Connections: Agustín Fuentes and the Stories of Free Market Capitalism

 Connections: Agustín Fuentes and the Story of Free Market Capitalism

Discussions about economic issues in the United States suffer from two debilitating limitations, neither of which shows signs of abating any time soon.

First, and perhaps most evidently, increasing social and political polarization has meant that such conversations too often descend into a cacophony of competing claims; a fundamental unwillingness to even listen to opposing points of view dooms them from the outset as participants stridently argue for and defend their particular position as being the only reasonable one.  The situation is captured brilliantly, if unintentionally, by a front page headline in the New York Times from June 16, 2019: Lost in Abortion Noise: Nuance, a headline applicable for most any fill-in-the-blank topic at this fraught moment.

A second, more subtle limitation – present even when people do manage to engage in a sober conversation about our economic future – arises out of the unwritten rules about what can reasonably be discussed, a concept referred to for politicians as the Overton window: “the range of policies politically acceptable to the mainstream population at a given time.”  Discussions about economic policy are constrained to an extremely narrow Overton window: falling within it are considerations over whether and how to regulate capitalism; on the other hand, considering alternatives to capitalism lies decidedly beyond its edges.

The implications of this second limitation, and the ways in which the mainstream both subtly and overtly enforce what is considered acceptable, were highlighted recently in an interview by Krista Tippett for her program On Being.

Although I’m a big fan and occasional supporter of On Being, and I find Tippett’s interviews deeply engaging and enlightening, I’ll admit upfront that in what follows I’m going to be rather unfair to her.  Tippett generously provides listeners podcasts of her unedited interviews with guests – the hour and half or so of raw material that goes into the final, officially released, hour-long program – and I’m going to take advantage of her generosity here by quoting directly from one of these unedited releases.

The interview in question was a fascinating discussion with biological and evolutionary anthropologist Agustín Fuentes, entitled This Species Moment, (the final program is linked to at right, along with the transcript of the final version, and the unedited interview).  In what follows here, the portions quoted in normal font are from the official transcript, while the parts quoted in italics are my transcription from the unedited interview.

In the final, released show, Tippett introduces her interview with Fuentes by noting: “We’re exploring his spacious perspective on human nature, and capacities his intelligence for working with the insights 2020 has laid bare.”  She goes on to highlight in particular their discussion on “modern economic theory … [and] the extreme inequity in wealth distribution across the planet in the early 21^st century.”

She opens this exchange on the economy by noting:

We touched on COVID-19, the virus, and this is also part of the human niche as you describe it. Then there’s the incredible economic fallout of the response to this virus. And it’s also a moment — this moment was upon us, but it’s even more upon us now, and I think this will deepen as we move into the next year — that there’s something profoundly out of whack in the way we do an economy.

Notably, however, most of the next several minutes of their exchange (around the 36’ mark of the unedited interview) don’t make the final, released version of the show.  Certainly, in going from an 80-minute interview to a 50-minute final show (which also includes musical interludes), the conversation will be smoothed out to remove the hesitations and false starts of typical conversations, and some whole segments will necessarily be left out.  But in these excised portions, both in the comments themselves and in how they are expressed, it feels like Tippett carefully avoids stepping outside what she perceives to be the Overton window for the majority of her audience with respect to discussions on our economic system.

In particular, she avoids directly suggesting that capitalism or the free market are implicated in the economic issues she highlights, and in so doing struggles to find a way to express her concerns.

The … the … the … I don’t know where to … you know, the … I’m mean … one thing that I’m so aware of is how the market … if we ever believed that it was some kind of reflection of overall economic well-being or was connected to the economic lives of actual people, that’s just clearly not true.  And, the economic disparity, which, whatever your philosophy of that is … such a small, small number, just literal number of human beings, control so much of the wealth of the global economy.

She seems clearly to be seeking a way to point at the economic issues she wants to discuss with Fuentes without actually saying “capitalism,” without calling into question the fundamental system.  Even when she mentions “the market,” she hesitates a moment, before plunging forward with her statement.

Fuentes, however, crashes through the boundaries of this Overton window on economics for her, linking capitalism and the market economy directly to the current suffering of so many.  This, effectively, gives Tippett permission to follow him through to broader considerations, which she promptly does, and the two then proceed into a concrete discussion of the current economic situation.

Fuentes: We created the contemporary economy, and we are suffering for it.  There’s no doubt about it.  I think the way you describe this is this idea that right now if you think about it, 0.7 percent of the globe’s population control nearly half of the wealth; that’s not right, I don’t know of any context in which that’s right.  

So, if this economic system, this sort of current capitalist market global economy that is sort of not the only but essentially the dominant in the world, if this only benefits a teeny percentage of humanity really, that doesn’t sound very good.  Humans usually don’t do things on average that are highly deleterious for the vast majority of any given community. 

Tippet: Right!

Later in their discussion, it is Fuentes who circles back to observe the challenges associated with questioning capitalism and the free market; having stepped outside the Overton window, he looks back at it to emphasize the need to initiate among the general population a broader conversation about how our economics systems could and should function.  Not surprisingly, along the way he feels the need to defend himself against the criticism always quick to be mounted against anyone questioning capitalism as the one, true economic system.

Fuentes: Absolutely, but it’s systemic processes, and the problem is, everyone talks about individuals.  Economies are not about individuals, they are about societies, the processes.  And so, in fact, I think if we could push a little bit, and educate folks, or have folks think more deeply about, What is it we’re doing?

And I’m not arguing against our contemporary systems writ larger; I’m not saying get rid of our economy, but we can – there’s always going to be inequality – but we can manage how that inequality is shaped, how extensive it is, and how it works.  We know that, economists know that, it’s unavoidable, if you understand how these systems work. 

And yet, so many people are much more, sort of, structured in their belief systems to go buy a lottery ticket, than they are to vote, or to really think about how one would change the given system, and the power of the belief of human nature, this idea, the idea that this contemporary market system is free and open and the cream rises to the top.  It’s simply not true.

Tippett then hints at the bludgeon that critics so often used to silence questioning of capitalism, a rhetorical weapon invented by the economic winners, who have craftily convinced the economic losers to wield for them – and Fuentes again takes her lead to make it explicit:

Tippett: Right.  And this is such an … this discussion is alive in our society, and I’m a bit older than you, and it’s a fascinating thing to me that it’s alive, I mean, the cold war kind of shut down any question about capitalism.

Fuentes: I think something that’s really important to point out is that everyone says, “Well, communism failed.” Yes. Soviet communism failed miserably. That doesn’t mean that American capitalism is working wonderfully. Those two things are actually not even related.

Tippett: Right. Again, it’s a false binary.

