If you don’t follow Tom Edsall’s columns in the NYT, you’re missing some of the best deep-dive policy pieces on the web. When Ezra Klein speaks of integrating context into news, it sounds a little luftmenschy in the abstract. But Edsall does it all the time in a simple column. His latest is a must-read on a new, and potentially debate-changing book on the accelerating rise of inequality around the world. The book is Thomas Piketty’s Capital in the Twenty-First Century, due out in the US this March, but already a sensation in France. Piketty talks about his book here.
What Piketty is proposing is that the twentieth century was an anomaly in the history of global capitalism:
The six decades between 1914 and 1973 stand out from the past and future, according to Piketty, because the rate of economic growth exceeded the after-tax rate of return on capital. Since then, the rate of growth of the economy has declined, while the return on capital is rising to its pre-World War I levels.
“If the rate of return on capital remains permanently above the rate of growth of the economy – this is Piketty’s key inequality relationship,” Milanovic writes in his review, it “generates a changing functional distribution of income in favor of capital and, if capital incomes are more concentrated than incomes from labor (a rather uncontroversial fact), personal income distribution will also get more unequal — which indeed is what we have witnessed in the past 30 years.”
Edsall provides a variety of expert judgments on the book. I have a profound proclivity for exciting ideas that suggest we’re all doomed – so take my interest with a pinch of salt. But the book powerfully suggests a rather determinist view that capitalism constantly sows the seeds of its own destruction, by gradually and inexorably increasing social and economic inequality in such a way as to undermine the legitimacy of democratic politics that undergirds its existence. Let’s just say that Tom Perkins and Paul Ryan – as well as unreconstructed liberals who think government can truly defeat accelerating inequality – should read it.