Reforming Europe: Thomas Piketty meets Pablo Iglesias

Economist rock star talks with politician rock star.

Some highlights. There's much more of interest since these are two of the rising stars of Europe in the 21st century.

TP: I think that the line between economics, history, sociology and political science is thinner than what economists sometimes tend to affirm. It is tempting for economists to have people believe that they created a separate science, too scientific for the rest of the world to understand. But of course this is a big joke, which has done a lot of harm. I believe we need a modest approach to economics, and that we shouldn't let economists keep economic questions to themselves.…

PI: You are not a Marxist economist. You say it very clearly when you describe your experience of the fall of the Berlin wall as a moment of joy as much as an observation of the failure of real socialist experiences. In that light, then, why is your book called Capital in the Twenty First Century, when it's inevitable that a comparison will be drawn between the work of Marx and any new 'Capital' in the 21st century?… 

TP: The book's title is Capital in the Twenty First Century because I'm trying to return the issue of wealth distribution to the centre of political economy. Authors from the 19th century, such as Ricardo and Marx, put the question of distribution at the core of political economy. However, I'm trying to do it in a different way, because Marx's book was published in 1867 and mine in 2014.… 

Since the Anglo-American conservative revolutions, with Thatcher and Reagan, and even more since the fall of the Berlin wall, we have entered an era of infinite faith in a self-regulating market. The whole movement of financial deregulation has contributed tremendously to higher inequalities, which in some instances have returned to pre-1914 levels. This historical perspective on inequalities in capitalism helps us to understand that there is never anything natural in changing economic situations. These evolutions depend on institutions, laws, political and legal systems. In the twentieth century, it was political shocks that were the first to alter the nature of capitalism, in one way or another. This historical perspective is crucial to conceiving of a new way to regulate today's global, patrimonial capitalism. 

PI: I can't help but ask about what I see as a statement of principle at the beginning of your book, when you refer to the Declaration of the Rights of Man and of the Citizen. The Declaration states that social distinctions may be founded only upon the general good. Is this a way of saying that it is legitimate to intervene against social distinctions when they differ from the common good, the collective interest? 

TP: Yes, this is how I interpret this sentence. It says: if you wish to legitimise social distinctions then you have to prove they contribute to the common good. We can't simply suppose in principle that they do. The first article of the Declaration consists of two sentences. The first one is an absolute statement about equality: 'Men are born and remain free and equal in rights.' Then, immediately after, there is a second sentence which introduces the possibility of inequality: 'Social distinctions may be founded only upon the general good.' After stating an absolute principle of equality, the possibility of inequality in society is introduced, providing that it is for the common good. 

I think these two sentences express very well a contradiction we still have to resolve today, more than two centuries later. Inequality isn't a problem in itself, as long as it can be justified by the common good. The problem is that in real life, elites or winners always mention the general good to legitimise their position. But this is often false. I believe it's very important to think critically, to deconstruct these discourses, and never to take for granted these justifications, which are often extraordinarily hypocritical.…
My book is reasonably optimistic. I want to believe that democratic forces can regain control over inegalitarian forces. At the same time, it's delusional to think that peaceful electoral process is enough to secure the changes we need. Social movements, and sometimes chaotic political movements, are essential for change. 

There will continue to be several different ways in which the redistribution of wealth is ‘regulated’. Of course, I want to believe in peaceful regulations, such as a progressive tax on wealth. But sometimes inflation, debt cancellation or more chaotic political processes play an important role – and they will continue to play an important role in the future.…

Internationalism of the left versus nationalism of the right.

TP: European leaders would be wise to understand that parties like Syriza or Podemos are fundamentally internationalist and pro-European….

You know, there might be political shocks later this year in France. Regional elections will be held in December and the far right will certainly win several regions. This is far more dangerous for governments in Paris or Berlin than Syriza or Podemos.…

Open Democracy
Reforming Europe: Thomas Piketty meets Pablo Iglesias
Pablo Iglesias interviews Thomas Piketty