Saturday, July 16, 2016

I Finally Read Piketty's Capital!

This is one of those books I was looking forward to reading so much that I went and ordered it early, even though it was pretty pricey - come on university presses, get your discounts on Amazon. The thing is that it created so much buzz between the big conference of the Economists in January and when it was finally released in translation in the spring, so many people had written on and about the book that actually reading the book and taking in the argument for myself seemed pretty superfluous at the time, you know. It is a big book and if people are going to tell you that the rate of return is greater than the rate of growth on a long time scale in less than 700 pages I was ready to listen. My physical copy has it’s bookmark firmly on page 113, right in front of the beginning of chapter three. (I have Robert Gordon’s new book on my pile, afraid it will reach the same point).

But I then had an extra credit on my audible account, so I thought I would listen to it. I’m convinced by Piketty’s argument. I worry that the information he has is not full enough to jump to huge conclusions. He treats the big wars of the 20th century as one-off things. I’d bet that they are not the last big wars that civilization will see, and those are pretty good at destroying wealth in the form of real estate and equities (minus defense, I’d wager). And the data-sets, as impressive as they are are limited to only four countries for the longest sets, and to just France for the longest set. So let’s go with a global wealth tax. Just tell me how to implement it.

The other thing is that though I was an English major, I read mostly the 20th century, so the Austen references go over my head (not to say the Balzac ones, an author to me known only for what his name rhymes with in English). It seems to be a novel way to track price movements and what not since inflation nowadays makes mush of the idea of stable prices (all one needs is 500 pounds and room of one’s own to do the math on that on).