Fuentes: So let’s get rid of that binary, and let’s ask ourselves, how does our economy work? Are people getting paid the level, the value of the quality of their work? Is there equal access to different things? These questions, as you said, have been going on — for example, in the United States over the last century, there’s been this incredible dynamic of thinking about these kinds of economic processes. But now I think you’re right, I think people are saying, wait a minute. How did we get here?  And the thing is, we know how we got here, and we know how to change it.

Tippett: Something I also appreciate, that you point out, and really, first of all, that it’s possible to have this conversation and take it out of that fight, about capitalism versus communism.

Here, then, the fundamental plea: unburden discussions and considerations of our economic future from the simplistic accusation so often used to shut them down – that questioning capitalism necessarily implies advocating Soviet-style communism as the alternative.  And, thus freed, enter into a constructive conversation about what a sustainable economic future could look like.

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During their conversation on economic issues and how to begin addressing them, Tippett and Fuentes touch on a number of themes that point to holes in the dogma built up to defend the existing economic system, and that have been getting increasing attention from scholars from a variety of fields.

 The pair note, for example, a simple yet powerful realization about our economic system:

Tippet: One of the things you’ve pointed out is that our economy reflects our view of human nature, our beliefs about human nature.  And so, this is a mirror of … it’s such a tangible reality, and yet it is an invention, it is an act of the imagination.

Fuentes: We created the contemporary economy, and we are suffering for it.

That is, the economic system we have today did not evolve naturally but rather was constructed.  To use the language of historian Yuval Noah Harari in his book Sapiens (my review linked to at right), it is one of many stories that humans created and tell themselves:

There are no gods in the universe, no nations, no money, no human rights, no laws, and no justice outside the common imagination of human beings.

Harari expanded on this idea and its implications, in a 2017 interview with Sam Harris on the Making Sense podcast entitled Reality and the Imagination (at 27’ 55’’), in language that aligns with Fuentes’ comment above that we are “suffering” as a result of one such story, that of our economic system.

My understanding is that a source of human power, but also the source of much human misery is … the human imagination, and the ability of humans to create fictional stories, and then to believe them, to such an extent that they can start entire wars just because they believe some religious or national or economic fiction. ... We control this planet not because as individuals we are much more intelligent than chimpanzees or pigs or dogs, but rather because we are the only mammal that can cooperate in very large numbers;  and we can do that because we believe in fictions. If we examine any large-scale human cooperation, you always find a fictional story at the basis, whether it’s about god, or the nation, or money, or even human rights. Human rights, like god in heaven, they are just a story invented by humans, they are not a biological reality.

And critically, Tippett and Fuentes go on to note that the creation of our economic system, this story we tell ourselves, actually originated out of false understandings about human nature.  Their discussion of this begins with a consideration of why humans don’t behave as rational economic actors – as individuals focused on maximizing their personal benefit from the economy – and then transitions to comment on the fundamental origins of these assumption of rational economic behavior.

Tippett: Something that you point at that I really appreciate is that why we don’t behave as rational economic actors — because you are about understanding why and how we actually do things — is not because we’re stupid, but because we’re social.

Fuentes: Exactly.

Tippett: There’s this sentence from your writing that — I had to think hard about it. But you said, “We willingly accept losses as often as gains, in exchanges. The reason is that for the majority of humans” — because classic economic theory would say that we would have an intolerance for loss. But you said, “For the majority of humans, exchanges are not about profit, but about making and keeping social connections.”

Fuentes: Exactly. These exchanges, these back-and-forth — this is about our sociality. It’s not about the money. There are many exchanges that are about money, but really, humans are constantly — we do things all the time for people, which if we did the cost-benefit analysis, we’d end up losing, but we do them because we end up winning. They’re part of this whole social dynamic that we’ve been talking about.

And I think if we understand that, then we come back to this notion that what’s really central for humanity are our acts of compassion and caring. And that gets us back to this idea of hope. There’s always hope for humanity, and there’s capacity, if we think about our exchanges not just as economic relationships, but as the patterns and processes of building the human society, we’re gonna think about it in a very different way.

 
These last thoughts from Fuentes, that “what’s really central for humanity are our acts of compassion and caring,” resonate strongly with the thesis of historian Rutger Bregman in his book Humankind: A Hopeful History.  Bregman argues that our deep-seated belief that competition and greed are fundamental and even necessary characteristics of human nature – that absent a thin veneer of civilization, people’s true, selfish nature would emerge – is not only wrong, but worse it undermines our ability to progress further on our project of civilization. Using a fresh analysis of human history, he rebuts the presumption that humans are inherently selfish, a belief that he notes has been largely unchallenged doctrine for millennia.

And, just as Tippett brings up with Fuentes that “one of the things you’ve pointed out is that our economy reflects our view of human nature, our beliefs about human nature,” so Bregman argues that it was during the Enlightenment that these cynical ideas about human nature became institutionalized. Enlightenment period philosophers and politicians celebrated it, building institutions based on reason and rationality that aimed to encourage and support each individual’s (apparently inherent) selfish behavior as a path to furthering the greater good. Thus were born: economic systems that encouraged people to focus on a desire to make a profit; democratic systems such as the U.S. constitution that created “a system of ‘checks and balances’, in which everybody kept an eye on everybody else;" and more generally a rule of law “governed by reason alone.”

Certainly, acknowledges Bregman, “a few centuries into the Age of Reason [a]ll things considered, … the Enlightenment has been a triumph for humankind … our lives … exponentially better and the world … richer, safer and healthier than ever before.”  But he then, in perhaps the most trenchant statement in his engaging and convincingly argued work, fires a direct shot across the bow of the cruise ship filled with end of history celebrants, saying of these Enlightenment approaches to our world: “it was the best answer – until now.”

For, willing to grant the Enlightenment institutions their due in lifting the world over the past several centuries out of the abject poverty and misery that was the inheritance of the shift to an agricultural society, he proposes that these institutions are not the final, best approach. He argues that it has come time to consider the next step in our social evolution, pointing out that:

the Enlightenment also had a dark side. Over the past few centuries we’ve learned that capitalism can run amok, sociopaths can seize power and a society dominated by rules and protocols has little regard for the individual.

The flaw of Enlightenment thinking and the institutions that arose from it, according to Bregman, is in fact precisely the mistaken assumption that selfishness is fundamental to human nature.  (My review of Bregman’s book linked to at right.) 

And Fuentes expresses Bregman’s idea of this selfish image of human nature as being a learned concept in an exchange later in his discussion with Tippett:

Tippett: And this, the perspective that you bring, is an interesting and, I think, a refreshing way to look at it, because the discussion that gets had becomes very partisan, and actually quite emotional. But just to point out, as you do, that we have this system that actually is based on an idea about how human beings behave, that is simply not true –“

 Fuentes: Yes.

