I focus on fiction, sci-fi, fantasy, science, history, politics and read a lot. I try to review everything I read.
I have read a bunch of books about the 2007 financial crash. By focusing on the people that made a lot of money from the crash, this book explains quite clearly the underlying causes of the crash. Unfortunately this book requires a bit of understanding of how markets and financial products work. If you have these basic understandings, this is the best of the bunch of books examining the 2007 crisis. Not only were the characters quite fun to read about, but the story helped explain the underlying causes of the crisis in an interesting and compelling way. I generally recommend this as a great place to start if you want to understand the mechanics of what happened in the financial crisis of 2007.
In 1729 Jonathan Swift made A Modest Proposal that the Irish poor sell their children to the rich as food. Here Piketty suggests the opposite, that we cannibalize the rich (at least their money) to feed the poor by creating a global wealth tax to redistribute wealth from the rich into social programs.
I loved this book, it is mostly about data, and I love data. Not only is there lots and lots of data, but it is very good data, with very good explanations and outstanding transparency on sources and methods. I just love this kind of data. I spent hours before starting the book just absorbing the pdf containing over 100 charts and tables. You read that right – over 100 charts and tables, and there is no point listening to this book if you don’t understand these charts. Thus I recommend either getting a visual version of the book and/or taking a careful look at the charts before you start the book. All the raw data for all the charts is available in excel format on the book’s web site.
I highly recommend this book if you want to understand the debate regarding wealth inequality and what, in anything, should be done about it. The narration is good, but it is still a tough listen due to the many references to charts, numbers, and equations.
Although I love the data and the explanations, I did not find the conclusions very compelling. It is difficult to take the author to task regarding his conclusions because he is clearly quite a clever guy and meticulously covers his posterior by making every conclusion explicitly based on hypotheticals that might be the case.
An undemonstrated premise of this book seems to be non-egalitarian societies are inherently unjust or non-utilitarian. This is far from clear. Unequally rewarding an important helpful skill is non-egalitarian yet is both just and utilitarian. Most of my disagreements with Piketty’s conclusions are based on our differences regarding this premise. There is clearly a balance of inequality essential to capitalism, and understanding how to correctly detect imbalances, either way, should have come before any analysis of how to correct any such imbalance. Yet Piketty’s answer to what the social optimal balance should be is “it is hard to say”. Adjusting a tax when it is hard to say what the proper rate should be seems ill advised.
Piketty notes that the total capital per person (in units of annual production per person) has been increasing steadily from a low in the 1950’s back to its gilded age pre-war highs. Piketty seems to believe, without a wealth tax intervention, capitalism might naturally lead to a spiraling inegalitarian concentration of wealth (depending on various rate scenarios).
Piketty correctly points out the estate tax is not uniform internationally and we currently have poor wealth reporting mechanisms yielding an ineffective tax. Yet if we fix these weaknesses of the estate tax, it is not clear why an additional wealth tax would be necessary. The author seems to me to be throwing the baby out with the bathwater by taxing skill earned wealth invested productively the same as inherited (unearned) wealth using a Wealth Tax, instead of just fixing the estate tax so it works. Inheritance tax has been attacked by the wealthy as The Death Tax but I suggest it should be re-dubbed the Slutty Heiress Elimination Tax.