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23 March 2022

Why Thomas Piketty is optimistic about the left’s future

The French economist on his new book, the living standards crisis and why the “historical movement towards equality” will continue.

By George Eaton

Thomas Piketty is not a thinker renowned for optimism. His landmark work Capital in the Twenty-First Century (2013) warned that the world was regressing to an era of “patrimonial capitalism” in which huge wealth inequalities are sustained across generations.

But the French economist’s new book A Brief History of Equality adopts a radically different perspective. It argues that there has been a “historical movement towards equality” since the end of the 18th century – and that this trend is likely to continue.

Did he write the book because he fears the left has become too negative? “It goes beyond the left; I think it forces everyone to be more positive,” Piketty, 50, said when we spoke by video call. “If you look at the historical evidence that I have collected, what you see is that in the long run there is a movement towards more political equality, more social equality and more economic equality.”

He cited “the end of slavery, the rise of universal male suffrage and the rise of workers’ rights. This continued in the 20th century with decolonisation, with social security, with progressive taxation and female suffrage, and it’s continuing today with the #MeToo movement and with Black Lives Matter.”

Piketty’s intention is not to downplay the surge in income and wealth inequality that has defined the era of market supremacy, still less to suggest we live in the best of all possible worlds. Rather, he wants us to “take stock of all these improvements to think about the possible next steps”.

[See also: The Wonga chancellor: why Rishi Sunak prefers a quick fix]

A secondary motivation for the book was his desire to “write something shorter” than his two previous works (Capital is 696 pages; its sequel, Capital and Ideology, 1,150). “There were so many people telling me, ‘Why don’t you write something shorter that I can share with friends and family?’ So for a number of years I thought I needed to write a synthesis that goes straight to the main point.”

The last time I interviewed Piketty was in early February 2020, before the Covid-19 pandemic reshaped the economic world. Does he believe the neoliberal era is now definitively over? “It was already close to an end after the 2008 financial crisis and, yes, the pandemic has confirmed in its own way that the era of neoliberalism, which started in the 1980s, is to a large extent over.”

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“The big question,” he added, citing Donald Trump, Brexit and the rise of autocratic nationalists such as Vladimir Putin, Jair Bolsonaro and Narendra Modi, is “whether the end of neoliberalism is the beginning of neo-nationalism”.

In Europe, the pandemic has now been eclipsed by the war in Ukraine, and Piketty is unimpressed by the West’s economic response. “At this stage everything we are claiming about sanctions and oligarchs is close to wishful thinking. It would require a movement towards transparency about asset ownership, which is not happening. If we want to be serious about sanctions, it’s not just a few hundred people; there are about 20,000 Russians who are worth more than €10m and about 50,000 who are worth more than €5m.

“We have built a legal system that gives enormous protection to high-wealth individuals, wherever they come from – Russia, China or the West – and very little… to normal people. As long as we have this system it’s going to be very difficult to convince Russian opinion, or international opinion for that matter, that we are serious when we talk about economic justice and democracy.”

[See also: Why the Tories can’t blame the Ukraine war for the living standards crisis]

The war in Ukraine has intensified the living standards crisis in the UK and Europe, and raised the spectre of £3,000 annual energy bills in Britain. Does Piketty believe dramatic state intervention of the kind seen during the pandemic will be required?

“It’s clear that if we don’t completely change our approach to climate policy we will have yellow vest movements everywhere,” he warned, referencing the French protesters who have roiled Emmanuel Macron’s presidency. He points out that the carbon emissions per capita of the world’s poorest 50 per cent are in line with 2030 targets. “The problem is that… the top 1 per cent emit 70-75 tonnes” – 30 times the per capita limit for capping global warming at 1.5°C.

Piketty was born in 1971 in the Parisian suburb of Clichy to left-leaning parents, who were once members of the Trotskyist party Lutte Ouvrière. Their son, however, has never identified with the revolutionary left. (A visit to the Soviet Union in 1991 persuaded him of the merits of a market economy.) Rather, he is a radical reformist whose policy proposals, such as income and property tax rates of up to 90 per cent and a cap of 10 per cent on shareholder voting power, are not aimed at humanising capitalism but at forging what he calls “participatory socialism”.

Piketty, who completed his PhD on wealth redistribution at the age of 22 at the London School of Economics, served in 2007 as an economic adviser to Ségolène Royal, who was the Socialist Party’s French presidential candidate. Today, he attributes Emmanuel Macron’s anticipated re-election to the way Covid-19 “froze the political discussion” in France and allowed the liberal Macron to “look like a more social president”.

In Capital and Ideology, Piketty charted the rise of the “Brahmin left” (the educated/cultural elite, which has shifted left in recent decades) and the “merchant right” (the wealthy elite). Macron’s political success, he told me, had been to unite both groups. (In British terms, think of it as stockbroker-belt Tories joining hands with London liberals.)

[See also: Don’t let the Treasury sugarcoat it: we are about to undergo global economic shock]

Piketty first came to British political attention when he appeared in parliament in 2014 and met with Labour’s then leader, Ed Miliband. He later joined the economic advisory committee of Jeremy Corbyn’s shadow chancellor, John McDonnell, in September 2015, only to resign in June 2016, citing a lack of time and concerns over Labour’s “weak campaign” during the EU referendum. What is his assessment of Brexit now?

“I think in the long run it will be a failure for the UK but it is also a failure for the European Union. In my country, and in many European countries, people were looking at Brexit and saying, ‘Oh these stupid British nationalists, there’s nothing we can do about them’ – a little bit like the Democrats saying there’s nothing we can do about these white racists voting for Trump. But I think this is the wrong way to look at the problem.

“The way we have organised economic relations and competition within Europe, and the way we have organised globalisation, has been beneficial mostly to the people with the highest human capital and the highest financial capital. If we don’t find a way to change this, we will have other Brexits at some point.”

His message for Keir Starmer’s Labour is a similar one: “If you don’t change your economic and social platform so as to convince [working-class] voters that what you have to propose to them is better than what the nationalist, anti-migrant people have to propose, it’s not going to work.”

Though Piketty has few words of praise for any major government, he remains, perhaps paradoxically, an optimist. “Neo-nationalism and identitarian retreat is always easier; it provides much simpler punchlines and mobilisation strategies. But in the end that’s not going to solve the problems we have to solve: inequality, global warming, migration. In the end we will have to continue the movement towards equality because that is what allows us to solve them.”

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This article appears in the 23 Mar 2022 issue of the New Statesman, A Dream of Britain