A handsome and detailed study, the report offers a set of ambitious proposals that could only have from the minds of people enjoying the comfort of tenured positions: cap the growth of western economies at current levels; raise investment by rich countries in poor ones to 10% of GDP (a 25-fold increase over current aid levels); ensure per capita incomes converge to a common average across the world by 2100; reduce the consumption of material goods; cut the working week in half; tax the rich to equalize incomes across the globe; create a new international currency regime. Have these people spent any time canvassing in a by-election? Do they have any idea how this will sell in Peoria, Illinois?

In short, it seems difficult to picture this supposed action plan making it into the daily grind of retail politics. Not surprisingly, mainstream economists have been quick to pounce, the widely-read blogger Noah Smith calling it “total nonsense”, the taxation expert Dan Neidle dismissing it as “potty.”

And yet: step back and reflect on the document, and you see that Piketty and his co-authors might just be onto something. However impractical their solutions may appear, the authors have channeled an emerging zeitgeist in this age of polycrisis. The old neoliberal orthodoxy has fallen from grace but, like a zombie that keeps coming at you no matter how many times you kill it, it still dominates policy. The document at least offers an alternative vision of where things might be going. 

One striking thing, missed in the rush to dismiss this as fantasy, is the fact many of the things the report calls for in the future have already begun to happen. Cap economic growth in the developed economies at current levels? Check. Western economies have been slowing for decades and several have now approached virtual stasis. Indeed, there are signs that growth ultimately produces degrowth, regardless of what governments do. As I found in my recent book, economic growth triggers a cycle of behavioral and social changes whose effect, when aggregated, is to progressively inhibit a society’s economic dynamism while imposing new costs on that society, with the strength of these effects rising as a country grows richer. Western economies are now close to peak productivity. The one principal exception to the broadly-based slowdown of the rich countries is the US — but it has continued expanding thanks not to some internal dynamism, as is often supposed, but because of a massive run of debt-fueled stimulus. Take that added input out of the economy and the US too would be no outlier at all. In fact, real per capita income is already going backwards for all but the wealthiest Americans.

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Raise investment in developing countries? Check. It’s not nearly at the scale that the authors call for, but investors have been pouring money into developing countries for decades, lured by the higher average returns on offer in comparatively low-wage economies. Although the business story of the last couple of years has been about the “American exceptionalism” that has powered the boom in New York’s stock markets, the really exceptional performers have been in the developing world. Turkey’s stock market is up 40% over the last year, Taiwan’s has doubled, and Ghana’s has increased by over 130%. Forget AI, the big money’s in the Global South. 

Bring about a global convergence of per capita income? Also check. This mirrors the investment wave in the ascendant global periphery. While incomes within rich economies have diverged in recent years, the gap between rich and poor countries, which peaked at the turn of the millennium, has been steadily narrowing. For a while this finding was skewed by the extraordinary rise of China, but in recent years other countries have begun rising rapidly as well. Whether incomes could converge on a common level is another matter, and some war-torn countries have got stuck on the banks of the development stream. But all told, the old distinction between First and Third Worlds looks set to grow less relevant with time.

Reduce the consumption of material goods? Check. Consumers in Western countries have been substituting experiences for things for decades, with the result that the material intensity of developed economies has steadily declined. That is to say, the material component of each dollar’s worth of economic consumption is falling as people buy less stuff and spend more money on things like health and beauty, dining out, streaming videos and taking vacations. With most of the world economy’s future economic growth coming from developing countries, rising incomes are already causing a shift away from goods and towards services in consumption.

The other key proposals in the GJP report do not, when placed in the context of the century-long transition the authors envision, look all that unrealistic. Cut the work week in half? The average work week in Western countries has already nearly halved since the Industrial Revolution, so there’s no reason not to expect this trend to continue. It really comes down to whether productivity increases are used to raise income or free time: Americans have been more inclined to favor the former, Europeans the latter. This helps to explain the supposed “poverty” of Europe one reads about in the US business press; but outside of America, people have happily accepted more time off as a fruit of development.

Tax the rich to equalize incomes? There is a rising populist tide in many Western countries that advocates wealth taxes and greater limits to oligarchic power. With Elon Musk, a man described by one polling analyst as “political kryptonite”, on track to become the world’s first trillionaire, public patience with the ultra-wealthy is wearing thin.

Create a new international currency regime? Although the Western-based dollar order remains in place, it is rapidly eroding at the margins as the world moves towards a more pluralistic monetary system involving bilateral exchange, alternative payment systems like China’s CIPS, and the shift away from dollar reserves into other currencies.

In sum, it may be that the world economy is already moving in the direction advocated by the Global Justice Project, but organically rather than as a result of policy or an international revolution. Mind you, on current trends, the world will still face an ecological crisis. Many will take issue with the assumptions made in the report regarding the extent and impact of future climate change. However, there is little serious doubt that on current trends, the world faces a future of increasingly severe ecological crises. These, in turn, will hamper economic growth. Even though the material and energy intensity of production and consumption are declining, the sheer growth of both in the developing world over the next century will blow through all targets. 

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So in that regard, the Global Justice Project is a timely intervention. Admittedly, it doesn’t land at a propitious time. Western politicians are retreating from global campaigns, sweeping visions and anything that smacks of social engineering. It’s all about bringing gas prices down now. Thus as an action program, which it purports to be, the document seems out of touch with the times. In the chapter on political strategies the authors acknowledge there will be pushback from powerful vested interests to their proposals, before admitting there is “no magic bullet to address this issue, except trying to be more convincing and as precise as possible regarding the benefits of the GJP.” Erm, OK.

The problem, even for those who share Piketty and Co’s aims, is that there’s little evidence that the average citizen is moved by grand schemes. Indeed, as the success of Zohran Mamdani in New York attests, even self-declared socialists succeed best when they connect with voters around local, visceral issues, Mamdani’s focus on rental costs and grocery prices being no less ideological than Vladimir Lenin’s pledge of bread, land, peace and electricity.

But still. As an intellectual agenda, the document offers something sorely lacking in most modern political discourse, namely: ambition. Most mainstream economic commentary amounts to either fatalism that anything at all can be done, or a Pollyanna-ish optimism that technology will magically solve everything. The first option is a cop-out on the part of intellectuals whose job should be to solve problems; the second is as fanciful a belief as the most utopian assumptions in the radical literature. 

Yes, the energy-intensity of our economy has dropped dramatically as our technology becomes more efficient. But rather than bank those efficiency gains we have spent them. When, for instance, gas demand drops because our cars are made more efficient, we’ve spent the savings on adding bells and whistles to the cars, the result being a reduction in our carbon use that is much less than imagined. And that’s before we factor in the ravenous demand for energy that AI data centers are expected to add.

Building a sustainable path to the future will require both technological progress and human change. Economists have so far focused largely on the first and neglected the second. Even if it doesn’t provide the right answers, therefore, the Global Justice Project is at least asking the right question.

The scale of such riches is new, at least in the democratic age. At the turn of the millennium, it was Bill Gates who held the mantle of the world’s wealthiest person. Yet back then, when Britney Spears was a break-out teen sensation, and Vodafone was one of the world’s most valuable firms, Gates’s personal worth stood at a mere $60 billion, around $116 billion in today’s prices. Soon, though, Musk will possess a fortune ten times that.

