This
series explores the widening Wealth Gap and its impact on class and race
relations, excerpting heavily from Thomas Piketty, Professor at the Paris
School of Economics, who has explored the structural cause of the wealth gap in
his book Capital in the Twenty-First Century published in 2014. He created
quite a stir, getting both rave reviews and harsh critiques. He brought the
issue of a widening wealth gap to the limelight and has shown how war mitigated
extreme wealth gaps in the past. And without a discussion and resolution, war may
again mitigate the current wealth gap extreme. And now, Covid-19 has made wealth inequality impossible to ignore. That is not just wealth inequality, but
inequality of access to healthcare.
Capital in the Twenty-First Century by
Thomas Piketty, Professor Paris School of Economics, 2014, Excerpts
The central thesis of this
book is that a small gap between the return on capital and the rate of income growth
can in the long run have powerful and destabilizing effects on the structure
and dynamics of social inequality.
The concentration of wealth
and prospects for economic growth lie at the heart of political economy. The
main driver of inequality – the tendency of returns on capital to exceed the
rate of income growth – generates extreme inequalities that stir discontent and
undermine democratic values.
There is no fundamental reason
why we should believe that growth is automatically balanced. We should put the
question of inequality back at the center of economic analysis and begin asking
questions first raised in the nineteenth century. For far too long, economists
have neglected the distribution of wealth.
The latest book by the French economist Thomas Piketty appears unlikely to be sold in mainland China after he refused requests to censor it. The Chinese president, Xi Jinping, has expressed admiration for Piketty’s work, but Capital and Ideology, which was published last year, has not made it to the mainland China market due to sections on inequality in the country. “They basically wanted to cut almost all parts referring to contemporary China, and in particular to inequality and opacity in China,” he said.
Xi has previously referenced Piketty’s work, including his book Capital in the Twenty-First Century. As recently as this month, Xi wrote in an essay that Piketty’s work on US inequality was “worthy of our consideration”. Piketty writes that China’s wealth distribution to the top 10% and bottom 50% is “only slightly less inegalitarian than the United States and significantly more so than Europe”.
The coronavirus crisis has exposed the
ugly truth about celebrity culture and capitalism
31 Mar 2020
The
rich and famous are desperate to prove we are all in this together – in fact,
the outbreak has highlighted just how false that is. While this is a difficult
time for everyone, it has been particularly tough on the famous. They have been
upstaged by a virus. No one cares what they are wearing or who they are
snogging anymore; the world’s attention has been diverted by a headline-hogging
pandemic. It seems as if some celebrities are starting to grapple with the
realization that they are not quite as important or beloved as they thought
they were.
Gal
Gadot was the first victim of the great celebrity backlash of 2020. “We’re all
in this together,” the Wonder Woman star assured us in a video on Instagram a
couple of weeks ago, before launching into a star-studded rendition of John
Lennon’s Imagine. Can you imagine how little self-awareness you must have to
enlist a bunch of multimillionaires to sing about a world with “no possessions”
while huge numbers of people are losing their jobs?
Coronavirus
has made inequality impossible to ignore. That is not just wealth inequality,
but inequality of access to healthcare. A new famous person seems to test
positive for coronavirus every day while exhibiting mild symptoms at best.
Meanwhile, our friends and family can be coughing up their lungs and still not
get access to a test or a hospital bed.
Celebrity
culture and capitalism are inextricably entwined. Both elevate the individual
over the collective good. They rely on the lie of “meritocracy”: work hard and
you can achieve whatever you want. But it has become uncomfortably clear how
little we value our hardest workers – the healthcare professionals, supermarket
staff, bus drivers and delivery drivers who are keeping the world running while
the rich run to their second homes. And it has never been so clear how little
the people who earn the most contribute to society. “We’re all in this together,”
the rich and famous keep telling us. Sorry, but it is obvious that we are not.
