Re: Piketty Reading Group: Chapter 16

1

Nice summary. Thanks Walt.


Posted by: Moby Hick | Link to this comment | 09- 4-14 6:22 AM
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Before you object: "Who would get a Gilded Age reference?", how many Balzac references did you get? Have you all read Pere Goriot or something?

Presumably when he initially wrote the book he was aiming at a French audience, who I'd guess are more likely to get most of the Balzac references, and its success with US readers came as a surprise.


Posted by: essear | Link to this comment | 09- 4-14 6:36 AM
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3

Right?

I can't stand the chapter-a-week thing so I finished the book a couple of months ago and currently don't remember anything about it.


Posted by: essear | Link to this comment | 09- 4-14 6:36 AM
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4

I'm actually sort of surprised by how badly you all seem to have misread his main arguments.


Posted by: Von Wafer | Link to this comment | 09- 4-14 7:16 AM
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5

What is his main argument?


Posted by: Moby Hick | Link to this comment | 09- 4-14 7:18 AM
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I'm also really interested by 4. What did I think were the main arguments? (1) Inequality of capital is probably rising to pre-WWI levels; (2) This means a world that is dominated by stable intergenerational accumulations of wealth (this one, I thought maybe was overstated somewhat); (3) For those who don't like this idea, Piketty himself and probably most of his readers, the best alternative is the sort of wealth taxes backed up by transparency and international coordination the he alludes to.

What am I misunderstanding?

(Irrelevantly, bitching at a French author for relying on French examples seems weird to me. I've been suggesting Anglophone literary works as things that would fit Piketty's arguments throughout the reading group, but not in any serious way.)


Posted by: LizardBreath | Link to this comment | 09- 4-14 7:42 AM
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I finally finished the book. And caught up to the blog at the same time.

I think Picketty's proposal to "tax the shit out of wealth"* contrasts interestingly with Yglles' contention that "taxing rich people isn't enough, you also need to raise taxes on the middle class." I think Yglles argument isn't wrong, but it seems that he has always made it in reference to taxing incomes.... taxation of wealth hasn't even been on the table. And its true that, as a proportion of income, rich people are not such an outsized share that they can cover most of the cost of government operations. But when you look at the share of wealth that is held by the 1%, that case becomes a lot less obvious.

* Not an exact quote.


Posted by: Spike | Link to this comment | 09- 4-14 7:53 AM
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Irrelevantly, bitching at a French author for relying on French examples seems weird to me.

Yes, like that most famous work of French animated cinema, "The Aristocats."


Posted by: Spike | Link to this comment | 09- 4-14 7:55 AM
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And of course the premise that you also need to tax the shit out of the middle class depends sensitively on who you're calling middle class. There's the top decile of the income distribution, excluding the top centile or so -- those people certainly need to be taxed the hell out of income-wise, regardless of wealth. I have argued in the past that it's not reasonable to refer to that group as unambiguously rich, rather than middle class, and I think Yggles would agree with me terminology-wise.

But if you're thinking of the top decile, or even the top quintile, as "rich", and starting the middle class below that line, I don't think you do need to tax the hell out of the middle class.


Posted by: LizardBreath | Link to this comment | 09- 4-14 7:59 AM
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8: Well, consistently his English language literary examples were kind of stupid where they existed (Titanic?). But again, I'm not going to judge him for that.


Posted by: LizardBreath | Link to this comment | 09- 4-14 8:01 AM
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I'm not bitching at him for using French works. I think the whole thing with American movies is kind of hilarious. I guess you really have to be more explicit about joking in writing.


Posted by: fake accent | Link to this comment | 09- 4-14 8:06 AM
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taxation of wealth hasn't even been on the table

At this point, I would be happy to see equitable taxation of income derived from wealth, specifically capital gains and inheritance (above a reasonable threshold).


Posted by: knecht ruprecht | Link to this comment | 09- 4-14 8:07 AM
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Also, to 3, after I started the book in July, I didn't read it for a few weeks and forgot so much that I ended up starting over because I couldn't even remember how much I'd read of part one.


Posted by: fake accent | Link to this comment | 09- 4-14 8:13 AM
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14

Some people kill threads; I've killed the reading group. I actually enjoyed the book quite a bit, chapter 16's meanderingness notwithstanding.


Posted by: fake accent | Link to this comment | 09- 4-14 9:15 AM
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Well, U suspect waifu was pulling a chain, but there is possible esoteric meaning or ironic counter reading to the Piketty

1) Wealth tax etc, given current conditions and projected trends, ain't gonna happen...so

2) "Social disorder" as warned against by Piketty, is gonna happen, and catastrophes and bifurcations (9/11, 2008 GFC) are much more common then successful reforms under relatively placid conditions

3) DeLong and Krugzilla can "Oh Noes" social disorder. Piketty is fucking French, and the French drink blood-in-the-streets with their mother's milk. They spit on your puny social disorder, and understand that "There is a lot of ruin in a nation" is a description of opportunity. France survived, and prospered. Bring it on.


Posted by: bob mcmanus | Link to this comment | 09- 4-14 10:52 AM
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16

Sorry, I was kidding around and then forgot that I wrote that comment and went away for a bunch of hours.


Posted by: Von Wafer | Link to this comment | 09- 4-14 11:01 AM
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17

Damn. I was hoping for some shocking insight.


Posted by: LizardBreath | Link to this comment | 09- 4-14 11:03 AM
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I think VW has left that same comment (more or less) on another Piketty thread and should now be banned.


