The Atlantic’s digital media project QZ interviews the author of Capital in the Twenty First Century, Thomas Piketty.
There have been some American reviewers who have found your book to be very deterministic in assessing the inevitability of inequality and the challenges of constructing an effective response. Is there an undiscussed assumption about political economy behind the book?+
But there is a whole continuum of possible policy response! I don’t recognize myself at all in these reviews… I am not fatalistic at all, I certainly don’t believe that it’s all or nothing response. What’s probably inevitable is [investment returns being] bigger than [economic growth], that’s economics. In terms of politics, everything is possible, nothing is inevitable. [The United States] has a property tax which is a pretty big wealth tax. I would prefer it to be a progressive tax that was proportional and I would prefer it to be on net wealth rather than the gross value of real estate—if you take someone whose house is $500,000 and they have a mortgage liability of $490,000, his net wealth is $10,000, I would propose he would pay no property tax, no wealth tax. Right now he is paying as much property tax as someone with no mortgage who inherited his apartment 20 years ago. My premise is not to tax to destroy the wealth of the wealthy, it’s to increase the wealth of the bottom and the middle class.+
I am not terribly impressed by people who know for sure what will happen or not. What would they have said in 1900 or 1910? I’m sure many of them would have said there will never be a federal income tax because of the constitution. For a large country like the US—the US is one quarter of world GDP—the US has ample power to put sanctions on Swiss banks. You know, five years ago, people were saying it’s not possible to break bank secrecy in Switzerland, but you know, you put the right sanctions, you break it.
The bolded sections are mine, but this interview is a very interesting insight into Thomas Piketty’s political thought process.
He sees the world through the oppressor/oppressed axis, as Arnold Kling would have it. As a progressive, nothing in his answers to these questions from QZ strikes him as unreasonable or terrifying. He’s just suggesting policy responses that would help those poor people being oppressed by oligarchs.