James Pethokouskis recently addressed celebrated leftist economist Thomas Piketty's claim that rising income inequality in the United States confirms criticisms of Marxism, albeit 60 years later than Karl predicted, in his The New Marxism (parts one and two) columns at National Review. We were disappointed that the usually adept economics columnist failed to identify Piketty's most glaring false assumption nor emphasize his most revealing admission.
Pethokoukis notes at the outset that the left-wing Frenchman, in his much-awaited Capital in the Twenty-First Century, concludes that:
Sure, the productive and innovative capacity of market capitalism will generate enough income growth for the masses to prevent revolution. He concedes Marx got that bit of apocalypticism wrong.
Must we go on? Wasn't Karl Marx taken seriously because he offered criticisms of and alternatives to a Capitalism that would so fail to satisfy pursuits of happiness that revolution by labor would be inevitable? Piketty is an economist who proudly considers himself a disciple of Marx, yet concedes that the economic model, against which his mentor and he dedicated lives to oppose, works, economically. Stop the presses. Full stop.
So before we even get to the indictment of Capitalism on inequality grounds, we are assured that those on the short end of the unequal stick, still hold a stick that satisfies. The study of economics is about how best to allocate inherently scare resources so that the economic needs of human beings are met. Piketty concedes that Capitalism so delivers.
Happily, Piketty gives away the evolved game of he and his liberal Democrat friends when he quickly moves on to the "religious" aspect of leftist economics:
But an “endless inegalitarian spiral” will create such wealth bifurcation that “the meritocratic values on which democratic societies are based” will be undermined. The political process will be hopelessly captured by a tiny elite of rent seekers and trust-fund kids. America (and then the other advanced economies) will become what Occupy Wall Street types and Elizabeth Warren think it already is.
A liberal Marxist bemoans the undermining of "meritocratic" values? Piketty's epic oxymoronic outburst is revealed for the mask it is later on when he reveals his "remedy" for an "inegalitarian spiral" (that the masses are happy with, mind you) is an 80% tax rate on the rich. Very meritocratic, not.
Before we ever get to the New Marxism view of 20th Century history and 21st Century inequality supposedly beatifying a "Saint Karl", his Paris School of Economics disciple has already given away the game on revolution prevention. Do atheist Communists turn over in their graves? I digress.
Pethokoukis then recounts Piketty's view that but for a Great Depression and world wars, the Marx-predicted Capitalism-caused inequality of the late-19th Century would only have worsened, instead of taking a hiatus only to return as it has in recent years. But who does Marx's acolyte blame for today's inequality after five years of Obamanomics? Barack Obama? No, he blames Ronald Reagan and sees as good things that so many Americans lost their wealth in the 1930s and that industries were nationalized to fight Fascists in the 1940s. Piketty then goes on to praise the economic circumstance of the United States in the more equal stagflation 1970s and the return of the more pure and unequal capitalism of Reaganomics as the cause of our circumstance today.
Besides skipping over the decidedly non-Capitalist liberal Democrat housing policies of the 1990s that led to the Housing Bust-caused Great Recession and the Marxist-inspired totalitarian taxes and regulations of energy and healthcare that have produced a jobs-depression-defined most-anemic so-called "recovery" since WWII; Piketty assumes, and Pethokoukis fails to refute,the assumption that we have had a decidedly unfettered Capitalist economy since the 1980s. We have not.
And just as wealth generated by Capitalism made the mobilization for, and victory in, WWII and the Cold War and liberal welfare state experiments possible; so it is that but for the 25-year Reagan supply-side recovery, no discernible middle class would have been sustained to this day. It was non-Capitalism ie Marxism if you will, that turned a Black Friday stock market crash and recession into a great depression, first at Hoover's big government hands and then at Hoover-on-steroids' gargantuan FDR's New Deal Hands.
Piketty bemoans inequality more than he should, but the very sine qua non of evil that he attributes to Capitalism as inherent, has been caused by the decidedly non-Capitalist policies of Barack Obama and his fellow liberal Democrats who drink from the same non-Pierian Socialist springs as does he.
And now we know why. Because liberals seek more from economics than economics can provide. They aren't content with content "masses" happy not to instigate revolutions. No, they seek spiritual sustenance from a leveling of society, and economic happiness pursuits be damned.
This is why President Obama is happy with Obamacare and skyrocketing energy prices. After all, he and Michelle gives us food stamps, public transportation and arugula-a-plenty school lunches.
"One man with courage makes a majority." - Andrew Jackson