Capital in the Twenty-First Century

There is a new book out, this one by a Professor Thomas Piketty of the University of Paris. Others more equipped than I am have written excellent reviews. See, for instance, Martin Wolf of the Financial Times at http://on.ft.com/1hIeobd. What emerges from the book is clear evidence that the rich are getting richer and that the process is accelerating. Wealth brings power and enables CEO’s to demand outrageous salaries that add to the pile. The wealthy are unable to spend their wealth and so it accumulates even further. The growing importance of robots doing the jobs that humans used to perform is tilting the balance even further in favor of a small group of very, very rich people. We are returning to the world of feudal kingdoms when the lord of the manor owned most all of it. Wolf suggests that this might not matter economically. After all, he says, the poor in developed countries enjoy lifestyles that the rich of a century ago would envy. On the other hand, he and others do worry that it does matter politically as wealth gives the rich an inordinate share of the vote.