3 Cheers For Thomas Piketty For His Praise of Bernie Sanders' Campaign

 Thomas Piketty, author of the 700-page economic work, 'Capital in the Twenty-First Century', has now firmly come down on the side of Sen. Bernie Sanders in the American elections, to the consternation of the elites and their media gate keepers. To remind readers, Piketty's tome methodically researched hundreds of years of French tax records - which are amongst the most detailed in the world - given the French bureaucracy was intent on meticulously documenting who was wealthy and how much they'd amassed since the French revolution. Clearly, the purpose was not to have a replay of that horrific historical spasm, but also to quantify inequality.

With the assistance of Berkeley scholar Emmanuel Saez, Piketty's monograph also integrated 15 years of similar tax records from 30 other nations, including the U.S. In concert, the French records disclosed the rich inevitably make out like bandits, even after major financial downturns. This is possible because the rate of return to wealth (r) inevitably exceeds the rate of growth (g) of the revived economy. Hence, the share of national income that labor receives as compensation is invariably lower than the share accruing to rentiers and speculators via investments, speculation. Because capital -rentier income is less equally distributed than work income (most Americans don't own stock shares), the wealthy prosper while the rest suck salt.

This also has much to do with the basis for our own metastasizing inequality which few in the political establishment want to address. They'd just as soon we all remain comatose or at least like de facto zombies and never read a word about the issue, becoming more engrossed in our social media distractions or video games.

Piketty -  in a new op-ed published Tuesday in The Guardian  -  credits Democratic presidential candidate Bernie Sanders with waking the larger American political establishment up to the problem of rising income inequality and channelling the Democratic electorate’s righteous outrage. Piketty says that Sanders’ campaign proves that a leader like Sanders—if not Sanders himself—“could one day soon win the U.S. presidential elections and change the face of the country.”  Piketty, went on - in a swipe at the Neoliberal Hillary:

 

“Because he is facing the Clinton machine, as well as the conservatism of mainstream media, Sanders might not win the race, but in many respects, we are witnessing the end of the politico-ideological cycle opened by the victory of Ronald Reagan at the 1980 elections.”

So true! I myself believe it will take something akin to a political miracle for Sanders to prevail - requiring most citizens tuning out the endless corporate media yap, the attack propaganda from the Clintons, as well as succeeding in getting at least 50 percent of the registered voter millennials to show up to actually do it to compensate for the millions of African-Americans hoodwinked into believing HRC is their only hope.

Piketty also correctly put the Neoliberal tag on both former president Bill Clinton and President Barack Obama- who have failed to even attempt real tax reform, allowing for inequality to run rampant. Obama's administration even arguably made it much worse by failing to allow the brazen Bush tax cuts to expire when they should have, back in 2010, and then even added kerosene to the fire by not collecting the full 6.2%  Social Security payroll tax for two years. This cost the system well over $200b and was the proximate cause of the S.S. Disability fund being emptied so rapidly - necessitating a transfer from S.S. proper.

 According to Piketty:  “Sanders’ success today shows that much of America is tired of rising inequality and these so-called political changes, and intends to revive both a progressive agenda and the American tradition of egalitarianism”

This turns on its head the insipid propaganda that "it is mainly the young supporters who never lived when socialism thrived and have no idea how bad it is".  Which is obvious claptrap circulated by committed buffoons who probably can't tell the difference between the Soviet style socialism of the Cold War and the democratic socialism practiced by many western European nations today. Those nations, including Norway, Denmark and Sweden,  believe their citizen's general welfare trumps military welfare or wars without end.  Piketty also observed;:

"Sanders makes clear he wants to restore progressive taxation and a higher minimum wage ($15 an hour). To this he adds free healthcare and higher education in a country where inequality in access to education has reached unprecedented heights, highlighting a gulf standing between the lives of most Americans, and the soothing meritocratic speeches pronounced by the winners of the system.changes, and intends to revive both a progressive agenda and the American tradition of egalitarianism  "

 Piketty further notes, quite accurately, on the Repukes:

“Meanwhile, the Republican party sinks into a hyper-nationalist, anti-immigrant and anti-Islam discourse - even though Islam isn’t a great religious force in the country-  and a limitless glorification of the fortune amassed by rich white people.”

I couldn't have summarized the GOOPr clown cavalcade  better, also explaining why I no longer plan to waste any blog posts on their inane brat fests - like the last one in South Carolina.

As for Sanders’ rival, Hillary Clinton, Piketty observes: she "is now just another heiress of the Reagan-Clinton-Obama political regime.”

For those for whom this reference may sail over heads or not register, I suggest getting hold of the last instalment of Oliver Stone's excellent series 'The Untold History of the United States' which, of course, the corporate media and other ancillary, hack-infested abodes (e.g. 'The Daily Beast') have attempted to debunk- to no avail for anyone who knows and grasps the country's history, i.e. minus the B.S.

Interestingly, despite the toxic influence of money in our politics -  ramped up by Citizens United -Picketty himself is not resigned to doom, instead crediting the Sanders campaign with offering a real counterforce to fight unlimited campaign contributions. This as opposed to succumbing to its power.

