What explains Piketty’s extraordinary success? His book is certainly not the first study of economic inequality. My colleagues at the Institute for Policy Studies have been hammering at this issue for more than a decade...
And even before Piketty became a surprise bestseller, we were awash in statistical evidence. “In the United States, according to the economist Emanuel Saez of the University of California, Berkeley, the richest 10 percent increased their share of total pretax income from about 33 percent in the late 1970s to 50 percent by 2012,” Paul Starr writes in The New York Review of Books. “The top one percent alone now capture more than 20 percent of total income, double the share they received before the Reagan years.”
Piketty, however, provides the kind of continental, academic imprimatur that mere number crunchers in the United States lack. His use of an extensive data set appeals to the empirically minded, his prescriptions satisfy the policy-minded, and his references to Austen and Balzacimpress Paul Krugman. And he offers the long view, situating today’s inequality in the much larger historical context of oscillations in income distribution. Finally, his book has put theHeritage Foundation and the American Enterprise Institute on the defensive, as they dust off their usual arguments about the dangers of taxation....
But perhaps the most important reason for Piketty’s success here in the United States is a latent outrage at the deal that the Obama administration made down at the crossroads at midnight in the wake of the financial crisis. As we all know, the U.S. economy did not collapse in 2009, though it came close....Foreign Policy in Focus
The deal with the Devil, however, was an ugly one. Only one person is going to jail as a result of the widespread malfeasance connected to the financial crisis—Kareem Serageldin of Credit Suisse. His story reads like one of those cautionary Mafia narratives in which one of the mobsters takes the rap for the entire gang, keeps his mouth shut, does his time, and returns for his payout when his time is up.
For despite a very brief period of self-imposed austerity at the depths of the crisis, the financial world has continued to enjoy extraordinary success. Just take a look at how our oligarchs—oops, I’m sorry—our “wealth generators” have benefitted....
The 2016 presidential elections will address a range of issues, many of them entirely irrelevant. Foreign policy will inevitably surface as candidates debate the pros and cons of the Obama doctrine. But unless a major war has broken out by that point, Americans will focus as they usually do on their own wallets. As such, the wisest candidates will focus on gross inequality. Piketty’s book, whether it’s read or not, should be a wake-up call for politicians. If inequality sells in the stores, it will sell at the polls as well.
Piketty in Elysium
John Feffer
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