Dean Baker — Surge of Attention to Crusading Economist Piketty's New Book Takes Us to the Big Question of How to Reduce Inequality

This raises the obvious question of what can be done to offset this tendency toward rising inequality? Piketty's answer is that we need a global wealth tax (GWT) to redistribute from the rich to everyone else. That is a reasonable solution if we're just working out the arithmetic in this story, but don't expect many politicians to be running on the GWT platform any time soon.

If we want to counter the rise in inequality that we have seen in recent decades we are going to have to find other mechanisms for reversing this upward redistribution. Specifically, we will have to look to ways to reduce the rents earned by the wealthy. These rents stem from government interventions in the economy that have the effect of redistributing income upward. In Piketty's terminology cutting back these rents means reducing r, the rate of return on wealth.

Fortunately, we have a full bag of policy tools to accomplish precisely this task...

Now meaning to "the rent is too damn high."

AlterNet
Surge of Attention to Crusading Economist Piketty's New Book Takes Us to the Big Question of How to Reduce Inequality
Dean Baker | co-director of the Center for Economic and Policy Research (CEPR).