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Many Kossacks have written about Emanuel Saez’ and Thomas Piketty’s work on income inequality, including yours truly. When it comes to virtually any intelligent, substantial discussion on the topic, these two university professors (Saez at UC Berkeley and Piketty at the Paris School of Economics) are widely considered to be the go-to authorities on the subject, worldwide.

Tonight, via Columbia University Professor of Journalism Thomas Edsall’s op-ed in Wednesday’s New York Times, we’re learning about the details regarding Piketty’s new book, “Capital in the Twenty-First Century.”

Some (see below) are referring to it as “the watershed book on economic thinking” of this generation.

This is, easily, the most interesting development concerning virtually anything I’ve read about the “dismal science” of economics in a long, long time (if for no other reason than the discussions that it will inspire).  

I really hope you’ll take the time to read both Edsall’s entire column and the review of the book by World Bank economist Branko Milanovic, which is set for publication in the June issue of the Journal of Economic Literature. Apparently, as Edsall notes below, it’s “already caused a stir.” (If you’re into economics—at least when it’s written in easy-to-understand language--I think you’ll find the first few pages of Milanovic’s commentary to be nothing short of amazing!)

Capitalism vs. Democracy
Thomas Edsall
New York Times (Op-Ed)
January 29th, 2014

Thomas Piketty’s new book, “Capital in the Twenty-First Century,” described by one French newspaper as a “a political and theoretical bulldozer,” defies left and right orthodoxy by arguing that worsening inequality is an inevitable outcome of free market capitalism.

Piketty, a professor at the Paris School of Economics, does not stop there. He contends that capitalism’s inherent dynamic propels powerful forces that threaten democratic societies.

Capitalism, according to Piketty, confronts both modern and modernizing countries with a dilemma: entrepreneurs become increasingly dominant over those who own only their own labor. In Piketty’s view, while emerging economies can defeat this logic in the near term, in the long run, “when pay setters set their own pay, there’s no limit,” unless “confiscatory tax rates” are imposed.

Piketty’s book — published four months ago in France and due out in English this March — suggests that traditional liberal government policies on spending, taxation and regulation will fail to diminish inequality. Piketty has also delivered and posted a series of lectures in French and English outlining his argument…

There is so much outstanding and brutally important commentary in this op-ed (from economists that agree and disagree with Piketty), to even begin to attempt to republish it in my own words (to comply with Fair Use guidelines) would be a great disservice to my fellow Kossacks.

But, here’s a little more on Piketty's book; an intro paragraph from Milanovic’s 20-page review; and, the article is absolutely NOT “dry,” like many would expect from a source such as him, and from a publication that’s titled the Journal of Economic Literature. (Please take the time to at least read the first couple of pages of Milanovic's document, linked in the previous sentence. If you've gotten this far in this post, you’ll be glad you did!)

From Milanovic…

“I am hesitant to call Thomas Piketty’s new book Capital in the 21st Century one of the best books in economics written in the past several decades. Not that I do not believe it is, but I am careful because of the inflation of positive book reviews and because contemporaries are often poor judges of what may ultimately prove to be influential. With these two caveats, let me state that we are in the presence of one of the watershed books in economic thinking...”

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