21st Century, is such a book…As leaders from Pope Francis to Barack Obama have proclaimed, growing inequality is the defining issue of our time. Much indeterminate discussion has swirled around its key causes, from job-displacing technologies to wage-deflating outsourcing of jobs. Capital in the 21st Century clears up all the confused thinking and presents us with the most compelling analysis to date of the key dynamic that drives ever-increasing inequality. This book is more than a must read. It is a manual for action that provides a fresh framework for the new politics of the 21st Century. (Nathan Gardels The WorldPost 2014-03-24)

[Piketty’s] thesis is simple. The growing concentration of capital in fewer hands has enabled its owners to keep it relatively scarce and thus valuable…Continuing high inequality is socially and economically destabilizing, though it need not lead to Marx’s apocalypse. So what we need is another bout of social democracy especially in the form of progressive taxation. You many think that it doesn’t require 600 pages to get this message across. This would be wrong. The strength of Piketty’s book is his close attention to the different sources of inequality, the massive documentation underpinning his history and conclusions, and his impressive culls from sociology and literature, which exhibit the richness of ‘political economy’ compared to its thin mathematical successor that has attained such prominence…Piketty’s book is a timely intervention in the current debate about inequality and its causes. (Robert Skidelsky Prospect 2014-04-01)

Over the last decade or so, economist Thomas Piketty has made his name central to serious discussions of inequality…Piketty expands upon his empirical work of the last 10 years, while also setting forth a political theory of inequality. This last element of the book gives special attention to tax policy and makes some provocative suggestions–new and higher taxes on the very rich. (Joseph Thorndike Forbes 2014-03-26)

It’s a brilliant, surprisingly readable work that synthesizes a staggering amount of careful research to make the case that income inequality is no accident. Indeed, Piketty argues that it is a feature of capitalism itself–unless governments take action to rein in capitalism’s excesses…But the value of Piketty’s work is that it shows that capitalism’s postwar heyday–in which incomes at the bottom and the top actually converged–was a historical anomaly. Piketty’s analysis of the last two centuries makes the case that capital in its natural state does not tend to spread out or trickle down, but to concentrate in the hands of a few…He has starkly and convincingly outlined the stakes for future generations. Either we’ll have a new birth of reformed capitalism…or we’ll have wealth concentration on such a colossal scale that it will threaten the democratic order. (Ryan Cooper The Week 2014-03-25)

Thomas Piketty’s new book, Capital in the 21st Century, painstakingly details the dynamics of wealth and income inequality throughout the last two centuries, and offers a somewhat grim picture of the future of economic inequality. Along the way, Piketty also offers his theory of the cause of exploding executive pay and how we can successfully combat this destructive trend. (Matt Bruenig The Week 2014-03-20)

In Capital in the Twenty-first Century, Piketty sums up his research, tracing the history and pattern of economic inequality across a number of countries from the eighteenth century to the present, analyzing its causes, and evaluating some policy fixes. Spanning nearly 700 densely packed pages, it’s a big book in more than one sense of the word. Clearly written, ambitious in scope, rooted in economics but drawing on insights from related fields like history and sociology, Piketty’s Capital resembles nothing so much as an old-fashioned work of political economy by the likes of Adam Smith, David Ricardo, Karl Marx, or John Maynard Keynes. But what is particularly exciting about this book is that, due to advances in technology, Piketty is able to draw on data that not only spans a substantially longer historical time frame, but is also necessarily more complete and consistent than the records earlier theorists were forced to rely on. As a result, his analysis is significantly more comprehensive than those of his predecessors–and easily as persuasive…Capital is a consistently engrossing read, encompassing topics including the stunning comeback that inherited wealth has made in today’s advanced economies, the dubiousness of the economic theory that a worker’s wage is equal to his or her marginal productivity, the moral insidiousness of meritocratic justifications of inequality, and more. But the book’s major strength lies in Piketty’s ability to see the big picture. His original and rigorously well-documented insights into the deep structures of capitalism show us how the dynamics of capital accumulation have played out historically over the past three centuries, and how they’re likely to develop in the century to come…America’s twenty-first-century inequality crisis is, if anything, even more daunting and complex than the one we experienced a century ago. But as Piketty reminds us, the solutions to this problem are political, and they lie within our grasp. Should Americans choose to deploy those solutions, not only would we be doing the right thing, we’d be living up to our deepest traditions and most cherished ideals.” (Kathleen Geier Washington Monthly 2014-03-01)

The most eagerly anticipated book on economics in many years. (Toby Sanger Globe and Mail 2014-03-11)

[An] enormously important book. (Doug Henwood Bookforum 2014-04-01)

How does a rigorous, seven-hundred page economic history become a lionized hit? Through the canny voice of professor Thomas Piketty, and his demystification of inherited wealth, Karl Marx’s true legacy, and what we mean when we talk about monetary ‘growth’ and ‘inequality.’ (Barnes and Noble Review 2014-03-26)
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About the Author
Thomas Piketty is Professor at the Paris School of Economics.

 

If you like this then I think you’ll like journalist & writer Paul Mason’s review “everything you need to know about Thomas Picketty’s: Capital” LINK