Tippett:  that this kind of economy is based on an idea that we are essentially rational, logical economic creatures, and to the extent that we’re not, we’ll balance each other out, and you pointed out this study that I hadn’t heard about, in the 1990’s, this study in twelve countries, four continents, and there was not a single society in which people consistently behave in accordance with expectations of basic economic theory.

Fuentes: And that’s because, to behave in expectation … to behave as a good capitalist, you have to grow up in a capitalist society, that’s the way it works; if you grow up in a different kind of society, then your values, your perceptions, the way in which you think about money, for example, are totally different. And so, if we created it, right, we can alter it.  And that’s my point.

Thus, Fuentes argues, we are trained (as Bregman also claims) to believe that humans are fundamentally selfish, and, as a consequence, that free market capitalism is therefore the best possible economic system, and so finally raised to be good capitalists who actively defend the system against any evidence to the contrary.  As Fuentes points out earlier in the interview:

you’ve got to ask yourself, where did we get this and what’s going on, and that’s the really interesting question, because so many people who are even harmed by the contemporary economic system, they’ll support it, because they believe wholly and fully that this is the outcome of human nature, that this is the outcome of naturalness.

Another aspect that Fuentes explores of the economic story that has been created, is a more recent addition to the narrative we have been raised – particularly in the West – to believe:

Fuentes: that those who have money have money because of reasons of their genetic endowment or some kind of incredible business neuro-biological savvy…”

Tippett: It is kind of ‘survival of the fittest’ …

Fuentes: Yes!

Tippett: A very simple equation.

Fuentes: And it’s just not true, right?  People who have money aren’t necessarily – some could be quite smart – [but] many of them inherit money; the vast majority of people who have a lot of money have always had it.

Tippett: Or, they’re smart at some very specific little thing …

Fuentes: Right

Tippett: Not necessarily wiser, or smarter on balance.

Here, Fuentes draws similar conclusions to those of economist Thomas Piketty in his engaging and thought-provoking book Capital in the Twenty-First Century (my review at right).  Piketty presents extensive data that demonstrate Fuentes’ point about the significant impact of inheritance, and its powerful tendency in the capitalist system to cause wealth to become more concentrated among an elite few under quite naturally occurring economic conditions.  But, more directly to Fuentes’ specific point, Piketty also calls out the illusion of meritocracy that those who most benefit from the economic system as it exists today have propagated among the rest of society, in order to maintain their own right to further enrich themselves:

The conventional wisdom that modern economic growth is a marvelous instrument for revealing individual talents and aptitudes … has all too often been used to justify inequalities of all sorts, no matter how great their magnitude and no matter what their real causes may be, while at the same time gracing the winners in the new industrial economy with every imaginable virtue.

Later, focusing more specifically on the enormous and still growing disparity in wage income, particularly in the United States, Piketty writes:

a very high level of total income inequality [which] can be the result of a ‘hypermeritocratic society’ (or at any rate a society that the people at the top like to describe as hypermeritocratic) … a very inegalitarian society, but one in which the peak of the income hierarchy is dominated by very high incomes from labor rather than by inherited wealth …. It is hardly surprising that the winners in such a society would wish to describe the social hierarchy in this way, and sometimes they succeed in convincing some of the losers.

For many years there have been attempts to reform capitalism by pointing out its negative impacts, such as dramatically rising inequality and ignored environmental externalities, which, despite the benefits capitalism has brought about historically, now lead to concerns about its future sustainability.  These approaches at reform have mostly failed to gain traction, in large part because of the kind of aura that has built up around capitalism as the inevitable, ultimate outcome of human economic development.  This end-of-history belief has become so strong that even the losers in the economic status quo defend the system, easily persuaded that other reasons lie behind their economic struggles, typically some other they who are to blame: another race, immigrants, foreign governments, to name a few.

 In the past few years, however, a new front has been opened in the pursuit of economic reform, one focused on pointing out that free market capitalism is not necessarily the final stage in the evolution of economic systems, but rather an artificial construct built on potentially incorrect assumptions about human nature.  And, if the story we have been telling ourselves is no longer working, then perhaps it is high time to write ourselves a new one.

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Other notes and information:

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Have you read this book, others by this author, or even similar ones by other authors? I’d enjoy hearing your thoughts.

Other of my book reviews: FICTION Bookshelf and NON-FICTION Bookshelf

Book Review: "The End of Everything (Astrophysically Speaking)" by Katie Mack

The End of Everything (Astrophysically Speaking) (2020)
Katie Mack (1981)
226 pages

Katie Mack is like a kid in a candy store … except that as an astrophysicist her candy store is the universe – unimaginably immense and containing an untold variety of goodies. And the seemingly unquenchable curiosity and sense of wonder she experiences as she explores this realm animates every page of her book The End of Everything (Astrophysically Speaking).

Despite the dire title, Mack’s joy for her work shines through as she examines the implications of current theories in astrophysics for how our universe might end. This theme serves Mack as both a dramatic narrative thread, and a vehicle for describing several of the most significant developments in physics of recent decades, from the experimental confirmations of the Higgs field and gravitational waves, to the implied existence of dark matter and dark energy. These discoveries and others have not only deepened physicists’ understanding of how the universe began, but also of how it may eventually end.

Beginning at the beginning, Mack describes current understandings about the Big Bang. Here she introduces one of the key tools for cosmologists – the ability to see into the past. It arises, she notes, from the fact that light takes time to travel, meaning that

to a cosmologist, the past is not some unreachable lost realm [but rather] an observable region of the cosmos [in which they can] watch the progress of astronomical events that happened millions or even billions of years ago. (15-16) 

One crucial discovery, in that sense, has been of cosmic background radiation, which is thought to be a signature of the Big Bang, and the investigation of which has led to an improved understanding of the early universe as well as the evolution of the physical laws that governed it.

Tracing forward from the moment of the Big Bang, Mack sketches out the phases physicists theorize the universe has passed through on the way to its current state. These phases – often described in unimaginable quantities in both space and time – include the Planck Time, the first 10^-43 seconds before which nothing can apparently be known, and the inflationary period, during which 

our entire observable universe increasing in size by a factor of more than 100 trillion trillion … to about the size of a beach ball … over the course of something like 10^-34 seconds. (38-39)

 Mack goes on to describe how the theories developed to model what occurred during these phases have motivated the design of lab experiments to recreate the conditions then thought to have been present, and have thereby led to a better understanding of the physical laws that reigned during each of these periods. And through these studies, physicists have achieved ever more comprehensive models of the physical laws of our present-day universe.

