The Controversies Of Capital In The 21st Century

Tax And Spend?

The real controversies surrounding the book stem from what he recommends doing about the unequal distribution of wealth, which include a global tax on capital; transparent global banking regulations (to see where the uber-wealthy have hidden their money to tax it uniformly so wealth cannot flee from one country to another); a hefty tax on bonuses and inheritance (“death taxes” in the U.S.); strict regulation of banking; and, an almost-confiscatory tax (not quite as high as the 80 percent to 90 percent tax on the wealthy the U.S. has imposed during parts of the 20th century) on people whose wealth comes solely from investments.

He advocates spending on education, infrastructure, health and saving the world from climate change.

Another of Piketty’s recommendations is an increase in the minimum wage. In an interesting note of historical irony, Piketty notes in the U.S. low-wage workers got the biggest bang for their buck in 1969 when the minimum wage was set at $1.60. In 2013 dollars, $1.60 equals $10.10 or what some members of Congress are advocating for the minimum wage.

There are other recommendations for taxes; how to deal with national debt (including the mess in Europe); and, how to share the wealth with the poor.

The book is worth the effort. You might want to skip directly to Part Four ("Regulating Capital in the Twenty-First Century") and then return to the first three parts where he examines the economic systems of the “Ancien Regime” (France: from the 15th century to the French Revolution); Britain in Jane Austen’s time; “La Belle Epoch” (France: 1871 to the start of World War I); and “The Shocks” to the world economy (World War 1 and II, the Russian Revolution and the Great Depression).

Also noteworthy in the book are his economic histories of Europe, Scandinavia, the United States, Japan, China and other countries. And in this earlier part of the book is where he presents the history of unequal distribution of wealth.

Capital in the Twenty-First Century by Thomas Piketty. Belknap Press of Harvard University Press; March 10; 685 pages.

William L. Haacker is an award-winning journalist and editor who has worked for various New Jersey newspapers, including Gannett New Jersey.