Bernie now has a new and powerful ally in his crusade against the monied political establishment and its media cronies, but make no mistake they will try to slime him as viciously as they've tried to slime Oliver Stone. Alas, truth is a commodity that the rigged, Neoliberal establishment can't abide.

See also:

http://www.smirkingchimp.com/thread/brent-budowsky/66020/surging-sanders-could-surprise-nevada-caucus

And:

http://www.smirkingchimp.com/thread/dean-baker/66001/bernie-sanders-hillary-clinton-and-the-money

Excerpt:

"This is how the wealthy control the political process. The system makes it extremely difficult for those who challenge the policies that serve their interests to ever be heard. That is why it is inspiring to a see candidate like Senator Sanders get enough money and support to be a serious contender for the Democratic nomination, even without big money contributions."

Piketty, Capital, Soaring Stock Markets and Why Americans Aren't Rioting in the Streets

It's incredible but for the past couple years, on successive European junkets, a question that invariably pops up from the Euros - be they Austrians, Germans or Swiss is: "Why aren't Americans rioting in the streets? Why aren't they burning everything down like those folks in Kiev? Why do they tolerate the super rich getting off at their expense?"

Well, as I informed them, it's not as if the images of the rich haven't been circulated, including their $100,000 gold-plated bathtubs, special electronic, auto-wiping, super-sanitizer butt-cleaner toilets and so on. Not to mention images like these showing the rich at play using the gains from the labor of the rest of us:




And:

And:

























The $ 25,000 (apiece) Frrrozen Haute Chocolate fills the bellies of the wealthy layabouts  as an every day dessert but would incite a workingman to barf.


This isn't "blowing smoke" or instigating  insurrection either. In one candid conversation with Frank Rich last fall, Chris Rock said, “Oh, people don’t even know. If poor people knew how rich rich people are, there would be riots in the streets.” Further, the findings of three studies, published over the last several years in Perspectives on Psychological Science, indicate that Rock is right. We have no idea how unequal our society has become and to address the Europeans' question, most Americans really don't care  (e.g. http://brane-space.blogspot.com/2015/03/clutter-capitalism-and-inequality-why.html   ) since they fancy that one day they will become rich too - just by working hard. Of course, they are deluded. As author Michael Parenti has noted ( 'Dirty Truths') 94 percent of wealth comes by way of the wealthy not doing a damned bit of work but by inheritance.

Thomas Piketty noted the parlous effect of this inherited capital in his masterpiece book: 'Capital in the Twenty-First Century', where he noted the innate tendency for capital to increase  encapsulated by the shorthand,  r > g  with r the long run returns on capital and g is the rate of economic growth. Basically, it shows the "past devours the future". This is highlighted by the fact that the heirs of the fatcats  pay zero capital gains taxes on their stocks or other assets.  Such “unrealized” gains now account for more than half the value of assets held by estates worth more than $100 million. At the same time, the estate tax has been slashed. Before George W. Bush was president, it applied to assets in excess of $2 million per couple at a rate of 55 percent. Now it kicks in at $10,680,000 per couple, at a 40 percent rate.

No wonder these little bastards can afford to eat two or three Frrrozen Haute Chocolates  each day then whiz off to St. Kitts for 18 holes each weekend while their wives enjoy rose wine wraps.

Piketty's data shows  that indeed, inherited wealth has  metastasized inequality because the scions of the wealthy can then park their capital in rentier venues: dividends, profits, capital gains, interest and so on- and just let it grow while they sit on their asses. As a result, the gaping inheritance disparity actually grows more gaping each year after the inheritances have been received.

Worse now, is that the Fed has been feeding these layabouts with crack money via quantitative easing which has propelled the stock market to new heights. (Of course, it will have to come down eventually, which will be when the Fed finally gets the cojones to raise interest rates again instead of feeding crack to the markets and subsidies for chronic borrowers - while savers suck salt.)

Of course, the reason Americans are hard to enrage about this is not only their pie-eyed optimism but also their woeful ignorance.  From recent studies, the average American believes that the richest fifth own 59% of the wealth and that the bottom 40% own 9%. The reality is strikingly different. The top 20% of US households own more than 84% of the wealth, and the bottom 40% combine for a paltry 0.3%. The Walton family, for example, has more wealth than 42% of American families combined.

As the journalist Chrystia Freeland put it I her book about the plutocrats,  “Americans actually live in Russia, although they think they live in Sweden. And they would like to live on a kibbutz.” Norton and Ariely  in their own study also found a surprising level of consensus: everyone — even Republicans and the wealthy—wants a more equal distribution of wealth than the status quo. (Of course, the intelligent wealthy had better get on board if they have any recollections of what transpired during the French Revolution.)

Of course, the Republican Party itself - in the maw of the wealthy business class- is determined to exacerbate the inequality and make the Gini coefficient even lower. Their most recent budget attests to this, cutting not only Obamacare and Medicaid (which more than 20 million currently depend upon) but also Medicare (using Paul Ryan's infamous vouchers or "premium support" - more like premium abort) and cutting Social Security.

If we ever do end up in a scenario in this country resembling the French Revolution you will be able to lay most of the blame on the Republican Party.

See also:
http://www.smirkingchimp.com/thread/john-chuckman/61645/the-enduring-reality-of-government-by-wealth-and-some-of-its-consequences