Yanis nails it. Economics isn't an analytical science like physics or biology, it's a philosophy that's taken on the trappings of religion. With numbers as icing on top to legitimize political-economic decisions. It's time we bring back the concept of the political economy and stop pretending that society-wide resource allocation can be totally apolitical.
I'm listening to the opening of this discussion. Mr Mazzone opens with a condemnation of the book, and Prof Varoufakis is explaining why the book is telling the story it is. He states that it is a not a text book on the mechanics of economics, but a description or perhaps a non-defensive apologetic of an outcome where capital outpaces labor. That outcome is the further difference between the very few "haves" (who have it all) and the growing multitudes who have very little. Mr Mazzone states that there is not capital, but only wealth discussed, Professor disagrees and say they are (to Piketty) essentially one and the same. Both gentlemen come to a discussion where the book is almost theological, but without a means to apply it. In Professor Varoufakis' attempt at an application (than narrows the gap through redistribution) he discusses a tax on wealth, including possessions. He concludes however that the book, and its author, only mean to be voices of change, but not agents of change. After all, according to both gentlemen, there is no approach, only a deformed theory. I'll have to read the book. I take it, the book is a warning, a harbinger of something. It seems odd to me, that the two gentlemen discussing the book, who seem like decent folks (I've heard the Professor and Noam Chomsky discuss eco-politics) don't take hold of the problem Mr. Piketty describes and champion it. Instead, they give it an F as n economics paper. Toward the end of this discussion, the Professor brings up, finally, the subject of Piketty's book, justice, and uses John Rawls as a person who really knows how to tell that story. Rawls (liberal) believes that the fairest distributions pour out until the lowest levels of society are satisfied (the greatest benefit). He then adds, in shadow boxing fashion, Robert Nozick (libertarian), who runs the Rawls model in order to prove it unjustifiable. Instead let the process determine it. In the end, the final critique is, as there is not process described in Picketty's book. And if that is the case, any libertarian would crush the liberal who seeks to promote the egalitarianism promoted in the book. I'd like to see Monsieur Piketty and Professor Varoufakis hash this out. My guess is the author will admit to all charges but then engage in substantive methods to close the gap. I've ordered the book. I understand Mr Mazzone has passed away. I echo his obituary pages that he will be missed, I know I shall miss his lectures and wisdom..
@@josephorlando5244 Thank you Joseph! Check out Piketty's latest book here: news.harvard.edu/gazette/story/2020/03/pikettys-new-book-explores-how-economic-inequality-is-perpetuated/ Joe C.
Varoufakis is absolutely correct; Piketty's statistical analysis re: economic history "legitimizes" of economic inequality into the the neo-classical economist profession establishment mainstream. However, the Picketty book which I am currently reading does provide legitimate argument as to the source core drivers of inequality. It is unfair to criticize Piketty for him not to provide specific solutions. There is no other book that I have read which has so much good use of statistics to prove the point.
Is envy a way of admiring? Piketty's book is weak on solutions granted, but its historical analysis is solid and impressive. Picketty's solution to the inequality of capital, involving international financial transparency and a worldwide tax on wealth, could be revolutionary, albeit highly unlikely any time soon. Solutions are tricky, how is Varoufakis's democratic socialist revolution going? His game theory 'game of chicken' with the EU didn't end well.
Pikettys book is great! I tend to agree with yanis more than anyone, and MMT is a close second, but i think it's important to read piketty for the numbers he provides. It's a great starting point to think about the scale of the problem
I read Piketty's book, not just to page 12. I don't think these guys read the book. Yanis suggests, and Andrew agrees, that the only POLICY idea from the book is taxing capital. That is ridiculous. The book talks a ton about how elite schools get their students in France and the cost of schools in the US and how both impact inequality. Additionally it talks about political party cleaveges and the need for Identity Politics to split the poor. All of these have policy implications. There are dozens of other examples that have policy implications. Yanis claims Piketty is not honest. Perhaps Yanis needs a mirror... No?