Musk’s rise, as well as that of his fellow tech barons, is thus an object lesson in wealth inequality. While that is most glaring in the United States, where Wall Street rubs shoulders with Mississippi, a state where women are more likely to die in childbirth than Uzbekistan, Britain is far from immune. According to the Sunday Times rich list, the combined fortune of the country’s 200 wealthiest families stands at 20% of GDP. In 1994, long after the Thatcherite revolution had prevailed, it was a mere 6%. In France, meanwhile, the 500 most affluent families had a combined wealth equivalent to 6% of national output 35 years ago. Today, by contrast, that figure is 42%. If Musk is an eye-catching luminary of our gilded elite, his personal rise is just the most visible expression of a far broader transformation. 

While there’s little doubt these have been boom years for the ultra-rich, a conclusive explanation as to why that happened remains elusive. Some point to the demise of organized labor in the West, others to the increased centrality of high-value services in the economy, meaning productivity gains accrued to elite-tier knowledge workers. Then there’s long-term shifts in asset values over the last five decades, primarily driven by a decades-long collapse in interest rates, and more recently compounded by quantitative easing.

Whatever drove the growth of a globally mobile super-rich — and it likely includes all of the above — it’s important to clarify such a shift isn’t limited to countries with a low-tax “Anglo-Saxon” model of capitalism. If that were the case, then Finland, Sweden, Denmark and Norway, all high-tax, high-welfare economies, wouldn’t boast more billionaires per capita than Britain. The same applies to France. While it has numerically fewer billionaires than here, the wealth of the billionaire class across the Channel is around three times greater. Yet tax still matters. Because whatever the other explanations for the West’s spiraling inequality, the fact remains that billionaires, and multi-millionaires too, pay relatively less of it than the rest of us.

The extent of such “tax efficiency” is shocking. In France, the average citizen hands over 51% of their income to the state once you account for consumption taxes. You might think that’s reasonable: given the republic’s outstanding healthcare system, high-speed rail and public infrastructure. Or you might feel it’s excessive, a moral affront to self-reliance and hard work. But that’s not really the point, because the kicker is this: the effective tax rate for the country’s billionaires, which includes the two wealthiest families in Europe, is less than half that, with just 13% going to authorities in Paris. Prefiguring today’s rhetoric of a rigged economic system, Marx once wrote that the modern state is a committee for managing the affairs of the bourgeoisie. Given the deal billionaires now get, such an outcome would be outlandishly egalitarian. 

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What explains such a misalignment? The answer is income tax, and how it’s become a thing for the little people. As data compiled by Gabriel Zucman and his International Tax Observatory concludes, billionaires in France, Italy and the Nordics pay an effective income tax rate of between zero and 2%. Zucman suspects the figure for Britain is roughly the same, though the relevant data has, so far, proved challenging to collect. 

For inequality campaigners, this isn’t merely an issue of fairness, but of recursive dysfunction. By taxing incomes more than we tax wealth, we let the ultra-rich get wealthier, at a faster rate, by allowing them to re-invest capital into yet more assets. Often yielding rents, which in turn bring higher returns than government bonds or public equities, altogether contributing to pervasive rent-seeking across the economy — from land and private equity to the pursuit of monopolistic business models with venture capital. 

That all means wealth inequality widens further still. If you aren’t an oligarch, your best bet is to try something similar, albeit on a smaller scale: whether it’s becoming a buy-to-let landlord or entering the “gold mine” that is housing vulnerable children. No less dispiriting, this soon creates a vicious circle. Lower taxes on capital gains and asset ownership means more rentierism. More rentierism means more inequality and more state dysfunction. What’s on the line, ultimately, is the destruction of that central pillar of democratic society: the prosperous middle class.

In response, some on the Left have rallied around the idea of a wealth tax. Thomas Piketty first touted the idea more than a decade ago, but it has since been popularized in Britain by figures such as Gary Stevenson and Zack Polanski. In France, for its part, Zucman has influenced figures in both the Socialist Party and the more radical La France Insoumise. Even Wes Streeting recently spoke of his desire to equalize tax on capital gains with income, while Andy Burnham has spoken about a land value tax. While neither is an explicit commitment to a wealth tax, both Labour rivals seemingly agree the ultra-rich presently pay too little.

And yet despite such conversations on the Left, the center-Right — the very tendency meant to promote the interests of the aspirational, propertied middle class — is more likely to dismiss a wealth tax. In a stunning example of negative polarization, where your own position is based on the opposite of what your opponent says, the party of family capital often seems gleeful about its rejection of taxing the very richest. 

Why would pro-market conservatives, who claim to represent successful, affluent people, be happy for those richer than them to pay effectively zero in income tax? One explanation is ambition, and the fantasy that the middle classes might one day join such rarefied company; that a successful Home Countries accountant is merely a temporarily embarrassed oligarch. Talk of taxing the very wealthiest thus sounds too close to burdening them with more taxes. And, frankly, they pay quite enough already. 

But that’s exactly the point. Because such groups — generally pro-business and skeptical of the state — contribute an outsized amount to HMRC. Britain increasingly feels like a standard bell curve: at one end, those on low incomes and pensioners pay comparatively little to the Exchequer, except by way of consumption taxes (visit a Home Counties garden center on the Bank Holiday and you’ll see what I mean). The jet set, meanwhile, have landed themselves in the same category. All of which leaves the middle, who are left to support the system while withdrawing increasingly little from it. The most extraordinary example of this is the £100,000 “tax trap”, where earnings between £100,000 and £125,140 are subject to a 60% marginal tax rate, not to mention the loss of benefits such as free child care. 

Why would anyone facing such a situation support oligarchs paying so little into the system? And yes, they do exist. I’ve met them. To be clear: a wealth tax is not a silver bullet. The estimated revenue generated by a 2% tax on those with wealth above £100 million would be between £10-£15 billion. To put that into context, Britain spends more than £200 billion a year on health and social care. Yet such sums remain considerable. Last year, for instance, the policing budget for England and Wales amounted to £16 billion. The British Transport Police has been cut to the bone, and even with Starmer’s recent public largesse are subject to further cuts. So if you want fewer fare dodgers on the London Underground and less antisocial behavior on trains — both supposedly cherished center-Right goals — that means hiring more people to actually enforce the rules. 

Trading standards are another area that could be helped by a wealth tax. In response to a recent BBC expose, the Government awarded officers an additional £6 million a year to deal with the scourge of low-level criminality on high streets. But that’s a paltry sum when you consider that, in some areas, as many as half of convenience and vape shops are suspected to have criminal links. Nor do the center-Right arguments for a wealth tax end there. For one thing, the deficit, a perennial concern for fiscal conservatives, might be addressed if the very richest paid the same effective tax rate as the rest of us. Similarly inheritance tax — something I personally support but which raises huge passions on the Right — could be abolished in its stead. 

Yet the very same voices who claim to care for such things fall silent when it’s proposed that the wealthiest fund them. In part, certainly, this explains the demise of the Conservative Party, underscoring how beholden it’s become to finance, Big Tech and the ultra-rich rather than its petit bourgeois base. In Tory world, it is acceptable for nurses to graduate with over £50,000 of debt — and for solicitors to lose access to free childcare — while a billionaire landlord can effectively escape taxation altogether. Little wonder, then, that lifelong Conservative voters are flocking to Reform. There’s a problem with that too, however, given Farage and his friends similarly seem to believe that American tech billionaires and land-owning dukes share the same economic interests as Britain’s squeezed middle.

