French economist Thomas Piketty wrote one of the most important books of the beginning of the 21st Century and published it in April of 2014. Capital in the 21st Century re-writes the economics on which so much of our modern business and politics are based and, by putting the last 50 years in the context of larger historical trends and time frames, is able to explain the current ‘diffidult’ economic times and the slow disappearence of the middle class in digestable, understandable language.
Cory Doctorow, co-editor of the web news site Boing Boing and has written an excellent review of Piketty’s book.
If nearly 700 pages of economic theory is not your cup of tea, Doctorow’s column is a well-written and useful summary/discussion of the tomb.
[excerpt][source]Piketty’s thesis has been shorthanded as r > g: that the rate of return on capital today — and through most of history — has been higher than general economic growth. This means that simply having money is the best way to get more money. Piketty uses examples from English and French literature (Austen, James and Balzac) to illustrate just how unimaginably weird this situation is by modern standards. The literature of the pre-modern era is full of people who understand that the being rich is a hereditary condition, and no matter what you create, or where you work, or how important you are, or how great you are, the only way to get rich is to be rich or marry someone rich.
“The most striking fact is that the United States has become noticeably more inegalitarian than France (and Europe as a whole) from the turn of the twentieth century until now, even though the United States was more egalitarian at the beginning of this period. What makes the US case complex is that the end of the process did not simply mark a return to the situation that had existed at the beginning: US inequality in 2010 is quantitatively as extreme as in old Europe in the first decade of the twentieth century, but the structure of that inequality is rather clearly different.”
In the US (and Canada), this is a more remote memory, because the European colonists who came to the “New World” generally arrived without much capital, and notwithstanding the occasional land-baron or rail tycoon, have not had the opportunity to set up the kind of enduring, centuries-long dynasties that characterized the world they’d left. But for Piketty, this extreme wealth disparity is a central fact of history, and it is supposed to be the thing that modernity — and capitalism — conquered, through a “meritocratic” system that rewards people who do amazing things with amazing fortunes, and that recognizes that merely being the kid of someone who did something amazing is not, in itself, amazing, and should not entitle you to the exalted heights that your storied forebears attained.