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April 25, 2014

Latest Posts from Economist's View

Latest Posts from Economist's View


Paul Krugman: The Piketty Panic

Posted: 25 Apr 2014 12:15 AM PDT

Money talks, but sometimes not very coherently:

The Piketty Panic, by Paul Krugman, Commentary, NY Times: "Capital in the Twenty-First Century," the new book by ... Thomas Piketty, is ... serious, discourse-changing scholarship... And conservatives are terrified. ...
The really striking thing about the debate so far is that the right seems unable to mount any kind of substantive counterattack... Instead, the response has been all about name-calling — ...that Mr. Piketty is a Marxist...
For the past couple of decades, the conservative response to attempts to make soaring incomes at the top into a political issue has involved two lines of defense: first, denial that the rich are actually doing as well and the rest as badly as they are, but when denial fails, claims that those soaring incomes at the top are a justified reward for services rendered. Don't call them the 1 percent, or the wealthy; call them "job creators."
But how do you make that defense if the rich derive much of their income not from the work they do but from the assets they own? And what if great wealth comes increasingly not from enterprise but from inheritance?
What Mr. Piketty shows is that these are not idle questions. Western societies before World War I were indeed dominated by an oligarchy of inherited wealth — and his book makes a compelling case that we're well on our way back toward that state.
So what's a conservative, fearing that this diagnosis might be used to justify higher taxes on the wealthy, to do? He could try to refute Mr. Piketty in a substantive way, but, so far, I've seen no sign of that happening. Instead, as I said, it has been all about name-calling..., to ... denounce Mr. Piketty as a Marxist..., which only makes sense if the mere mention of unequal wealth makes you a Marxist. ...
And The Wall Street Journal's review, predictably, goes the whole distance, somehow segueing from Mr. Piketty's call for progressive taxation as a way to limit the concentration of wealth ... to the evils of Stalinism. ...
Now, the fact that apologists for America's oligarchs are evidently at a loss for coherent arguments doesn't mean that they are on the run politically. Money still talks — indeed, thanks in part to the Roberts court, it talks louder than ever. Still, ideas matter too, shaping both how we talk about society and, eventually, what we do. And the Piketty panic shows that the right has run out of ideas.

Links for 4-25-14

Posted: 25 Apr 2014 12:03 AM PDT

'Will 2014 end up like 1914?'

Posted: 24 Apr 2014 10:07 AM PDT

Larry ("The Numerologist") Summers:

Will 2014 end up like 1914?: 2014 is a year, if you think about it correctly, of anniversaries. It is the 100th anniversary of 1914, a moment when the world mismanaged itself and reaped the legacy of its mismanagement in as terrible a way as has ever occurred. ... Seventy-five years ago the year was 1939. It had been thought that the war that began in 1914 was a war to end all wars. ... Fifty years ago it was 1964. ... 1964 was months after the assassination of President Kennedy. It was the year that saw the United States' entry into Vietnam. ... Twenty-five years ago it was 1989. It was the year that in a historical sense the 20th century ended. ... A totalitarian ideology and empire was defeated without a shot having been fired. ...
So, if you believe in numerology, if you believe in centuries and quarter centuries, this is a remarkable year. History does not repeat itself, it has been said, but it does rhyme. If you think about the challenges that I have described, that sometimes were met well and sometimes were met poorly, echoes of many can be heard today. ...
I would suggest last that history teaches that no individual nation can be a guarantor of the stability of the system. It is only through the cooperation of nations, through the establishment of institutions, through the legitimacy that comes from convocation and dialogue, that firm and clear lines can be drawn...
My impulse to government, in a sense, came to me as a young child watching the first president who impinged on my consciousness, John F. Kennedy. He said, "Man's problems were made by man. It follows that they can be solved by man." There is no reason why the darker parts of history ever need to be re-enacted... It lies in our hands, as concerned citizens, to shape what somebody in 2114 will say when they reflect on the past hundred years.

Consumption Inequality is Also Growing

Posted: 24 Apr 2014 08:46 AM PDT

Hearing a lot of talk about how Democrats never talk about consumption inequality, and that this is "the holy grail for inequality skeptics". It is talked about, and it's a "myth that growing consumption inequality is a myth." A very quick search of this blog turns up:

The Myth that Growing Consumption Inequality is a Myth 2012
Inequality of Income and Consumption 2012
Inequality Has Increased in Income and Consumption 2012
But They Have TVs and Cell Phones! - 2012
Has Consumption Inequality Mirrored Income Inequality? 2011
Is Consumption the Grail for Inequality Skeptics? 2009

Income Inequality, Spending Inequality, Wealth Inequality 2008

Consumption and Income Inequality 2008

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