The counter-argument to a wealth tax — especially among those who claim to be otherwise sympathetic — is enforcing it. In a globalized economy, they muse, capital is too mobile, and millionaires and billionaires can go elsewhere. That is true to an extent, though recent events in the Gulf show the value in long-trusted safe havens like London and New York. And even for those willing to risk a move to the other side of the world — or anyway just Milan — a simple tool is available: adopting a system, like the US, that taxes nationals on global earnings regardless of where they live. 

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Some Right-wing ideologues will tell you this is impossible. Yet it’s precisely what the historic champion of free markets has done. Simply put, you make it illegal to not file, and pay the relevant taxes to, HMRC — even if you’re a British citizen and reside elsewhere. As with the United States, this would apply to lower-tax jurisdictions, so the Cayman Islands or Qatar rather than Sweden or France, where you pay the difference beyond a certain threshold (the Americans call this the “Foreign Earned Income Exclusion”). The idea, after all, is to tax ultra-rich tax dodgers, not simply those who work overseas.

For some, of course, that won’t make a difference. But the vast majority would want to play by the rules, whatever the online screeching: the inconvenience, bureaucracy and stigma of illegality wouldn’t be worth it. Besides, even with a tax of 2% on anything north of £100 million, most billionaires would still be paying a lower effective rate than a headmaster or doctor. All told, then, the arguments for a wealth tax have never been stronger, on the Right if nowhere else. If so-called conservatives want to preserve the middle-class prosperity of the last century, it will be a crucial, and I suspect inevitable, tool. 

Over the last decade, the Right has been proven spectacularly correct about certain things, not least the importance of place in political life. It’s all the stranger, then, how many on that side of the divide insist such thinking, somehow, doesn’t apply to the wealthiest. Maybe one day, after Musk starts his first libertarian space colony, affluent Brits will flock to Mars rather than Dubai, Singapore and Malta. Until then, His Majesty’s Revenue and Customs officers should be enforcing a wealth tax on our richest compatriots — wherever they happen to live. 

It was into this context that a 700-page book about rentiers, wealth elites, inheritance, war, and taxation, over the previous two centuries, became an extraordinary publishing sensation. Few had heard of Thomas Piketty when Capital in the Twenty-First Century appeared, but his publisher, Harvard University Press, would soon be struggling (and failing) to keep up with demand for the book. Hundreds of thousands of copies were shifted over the summer of 2014, while A-boards appeared outside the luckier independent bookshops in hipster neighbourhoods around the world declaring “PIKETTY IN STOCK!”. Sales figures topped two million within a couple of years.

Inevitably, much of the media commentary descended into banality and crass comparison. Piketty himself was instantly declared a “rock star economist”, and compared with Karl Marx, presumably because he had published a doorstopper with the word “capital” in the title. Those who’d bothered to read (at least some of) Capital in the Twenty-First Century were surprised and impressed to discover, amid lots of graphs, references to Balzac and Jane Austen in a book notionally of economics. This was clearly more intriguing than the “economics 101” that was taught at school and university.

From the perspective of the trade publishing market, the book also had the merit of being beautifully simple to understand. Capital in the Twenty-first Century is ultimately a piece of historical statistical description, containing no real theory or mathematics to speak of. Its famous formula “R>G”, which even came to adorn t-shirts, refers to the long-standing tendency (Piketty has been adamant it’s not a “law”) of returns on capital being higher than growth in income from production. As anyone who has owned an asset (such as a house) might have noticed, its value tends to rise faster than one’s pay. Scale that up to an economy as a whole, and you have a situation where existing stocks of wealth are growing faster than GDP.

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Piketty’s thesis clearly chimed with narratives about inequality that had been developing on the Left since the 2008 financial crisis. The book’s focus upon the rising incomes and wealth of the top “1%” echoed the language of the Occupy movement, language which had itself been borrowed from the study of “top incomes” that Piketty had helped pioneer some years earlier. One of Britain’s most eye-catching political reactions to the banking crisis was UK Uncut, which was founded in 2010 to campaign against corporate tax avoidance, at a time when brutal cuts to benefits, higher education and local government were being unveiled. Fred “the shred” Goodwin, the CEO of RBS that had been bailed out by the British taxpayer and who had then resigned with a knighthood and a £700,000 pension, became a symbol of something morally rotten in capitalism. There was a widespread sense of an economy that was rigged in favour of the rich, which Capital in the Twenty-first Century did much to empirically substantiate.

But the extraordinary success of the book cannot be wholly explained in terms of media hype or the immediate fall-out from 2008. No doubt, the sentiments expressed by Occupy and UK Uncut remained potent ones, contributing some years later to the unexpected rise of “Left populists” such as Bernie Sanders and Jeremy Corbyn. Piketty has expressed some political sympathy with those movements, but if one were looking for a rousing, polemical denunciation of neoliberal capitalism around which to mobilise, one probably wouldn’t turn to Capital in the Twenty-First Century. Its resonance requires some deeper explanation.

The scientific study of “top incomes” originated in the early 2000s, led by the late British economist, Tony Atkinson, who struck up a collaboration with Piketty, based in Paris, and Emmanuel Saez in Berkeley. This yielded a series of academic articles and edited volumes, which passed under the radar of general readers or the media, back when nobody had ever spoken of “the 1%”. One distinguishing feature of this programme was a willingness to use novel sources of empirical data, namely tax records. Another was the study of very long-term historical trends, over not just decades but centuries. “The Top Incomes Database”, which first presented the kinds of graphs with which Capital in the Twenty-First Century is littered, was launched at a conference hosted by Atkinson and Piketty in Paris in 2011.

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Given the extraordinary historical reach of this research field, there was nothing explicitly contemporary about its findings or implications, especially during those years when few politicians or commentators were worrying about inequality. Most people had a general sense that inequality had been rising since Thatcher and Reagan came to power, but political attention under New Labour was squarely focused on alleviating poverty, and not on the other end of the income spectrum (which, famously, Peter Mandelson was “intensely relaxed” about).

The global financial crisis did disrupt that complacency, but not simply because of “Fred the Shred” or because George Osborne took an axe to various social safety nets. Piketty and his publishers lucked out because the macrofinancial paradigm of the post-2008 world suddenly rendered the “R>G” tendency (which Piketty argued had been around for at least 200 years) impossible to ignore. Britain in particular experienced its longest period of wage stagnation since the industrial revolution, while asset prices (including housing) soared. Quantitative easing poured boundless cheap money into equities, facilitating the sharp ascent of BlackRock and other giant asset managers. Fiscal tightening and unprecedented monetary loosening combined to offer as devastating a demonstration of Piketty’s thesis as he could possibly have imagined.

In this Pikettyan dystopia, the wealthy didn’t need to take any risks or become Gordon Gekko to swell their portfolios further; they simply needed to take advantage of the glut of cheap credit and hire a wealth manager. Capital in the Twenty-First Century arrived with a historical account of a phenomenon that had been largely forgotten about: the idle rich, living off passive investments and inheritances. Everything that Marx had admired about capitalism — its modernism, its upheaval, the insatiable hunger for productivity gains — was nowhere to be seen. In his rather nerdish, atheoretical manner, coolly tracing the ebbs and flows of wealth since the Enlightenment, Piketty held up an image of capitalism that was less characterised by class conflict, exploitation or upheaval, and more by the sheer durability of estates and portfolios over time.