I think Yanis draws to many conclusions from the book. The critizism in the interview is weak and undefined. The interviewer, Mazzone, is obviously biased against Piketty and does not have any solid arguments of his own. That r > g is the central theme of the book. That means that currently the return of wealth is larger than the growth of the economies. That will imply that having a large bank account is more profitable than working and receive a salary because salaries will never grow as fast as wealth in a bank account (or shares/infrastructure investments/real estate). While g was larger than r during the eighties, the numbers are now rapidly going back to the earlier state. Piketty uses the available data, but that data is limited to a few countries. He, however extrapolates the findings and based on the growing inequality figures from many western countries, that method seems viable. The critizisers should themselfs bring data to disproof him. That has not yet been done. In the interview Yanis implies that Piketty is insincere while Krugman is sincere and judgements like that are not possible to make on the basis of the books. However, as Krugman, but also Piketty, draws a multitude of critiscsm from economists and politicians. Since they argue for a global wealth-tax on the richest percent, their adversaries will be rish and powerful. I would say that probably both Krugman and Piketty are sincere in their efforts.
I disagree strongly. I find the criticisms made by YV and by AM cogent and pointed. I have not read "Capital" but the criticisms may be understood from the discussion. After all, that is why we value book reviews: they help us decide if the book is worth buying and reading. The basic criticism made by YV is Piketty's avoidance of the issue that capitalism and egalitarianism, indeed capitalism and democracy are incompatible. Piketty argues, we are told, from within the premises of classical economics to show, with data so interpreted, that inequality is a condition that derives from it and therefore is a proper subject for inclusion within classical economics. That inequality is an inescapable result of capitalism itself, Piketty avoids. Thus, as YV makes clear, the author remains within the graces of classical economics and the establishment while accruing credit for allowing the long shunned subject of inequality to be a part of the economic academy.
Björn Magnusson I don’t think you understood the point. It’s not that the return in wealth is necessarily greater furthermore. What it is is that the total capital of the top is increasing at a larger rate than economic growth and the great of the lower classes.
Well, most marxists have been and are strongly against the idea of marginal utility, remember marx died before he was able to finally publish his critic, further economics on a whole dismisses social action, which marxists again consider a cogent part of economic policy framing, so you see, where yanis is coming from is systemic PoV.
The value of this talk was in the last three minutes or so. What was important was the idea that the process needed to be fair, but the outcome was not something you could control in detail. The rest of it was frustrating because of the generality of it. For instance there was a discussion of three points made by Piketty, the first was deemed a tautology, the second was of some value, and the third was also dismissed. There was no discussion of what the three points were and why their description of them was true. I have read the entire book, but I cannot recall what were the three points they were talking about. The discussion of how Nozick destroyed Rawls' thesis by asking a simple question was very informative. The fear that the same thing would happen to Piketty as what happened to Rawls was also a lesson well worth learning. I also valued the insight by Varoufakis of what was right and what was wrong with Libertarian philosophy. In essence the focus on process is right, the thought that unfettered capitalism was a fair process was wrong. Much of the rest of the discussion was useless to me. I can't pass judgment on how useful it was to anybody else, because I cannot know what prior knowledge someone else brings to listening to this discussion.
Steve I also found this discussion informative as I have listened carefully to a number of presentations made by Mr PICKETTY, without reading the whole book. I am grateful to him for attempting to alert the so called “Economics Profession” to the importance of discussing the awful and tragic consequences of growing inequality on the current & future generation. Even though I come from an Engineering / Science background, following the “Great Crash of 2008”, I was compelled to learn as much as I can about how the world of banking & finance functions, its impacts on the real economy as well as the ideological foundations of the economics profession. I spent a great deal of time reading & listening to people like Joseph Stieglitz, Paul Krugman, William K Black, Robert Sheer, Steven Keen, Max Kieser, Yanis Varoufakis & others as well as going over material written by the greats like Keynes, Marxs and Hayek. So I would say by 2011, I had formed a view as to what was going on "under the surface" as well as the evolving nature of this global phenomena. So one of the things that I understood early was that indeed the Economics Profession had developed a sophisticated & mathematically beautiful set of equations (based on the world of physics) to explain how our social economy is supposed to work, but that these models explained very little about real world capitalism as well as the sophisticated power games that are played out by various actors both locally, regionally & globally. So it appears to me that the western world’s economic priesthood have created a narrative that helps them to retain their power over us mortals as well as allowing so called political elites to institute toxic solutions to perceived economic issues.
Alex Khalif I have a story that is similar to yours. I am an Electrical Engineer by training and profession. I have done some of the same reading that you have. One question though, was Hayek one of the greats? He did win the Nobel Prize, but I thought that his Austrian Theory is the opposite of what the people in this interview would espouse. Reading the WikiPedia article on him was somewhat confusing if you look at his friends and "enemies". Although Milton Freidman was a friend, he was a critic of his writings. He was awarded a medal by Margaret Thatcher. So which side of the debate is he really on?