Posted by: fake accent | Link to this comment | 09- 4-14 11:05 AM
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Shorter 15:

Piketty, c'est moi!


Posted by: peep | Link to this comment | 09- 4-14 11:05 AM
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At this point, I would be happy to see equitable taxation of income derived from wealth, specifically capital gains and inheritance

You know, I'd like to see a tax on stock buybacks, since so many companies are basically doing that instead of dividends these days. Sure, you could wait for the stocks to actually get sold and maybe collect that tax as capital gains, or you could just go ahead and tax it at the time of distribution. Time of distribution, I say.


Posted by: Spike | Link to this comment | 09- 4-14 11:33 AM
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There are a number of times when he talks about potential violence from below that could only be held off by violent repression or some extraordinary "means of persuasion".

bob has what I think is the standard interpretation of this - that Piketty is predicting social disorder. But I'm not sure that's right.

I think Piketty is pointing out that whatever it is that keeps people from burning shit down today - whatever "means of persuasion" is already working - will continue. I admit that my opinion may reflect a bias against calamity and in favor of futility.

Contra bob, I think that when Piketty is talking about the egalitarian effects of global war and depression, he's not actually advocating those things.


Posted by: politicalfootball | Link to this comment | 09- 4-14 12:55 PM
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21: The implausibility of social revolution or radical change is actually the position of the French Left (except Badiou ) since 1968, although there are complications and nuances.

Piketty is very pointedly not associated or affiliated with that crowd, but more a liberal centrist who had been involved in politics and so had a bias toward possibilities of reform. Yet C21 looks much more pessimistic and I contend marks and shows a personal disenchantment with the possibilities of electoral politics and technocratic governance.

21.last: I do not advocate global war and depression.

But as we saw after 9/11 and the 2008 crash (if not history), if the Left or left-center is not prepared for these catastrophes and determined to use them opportunistically and immediately without giving even a moment to mourning or fear or caution or consensus, the Right will eat us alive and enchain us forever. And the Right does not fear catastrophe, and will eventuate it for their advantage.


Posted by: bob mcmanus | Link to this comment | 09- 4-14 1:46 PM
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Well done, everyone! YOU DID IT!


Posted by: heebie-geebie | Link to this comment | 09- 4-14 2:34 PM
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IF IT WEREN'T FOR THOSE PESKY KIDS!


Posted by: OPINIONATED HANDCUFFED PLUTOCRAT | Link to this comment | 09- 4-14 6:32 PM
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I have a thought that relates back to chapter 14 (on the effect of top-bracket income tax rates on the behavior of the elite). Last month, I visited Hearst Castle in San Simeon (home of William Randolph Hearst, the newspaper magnate), and thanks to the quirks of scheduling, wound up with a semi-private tour of the cottages with a guide who had been there for decades. WRH's father, who bought the land, was described as the tenth-richest man in the US, thanks to his mining investments/work, and WRH was his only child and heir. The property was given to the state of California after WRH's death in 1951, when the corporation's trustees decided they didn't want to keep financially supporting the property. However the family retained the right to stay there overnight up through the 70s. During the Patty Hearst/SLA affair, one of the cottages was bombed, at which point the family gave up that right when the state was unable to guarantee their safety going forward.

This seems like an example where, during a high-tax era, the elite adopted structures to control stuff indirectly (through control of corporations, or agreements with the state), rather than owning it directly. I suspect that these days,the elite are more likely to have personal control of their assets, rather than limiting salaries and operating indirectly.


Posted by: Dave W. | Link to this comment | 09- 5-14 6:08 PM
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I think elite still do that when it comes to private aircraft. Their companies own and pay for the learjet, but they get to fly around it all they want... as a form of compensation that doesn't get taxed.


Posted by: Spike | Link to this comment | 09- 7-14 7:30 AM
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This probably should be in the Reviews thread, but I found myself immediately having Piketty thoughts upon reading it. Great commentary by Will Mackintosh on the slave review thingy being published by The Economist nut graf:.

Here's my theory: among magazines, The Economist is perhaps the most articulate, erudite defender of the neoliberal capitalist order. They are too smart to waste their time as Laffer curve snake-oil salesmen or crude economic nationalists (cough cough, Wall Street Journal, cough cough), but nevertheless, the main commitment of their reporting and their commentary is to defend late modern global capitalism as an economic and moral good. Think Davos, not the Tea Party. And that's why they don't like Baptist's book: it demonstrates unequivocally that modern capitalism was born in blood. Let me say that again: whatever else you might say about capitalism, it took on its characteristic modern forms of capital accumulation and labor "management" in the context of American slavery. For a group of journalists with a deep, largely unarticulated commitment to modern capitalism's fundamental benevolence, this is an uncomfortable truth indeed.
Via Holland Confection.


Posted by: JP Stormcrow | Link to this comment | 09- 7-14 7:42 AM
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26: Yes, that has occurred to me a lot with regard to a the CEOs of a company that I'm, uh, familiar with. They're rich as shit, but not necessarily "Fuck You" money (at least not during the early part of their tenure), but they have access to "Fuck You" money level of things like planes and the like.

One test: If you "lost" your current position would you be invited to Davos next year?


Posted by: JP Stormcrow | Link to this comment | 09- 7-14 8:00 AM
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One test: If you "lost" your current position would you be invited to Davos next year?

No I would not. But I somehow didn't get my invitation this year either. Lost in the mail, I suspect.


Posted by: Spike | Link to this comment | 09- 7-14 8:21 AM
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