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Marxists scoffed. After all, where had all this wealth originated from, if not from relations of production that were essentially exploitative? But Piketty’s analysis spoke to a range of other struggles and injustices that often had little to do with production and employment, but which became increasingly prominent as the decade wore on. Piketty’s definition of “capital” (“the sum total of nonhuman assets that can be owned and exchanged on some market”) decentred productive capital, but shone a fresh light on how wealth in general is protected and passed on, via inheritance, tax avoidance, “philanthropy” and other forms of gift-giving, all of which were politicised in the 2010s. Social scientists were soon filling in the blanks, with fascinating studies of the legal services, “family offices”, elite schools and offshore trusts that insulated the new oligarchy from political interference.

Political-economic conflict now seemed less about class, in a Marxist sense, and more about intergenerational unfairness and the sheer luck of which family (with what sized “bank of mum and dad”) one happens to be born into. One of the remarkable implications of Capital in the Twenty-First Century is that, due principally to its very high levels of top marginal income and inheritance tax, the post-1945 Keynesian era is the one phase of capitalist history in which the promise of meritocracy has ever been close to being realised. By fiscally suppressing “R>G” for 30 years (and because so much capital had been destroyed by war), people were able to work their way towards wealth ownership. The baby-boomer generation that benefited from this was the same generation that would later benefit from surging house prices, pay off their modest mortgages, and vote for Brexit. It has taken a while to recognise how much societies such as Britain have been reshaped by long-run trends in asset ownership and asset prices, but Capital in the Twenty-first Century was a key moment in this awakening.

Where has this got the Left? Piketty identifies as a “socialist”, and has produced a number of thoughtful proposals to tackle wealth inequality, such as a global wealth tax and (in his subsequent Capital & Ideology) a “citizen’s inheritance”. One could no doubt build a political movement dedicated to reversing the power of rentiers and wealth elites, as Jeremy Corbyn occasionally hinted at, launching his 2019 manifesto with a promise to go after “150 billionaires”. Tactics oriented around asset ownership, such as rent strikes, might form part of such a movement.

But Piketty is also a mild-mannered liberal technocrat, an heir to Keynes rather than Marx. Piketty anticipated the anxiety of liberals today, who believe in “hard work” and “enterprise”, but can see quite clearly that this economy rewards neither. In the decade since Capital in the Twenty-First Century was published, that has virtually become an orthodoxy. Even some of capitalism’s most passionate defenders are concerned by the rising number of young people living with their parents into their 30s due to spiralling housing costs, by the creeping power of surveillance capital, or by the rise of “universal owners” such as BlackRock. These are all symptoms of a society governed wholly in the interests of asset owners. Some have even questioned whether it is still “capitalism”, given it no longer relies on productivity gains, or whether we are descending into “neo-feudalism”.

The political question, looking back on the decade that followed Capital in the Twenty-First Century, is why this groundswell of opposition has still not translated into a genuinely transformative political program that puts these tendencies into reverse. Piketty cannot be held responsible for that, and he has done his best to identify the necessary measures that might reduce inequality. But there is nevertheless a slight unworldliness about his perspective and its emphasis upon very long-term statistical trends, which while never inevitable, come to feel almost natural and unsurprising. Even if “R>G” is merely a trend, and not a law, it expresses a slight air of fatalism, that (combined with so much other environmental and political news over the past decade) makes progress feel impossible. Like the proverbial frog in the ever-heating water, there is no moment of crisis when it might become necessary to jump out. In one of Capital in the Twenty-First Century’s most evocative phrases, Piketty describes how the “past devours the future”, as past accumulations of wealth overshadow our options in the present. This is not a fertile mood for progressive politics.

When Occupy first raised their banners declaring “we are the 99%” in Zuccotti Park and on the steps of St Paul’s Cathedral, “the 1%” was felt to be nearby, in the banks of Wall Street and the City of London. These encampments were putative acts of democracy. But as empirical attention to wealth, asset management and “high-net-worth” individuals has grown, their distance from the rest of us has come to feel ever more unbridgeable. At their best, studies of the super-rich illuminate the impacts of extreme wealth upon cities, democracy and culture, to aid public understanding. But the sheer exoticism of Elon Musk, Mayfair hedge funds and Monaco superyachts can also become a spectacle, which reduces the observer to passivity.

Piketty was right to divert attention away from the sphere of productive capital, and towards wealth in general. But this means that political conflict evaporates into the ether of long-run tendencies, asset portfolios and offshore jurisdictions. One of the great strengths (or comforts, if you like) of Marxism is that it focuses political attention upon one specific locus of activity: the workplace. You know what to do and what to demand if you are a Marxist. The same is less true if you are a “Pikettyan”. A return to Sixties-era top marginal tax rates (at over 90% for income and inheritance, even in the United States) would be a start. Piketty has made many radical and optimistic proposals of this sort. The problem is that they suggest a faith in liberal democracy and the current assortment of political parties that few people share in 2024, given the influence of big donors and media. Meanwhile, the long-term tendencies roll on.

For much of its history, Japanese politics was characterised by conflicts among its ruling daimyo, and later between the great industrial zaibatsu who replaced them as dominant powers. Similarly, America’s politics is now being shaped by a civil war not between classes, but within the ruling capitalist elite.

As the 2022 congressional elections approach, two sides are polishing their armour and fletching their arrows. In one corner stand the daimyo of the gentry corporate elite, largely drawn from the ranks of tech oligarchs and much of Wall Street. Their focus lies in the creation of a capitalist utopia rooted in paternalistic state control, much along the lines of the corporatist “Great Reset”. In the other corner, meanwhile, stand their opponents to the Right, largely made up of those who own private capital and are therefore anxious not to see their activities curbed.

These divisions reflect profound differences in industry, reminiscent of the 19th-century conflicts between aristocratic merchants and British manufacturers, or the one that broke out between the daimyo who embraced industry and those samurai who stubbornly hewed to traditional ways. Drawing on this, the French economist Thomas Piketty aptly divides our capitalist class into what he calls “the Brahmin Left” and the “merchant Right”. One side, as its caste association assumes, tends to see itself as more spiritually enlightened, as priests of the progressive secular religion. The merchant side, however, is more concerned with market competition (particularly from China), the cost of goods, and the impact of regulatory policies on their core businesses.

Today, the Brahmin Left has its base in large corporations and investors, and has allied itself with the academic and media establishments, financing non-profits and generally supporting increasingly intrusive government. By contrast, the merchant Right draws its natural support from the traditional middle class — skilled workers, high-street businesspeople, and small property owners — who also have become the bulwark of the Trumpian Republican Party.

Until recently, these two opposing capitalist groupings have contented themselves with near-peaceful coexistence. But the recent massive hysteria among progressives over Elon Musk’s takeover of Twitter could signal the start of a more heated conflict, pitting competitive, market-oriented business interests against the conformist gentry progressivism of so many of the largest firms.

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This corporate shift to the Left, particularly since the Black Lives Matter protests, has created a backlash within the capitalist class, with many concerned at what they see is the creation of a highly regulated, less competitive and openly politicised economy. Add to this Biden’s own embrace of progressive ideology and it’s hardly surprising that many traditional capitalists now fear for their future.

