Tuesday, April 22, 2014

Piketty, Piketty

Daniel Shuchman, writing in the Wall Street Journal, gives a French economist a taste of Yankee ingenuity;
A professor at the Paris School of Economics, Mr. [Thomas] Piketty believes that only the productivity of low-wage workers can be measured objectively. He posits that when a job is replicable, like an "assembly line worker or fast-food server," it is relatively easy to measure the value contributed by each worker. These workers are therefore entitled to what they earn. He finds the productivity of high-income earners harder to measure and believes their wages are in the end "largely arbitrary." They reflect an "ideological construct" more than merit.
Soaring pay for corporate "supermanagers" has been the largest source of increased inequality, according to Mr. Piketty, and these executives can only have attained their rewards through luck or flaws in corporate governance. It requires only an occasional glance at this newspaper to confirm that this can be the case. But the author believes that no CEO could ever justify his or her pay based on performance. He doesn't say whether any occupation—athletes? physicians? economics professors who sell zero-marginal-cost e-books for $21.99 a copy?—is entitled to higher earnings because he does not wish to "indulge in constructing a moral hierarchy of wealth."
Our bold in the above, of course.
The title of Shuchman's review is apt;  Thomas Piketty Revives Marx for the 21st Century. 
Which reminds us of Iain Pears' observation from his novel Stone's Fall
A few months ago I read a book by Karl Marx on capital. Elizabeth gave it to me, with a smile on her face. A strange experience, as the author's awe exceeds even my own. He is the first to understand the complexity of capital and its subtlety. His account is that of a lover describing his beloved, but after describing her beauty and the sensuality of her power, he turns away from her embrace and insists that his love should be destroyed. He could gaze clearly into the nature of capital, but not into his own character. Desire is written in every line and paragraph of his book, but he does not see it.


  1. Along with the Labor Theory of Value, Piketty must believe in the Professor Theory of Value.

    How cruel is the world, to give such wealth to a segment of those in "the trades" and deny PIketty his just rewards for pure thought. Clearly, this is an accident of history which rational Socialism would correct.


  2. Pretty much as Joseph Schumpeter predicted in Capitalism, Socialism and Democracy. Intellectuals would undermine capitalism because their output wasn't valued by the market as highly as they themselves did.