A transformative understanding of the universe came, Mack notes, with the discovery that distant galaxies are moving away from us – that is, that the universe is expanding, and not static, as previously thought. The dramatic consequence of this realization provides the spark for Mack’s book, “that a universe that is not static, that had a distinct beginning, must also, inevitably, have an end.” (50) And to the ‘ends of everything’ Mack considers, she gives fairly dramatic, if descriptive, names: the Big Crunch, Heat Death, the Big Rip, Vacuum Decay, and Bounce; none a particularly appealing conclusion to our story.

But each of these dramatic possibilities for the end of the universe provides Mack an opportunity to explain and explore the intersection between developing models of the universe and the experimental data being collected to either affirm or challenge their validity. She makes evident in her narrative the intimate relationship between those physicists who do theoretical work, and those pursuing experimental data. Although Mack herself works as a theoretical astrophysicist, her descriptions of the work of experimental physicists as they push forward the boundaries on what can be measured make evident her excitement for this collaborative effort.

And in fact, late in the book she makes the statement that 

creative thinking becomes especially important when we’re faced with a conundrum like “how do we improve on [existing theories such as] Concordance Cosmology or the Standard Model?” Everything we’ve tried so far [in terms of experimental data] has been frustratingly consistent with predictions.

I tripped over this line when I first read it: the data being “consistent with predictions” of the models would seem to be a good thing, not a source of frustration. But in the next line she clarifies this sentiment: 

where are we supposed to find clues leading us to new models if we can’t get something in the current model to break?” (190) 

Here the clear passion of an astrophysicist who through her work – and I nod here to her apparent love for science fiction stories based on her references them – looks to explore new worlds … to go where no one has gone before.

In a coincidence that must have caused at least some consternation at both publishing houses, Mack’s The End of Everything has appeared in the same year as that of her fellow physicist Brian Greene’s Until the End of Time (my review of Greene’s book linked to at right LINKLINK). It is perhaps not such a remarkable coincidence in the end, as we learn in both books that a host of significant advances in physics – theoretical and experimental – over the past couple of decades have fundamentally reshaped physicists’ understanding of the universe, from its origins to its ultimate end. So, the time was clearly ripe for narratives that bring these advances to lay audiences. And if, as we learn from both authors, these advances have so far generated more questions than they have resolved, that is only to the good in providing a rich palette for their further work.

Having read these two books almost back-to-back (with a big dose of Thomas Piketty's Capital in the Twenty-First Century in between to bring me firmly back to present-day Earth), I can highly recommend both to anyone interested in these topics. Mack provides a quicker read, and certainly a more colloquial style, wearing her passion for her work on her sleeve. Greene’s book by comparison comes in at about twice as long, and he takes a more in-depth pass through the material, if still eminently engaging and readable. In particular, he makes a valiant attempt to lay out for readers the timeline over which the details of these potential “ends of the universe” would play out. His narrative approach is more measured, but like Mack, his fascination and love for his field comes through on every page.

An animating theme that runs throughout Greene’s exposition is, to pull from the subtitle of his book, Our Search for Meaning in an Evolving Universe. Mack, too, explores this, in her Epilogue, recognizing that

it’s impossible to seriously contemplate the end of the universe without ultimately coming to terms with what it means for humanity. … Whatever legacy-based rationalize we use to make peace with our own personal deaths, … none of that can survive the ultimate distribution of all things. (206) 

Nonetheless, for Mack – like Greene – such considerations cannot dampen her enthusiasm for what we are learning in the here and now, this moment when astrophysicists are exploring the distant reaches of space and time to better understand the history, workings and future of our universe.

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Here a brief overview of the ‘ends of everything’ that Mack considers (spoiler alert)

Attempts to understand and model the changing structure in a now recognized to be evolving universe led physicists to postulate the existence of dark matter as a necessary presence to explain the complex dance of galaxies. Though dark matter remains undetected, observations have provided firmer estimates of the amount present in the universe, reaching levels thought to be sufficient to overcome the expansion arising from the Big Bang, and eventually initiate a collapse. Mack refers to this as the Big Crunch, in which the matter of the universe comes crashing back together. More critically, she points out, all the energy that has been radiated out into the universe would also become condensed into an ever-smaller region, creating energies intense enough to “begin to ignite the surfaces of stars,” (65) with ultimately nothing able to survive. A hot, fiery end to our universe.

In the 1990’s, however, came the discovery that the expansion of the universe is actually accelerating, not slowing down as was predicted based on the estimates of the amounts of dark matter. To explain this, “astronomers invoked the existence of a vast cosmic energy field that could make the empty vacuum of space itself have an intrinsic outward push in all directions,” (76-77) referred to as dark energy.

Mack notes that dark energy currently appears to have a constant value that leads to the conclusion that the universe, instead of collapsing in a ball of fire, could end in what she refers to as Heat Death: its expansion will continue to accelerate, with everything beyond our local cluster of galaxies eventually disappearing beyond the edge of our observable range. Ultimately stars will die out and everything will slowly disintegrate, even protons decaying as the universe reaches a cold, dark state of maximum entropy.

The Heat Death scenario assumes that dark energy has – and maintains – the specific, constant value of -1. But, Mack writes, a group of cosmologists have realized that if the value “is even infinitesimally lower,” (112) the result will be a Big Rip. In this scenario, the expansion of space overcomes the other forces in the universe, so that even the space within matter expands, leading ultimately to the disassociation of even atoms.

The next, and perhaps scariest, end to the universe that has arisen out of recent theoretical analysis, came out of what was perhaps the most well-publicized experimental discovery in physics in the past decade: the Higgs boson. The discovery of this particle confirmed the presence of the Higgs field, “a kind of energy filed that pervades all of space and has interactions with other particles in a way that allows them to have mass.” (134) Physicists have determined that the Higgs field has just the right value to permit our universe to exist.

Confirmation of the existence of such a field, however, has provided experimental evidence supporting a proposal from decades earlier: that our universe may not be stable. In fact, Mack notes, the data suggest that the Higgs field could decay to a more stable value, and, critically, this value would no longer allow our universe to exist as it has. She refers to this as Vacuum Decay, and notes that it could be initiated at any moment by a sufficiently powerful event. Such an event would initiate a kind of ripple moving outward at near the speed of light in all directions, as the Higgs field in the surrounding space subsequently decays. Unfortunately, this state is one in which matter would completely disassociate: a painless death that could happen at any time, and that we could never see coming.