Some of this reflects understandable concern over Biden’s energy policies and taxes on the analogue economy — where food is grown, products are manufactured and shipped, and oil and gas are drilled. In recent years, Republicans have reaped support from many of the families tied to the “old economy” that markets tangible products. Looking at contributions, the differences between business sectors are stark: with manufacturers and agribusiness favouring the GOP by three to one, while the entertainment, internet and publishing industries overwhelmingly support the Democrats. To some extent, this is a conflict between those who invest and make stuff, and those who gorge on media and digital tools.

What makes Musk so different from his tech counterparts is that he remains, primarily, an industrialist, more in the mould of great Valley founders like Robert Noyce or Jerry Sanders — building cars, spaceships, and tunnel-making equipment. Like any manufacturer he needs reliable, affordable energy and worries about overregulation, which sets him against California’s ultra-progressive legislature.

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How a divided America empowers Putin

By Joel Kotkin

By contrast, Meta, Google, Apple, and Microsoft manufacture almost nothing in the United States, and primarily make their money based on advertising or charging for services without much in the way of competition. So while many industrial firms support some protectionist measures against China, Silicon Valley is largely resistant to the idea. After all, on those rare occasions when they do manufacture products, they outsource their most critical production to China. Wall Street follows a similar post-national script, financing Beijing’s industrial machine with its notoriously high carbon supply chains.

A year or two ago, these elite divisions would not have been so pronounced. After the chaos of the 2020 election, big business seemed to welcome Joe Biden’s presidency as a return to normality. Many capitalist elites, particularly in the tech and finance industries, invested heavily in elevating the somewhat doddering warhorse into the White House. Biden, they reasoned, was far more reliable than Trump, whose greatest talent seemed to be widening already serious divisions in the country.

And at first, this corporate class seemed to support the Biden administration’s priorities on immigration, racial “equity”, gender, and climate change. But the government’s incompetent Afghanistan withdrawal, the intensifying border crisis and its own economic programme weakened this capitalist ardour. Most critical has been Biden’s stunning failure to address the roots of rising inflation. While costs of living soared, his supporters claimed everything was either temporary or Vladimir Putin’s fault. But it is clear inflation was rising rapidly before the Ukrainian invasion, and is now considerably higher than key competitors, such as Japan, Germany, France, Canada and China.

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Meanwhile, those who would have previously moderated the Democrat machine, as occurred during Bill Clinton’s ascendency, find themselves unable to restrain a party now dominated by its far-Left fringe. And for all its alleged benefits, wokeness is not generally a good business strategy; it just cost Disney an estimated $50 billion, while causing firms such as Netflix to lose subscribers, in part due to what Musk describes as a “woke mind virus”. Yet so deep are the partisan divisions that it’s unlikely that much of the Silicon Valley and the Brahmin Left are ready to seek refuge in the clutches of the GOP .

Amid a contentious climate, who will win this new capitalist civil war? Hopefully neither side, at least not too decisively. As unromantic as it may seem, the middle and working classes rely on political competition between the elites to survive, as it forces them to make concessions to those below. Just look at the Meiji Restoration, or the socially democratic turn of the British Conservative Party, in Disraeli’s time as well as in recent years. Both are proof that the enemy of mass progress is in the uniformity of elites: when autocracy thrives, and when a small group of people — be they feudal lords, oligarchs or party cadres — control the political field, it is the middle and working classes who suffer.

To put it simply, a capitalist civil war isn’t necessarily all bad news. Although voters should not expect either side to defend their core interests, conflict between corporate moguls gives leverage to the middle and working classes. Like the plebeians in the Roman Republic, the average American could use this conflict to their own advantage. This could, for instance, take the form of a pro-reshoring strategy, which would lead to better paid blue-collar jobs, greater incentives for home-building, more skills education and greater access to healthcare. It’s not an ideal situation; in fact, it’s thoroughly depressing. But it’s far better than letting the rich gorge without conscience or concerns over popular pushback.

There’s no business like intello-business, and for centuries it came from Paris: Voltaire, Rousseau, Hugo, Zola, Sartre, Camus and de Beauvoir once defined both public engagement and intellectual glamour — the ultimate in intersectional cool.

As far back as the 18th century, Diderot famously boarded with Catherine the Great while Voltaire, a steadfast correspondent of Catherine’s for decades, visited Frederick the Great at his Sanssouci for two years. Victor Hugo, somewhat unfairly, destroyed Napoleon III’s reputation in posterity for good (he dismissed him as “Napoléon le Petit”). Jules Verne predicted the future; Proust and Céline, at opposite ends of the spectrum, illuminated the precipices opened by the Great War.

Marc Bloch opened up historical studies to social sciences and painstaking assessment of primary sources in context, while Fernand Braudel mapped out mentalities and trends over centuries in the Mediterranean. Sartre and de Beauvoir travelled across Russia, China and America, sprinkling intellectual pixie dust at universities from Cornell to Smith and Wellesley ­— or endorsing Communist dictators from Mao Zedong to János Kádár.

When the young André Glucksmann, one of the bright stars of the Nouveaux Philosophes, organised the public reconciliation between Raymond Aron and Jean-Paul Sartre in 1979, the encounter took place in the office of President Giscard d’Estaing at the Élysée. Le Président looked on benignly from the sidelines, obviously enjoying a validation that in everyone’s mind bested the popular vote he’d won five years earlier.

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Why we French love to hate the English

By Anne-Elisabeth Moutet

Glucksmann and Bernard-Henri Lévy, for all their Left Bank rich boys swagger, had rightly called the end of the French intelligentsia’s love affair with the radical Left: no more fellow-travellers, no more Odes to Stalin (from France’s greatest 20th century poet, Paul Éluard, no less); no more apologias for Mao’s Cultural Revolution. Even staged, it was momentous.

But perhaps the more pertinent question is: who would a Nazarbayev, Kim Jong Un or Lukashenko invite today, assuming they even saw the point? Where are the successors to Sartre and Aron? To curry favour with their president, Kazakh oligarchs found more soft power value in buying Prince Andrew’s decaying marital home. Kim Jong Un had to make do with Dennis Rodman. Contracts with Tony Blair’s associates have replaced correspondence with Voltaire.

Camus died in 1960, Merleau-Ponty the following year, while Sartre’s death in 1980 was followed by Aron in 1983, Foucault the year after and de Beauvoir in 1986. Derrida lingered on until 2004, pre-deceased by Bourdieu in 2002; but by that time they had become their own statues, only of use to radicalised Ivies at $60,000 a pop, to spruce up their toxic mix of race/gender/linguistics/post-colonial studies. The only French novelist of true international note is Michel Houellebecq, a misanthrope and a pessimist whose protagonists embody anomic failure.

Compare our four most recent Nobel Prizes for literature — Claude Simon (1985), Gao Xinjian (2000), J.M.G. Le Clézio (2008), Patrick Modiano (2014) — with their predecessors (Romain Rolland, Anatole France, Albert Camus, Jean-Paul Sartre) and the problem becomes obvious. Of all the works by current aspirants to the title of Public Intellectual, you can probably take Thomas Piketty’s Capital in the Twenty-First Century to the barricades, but it’s a dry read at 976 pages. (Piketty’s most publicised political stance was his public support for François Hollande in the 2012 presidential election. It has not aged well.)

