Everyone is talking about Capital in the Twenty-First Century, but few people have read it. In fact, I was watching Real Time with Bill Maher the other day, and the entire panel was debating the virtues of the book — then they admitted no one had read it.
Meanwhile, The Guardian wrote, “This is a huge book, more than 700 pages long, dense with footnotes, graphs and mathematical formulae. At first sight it is unashamedly an academic tome and seems both daunting and incomprehensible [emphasis added].” Well, I just spent an inordinate amount of time reading his masterpiece, and have quickly placed every lesson in the following article. I’ve tried to link to further explanations, should you care to spend the time.
Here’s everything you need to know about Capital in the Twenty-First Century in 5 minutes or less.
- Income equality is increasing.
- We are approaching another Gilded Age.
- Net worth is not trickling down.
- A global wealth tax is proposed.
- Marginal tax rates used to be much higher.
- Income inequality undermines meritocratic values.
- Marx couldn’t properly account for technological progress.
- Industrialization and economic shift is inherently advantageous to a select few.
- War and taxation created a by-product of economic equality in the 40s/50s.
- Theoretical and mathematical interpretations fail to account for individual actors and historical data.
- Inequality is not necessarily bad, but the reasons for it could be.
- Top managers can control their own paychecks.
- Profit is necessary to attract capital; at least, as the economy currently stands.
- Per capita income averages hide disparities (median versus mode).
- There are errors and gaps in tax revenue due to tax havens.
- Foreign direct investment hasn’t led to a convergence in economies.
- Economic growth is unsustainable, as compounded growth will kill the planet (think climate change and food shortages for a growing population).
- Social mobility is at the heart of moderating income inequality.
- Inherited wealth is monopolizing income distribution.
- Those with capital and assets can increase wealth faster than beginning entrepreneurs.
Now go out there, act like you read it, and sound smart!