Steve Greenberg Briefly, I personally dont agree with Hayek’s views & prescriptions, but I acklowledge his contribution to shaping Neo-Liberal agenda in the 70s, 80s & 90s. The important historical & moral lesson for me cames more from FDR’s “New Dealers” who I think experienced the results of WW1 followed closely by The Depression & WW2 which I think forced those in positions of power & influence to review their own ideas about society & economics.
Alex Khalif I respect your opinions so much more, because a lot of people, especially on the left, never bother to read anything that goes against their believes.
I'm usually a fan of Yanis Varoufakis, but I don't know the other guy. I think they have both missed some of the intention of Piketty and his book. I'm just an engineer, but I have read a good bit (slogging through the rest) of Piketty's book. So far, the main point it makes is that wealth tends to grow exponentially, faster than the economy (of revenue). With time wealth gets bigger and bigger, almost without effort, whereas "wage slaves" have to continue to work harder and harder for their money. I do not like the dismissive "tone" of either of these participants. Valid criticisms are fine, and there are some. Dismissive sneering, and attributing motives, impugning character are not. In some parts, I found both were trying to further complicate any concepts, so that nothing can be proved or even discussed, rather than trying to clarify ideas. They criticize Piketty for not providing policy prescriptions. My impression was that Piketty's purpose was to outline a trend, back it up with 200 years of data, and just make the suggestion that "perhaps one should tax wealth", to try to prevent runaway concentration. Otherwise, as a TED presenter quipped: some few people will end up with all the money, and the rest of us will be lining up to give them foot massages! Varoufakis's example of grandma's silverware is ridiculous. One of his other comments was that taxing machinery of production is effectively a tax on investment. I'll have to mull that over, as to its implications. If the machinery is not producing revenue which can supply money to pay such taxes, maybe it should be taxed away (as useless). BTW, what Varoufakis disparages is actually happening! Grandma is already being forced to sell her belongings to pay taxes. I lived in St. John's in Newfoundland, Canada. Property values were rising rapidly (from depressed levels to approach the rest of Canada). Tax rates were also rising (both mill rate, and evaluations). People who had paid off their homes in the centre of town could no longer afford to pay the taxes! They were forced to sell their homes and move to cheaper accommodations, out of town.
What Varoufakis was getting at was that Piketty assumed neoclassical principles in his book and disagreed with the way he used them to derive his big theory. It sounds very nuanced to ordinary readers. The part about grandma's silverware is the neoclassical inability to distinguish between different forms of wealth/capital (which Piketty conflates in the book), so the heirlooms would look the same to Piketty's taxman as highly speculative financial derivatives, as would good capital equipment in a factory. And he does bring up the point about Piketty having little to say about the 'process' and only having blunt tool of a 'global' wealth tax which would hit the middle classes disproportionately.
Some very good points Absoleet. I just wanted to add that it's one thing when you write a book revealing ironclad proof of global inequality rising exponentially, and a whole different beast doing a monolith study of inequality - what Piketty indeed tried to do in his work. Then you get the responsibility of the way inequality is explained to the public, and that's where Piketty didn't do a good job, and what's more, after taking the reader "through 700 pages of inequality" he comes out suggesting "perhaps one should tax wealth." No nothing about policy, no nothing about the fundamental flaws of neoliberalism, really existing capitalism, and that if you impose a net wealth global tax system it a) won't do anything about the way this horrendous inequality is produced, b) dismantling it would be a no brainer (it took Trump less than a year to push through his tax cut legislation).
None of what you say is news to anyone outside the mainstream economics departments. Piketty comes out with the most arrogantly titled book in the history of the profession and is hailed as a genius simply because he comes from the same background as the rest of the courtiers in the economics profession.
Since I am into the third of a series of Yanis's books, I value his voice. I find Piketty's book first as an empirical compilation of dissimilar data over a longer period, and a reasonably convincing overall observation. I am very glad to see such an effort, and consider this a substantial and superbe effort. This of itself was worth the cost of the book. Second, he offers some theories to perhaps explain the data. Somewhat interesting, and certainly worth a try. But the theories of economists I very often find not convincing. Third, having identified a problem, it would be somewhat lame not to at least attempt to suggest a solution. Piketty suggests one perhaps-workable solution. I place overwhelming value on the first aspect of the book. The secondary aspects are a reasonable exercise, but only that. This is a few years back in Yanis's timeline. Where is he now? Watched this video as for several years I have been trying to understand the moment when TDR offered JP Morgan an argument, and Morgan folded. That moment caused shock in that time among the rich. Following the threads lead to Henry George, which in turn lead here. I am more interested in finding a hard empirical base for economic theory, and less in fuzzy "moral" arguments (though I might have some sympathy for the outcome). Piketty offered a very solid step forward.
