R. R. Reno

Capital in the Twenty-First Century is really two books, maybe three. The first is a book of economic history. The second one advances a theory to explain that history. The third offers a policy proposals keyed to the economics, as well as a tacit political philosophy of meritocratic egalitarianism: from and to each according to his abilities. As I’m coming to the final part of the book I can see that the theory plays an important role. It provides the “laws of capitalism,” and these “laws” allow Piketty to describe a future: If unchecked, capitalism will lead to greater and greater concentrations of wealth. This specter is haunting the global economy—if I may be permitted an updating of the Communist Manifesto. It foretells the end of democracy. It’s also what gives Piketty’s book urgency. But I misspoke. It’s not the “laws of capitalism” that lead to his dire prognosis. Instead, it’s the “laws of capitalism” plus the crucial assumption r>g (the rate of return on capital is greater than the overall growth of the economy). But what about this assumption? I’m told that economist are by no means agreed that r>g. That’s not surprising. Common sense suggests that the rate of return on capital can’t be greater than the rate of growth. That’s because returns on capital are simply claims on national (or increasingly global) income. And over the long haul those returns be paid in real terms unless the national or global income increases, which is to say g increases. If an economy could pay 4 or 5% on capital while growing at 1 or 2% per annum, then we’d be in the surreal situation in which return on capital over time produces more wealth than does economic growth. In fact, because SOME collective wealth has to be spent on something other than paying returns on capital, it seems tautological that r Continue Reading »

I found myself backtracking after working through Piketty’s discussion of inequality of labor income. That’s because there’s data that works against his main thesis that, because r>g, capital becomes ever more important than labor. Continue Reading »

Piketty toggles back and forth between numbers and speculation (often political and sociological) with enough frequency to hold the lay reader’s interest. I see now why the book has been a hit. Continue Reading »

Part Two of Thomas Piketty’s Capital in the Twenty-First Century concerns history of capital in relation to income (the capital/income ratio) over the course of the twentieth century. Continue Reading »

I’ve started reading this year’s big book, Thomas Piketty’s Capital in the Twenty-First Century. Fascinating stuff, at least to this non-economist. He engages in Big Think, which of course appeals to me. Anyone who writes an essay like “Empire of Desire” is bound to . . . . Continue Reading »

We need marriage equality now! The inequality is stark. Wealthy people tend to get and stay married. Their children go to good schools, get good jobs—and they in turn get and stay married. The social capital builds from generation to generation. Meanwhile, the rest struggle. Kids lower down on . . . . Continue Reading »

These days a man can wake up and say, “Enough! I’m tired of fighting against my innermost feelings. I’ve always felt myself to be a woman, and I’ll be damned if I’ll let myself go on like this.” Medical professionals stand ready at hand; psychologists are prepared to help. If he has . . . . Continue Reading »

• Jerry Coyne’s exactly the sort of academic David Bentley Hart finds exasperating. So do I. The undoubtedly well-trained evolutionary biologist and professor at the University of Chicago can’t distinguish empirical arguments from metaphysical ones. On his Why Evolution Is True . . . . Continue Reading »

We are coming to the end of First Things’ two-week digital fundraising campaign. When we started this campaign, we weren’t sure how much support we could expect from our online readers, and we set a goal of $20,000. I’m thrilled to report that, thanks to the generosity of folks like you, we have raised nearly $30,000 thus far! Continue Reading »

First Things is now in the second week of a two-week digital campaign to raise $20,000. And I’m pleased to report we have raised $5,305 thus far! Continue Reading »