The last of the fates of the universe that Mack considers arises out of the recent experimental verification of gravitational waves, found as part of the study of gravity, specifically why it’s so weak compared to the other forces in physics. Among the theories being explored, based on the work of cosmologists interpreting the experimental data that’s been collected, is the idea of extra dimensions. In particular, Mack describes a theory that allows for there being two adjacent three-dimensional universes that move apart and collapse – like clapping hands – with each Bounce, as Mack refers to it, ending, and then restarting the universe in a high-energy, Big Bang like event.

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Other notes and information:

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Have you read this book, others by this author, or even similar ones by other authors? I’d enjoy hearing your thoughts.
Other of my book reviews: FICTION Bookshelf and NON-FICTION Bookshelf

Capital in the Twenty-First Century (2014)
Thomas Piketty (1971)
Translated from the French by Arthur Goldhammer
793 pages

The dramatic economic growth experienced globally since the end of World War II has lifted millions out of poverty and spawned a dizzying array of new technologies. The past decade, however, has seen a growing pushback in wealthy Western liberal democracies against the new economic order of globalization and free trade. A sense has developed among the working poor and middle class of having been left behind economically, and that their prospects for the future – and perhaps more critically those for their children – look increasingly bleak.

One consequence has been a series of populist uprisings, including the Brexit campaign, the Yellow Vests rallies in France, and in the US the Tea Party and Occupy movements, as well as the election of Donald Trump. Although these movements share a broad concern for the impacts of globalization, on particular topics their participants often take strikingly contradictory positions: some argue that rising government debt endangers our economic future, while others dismiss austerity programs as a cure worse than the disease; some argue for increasing tax rates on the wealthy, while others call for reducing taxes. And deepening political polarization confounds attempts to achieve consensus about the true nature of these problems or potential solutions, with opinion and conjecture – often driven by vested interests – overwhelming nuanced consideration.

French economist Thomas Piketty seeks to bring some clarity to this impasse in his monumental work Capital in the Twenty-First Century. Arguing that growing wealth inequality represents a dire threat to continued economic and political stability, he rejects the idea that capitalism and free markets, whatever benefits they have, naturally lead to stable outcomes:

There is no fundamental reason why we should believe that [economic] growth is automatically balanced. It is long since past the time when we should have put the question of inequality back at the center of economic analysis and begun asking questions first raised in the nineteenth century. For far too long, economists have neglected the distribution of wealth. (20) 

And so, in pursuit of a deeper understanding of the distribution of wealth, its origins and consequences as well as policy solutions to address it, he proposes a structured, data-driven approach:

If the question of inequality is again to become central, we must begin by gathering as extensive as possible a set of historical data for the purpose of understanding past and present trends. For it is by patiently establishing facts and patterns and then comparing different countries that we can hope to identify the mechanisms at work and gain a clearer idea of the future. (20)

Piketty makes clear from the outset that his goal is not to completely overthrow the current economic system. “I have no interest in denouncing inequality or capitalism per se … [but rather] in contributing … to the debate about the best way to organize society and the most appropriate institutions and policies to achieve a just social order … [based on] democratic debate.” (40)  In measured tones, then, and with repeated acknowledgement of the limits both of the historical data at his disposal and the ability of models to provide precise policy prescriptions, he proceeds to lay out a remarkably clear and trenchant analysis of the historical evolution of capital, what it portends for the future, and what can be done to stabilize it. Setting a hopeful tone early on, he states

Democracy can regain control over capitalism and ensure that the general interest takes precedence over private interests, while preserving economic openness and avoiding protectionist and nationalist reactions. The policy recommendations I propose … are based on lessons derived from historical experience, of which what follows is essentially a narrative. (2)

Given the topic, and the 700+ page count, one might be tempted to imagine that Piketty’s tome is one only an economist could love, but nothing could be further from the truth. Certainly, the ongoing series of plots demonstrating the evolution of capital, income and other values over the past few centuries, and the accompanying discussion describing their implications, can be a bit technical at times for the uninitiated, but Piketty brings an extraordinary liveliness to his narrative, with sparkling prose that engages even as it informs.

As just one example, he repeatedly references French and English literary works from the 18th and 19th centuries. These sources support his arguments and reinforce his data, but also animate his telling. And, though offering his interpretations, opinions and proposals where appropriate, Piketty is careful to stick close to the data, to what it can tell us – and what it cannot – while making clear the quality of the data, and how this quality varies from country to country and over time.

More generally, he acknowledges the limitations of economic analysis, arguing that it must needs be complemented by the work of other social sciences, such as history, sociology, anthropology and political science. In particular, he rejects the term economic science, for its implication that economic decisions can be made purely from dry calculation. Always he falls back on the need for democratic debate to decide our policy future.

After a helpful Introduction that briefly but efficiently lays out the history of economic analysis since the late 1700’s, Piketty sets about defining the terms and quantities that play a fundamental role in his discussion, including among others: income versus capital, labor income versus return on capital, and the capital/income ratio, which defines the amount of capital as a number of equivalent years of nations income, a value he tracks as an indication of the importance of capital in a society.

Having established these preliminaries, he then turns to the historical economic data he has gathered, which reveal a crucial theme that will run throughout his narrative: in the context of the past several hundred years, the 20th century represented an aberration in the evolution of capitalism.

As an example of this, he charts the economic growth rate, which is a combination of per capita output and demographics. After spiking in the late 20th century, with growth rates for both per capita output and population peaking at over 10 times their long-term average, it has more recently begun to decline. And, looking forward over the course of the 21st century, both of these metrics are projected to return to their long-term averages, with the consequence, Piketty declares, that the economic environment of the past half century, supported by high growth rates, will not persist.

Similarly, tracking the capital/income ratio as an indicator of the relative importance of capital, he shows that high levels of capital, and capital concentration, had been reached by the late 19th century, a period variously known as the Belle Epoque in France and the Gilded Age in the US. They then dropped precipitously from 1915 to 1950, with the destructive shocks of the World Wars and the institution of progressive taxation to both support the wars and create social programs aimed at reducing extreme inequality. More recently, however, they have begun to climb again, as conservative governments lowered tax rates on high incomes since 1980, and the economic growth rate has dropped off.

A dangerous consequence of the anomalous period of extremely high growth rates and extreme shocks to the global economy in the 20th century is that it has, according to Piketty, come to inform present-day intuitive understandings of and assumptions about the evolution of capitalism. In particular, it has instilled an erroneous belief that capitalism somehow righted itself in the 20th century, and that left to the dynamics of the free market a stable long-term economic trajectory can be achieved.

On the contrary, he argues, the historical evidence predicts that, with the projected downward trend in the economic growth rate over the course of the 21st century, the capital/income ratio will return again to the high levels seen in the late 1800’s.

