Piketty’s “Capital In The 21st Century”

[TBF]

Has anyone here read it yet?

Top 4 radical conclusions from Piketty’s “Capital In The 21st Century”
by: John Case
April 17 2014

French political economist and author of "Capital In The 21st Century" Thomas Piketty is making a groundbreaking book tour of U.S. policy and academic centers armed with mounds of data that is shaking up economic prognosticators. Nearly every economist of any reputation must now deal with the stunning evidence behind the inequality trends Piketty illuminates. Even Robert Solow, Nobel Prize-winning economist, famed for discounting the dangers of excessive inequality over the "the long run" in market economies, was ready to dialog with Piketty at the Economic Policy Institute's forum this past week. His book, which draws on massive data retrieved from previously untapped tax reporting resources, is literally shaking the foundations of even liberal economic thinking because of four principal conclusions:

1. Increasing concentration of wealth (primarily returns to capital) in the U.S. and Western Europe is returning to its historic dominance in the capitalist system after a brief 35-year period of relative shared prosperity. Economic surveys defining the "top" incomes as the top "20 percent" disguised the rate of concentration in recent years. When looking at the top 1 percent and higher the actual travesty of inequality is uncovered. Standard government economic data collection missed this. ...

Much more here: http://peoplesworld.org/top-4-radical-conclusions-from-piketty-s-capital-in-the-21st-century/

[johnp3907]

1. I'd like to see reviews from memebers of this group.

I've been wondering if this book offers anything new.

[Jackpine Radical]

2. I haven't read it, but that's not going to stop me from opining little.

First, it's a post-Marxist book. Marx was writing nearly 200 years ago, after all. The available base of politico-economic knowledge was much smaller then, and the world had had much less experience with the effects of industrialization. Marx was a great genius, but his insights were limited by the knowledge base of his time. Nevertheless, his thought formed the major basis for socioeconomic theory ever since. Even the language of "capitalism" had its origins in Marx, and all subsequent writers, no matter where they positioned themselves on the theoretical spectrum, had to define their positions in terms of Marx.

The dominant trend in economic theory, at least since World War II, was essentially to reject the "messy," qualitative sociological aspects of the field in favor of a hypertrophied set of mathematical models that fed on the more readily quantified aspects of our economic existence. This distortion caused us to reduce all values to monetary measurement, and produced models that became further and further separated from the experienced reality of daily life. It was this systematic, self-inflicted blindness to the fullness of the human experience that permitted economists like Milton Friedman to get away with postulating greed as a virtue.

So along comes Piketty. Yes, he's a post-Marxist. He doesn't have "Marxist credentials." What he does, however, is to broaden the scope of his concerns to something closer to the fullness of human experience, thereby shifting the public consciousness back into an awareness of the things that really matter in the politico-economic sphere.

He does this by attending to a wider set of variables than the economists of the last 70 years or so have acknowledged as important in their models--things like the growing inequality between the classes. He is able to do this in ways that traditional economists find either persuasive or highly threatening (depending on their sociopolitical allegiances) because he has found ways to assign numerical values to these previously unmeasured factors--a range of variables that the Marxists had previously only been able to grapple with in qualitative terms, and the post-war mathematical economists had ignored in their models as unquantifiable.

Thus, in some meta-theoretical sense, he provides a synthesis of the qualitative and humanistic Marxist doctrines and the numerically-driven modeling approaches of the mathematical economists, thereby producing a new and more satisfying level of politico-economic theory.

[The_Commonist]

3. I downloaded the sample chapter to my Kindle.

Started reading it yesterday. So far so good.

[socialist_n_TN]

4. OK, I haven't read the book.........

HOWEVER I did read this article and it's difficult to see how these four "radical conclusions" are NOT a Marxist analysis, in spite of what the writer might want us to think. Of those 4 radical conclusions, ALL of them were foreshadowed by Marx, Engels, Lenin, Trotsky, et.al.

1) Marx called this a "rentier" economy and wrote quite a bit about it.
2) This is part of the Marxian concept of the reserve army of labor.
3) Marx and, more especially, Engels developed and wrote on these socio-political aspects of capitalism.
4) This ties directly into the Marxist idea of internationalism of the working class as the antidote to this globalization of capitalism. Developed further by Lenin and Trotsky and the idea of imperialism.