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By Anne-Elisabeth Moutet

When the talented Le Figaro columnist, Eugénie Bastié, recently asked Éditions Gallimard’s residing sage Pierre Nora, 89, what he thought of the state of intellectual life in France today, Nora couldn’t find enough epithets to characterise his disdain. “Do we have an intellectual life left? It has collapsed. Well,  subsided, really. Shrunk… Ran out of steam… French intellectual life is provincialised.” (And no worse insult is possible from the heart of the Septième Arrondissement.)

Back in 1980, Nora co-founded the influential Le Débat bi-monthly review with the sociologist, historian and philosopher Marcel Gauchet, who to this day — aged 75 — sits in the next-door office at Gallimard. A trio of Paris publishing houses set the Parisian intellectual tone, issue excommunications and sweep up the majority of literary prizes, a situation which has not changed since Balzac’s Lost Illusions. I once witnessed the editor of a lesser intellectual review paying court to Gauchet in hopes that they might publish a joint issue with Le Débat. It was straight out of the Duc de Saint Simon’s Memoirs of the Court of Louis XIV. The joint issue never happened.

Called upon to answer Bastié’s question, Gauchet doubled down, stating that “Intellectual life nowadays is non-existent.” And just to emphasise the point, he and Nora closed down Le Débat last year. Bastié, who’s 29, agrees with this downbeat assessment. “Fifty-thousand people walked behind Sartre’s funeral procession [in 1980],” she writes in the newly-published La Guerre des Idées. “Nowadays it’s Johnny Hallyday’s they follow.”

In many ways, France’s intellectual life suffers from the same conformism as French politics, or French society at large. Just as our vaccine roll-out was plagued from the start by pusillanimity, negativity and the structural incapacity of France’s top-heavy bureaucracy to think imaginatively or admit to mistakes, French universities or Grandes Écoles haven’t produced a critical mass of robust dissidents. Conformism is the key to good grades and social advancement, whether in government, the private sector or in an intellectual community where the gatekeepers have sometimes held the same job for half a century. Outliers — they do exist — take years to receive some sort of acknowledgement; and this is more often conferred by newspapers opinion pages or cable channels talk shows, neither of which make for solidly grounded arguments.

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How France lost her dignity

By Michel Houellebecq

What we get, in keeping with the rest of the world, are strident debates. Thoughtful thinkers like Alain Finkielkraut, once a promising Gallimard author, now a member of the Académie Française (an honour that usually smothers its holders to complete irrelevance), has become little more than a conservative columnist. Finkielkraut is regularly targeted by the Left: cancelling attempts, as early as 2005, by Le Monde, Libé and L’Obs, lumped him in a group of right-of-centre commenters as a Nouveau Réactionnaire (boo, hiss).

Finkielkraut still publishes books that sell well and has a France Culture (think Radio Three) weekly programme, but his influence in Parisian circles of power is non-existent. Unlike in the United States, non-personhood in France isn’t followed by the actual destruction of your professional life; you just become an intellectual ghost.

As for French intellectual soft power nowadays, it lives more in old symbols than in actual argument. There are no French Jordan Petersons to polarise public opinion and draw crowds of thousands (even if on Zoom these days) to demonise or applaud their latest pronouncements. Foucault and Bourdieu, being safely dead, cannot protest the uses they are put to in American universities: their former students refute most of these, but this isn’t much heard beyond our borders, and not just because the French language is in full retreat.

The language barrier has to some extent protected us — so far — from the excesses of identity politics; but as a cultural rampart, it’s a Maginot Line. It’s a sad retreat from what politicians up to Jacques Chirac used to praise as le rayonnement de la France (“rayonnement” can either refer to the benevolent light of the sun’s rays, or to atomic radiation; in today’s performative anti-colonialism it’s the second meaning that’s more often implied). French intellectuals need to be less retiring and limelight-shy — and there’s a sentence I never, ever expected to write.

These are among the alarming stats cited by Joel Kotkin’s The Coming of Neo-Feudalism, published earlier this year just as lockdown sped up some of the trends he chronicled: increased tech dominance, rising inequality between rich and poor, not just in wealth but in health, and record levels of loneliness (4,000 Japanese people die alone each week, he cheerfully informs us).

Kotkin is among a handful of thinkers warning about a cluster of related trends, including not just inequality but declining social mobility, rising levels of celibacy and a shrinking arena of political debate controlled by a small number of like-minded people.

The one commonality is that all of these things, along with the polarisation of politics along quasi-religious lines, the decline of nationalism and the role of universities in enforcing orthodoxy, were the norm in pre-modern societies. In our economic structure, our politics, our identity and our sex lives we are moving away from the trends that were common between the first railway and first email. But what if the modern age was the anomaly, and we’re simply returning to life as it has always been?

Inequality was almost universal from the agricultural to the industrial revolution, and medieval Europe would have had a GINI index higher than modern Latin America, with a handful of families owning up to a quarter of land in England, and the monarch a similar share.

Most of the medieval left-behinds would have worked at home or nearby, the term “commuter” only being coined in the 1840s as going to an office or factory became the norm, a trend that only began to reverse in the 21^st century (accelerating sharply this year).

Although I imagine most people will return to the office after the vaccine, unemployment patterns will continue on their pre-modern course. One of the peculiar features of the modern world is the shortage of labour, while the medieval era was characterised by mass underemployment, except in times of harvest, which is why land was so valuable relative to labour.

The industrial revolution increased the demand for labour and helped drive up wages, which rocketed in the 18th century, but with automation increasing numbers will be unemployed or underemployed; while government policies used to focus on creating work, the seemingly inevitable logic of Universal Basic Income reflects the fact that we may have to give up on that dream.

Along with income stratification, another pre-modern trend is the decline of social mobility, which almost everywhere is slowing (with the exception of immigrant communities, many of whom come from the middle class back home).

Social mobility in the US has fallen by 20% since the early 1980s, according to Kotkin, and the Californian-based Antonio Garcia Martinez has talked of an informal caste system in the state, with huge wage differences between rich and poor and housing restrictions removing any hope of rising up. California now has among the most dystopian of income inequality, with vast numbers of multimillionaires but also a homeless underclass now suffering from “medieval” diseases.

Unfortunately, where California leads, America and then Europe follows.

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Social mobility was not unknown before the modern age, but it was rare and mostly only possible through the Church or war. William of Wykeham was the son of a Hampshire freeman and rose to become Bishop of Winchester and also Chancellor of England, founding Winchester College, the oldest public school in England, with its famous motto “Manners makyth man”. But Wykeham was fortunate to have received patronage from two wealthy men, which was necessary before the age of welfare and free education.

Patronage has made a comeback, especially among artists, who have largely returned to their pre-modern financial norm: desperate poverty. Whereas musicians and writers have always struggled, the combination of housing costs, reduced government support and the internet has ended what was until then an unappreciated golden age; instead they turn once again to patrons, although today it is digital patronage rather than aristocratic benevolence.

A caste system creates caste interests, and some liken today’s economy to medieval Europe’s tripartite system, in which society was divided between those who pray, those who fight and those who work. Just as the medieval clergy and nobility had a common interest in the system set against the laborers, so it is today, with what Thomas Piketty calls the Merchant Right and Brahmin Left — two sections of the elite with different worldviews but a common interest in the liberal order, and a common fear of the third estate.

