Piketty, Capital, and the World Wars: does government policy make a difference in wealth concentration?


#1

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#2

Both the left and the right have their panaceas of choice designed to return the American economy to the golden age of 1945-1975.

Neither will admit that that age was golden because (1) the rest of the world's industrial capacity was WW2'd all to shit and (2) energy prices were at low levels never seen before or since.

Neither will admit that the prosperity of that age, and its rising standard of living, is reachable again only by way of a time machine.


#3

I hear there are other countries in the world with middle classes and low levels of economic inequality apart from just 1950's America.

Just because there were some non-policy related things that boosted the economy at that time, doesn't mean that policies don't matter. And we've had some fairly horrendous policies implemented since then, including several decades of tax rate slashing, deregulation, union busting, and privatization. All of which may just have had some sort of an impact on inequality.


#4

does government policy make a difference in wealth concentration?

wait there are people who think it doesn't?


#5

Another interesting thing happened in the US in the early 1970s.
Oil production peaked and began to decline. Importation of oil began to ramp up.

... probably just a coincidence ...


#6

Of course it does. If the government is ipso facto run by corporations and others with capital and cash, whose policies will be reflected and to whose benefit?


#7

Really? But that leaves out the fact that some people have an incredible standard of living, with extraordinary wealth accumulation, even within the last few years since the economic collapse.


#8

Michael Hudson thinks that Piketty didn't go far enough. For starters, by not including income in the form of stocks and bonds, his stats don't show the full effect. Renegade Economists' Karl Fitzgeral interviewed Hudson a week ago. Among other things, they talked about Piketty's book.

If you're interested in hearing from other non-Chicago School/non-neoliberal economists, you can do worse than Steve Keen.


#9

For some reason the scalloping around the window in the picture breaks my heart


#10

There was a long discussion of that photo a couple months ago. Lot of interesting detail. It's wash day. Clothes were boiled on the stove in the copper "boiler" and scrubbed in the tub.


#11

Is that actually true, though? Looking around, I'm only seeing sources that indicate that energy was cheaper in the '90s, adjusted for inflation.


#12

I think we have a counter-example to Betteridge's Law, right here, for the answer is a resounding 'yes'.

I have not had the pleasure of thumbing around this tome. Amazon is sold out and Barnes & Noble wants $40.

For those who have; is the [not] Federal [with no ] Reserve given a mention?


#13

I haven't read Piketty, but I can't believe he would be taken seriously if he argued that policy has no effect on the distribution of wealth. Is that really what he says, or just the Doctorow version?


#14

I'm a bit surprised by the article... I read Piketty's book and found he was very specific about the way policy influences wealth distribution giving examples from the New Deal to post WW II social-democratic Europe.

In fact Piketty's argument is that the wealth inequalities we are seeing today are linked to policy!


#15

"energy prices were at low levels never seen before or since."

A gallon of gas cost about $0.30 and a high school student could get a job paying $0.25 an hour. Today gas is about half the minimum wage.


#16

I don't doubt your numbers, but they in itself are not enough.

  • Did people get the same mileage from a gallon back then as they do now?
  • Did they need to travel as far each day as they do now?
  • What about the prices the big users paid? And other kind of energy, like electricity?

#17

From a Guardian article by Paul Mason

You would expect the Wall Street Journal to dissent, but the power of Piketty's work is that it also challenges the narrative of the centre-left under globalisation, which believed upskilling the workforce, combined with mild redistribution, would promote social justice. This, Piketty demonstrates, is mistaken. All that social democracy and liberalism can produce, with their current policies, is the oligarch's yacht co-existing with the food bank for ever.

http://www.theguardian.com/books/2014/apr/28/thomas-piketty-capital-surprise-bestseller


#18

@doctorow

Even Piketty's critics can't fault his methodologies, though there are critiques of his conclusions -- which propose that unregulated capitalism will produce a hereditary class of the super-rich -- on both the right and the left.

"Will"? How about "have"?


#19

Oh. That's very different from saying "policy has no effect..." He's saying Neoliberal policy has no effect on the distribution of wealth, and I think Clinton and Obama have proved his point.


#20

Heh. ISWYDT