Saturday, April 26, 2014

A Review of Picketty's Hot Best Seller...

From: Les Carpenter
Rational Nation USA
Purveyor of Truth


One of the better reviews IMO of the Piketty book “Capital in the Twenty-First Century” is by David Brooks in The New York Times.

Excerpt -
... Politically, the global wealth tax is utopian, as even Piketty understands. If the left takes it up, they are marching onto a bridge to nowhere. But, in the current mania, it is being embraced.

This is a moment when progressives have found their worldview and their agenda. This move opens up a huge opportunity for the rest of us in the center and on the right. First, acknowledge that the concentration of wealth is a concern with a beefed up inheritance tax.

Second, emphasize a contrasting agenda that will reward growth, saving and investment, not punish these things, the way Piketty would. Support progressive consumption taxes not a tax on capital. Third, emphasize that the historically proven way to reduce inequality is lifting people from the bottom with human capital reform, not pushing down the top. In short, counter angry progressivism with unifying uplift.

The reaction to Piketty is an amazing cultural phenomenon. But it says more about class rivalry within the educated classes than it does about how to really expand opportunity. Of course, this perspective could just be my own prejudice. When it comes to cultural analysis, I, like Piketty, am quasi-Marxist.

Hat Tip to BB Idaho for the link he provided to several other reviews.

Via: Memeorandum

16 comments:

  1. Progressive consumption taxes? I wonder where Brooks is going with that. Consumption taxes usually hit the poorest the hardest.

    JMJ

    ReplyDelete
  2. Wonder where you're going. Wealthy people own yachts, airplanes, helicopters, mansions, entertain in high fashion, etc., etc., etc.

    Ask Al Goreleone, a dude with a HUGE carbon footprint.

    ReplyDelete
  3. "Second, emphasize a contrasting agenda that will reward growth, saving and investment, not punish these things, the way Piketty would."

    Huh?

    My copy is on order but from what I can glean from the reviews a progressive tax on wealth
    is Piketty's starting point although he is pessimistic about the chances of stopping the current trend.

    Now whenever someone suggests a proper progressive tax we get this same talking point crap
    from the likes of Brooks. Regardless of the fact that Piketty's coup here is to start the demonstration
    that the current wealth transfer INHIBITS growth because there is an insufficient tax on capital which
    allows it to grow like a cancer, Brooks wants to wave his hands in the air and try the same old misdirection.

    I doubt he's read the book.

    ReplyDelete
    Replies
    1. You would ducky. From what I understand the book has strengths and weaknrsses, like most books.Nothing wrong with pointing out weaknesses as well as strengths.

      BTW, Brooks sees both.

      Delete
  4. The problem, Les, is that there aren't that many rich people and even fewer yachts - and as far as I know, only one Al Gore... Consumption taxes, or at least an over-reliance on them, hit the poor harder because the poor spend a far greater percentage of their income on consumption than do the wealthy. This has long been the progressive argument against consumption taxes beyond direct taxation, fees, or plain ol' sin taxes. Silly conservative arguments regarding this seem to come from a place of simply not understanding the progressive position.

    JMJ

    ReplyDelete
  5. Well worth a read

    ... it's becoming more difficult to defend the American oligarchy.


    ReplyDelete
  6. The whole "punish" thing is one of the sleaziest of those misdirections, too. It's right up there with "death taxes."

    JMJ

    ReplyDelete
  7. We all at his point are convinced you know a LOT about sleaze jmj.

    ReplyDelete
    Replies
    1. I know it when I see it, and that pseudo-martyrdom of the rich is the single sleaziest element in American politics today.

      JMJ

      Delete
    2. Yada, Yada, Yada, bla, bla, bla...

      Like I said, it surprises no. one you're intimate knowledge of sleaze.

      Have a nice day...

      Delete
  8. "Second, emphasize a contrasting agenda that will reward growth, saving and investment, not punish these things, the way Piketty would. Support progressive consumption taxes not a tax on capital. Third, emphasize that the historically proven way to reduce inequality is lifting people from the bottom with human capital reform, not pushing down the top. In short, counter angry progressivism with unifying uplift."

    We already reward "growth, saving and investment" and its been the whole basis of supply side economics. Supply side economics, in its current manifestation (including all the gifts, grants, free money, and tax abatements given by local and state governments to companies). It has not done a thing but made inequality worse.

    David Cay Johnson writes quite well about our current tax structure on his blog:
    http://www.taxanalysts.com/www/website.nsf/Web/DavidCayJohnston

    Consumption taxes...the government already gets most of its tax revenue from payroll taxes and now the idea of taxing workers even more with a consumption tax, which is regressive how ever you lay it out, is absurd.

    Oh, and I can't wait for someone to explain to me exactly what "human capital reform" means...

    ReplyDelete
    Replies
    1. Well, here's a "human capital reform" idea from the Right: http://www.forbes.com/sites/pascalemmanuelgobry/2013/06/05/a-reform-conservative-manifesto/

      "Families are our number one incubators of human capital. Kids who grow up in two-parent households (on average) do better than others, which means they find their prospects increased, which means they have more economic and social security, which means they’re less likely to need government handouts. The most important way to increase American human capital and reduce demand for big government is to strengthen lower-middle American families. Rick Santorum was right to point out that if you get married, your economic prospects are much better."

      So, there you have it. Nothing.

      JMJ

      Delete
    2. I'll agree with Tao regarding 'trickle down'. It not only failed to help the middle class, but
      worsened the disparity. 30 years data is enough for me; probably the diehards will need another 30.

      Delete
    3. BB, the top tax rate for the past 24 years has been somewhere between 35 and 40%. Couple that with the top tax rate in states like New York and California where it's in the 12-13% range and I really have to ask you here, have the last 30 years really been all about "trickle down"?

      Delete
    4. And the President is always talking about the rich paying their fair share but never once defines thing. The top 1% is currently making 18.9% of the country's total income and paying 37.4% of the total income tax. This are radically unfair stats in his mind? And, if so, what SHOULD these numbers be; 10 and 45, 5 and 50? I really would like to pin the sucker down.

      Delete
  9. I have a suggestion. How 'bout instead of a wealth tax, which is essentially a radical form of tax on capital with an exceedingly high deadweight cost, we institute a national property tax? Make it 1-2% and exempt the first $500,000 so it doesn't hurt the middle class. So a rich dude with a $2 million home would pay to the Feds an additional $15,000 to $30,000 a year (reducing his extant capital) and it probably wouldn't hamper growth quite as much. It sounds like a fair compromise to me.

    ReplyDelete

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