And this rise in the amount of capital, he warns, will make visible again that “capitalism is undermined by its internal contradictions,” as first recognized in the late 19th century. The danger for capitalists in such a regime is that as the amount of capital increases the return on it eventually declines. Although this relationship, notes Piketty, can be countered “(to a certain extent) [by] permanent growth of productivity and population,” in an environment of declining productivity and population,

capitalists do indeed dig their own grave: either they tear each other apart in a desperate attempt to combat the falling rate of profit … or they force labor to accept a smaller and smaller share of national income, which ultimately leads to a proletarian revolution and general expropriation. (287)

Although this reckoning was held off in the 20th century, with the return in recent decades to regressive taxation and in a projected low growth environment, these ameliorating conditions are absent, and so capital growth has returned, along with its internal contradictions. And compounding these challenges, notes Piketty, is the historical evidence that as the amount of capital grows, its importance in national income relative to labor increases, along with its concentration among an elite few.

One bright spot that Piketty finds to have arisen out of the 20th century disruptions is that current-day capital ownership among the top 10% in the US (and similarly in Europe), although again high and rising, actually represents a reduction from levels of 80-90% at the beginning of the 19th century. During the disruptions of the mid-20th century a small but significant shift in capital ownership occurred to those in the middle class (defined here as 50-90% of the wealth distribution), leading to the emergence of what Piketty refers to as the Patrimonial Middle Class. (At the same time, he points out, the bottom half of the population saw no benefit from this shift, their share of capital ownership remaining at or below 5%.)

Piketty describes the development of the Patrimonial Middle Class as “a major transformation, which deeply altered the social landscape and political structure of society and helped redefine the terms of the distributive conflict.” (328). Nonetheless, despite this

important, if fragile, historical innovation … wealth is still extremely concentrated today…. [T]he historical reduction of inequalities of wealth is less substantial than many people believe. Furthermore, there is no guarantee that the limited compression of inequality that we have seen is irreversible. (327)

And countering this shift in some capital wealth to the middle class has been a phenomenon, mostly in the US and other anlgo-saxon countries, that Piketty refers to as “the rise of the Supermanager” or, alternatively, Supersalaries. This can be seen in that the share of labor income for the top 10% has increased by 10% since 1970, with the share for the top 1% alone increasing by roughly 7%. Piketty points out that is overwhelmingly the result of increases for top managers, not athletes, actors, artists or “super entrepreneurs” (such as Bill Gates).

He notes that these supersalaries are not a question of technology level (as continental Europe has not seen such wage increases), or supply and demand of talent. Rather, the data provide 

convincing proof of the failure of corporate governance and of the absence of a rational productivity justification for extremely high executive pay …. This is particularly clear in the case of US corporations: Bertrand and Mullainhatan refer to this phenomenon as “pay for luck.” (422)

Equally troubling, he points out, is that the decline in top tax rates since 1980, in the US and Britain, has created an 

amplifying mechanism [that] can give rise to another force for divergence that is more political in nature: the decrease in the top marginal income tax rate led to an explosion of very high incomes, which then increased the political influence of the beneficiaries of the changes in the tax laws, who had an interest in keeping top tax rates low or even decreasing them further and who could use their windfall to finance political parties, pressure groups, and think tanks. (423)

Examining the concept of using marginal productivity increase as a method of understanding the appropriateness of higher wages for particular jobs, he finds no evidence to support the idea that it can explain the high wage levels of these Supermanagers. He also notes that such an approach encourages 

a far too instrumental and utilitarian view of training. The main purpose of the health sector is not to provide other sectors with workers in good health. By the same token, the main purpose of the educational sector is not to prepare students to take up an occupation in some other sector of the economy. In all human societies, health and education have an intrinsic value: the ability to enjoy years of good health, like the ability to acquire knowledge and culture, is one of the fundamental purposes of civilization. (386-7) 

Certainly, in a US context in which education already from elementary school on is too often seen as one long race to maximize an eventual paychecks, his sentiment seems almost quaint – a disturbing commentary in itself on the current state of our civilization. And beyond health care and education, Piketty’s comments are echoed in science write Colin Tudge’s conclusion in The Time Before History that the merciless logic of capitalism has created the fundamental reality that “the agricultural systems of the [modern] world are not actually designed to feed people.”

One way that the wealthy in the US have promoted their success, according to Piketty, is through the particularly American belief in the gospel of meritocracy, a concept he dismisses with malice:

The conventional wisdom that modern economic growth is a marvelous instrument for revealing individual talents and aptitudes … has all too often been used to justify inequalities of all sorts, no matter how great their magnitude and no matter what their real causes may be, while at the same time gracing the winners in the new industrial economy with every imaginable virtue. (107) 

He argues that this view has been “largely created by the United States over the past few decades.” (331), as the gilded age inequality based on inherited wealth has been replaced by 

a very high level of total income inequality [which] can be the result of a ‘hypermeritocratic society’ (or at any rate a society that the people at the top like to describe as hypermeritocratic) … a very inegalitarian society, but one in which the peak of the income hierarchy is dominated by very high incomes from labor rather than by inherited wealth …. It is hardly surprising that the winners in such a society would wish to describe the social hierarchy in this way, and sometimes they succeed in convincing some of the losers. (331)

 And these “winners” extend their meritocratic justification beyond just increasing their out-size salaries. As journalist Anand Giridharadas writes in his trenchant and disturbing book Winners Take All, these

elites put themselves in the vanguard of social change…. How can there be anything wrong with trying to do good? The answer may be: when the good is an accomplice to even greater, if more invisible, harm. In our era that harm is the concentration of money and power among a small few, who reap from that concentration a near monopoly on the benefits of change. And do-gooding pursued by elites tends not only to leave this concentration untouched, but actually to shore it up.” (8, Winners Take All; my review at right)

It is the increasing concentration of capital, however, that Piketty returns to as most concerning, globally.

He notes that historically capital has always been more unequally distributed than labor. In the US in 2010, for example, the upper 10% of the labor income distribution took in about 35% of the total labor income, while the bottom half took in about 25%. In terms of capital ownership, however, the numbers are more extreme: the top 10% own some 70% of the wealth, while the bottom half own only 5%. And Piketty argues that these numbers can only be expected to worsen: “It is an illusion to think that something about the nature of modern growth or the laws of the market economy ensures that inequality of wealth will decrease and harmonious stability will be achieved.” (475) And aggravating this tendency to concentration is that the rate of return on capital is generally higher the more wealth one has, due in part, he argues, to the wealthier being able to be more patient in their investments, but also able to employee more and better financial advisors.

