American liberals and intellectuals are enthralled with French economist Thomas Piketty’s new book, Capital in the Twenty-First Century, which argues that capitalism’s tendency to lead to ever-increasing inequality means we need much higher taxes on the wealthy. It’s the No. 1 book on Amazon right now and is sold out. The Harvard University Press wasn’t ready for this kind of reception — in part, maybe, because the book wasn’t that big a deal when it was first published in France, last year.
And why was that? Maybe because the very same Socialist party Piketty actually advised during France’s 2007 elections is talking less like him and more like Friedman (okay, a French Friedman) these days.
Tyler Cowen and NRO’s Veronique de Rugy explain over at the New York Times’ Upshot blog that it could be French fatigue with socialist policies: President François Hollande is walking back some of his promises, after getting through a 75 percent top marginal income-tax rate, which is only 5 percentage points off of what Piketty recommends. For instance, France continues to express reservations about a financial-transactions tax it’s about to implement with some other EU countries, which can amount to something like the other major policy proposal of Piketty’s, a global wealth tax.
Piketty’s work also doesn’t really get into unsown ground for the French intellectual debate, they explain:
Mr. Piketty has been on the intellectual scene, and the darling of the French Socialist party and intellectuals, for some time already. An early appointment as an economic adviser to Ségolène Royale, the Socialist presidential candidate in 2007, gave him a platform to present his ideas to the news media. He also has had access to President François Hollande and many other leaders for a while, so Mr. Piketty is older news to the French political elite and journalists alike.
Besides, in France, unlike in the United States, most people take for granted the notion that income inequality is growing and destructive. A book that tells people what they already believe may receive approval without generating adulation.
(Oddly, despite Piketty’s work for Royale, a Times profile from just a couple weeks ago quoted him as saying he’s never been an adviser to a politician.)
Piketty hasn’t been irrelevant from the intellectual scene in America, though, he’s just been somewhat subtly present: Whenever you hear shocking numbers about how income has become concentrated among the very rich in America, they were probably produced by him and Emmanuel Saez, a Berkeley professor. There are plenty of problems with their empirical work, as Scott Winship and others have documented, as there are with Piketty’s new book (both the theory and the evidence), something French intellectuals have been pointing out from the right and the left, which Cowen and de Rugy touch on.
But boy are those numbers shocking, so the American Left has been very excited to latch onto a case for why they’ll continue to worsen, and why the only answer is French-style socialist policies. As Justin Wolfers noted, also at the Upshot, Piketty-mania is real in America, but also heavily concentrated on the coasts, in wealthy, high-tax blue states — America’s France, in other words. Give them time.