Not true Yanis. I'm a language teacher with little knowledge of economics and the 'theology' section was simply put for the average man of no knowledge, definitely didn't want to not read it just because the field is unknown. To the Texas guy, who wants another book of statistics? Piketty explains the complexity of it well for lays and it can only encourage civil society to educate themselves on the subject of inequality.
Religions also have a history of falsifying ancient histories in order to make them look more important. Piketty didn't falsify anything, but I think people might think that inequality mysteriously "sprouted up" on a 500-year graph on page 850 of Piketty's "Capital." Varoufakis says we ought to read Marx for our theory of capital and recognize that anti-union politicians are to blame for inequality today.
All Piketty says, and documents, is that returns on capital grow faster than the economy in general...increasing the gap between those with huge capital and the rest of the world that lives on wages and market growth.
+Ronald Reagan2000 no youy don't lose it, you,just have exchanged is for an equal amount money, with this money you can make more money in different ways, the point is that the person whodidn't have gold in the first place can not do this and thus having gold indeed contributes to inequality
I admire Varoufakis, but this critique is terribly unfair to Piketty. Piketty doesn't attempt to recommend taxing granma's silverware or jobs producing investments. What I'd love to see is just what these two would recommend we do about inequality. That would be much more revealing in terms of critique. If Piketty is "wrong," what is "right." So easy to find fault when you do not have to take a stance on the solution.
Dale Walker You're watching this video on channel which has the name Henry George in it; George's name alone might be a massive hint at their preferred alternative.
So much minutious work, data and information that was put into this book, it's ridiculous to talk about any bias from the author, little or more it may be
@@37Dionysos Definition of minutiose: attentive to or dealing with minutiae precision of. E.g.: minutiose observation- J. A. Thomson minutiose and troublesome attentions - Metropolis
@@RoniiNN Yes it's true. The way he defined capital as mere asset n not RELATION also proves his simplistic view n mediocre understanding. A paper on value throry by English teacher James (or John) ******** mentions it. Even Isaac Deutcher biogrsoher oc Marx didn't n found it tough. He mentions a series of cases up to dome MP who only heard but never read it. Same way in India n everywhere.
@@RoniiNN Seriously Yes! There r mainstream economists who feel giddy n vomiting n pain in stomach or start sneezing in cold if asked 2 read Capital or Marx in general. At d same time there r those (reactionaries) who boast "i read all 3 volumes of capital". If u asked them what vol 1 n vol 2 is about they start seeing roof of d room as blanks! Talib rightly says Umberto Eco's Library of unread books!
@@RoniiNN because Marx isn't taken seriously by any stream of Economics today. Most of Marx's Theories are debunked and discarded. From surplus value to Marxian class analysis. All of it is in the garbage bin. Even welfare Economics or keynesians avoid Marx's views because they are so irrational.
@@gabbar51ngh Marx may not be of much use to modern day economics, but his historical significance both in economics and elsewhere is so, so vast that absolutely everyone dabbling in social sciences would benefit so much from reading his works. It also makes it ever so easy to counter Marxist arguments when you know the core works that their ideology draws from, better than them themselves.
Reduce inequality by LVT - Land Value Tax! Henry George suggested LVT in 18th C. 👏 Tax all private ownership of land. Not buildings, but raw undeveloped land. Remove income tax n wealth tax. No need.
“We could tear this apart” “Yea we could” “He’s so wrong” “Yea I know” “Liberalism is wrong, we’ve proved it” “I know, we could do it right now if we wanted to” “Yea, we totally could go into detail about what makes our perspective better” “Yea we totally could” “Great critiquing man” “You too bro”
Actually krugman has hugely changed his tune recently. He has dropped his sanity in exchange for a job in Hillarys establishment. He went back on many of the things he said in 2008. As for Picketty....maybe his book simplifies capitalism. But shifty? Seriously? I'm a huge fan of yanis. But he missed the mark a bit on this one.