One notable social consequence of the increasing concentration of wealth in rich countries has been fears of foreign ownership of domestic capital. But Piketty argues – again with data – that “currently prevalent fears of growing Chinese ownership are a pure fantasy.” More generally, “this feeling of dispossession … is partly irrational, [arising] no doubt [from] the universal tendency to look elsewhere for the source of domestic difficulties.” The real threat, he argues, is “an oligarchic type of divergence, that is, a process in which the rich countries would come to be owned by their own billionaires.” (588-9)

In the final part of the book, Piketty explores potential approaches to reversing the current trends toward concentration of wealth in an economic environment projected to have continued low growth rates.

He first charts the growth of taxation and the social state over the course of the 20th century, from tax rates of about 10% in the early 1900’s that only supported what he refers to as regalian functions – police, justice, military, and general administration – to present day tax rates of 30-50% that support a variety of social programs – health care, education, transfer payments to the unemployed and poor, and public pensions.

The mid-century support for the social state, he notes, came amid a time of strong productivity and demographic growth, with rising incomes predisposing citizens to accept paying higher tax rates. And the stability in tax rates since the 1980’s indicates a general consensus about maintaining the social state, if at different levels in different countries.

But the challenge going forward, into a period of expected low growth rate (economic plus demographic), is whether societies will choose to find ways to continue supporting these programs. Though Piketty discusses this challenge for countries globally, his analysis of the situation in the US over the past century is particularly enlightening.

As elsewhere, tax rates in the US up to WWI were less than 10%, including for the highest incomes. However, Piketty argues, the excesses of the Gilded Age created a climate for change in the US. 

[The] fear of growing to resemble Europe was part of the reason why the United States in 1910-1920 pioneered a very progressive estate tax on large fortunes, which were deemed to be incompatible with US values, as well as a progressive income tax on incomes thought to be excessive. (440) 

Then, a decade later, “the Great Depression of the 1930s struck the United States with extreme force, and many people blamed the economic and financial elites for having enriched themselves while leading the country to ruin.” (650) Consequently, income tax rates and inheritance tax rates rose to well over 50% for those in the highest income bracket between 1910 and 1980, as a strong social support network was created.

However, he writes, “perceptions of inequality, redistribution, and national identity changed a great deal over the course of the twentieth century, to put it mildly.” (440) And so, starting around 1980, the pendulum began to swing back again. Piketty notes that, supporting this turn against the social state, “US prejudices in regard to the poor … seem to be more extreme than European prejudices, perhaps because they are reinforced by racial prejudices.” (608n17) And that, more generally 

In the United States there is less of a consensus [than in Europe]. Certain substantial minority factions radically challenge the legitimacy of all federal programs or indeed of social programs of any kind. Once again racial prejudice seems to have something to do with this. (612n24)

These changing perceptions led, starting around 1980, conservative administrations to lower tax rates on the highest earners, eventually shifting from a progressive to a regressive tax structure, with opponents of high taxation among the wealthy often using hypocritical, misleading or specious arguments against it. (Countering, for example, the argument that high tax rates on the highest incomes stifle growth, Piketty notes that the US saw its highest growth rates in the 1950’s, at a time of extremely high, and progressive, taxation.)

And, with the current tax structure heavily weighted toward taxation of only income, and not capital or wealth, this shift toward a regressive tax structure has put significant strain on the ability to continue supporting social programs in the US, as well as elsewhere.

But Piketty proceeds from the assumption that the consensus on the need for social programs will continue, if not rise. And so, to fund such programs in an environment of projected low economic growth and increasing capital and capital concentration, he recommends instituting progressive taxation of income, estates and capital, noting that “these three progressive taxes play distinct and complementary roles [with] each … an essential pillar of an ideal tax system.” (675)

In support of taxing those with significant amounts of capital (particularly in a world of increasing capital concentration), Piketty describes both a contributive justification – that the extremely wealthy tend to have a significant amount of their income not from taxable wage income – and an incentive justification – that taxing capital will encourage investing it as opposed to simply sitting on low yield investments, leading to more benefit to society. In response to those arguing that such a taxation scheme would undermine capitalism and the free market, he counters that 

A tax on capital would be a less violent and more efficient response to the eternal problem of private capital and its return. A progressive levy on individual wealth would reassert control over capitalism in the name of the general interest while relying on the forces of private property and competition. (687) 

Based on historical evidence he argues that the alternatives, such as protectionism and capital controls, will never work as efficiently as progressive taxation.

The principal technical challenges to the taxation of wealth, according to Piketty, are the need to develop and implement rules of global transparency in capital so that the wealthy cannot hide their wealth, and global, or at least regional, agreement to impose this kind of taxation so that the wealthy cannot shift their wealth to places with lower taxes, encouraging a destructive race to the bottom.

Issues of taxation and support for the social state have also played a key role in arguments around public debt, which Piketty explores toward the end of the book. He argues that concern over debt levels has more to do with disagreement about what level of support should be provided to improve society, rather than any type of true economic argument about them per se.

[In Europe] net public wealth is virtually zero, given the size of the public debt, but net private wealth is so high that the sum of the two is as great as it has been in a century. Hence the idea that we are about to bequeath a shameful burden of debt to our children and grandchildren and that we ought to wear sackcloth and ashes and beg for forgiveness simply makes no sense. The nations of Europe have never been so rich. What is true and shameful, on the other hand, is that this vast national wealth is very unequally distributed. Private wealth rests on public poverty, and one particularly unfortunate consequence of this is that we currently spend far more in interest on the debt than we invest in higher education. (740) 

Here again, an example of a myth propagated by the wealthy to promote a reduction in their contribution to social support.

One consequence of the wealthy owning the conversation around support for the social state is reflected in Piketty’s expression of concern regarding underinvestment in education, as he mentions in the above quote and repeatedly throughout the book. As described earlier, in a 21st century already witnessing declining demographic growth, and with per capita output growth also projected to decline as the rest of the world expected to catch up by mid-century with the technological frontier established by the wealthiest countries, overall economic growth will decline. The principal way to lessen the decline in per capita growth, and so economic growth, he argues, is through improved education; but this requires funding government investments in education.

Parallels to Piketty’s concern over the defunding of support for public education and more generally a comprehensive social state, can be found in the arguments of Yuval Noah Harari in his thought-provoking 21 Lessons for the 21st Century. Harari argues that we are headed, if we don’t actively work against it, to a dystopian future in which advances in bio-tech and info-tech lead to a concentration of health, wealth and skills that leave most people “irrelevant” – unneeded for any task – and so unnecessary to be supported. (My review at right.)