I think that the writer is just trying to run from the label of Marxist.

[Starry Messenger]

5. I'm intending to read it.

I gather its like The Origin of Species for monopoly capitalism, not really Marxist, but still a valuable text for materialism. It's gotten lots of people talking about capitalism, which in this country is always a miracle.

[TBF]

6. Very funny from Jacobin --

How to Write a Marxist Critique of Thomas Piketty Without Actually Reading the Book
5.1.14
by Zachary Levenson
Capital in the Twenty-First Century is a long book, and you just don’t have time in your busy schedule to finish it and formulate a materialist critique. We’ve got you covered.

Be sure to emphasize that Piketty‘s conception of capital differs radically from Marx’s.
Note that his model is fundamentally at odds with the tendency for the rate of profit to fall.
Point out that his solution is openly reformist, and besides, would require worker militancy on a scale not witnessed in nearly a century.
Something something law of value something.
Okay, inequality. But then point out that he doesn’t explain it!
Mention in an aside his affiliation to Ségolène Royale and the PS.
Feign astonishment that people care now given that he simply codifies empirically what we already knew.
Lament his conflation of finance and industrial capitals.
Claim that you are going to buy it, though, as “the data will be useful.”

https://www.jacobinmag.com/category/blogs/

[yallerdawg]

7. You just saved me some money...

and a portion of the remainder of my life not wasting, as you say, time on something we already know.

I seriously have no problem with the French -- they just keep coming up lately -- but did this Frenchman just hustle the economics world? "Our Marxism is so vastly superior to yours, infidel swine," like a really nasty French waiter.

They say this book has taken the world by storm because now it is possible to discuss alternate economies after the failings of the capitalist trickle-down economic theory the world has been engaged in for so long, and the economic inequality is now so pronounced.

Really? I mean, really?

I am glad I didn't buy this book.

Not that there is anything wrong with buying the book, reading the book, or the French!

[TBF]

9. IKR ... I will buy it as it's good to read new ways to explain

Marx but yes the critical reports I am getting are that it is nothing new. I was lucky to find the Manifesto as a teenager (a rogue Economics teacher in high school smiled at my sharp questions & said "there's a book I can recommend&quot but so many have not read it and just take the red-baiting "communists are the debil" as gospel.

[socialist_n_TN]

10. "...new ways to explain Marx..."

Yep very good way to say it. It's highly ironic to me how so many people want to reinvent the wheel. AND that reinvented wheel NEVER works as well as the original.

[johnp3907]

8. You beat me to it!

I just saw this on Facebook, and logged on here to post it.

[Starry Messenger]

11. Ooo.

I will be sharing this elsewhere. I mentioned the Piketty book last week in passing in a group of Marxists and someone forwarded a ten-page critique to me in an email.

[rogerashton]

12. two things

1) His concept of capital is ambiguous, though to be fair, one could argue that it is the thing and not the language that is ambiguous. However, in most of the passages I have read so far (2/3 finished) he treats capital as a social relation -- that is, income claims based on supposed property rights -- rather than, as neoclassical economists do, as a resource comprising produced means of production. This is closer to Marx than to neoclassical economics. None the less, I would say that Marx' concept of capital is both richer and less ambiguous.

2) He doesn't explain his predictions of the growth of inequality, but having done some work of this kind (and heard or read a great deal more) I think I understand it. Not sure, understand, but he refers to "simulations." A standard method in 21st century macroeconomics is to write a "mathematical model" of a process by which an economic formation at one period is transformed to produce the different economic formation at the next period. The mathematics will include some random variables -- in Piketty's case the age at which proprietors die and leave bequests would be randomly distributed across the population, for example. These mathematical and random variables are then coded as a computer program and run, with a whole series of transformations, and trends and averages recorded from the computer program. We then try to tinker the math up so that, when we start with the numbers for, say, 1990, the results look a lot like the real world for 1990-2007. (Nobody tries to predict crises.) Then predictions are made from the tinkered-up computer program. This sort of works, sometimes.