The Piketty Panic and the Making of Intellectual Superstars

I wrote last week about the rapidly emerging discourse of Piketty having won the argument. I’m somewhat suspicious of it, largely because I read enough postmodernism at an impressionable time in my life to believe that people don’t win arguments in this way. Having said this, I’m actually reading the book now and it is clearly something extremely important. But it nonetheless seems to me that Piketty has been culturally elevated to fill a structural hole: the reformist left needed a John Maynard Keynes for the 21st century and they’ve finally found it. I don’t think this necessarily means that Piketty’s proposals will be adopted but I wonder if we are seeing the early signs of a consolidation of the centre left, perhaps analogous to the influence of third way politics but without being, well, shit. There’s an excellent post on Paul Krugman’s blog (HT jonnyholmstrom) which discusses the political reaction to Piketty’s work and the intellectual reasons for it:

“Capital in the Twenty-First Century,” the new book by the French economist Thomas Piketty, is a bona fide phenomenon. Other books on economics have been best sellers, but Mr. Piketty’s contribution is serious, discourse-changing scholarship in a way most best sellers aren’t. And conservatives are terrified. Thus James Pethokoukis of the American Enterprise Institute warns in National Review that Mr. Piketty’s work must be refuted, because otherwise it “will spread among the clerisy and reshape the political economic landscape on which all future policy battles will be waged.”

Well, good luck with that. The really striking thing about the debate so far is that the right seems unable to mount any kind of substantive counterattack to Mr. Piketty’s thesis. Instead, the response has been all about name-calling — in particular, claims that Mr. Piketty is a Marxist, and so is anyone who considers inequality of income and wealth an important issue.

I’ll come back to the name-calling in a moment. First, let’s talk about why “Capital” is having such an impact.

Mr. Piketty is hardly the first economist to point out that we are experiencing a sharp rise in inequality, or even to emphasize the contrast between slow income growth for most of the population and soaring incomes at the top. It’s true that Mr. Piketty and his colleagues have added a great deal of historical depth to our knowledge, demonstrating that we really are living in a new Gilded Age. But we’ve known that for a while.

No, what’s really new about “Capital” is the way it demolishes that most cherished of conservative myths, the insistence that we’re living in a meritocracy in which great wealth is earned and deserved.

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