This new age of liberal inequality is dominated by and defined by tech, with the four big firms, Apple, Amazon, Google, and Facebook, having a GDP equal to France. Tech accounts for eight of the 20 richest people on earth, as well as nine of the richest 13 under-40s, all of them based in California.

Tech is by nature anti-egalitarian, creating natural monopolies that wield vastly more power than any of the great industrial barons of the modern age, and have cultural power far greater than newspapers of the past, closer to that of the Church in Kotkin’s view; their algorithms and search engines shape our worldview and our thoughts, and they can, and do, censor people with heretical views.

Rising inequality and stratification is linked to the decline of modern sexual habits. The nuclear family is something of a western oddity, developing as a result of Catholic Church marriage laws and reaching its zenith in the 19^th and 20^th centuries with the Victorian cult of family and mid-20^th century “hi honey I’m home” Americana. Today, however, the nuclear household is in decline, with 32 million American adults living with their parents or grandparents, a growing trend in pretty much all western countries except Scandinavia (which may partly explain the region’s relative success with Covid-19).

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This is a return to the norm, as with the rise of the involuntarily celibate. Celibacy was common in medieval Europe, where between 15-25% of men and women would have joined holy orders. In the early modern period, with rising incomes and Protestantism, celibacy rates plunged but they have now returned to the medieval level.

The first estate of this neo-feudal age is centred on academia, which has likewise returned to its pre-modern norm. At the time of the 1968 student protests university faculty in both the US and Britain slightly leaned left, as one would expect of the profession. By the time of Donald Trump’s election many university departments had Democrat: Republican ratios of 20, 50 or even 100:1. Some had no conservative academics, or none prepared to admit it. Similar trends are found in Britain.

Around 900 years ago Oxford evolved out of communities of monks and priests; for centuries it was run by “clerics”, although that word had a slightly wider meaning, and such was the legacy that the celibacy rule was not fully dropped until 1882.

This was only a decade after non-Anglicans were allowed to take degrees for the first time, Communion having been a condition until then. A similar pattern existed in the United States, where each university was associated with a different church: Yale and Harvard with the Congregationalists, Princeton with Presbyterians, Columbia with Episcopalians. The increasingly narrow focus on what can be taught at these institutions is not new.

Similarly, politics has returned to its pre-modern role of religion. The internet has often been compared to the printing press, and when printing was introduced it didn’t lead to a world of contemplative philosophy; books of high-minded inquiry were vastly outsold by tracts about evil witches and heretics.

The word “medieval” is almost always pejorative but the post-printing early modern period was the golden age of religious hatred and torture; the major witch hunts occurred in an age of rising literacy, because what people wanted to read about was a lot of the time complete garbage. Likewise, with the internet, and in particular the iPhone, which has unleashed the fires of faith again, helping spread half-truths and creating a new caste of firebrand preachers (or, as they used to be called, journalists).

Most of us grew up in the industrial age of politics, when the great divide was over class and economics. But that is something of an anomaly — and the culture wars that were first identified in the mid-90s are just the return to normal, of people screeching at each other about their sinful beliefs.

English politics from the 16^th to the 19^th century was “a branch of theology” in Robert Tombs’s words; Anglicans and rural landowners formed the Conservative Party, and Nonconformists and the merchant elite the core of the Liberal Party. It was only with industrialisation that political focus turned to class and economics, but the identity-based conflict between Conservatives and Labour in the 2020s seems closer to the division of Tories and Whigs than to the political split of 50 years ago; it’s about worldview and identity rather than economic status.

Post-modern politics have also shaped pre-modern attitudes to class. In medieval society the poor were despised, and numerous words stem from names for the lower orders, among them ignoble, churlish, villain and boor (in contrast “generous” comes from generosus, and “gentle” from gentilis, terms for the aristocracy). Medieval poems and fables depict peasant as credulous, greedy and insolent — and when they get punched, as they inevitably do, they deserve it.

Compare this to the evolution of comedy in the post-industrial west, where the butt of the joke is the rube from the small town, laughed at for being out of touch with modern political sensibilities. The most recent Borat film epitomises this form of modern comedy that, while meticulously avoiding any offence towards the sacred ideas of the elite, relentlessly humiliates the churls.

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The third estate are mocked for still clinging to that other outmoded modern idea, the nation-state. Nation-states rose with the technology of the modern day — printing, the telegraph and railways — and they have been undone by the technology of the post-modern era. A liberal in England now has more in common with a liberal in Germany than with his conservative neighbour, in a way that was not possible before the internet.

Nations were semi-imagined communities, and what follows is a return to the norm — tribalism, on a micro scale, but tribalism nonetheless, whether along racial, religious or most likely political-sectarian tribes. Indeed, in some ways we’re seeing a return to empire.

The common theme running through all these trends is the decline of the middle class, a group who were unusually strong in the industrial age but are struggling in the tech era. The mid-century United States may have been the best time ever to be the average man, although as always one form of equality clashes with another; egalitarianism between men went with reduced opportunities for women, as well as racial exclusivity.

The middle-class age meant the triumph of bourgeoise values and the decline of the middle class has led to their downfall, widely despised and mocked by believers in the higher-status bohemian attitudes. Now the age of the average man is over, and the age of the global aristocrat has arrived.

How did we get to this point? As Thomas Piketty, in his book Capital, famously argued, a capitalist economy left to its own devices will tend to produce not just inequality but ever-rising inequality of wealth – and the income derived from wealth. The main reason is because the returns earned on assets such as stocks and bonds normally exceed the growth of wages.

Imagine an economy with one capitalist and one wage earner. If the annual rate of return to financial assets is, say, 3%, but wages are only growing by 2%, more and more income ends up in the hands of the capitalist. Wealth then begets more wealth as the capitalist, not needing to spend all of his added income, adds to his existing wealth and reaps ever-growing income from that wealth. Unless a war or other shock destroys his wealth (think depression or the devastation in Europe after the Second World War), or government decides to tax it away, we end up with the rise in wealth inequality that we are now seeing in many rich countries – the US in particular.

There is something deeply disturbing about Piketty’s work. If one takes his thesis seriously, it means that the inequality of wealth and its corollary, income inequality, along with their continued growth, is the new normal. They are baked into a capitalist economy.

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Of course, some financial capital gets invested in productive assets that help the economy grow. But productive investment and growth have slowed in recent decades, making it hard to argue that the rise in wealth at the top has benefited everyone. In the meantime, the accumulation of wealth in high-income households is one reason that income inequality is rising so sharply at the very top. While the richest 20% of US households, which benefit from a lot of human capital but not a lot of wealth, saw their market incomes rise by 96% between 1979 and 2016, the top 1% – which receives far more of their income from wealth – saw their incomes rise by a staggering 219%.

In short, growing wealth inequality spawns growing income inequality, so if we care about the latter, we cannot focus only on redistributing income. We need to tackle the accumulation of wealth as well.

What to do? Senator Elizabeth Warren, a serious contender for the US presidency, has proposed a wealth tax. She would levy a tax of 2% on households with net worth over $50 million and 3% on households with net worth over $1 billion. This proposal is now being fiercely debated.