Ultra-rich protect wealth with spread of
'family offices'
16 Mar
2017
The ultra-rich in London are
increasingly protecting their wealth through the use of "family
offices", says research from the London School of Economics. These are
teams of professionals - such as lawyers, financiers and psychologists -
employed to ensure the "dynastic wealth" of the super-rich, they
support a "bunkered" and "fortified" way of life of the
"global super-rich". The growth of extreme wealth, alongside poverty
and low-income families, means that there needs to be more analysis of how such
wealth is perpetuated, the study suggests.
Obama’s Farewell Address, Excerpts
10 Jan
2017
Our democracy won’t work
without a sense that everyone has economic opportunity. Our economy doesn’t
work as well or grow as fast when a few prosper at the expense of a growing
middle class, and ladders for folks who want to get into the middle class.
Stark inequality is corrosive
to our democratic idea. While the top 1 percent has amassed a bigger share of
wealth and income, too many of our families in inner cities and in rural
counties have been left behind. Convinced that the game is fixed against them.
That their government only serves the interest of the powerful. That’s a recipe
for more cynicism and polarization in our politics.
If every economic issue is
framed as a struggle between a hardworking white middle class and an
undeserving minority, then workers of all shades are going to be left fighting
for scraps while the wealthy withdraw further into their private enclaves.
Britain's inequality map - stark and
growing
02 Dec
2016
Andy Haldane, the Bank of
England's chief economist is not only worried about the inequality of those on
the lowest incomes versus the very rich, but also with those regions which have
fallen behind in the race for economic growth since the financial crisis. Most
concerning for a government which has pledged to make the economy work
"for all" - which presumably means across geographies as well as
income bands - is that the issue is becoming more acute.
UK one of the most unequal countries, says
Oxfam
13 Sep
2016
The richest 1% of the UK
population owns more than 20 times the wealth of the poorest fifth, according
to Oxfam. That made Britain one of the most unequal countries in the developed
world and contributed to the vote for Brexit, the charity said. The report said
many people in the UK felt locked out of politics and economic opportunity.
Rachael Orr, head of Oxfam's UK Program, said: "Inequality is a massive
barrier to tackling poverty and has created an economy that clearly isn't
working for everyone."
Wealth Over Work
23 Mar
2014
It seems safe to say that
“Capital in the Twenty-First Century,” the magnum opus of the French economist
Thomas Piketty, will be the most important economics book of the year — and
maybe of the decade. Mr. Piketty, arguably the world’s leading expert on income
and wealth inequality, does more than document the growing concentration of
income in the hands of a small economic elite. He also makes a powerful case
that we’re on the way back to “patrimonial capitalism,” in which the commanding
heights of the economy are dominated not just by wealth, but also by inherited
wealth, in which birth matters more than effort and talent.
Wikipedia: Wealth inequality in the United
States
The rich are accumulating more
assets while the middle and working classes are just getting by. Currently, the
richest 1% hold about 38% of all privately held wealth in the United States while
the bottom 90% held 73% of all debt. According to the New York Times, the
"richest 1 percent in the United States now own more wealth than the
bottom 90 percent".
The distributive nature of tax
policy has been suggested by some economists and politicians such as Emmanuel
Saez, Thomas Piketty, and Barack Obama to perpetuate economic inequality in
America by steering large sums of wealth into the hands of the wealthiest Americans.
This claim has created much controversy and debate within the academic and
political spheres.
Racial disparities: There are
many causes, but inheritance might be the most important. Inheritance can
directly link the disadvantaged economic position and prospects of today's
blacks to the disadvantaged positions of their parents' and grandparents'
generations.
In Capital in the Twenty-First
Century, French economist Thomas Piketty argues that "extremely high
levels" of wealth inequality are "incompatible with the meritocratic
values and principles of social justice fundamental to modern democratic
societies" and that "the risk of a drift towards oligarchy is real
and gives little reason for optimism about where the United States is headed.