The challenge posed to humankind in the twenty-first century by infotech and biotech is arguably much bigger than the challenge posed in the previous era by steam engines, railroads, and electricity. And given the immense destructive power of our civilization, we just cannot afford more failed models, world wars, and bloody revolutions [as were experience in the 20th century in pursuit of solutions to those earlier challenges]. This time around, the failed models might result in nuclear wars, genetically engineered monstrosities, and a complete breakdown of the biosphere. We have to do better than we did in confronting the Industrial Revolution. (34, 21 Lessons for the 21st Century)

Nonetheless, Piketty offers a hopeful vision for “an ideal society in which all other tasks are almost totally automated and each individual has as much freedom as possible to pursue the goals of education, culture, and health.” He notes that “we are to some extent already on this path [given] the considerable share of both output and employment devoted to education, culture, and medicine.” (387) These comments have parallels to philosopher Martin Hägglund’s concept of spiritual freedom, which Hägglund describes in This Life (my review at right) as the ability “to ask ourselves what we ought to do with our time [in this life].” (12)

Despite the similarities in their visions for an ideal society, the two authors remain far apart in their proposals for our economic future. However challenging it may be to realize Piketty’s prescriptions for the dangerous levels of inequality his analysis of the data portend, he does not propose a move away from capitalism. He notes that even “the progressive tax is … a relatively liberal method for reducing inequality, in the sense that free competition and private property are respected.” (648) Rather, he seeks democratically discussed and selected policies to balance out capitalism’s natural tendency to increase wealth concentration, without eliminating what he finds to be its benefits: 

if democracy is someday to regain control of capitalism, it must start by recognizing that the concrete institutions in which democracy and capitalism are embodied need to be reinvented again and again. (745)

Hägglund, like Piketty, finds the problems with capitalism to be immanent in the system itself. However, he differs from Piketty in that he is convinced that these problems will inevitably overwhelm any attempts to reform capitalism that keep its core principles in place. Thus, for example, Hägglund argues that instituting redistributive policies (such as progressive taxation) just requires more of the bad aspect of capitalism to provide the funds to redistribute, and so doesn’t solve the fundamental issue. 

The attempt to achieve social justice through the redistribution of capital wealth is inherently contradictory. The more welfare policies and state regulations that prevent the exploitation of living labor, the more restricted are the possibilities of extracting the surplus value, and the less “wealth” is available to distribute in the economy. To take a striking example, when health care, education, and other public services are run by the welfare state, they are not sold as commodities that generate a profit that is reinvested as capital, which means that they do not contribute to the “growth” of our social wealth as measured under capitalism. Inversely, when these public services are privatized and commodified – transformed into a matter of buying and selling for profit – they contribute to the growth of capital wealth. This is the economic rationale for the neoliberal dismantling of the welfare state and deregulation of the job market. As long as we accept the capitalist measure of wealth, social democratic reforms will tend to reduce the wealth that they aim to distribute more equally. (283, This Life)

And in a comment that echoes Piketty’s concern that a marginal productivity approach to explaining salaries “instrumentalizes” basic human goals, Hägglund notes that

as a capitalist society, we are not collectively committed to producing for the sake of consumption. Rather, we are committed to providing for the sake of extracting surplus value [profit] that can be converted into the growth of capital. (297, This Life) 

Thus, the very point of the capitalist system is its own furtherance, not the well-being of society, and this inescapable logic leads Hägglund to view capitalism as unsustainable, and to argue for the pursuit of an alternative.  (And, to be clear, arguing that capitalism is unsustainable into the future, does not dismiss nor negate the past benefits that the capitalist economy has provided in dramatically transforming lives over the past several centuries, as argued perhaps most passionately by Steven Pinker.)

Like Piketty, Hägglund argues for the centrality of democratic processes in rectifying the fundamental inequalities arising out of unfettered capitalism, though calling for a much broader transformation. Hägglund defines the term “democratic socialism” as a system that he characterizes as placing democracy and the democratic process at the heart of developing a post-capitalism future.

To subordinate the state to society is to transform the state into an actual democracy. … While the commitment to serve the interests of society as a whole will always be challenging and contestable, it is in principle impossible to sustain such a commitment under capitalism. Because of the social form of wage labor, democratic politics and democratic states necessarily serve as organs for representing class interests that are competing for control. We cannot actually deliberate on how best to serve the interests of society as a whole, since we must prioritize the private interests of capitalists. This prioritization is not optional, since under capitalism there can be no production of social wealth without the profits of privately owned enterprises. (268, This Life)

 One can argue that Piketty, the renowned economist, is a better source for understanding the possibilities for capitalism in a democratic state going forward, than Hägglund, a philosopher. And Hägglund freely admits that he does not have a precise prescription of how to arrive at democratic socialism from our present state; his point is to define the necessity of such a transformation.

But, interestingly, the prescriptions of both authors suffer from the same apparent predicament, one that each touches on without quite resolving, and that has been clearly identified by Yuval Noah Harari, as described above: that the capitalist system as it exists today has created an increasingly wealthy and powerful elite that has come to have inordinate control over the levers of government and so policy.

Thus, the question for Hägglund becomes, how could such an elite ever be convinced to fundamentally re-structure a system in a way that would surely diminish their power and wealth?

And, similarly for Piketty, though perhaps more directly: is it realistic to believe that democracy can rein in capitalism over the long run, given the immanent tendency of capitalism to lead to concentration of wealth, that concentration of wealth to concentration of power, and that power to policies that sustain this relationship. Piketty argues that to not do so will lead eventually to “revolution,” but does that not simply mean in practice that if we do not fundamentally transform our economic system, we will remain trapped in a cycle in which it takes wars and revolutions to tame capitalism, only to see it rise again?

I, for one, would enjoy a debate on these points between the two of them. Not with the goal of determining a winner and loser, but rather to achieve a deeper understanding on these critical questions.

In his engagingly written and eminently readable Capital in the Twenty-First Century, Piketty demonstrates that levels of wealth inequality, while having changed in structure, have returned to almost the same levels as seen during the Belle Époque in France, and the Gilded Age in the US. He argues persuasively that this inequality can be expected to continue to rise over the course of the 21st century if nothing is done to counteract it, threatening the social state that has been built in Western democracies, and likely leading to extreme social disruption.

Based on his analysis of what has been seen historically, he argues for a progressive taxation of all wealth – income, capital, and inheritance – to rein in the dangerous levels of inequality naturally generated by an unfettered capitalist system. But he makes clear it will not be easy, and emphasizes the need for democratic deliberation for settling on appropriate economic goals, including the level of the social state and approaches to taxation, noting that these must be political policy decisions based on citizen engagement: “there is no mathematical formula for answering this question, which is a matter for democratic deliberation.” (683)

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Other notes and information:

More quotes from this book

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Have you read this book, others by this author, or even similar ones by other authors? I’d enjoy hearing your thoughts.
Other of my book reviews: FICTION Bookshelf and NON-FICTION Bookshelf