One counter-argument is that taxing the rich will slow economic growth.  However, the idea that low taxes on the rich are the key to economic growth has been undermined by the repeated failures of supply-side economics and the tax cuts enacted under that banner to move the growth needle in a significant way. (They do provide a temporary stimulus to the economy.)

Finally, no one with less than $50 million would be affected by the Warren proposal; there would still be an incentive to save and invest, and if the revenues from the tax were invested in public goods such as more effective education and infrastructure, growth would probably be higher. Businesses need educated workers, good transportation and communication systems to function efficiently.

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If governments do raise taxes on wealth, what should be done with the revenues?

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Another concern with a wealth tax is the ability of individuals to avoid it by leaving the country or parking their money in untaxed assets. Many European countries used to have wealth taxes but rescinded them because of their administrative complexity. They require detailed and challenging audits, an exit tax on those seeking to avoid the tax by leaving the country, and annual valuations of closely-held businesses. In the US there is, in addition, a serious question about the constitutionality of a wealth tax.

On the positive side, a wealth tax would not just reduce inequality of both wealth and income but would also raise significant revenue from a group that can easily afford to pay more. Warren’s proposal is estimated to raise $2.75 trillion over ten years, according to Emmanuel Saez and Gabriel Zucman, economists at the University of California, Berkeley. This estimate has been disputed, and so likely represents an upper bound: Lawrence Summers and Natasha Sarin have warned that the Saez and Zucman estimate is overly optimistic: the rich will find myriad ways to avoid the tax.

Either way, a wealth tax can raise substantial revenue. Were that revenue invested in education, infrastructure, clean energy to combat climate change, or used to reduce deficits and debt, the benefits would almost surely exceed any costs.

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A tax on wealth is also politically popular – at least in the US. Two-thirds of Americans support Warren’s wealth tax. Six out of ten Americans say that the rich do not pay their fair share in federal taxes and seven out of ten say the same of corporations. While the rich cannot foot the bill for all of a nation’s needs, they can certainly pay more.

Not only could increased taxes on the rich fund sorely needed public investments, they could also reduce the political influence of the rich. While this fact is often overstated, the political scientists Martin Gilens and Benjamin Page have documented that US economic elites and business interest groups are much more likely to see their preferred policies enacted than are mass-based interest groups or the average citizen.

Rising inequality together with the undue political influence of the rich suggests a distributing tendency for inequality to beget more inequality through a political feedback loop. Even if wealth does not buy as much political influence as people assume, the perception matters and is causing people to lose faith in democracy — instead turning to would-be oligarchs dressed in populist clothes.

Warren’s proposal or others like it deserve a hearing. While a true wealth tax has not been proposed by the Labour Party in the UK, other proposals that approach a wealth tax are being debated. These include a mansion tax, which was seriously considered by the Coalition government, and a new band on the council tax for the richest Britons.

Other proposals that target the rich, such as raising the capital gains rate to match the tax rate on income, and placing a limit on tax-free capital gains earned from primary residences, are also promising. Linking a tax increase on the rich to broad-based benefits, such as infrastructure or education, would increase its chances of enactment – the popularity of tax and spend is at a 15-year high in the UK, with six in ten Britons in support.

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It’s time to tax the super rich

By Richard Godwin

A market economy may, by its very nature, produce increasing inequality. And increasing inequality leads to monied interests having more ability to sway political outcomes while simultaneously leaving the average citizen frustrated by the large and growing gap between their incomes and assets and those of the rich.

There is nothing intrinsically wrong with individual wealth. Many wealthy individuals are making important contributions to society via their enterprise or their philanthropy. Some, such as Warren Buffet, Ray Dalio, and George Soros, are calling for greater taxation of what they have earned. But societies with too much wealth at the top may not be politically sustainable or the kind of society most of us want to inhabit. The optimal level of wealth inequality is not just an economic question, but a political and social question as well.

By way of example, a confession. Over the years since the 2008 financial crash, there has been growing discussion about ‘inequality’ in Western societies. The work of Thomas Piketty and others gave ammunition to the cause, and the word is now weaponised by the Left in almost every political debate and context. Ten years ago, you would find me denying that inequality was any type of problem: “a product of the free market”, I would have said. “There has always been inequality.”

Over the past decade, though, one aspect of this inequality has become especially acute. It is the inability of young people to get onto the housing ladder and the fact that this is being reflected in youth voting patterns. People without capital don’t have much stake in capitalism, and people who cannot enter the housing market would appear to be losing faith in the free market.

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By Oliver Bullough

At the same time, the welcome given to oligarchism in places such as London (as described in Oliver Bullough’s eye-watering book ‘Moneyland’) has been warping prices to stark effect. We are living in a strange phase in capitalism that I sometimes think of as ‘Everyone can afford to eat out but no one can afford to eat in (a house they own)’.

I realise now that I was enormously resistant to conceding any points on ‘inequality’ not because I didn’t think there was something going on, and not only because the area isn’t one of my areas of specialism, but because I knew that the people lurking in the wings with the answers were people with the worst answers imaginable. It seemed clear to me from the start of the financial crisis (especially as events unfolded in Greece) that the people waiting to answer concerns about ‘inequality’ were basically Marxists.

They wanted to highlight inequality because they wanted to replace capitalism. Specifically, they wanted to give socialism, or one of its derivatives, another whirl. It’s possibly wise to resist engaging with such political gambits in the short term – at least until you have gathered together your own intellectual and political counter-forces. But it’s a mistake to ignore an issue in the long-term simply because the people waiting with the answers have the worst answers. The free-market across Europe is now in a serious state of disadvantage for having been so slow to respond to the worsening problem.

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The economic rationalists don't get the immigration debate

By Ben Cobley

This set me wondering about other issues which suffer from the same problem. The most obvious is immigration (which is the subject of a debate co-hosted by UnHerd this week). Today it is acceptable for mainstream politicians and pundits of Left and Right to highlight some (though not all) concerns about immigration. But people ask why it has taken such a long time for respectable figures to make their voices heard and to give voice to concerns of the general public.

From the late 1990s onwards people could see a range of problems developing (from integration to security) but they didn’t speak up, or they spoke incredibly carefully. Or they spoke out most loudly to condemn those who were highlighting the issue.

For a very long time, the subject was best avoided. Not only because it carried career risks. But also because many of the people waiting to benefit from a widening of the discussion were people with the worst possible answers.

Take the grooming gang cases that emerged in the first decade of this century. It is now a matter of record that broadcasters and politicians avoided the issue because they worried that to focus on it would only give an advantage to the British National Party and their ilk. As a result, these cases were ignored or played down for years. Today, incidents are still being revealed.

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Why are so many left-wing progressives silent about Islam's totalitarian tendencies?

By Julie Bindel

It was clearly deeply unwise to allow the BNP to set the parameters of the argument in the case of grooming gangs. Just as it was unwise to allow Marxists to drive the debate after the financial crisis. And it was unwise for people across the political spectrum to fail to get to grips with questions of immigration for fear that the only people waiting with answers were people waiting with the worst possible answers.

So there are two things that come from this. The first is my ongoing search for a word to define this phenomenon (suggestions on a postcard, please). The second is a reflection of how unwise it is to duck issues simply because you do not want to concede any ground to your political opponents.

Imagine what might be improved in politics if, instead of being directed by a fear of giving fuel to your enemies, it was driven instead by a desire to address and solve problems.