No reason to be fictitious about what taxing wealth means. By not stating what does "tax wealth" means, Piketty has prevented himself from getting banned from places like the WEF and alike. As long as he provided other researchers with a theoretical framework for other researchers to build on in their writings. Tax wealth can be easily translated to what imagine Piketty meant to write about a higher inheritance tax that will reduce intergenerational privilege. Don't have to be a PhD economist to figure this out or stand behind it.
There is a strong tendency by those who are against Piketty's ideas or theories of overcoming the level of inequality that we are currently dealing with to criticize without talking about the ideas specifically- I don't know who the older person is but he doesn't sound like an enlightened economist. It must be understood that in most cases of theories being developed and consequently adopted there is a generational gap where suddenly predictions that were mentioned by an obscure figure 30 or 50 years ago are suddenly coming true and therefore his ideas are now valid, and so we should adopt them - lest the house burns completely. Everyone knows that no real political figure with aspirations to a government post is going to adopt 80% tax on the wealthy, even if it theoretically makes sense. What is important is that through calculations they are being left as evidence until they can be validated. Marx's ideas were not common-place in 1850, he died poor, at the turn of the century people still remembered what he had held. I am not declaring that he will be remembered as Marx or Smith, but if you are reading this in March 2020, we can definitely see the fragility of an unfair system and how it can collapse.
The tacit aim in Piketty's book is to popularize shaming the disparity of wealth ...again. That shame has to be reset occasionally because it never reaches the level of potency it needs to inspire results. If you can avoid Shame, you've got it made.
Varoufakis started losing me at the end. I do not see Nozick as destroying Rawls in the slightest. Let's examine the points Nozick made and why they aren't really problems for Rawls. Rawls argues that economic inequality ought to be redistributed such that they benefit the poorest in society. This is his second principle of justice. (the first principle really isn't contentious in this context.) Rawls defends this point with his Original Position behind the veil of ignorance, where everyone is to assume they know nothing about their identity or status in society, and to make a choice on what society they wish to live in. Rawls contends that people will use simple game theory and choose the low-risk-high-reward option of choosing a society which is just to all; as their place in society might possibly be as someone who is socially or economically disadvantaged. From this thought experiment he derives that second principle of justice. Nozick responds by stating that if Wilt Chamberlain were to accrue money from people paying him to play basketball, his economic standing would not the same as it was in the original position. Nozick argues that this alternative standing for Chamberlain is just, since people are freely offering their wealth from the original position, and the distribution from the original position was just, then how can this subsequent distribution not be just as well? The reason this argument doesn't refute Rawls in the slightest is because the reason the original position's distribution was just was because it took place behind the veil of ignorance which renders people as objective as they can be. Distributing wealth outside of the veil of ignorance leads people to strategic distributing, where their motives are not to maximize fairness toward everyone in society. Secondly, nowhere that I know in _A Theory of Justice_ does Rawls argue that the original position solves inequality period. Rawls specifically states that even with the veil of ignorance, people's experiences in life, conflicting evidence, and other subjective factors will result in disagreements about what decisions we make on social and economic issues. Rawls refers to these differences as the _burdens of judgment._ Thus, it is entirely concievable that these differences in decision-making also apply to people's expenditure of money. If this is true, then economic inequality will continue to occur irrespective of how much we futureproof society with principles of justice. That said, with those principles in place, we can easily return to the original position by simply redistributing wealth once again. Perhaps you disagree with the concept of redistributing wealth. As Rawls said; reasonable people can disagree. However, I just don't see how Nozick's point sufficiently refutes Rawls in any way. Lastly, the notion that "the only thing that matters is the process" is just absurd to me. So if we have inequality in the end, do we just shrug and accept the inevitable plutocracy that is to follow? Is this some sort of advocacy for social darwinism whereby the people who are best at "gaming" the system are inherently superior, so they just get to ruin the society for everyone else because they "won the game of life", and "the system is all that matters?" This seems like a horrible way to run a society and I vastly prefer Rawl's method of determining justice through fairness.
***** Nozick is effectively saying that if people freely choose to give money to someone in exchange for their actions, then that proves that the original position that Rawls was advocating is wrong, because if Rawls's original position was the most just, then how could this other redistribution be just as well? (Nozick merely claims that giving money to the basketball player is a just action, and we're just taking that to be true for the sake of the argument) But Rawl's position isn't that the Original Position cures a society of inequality forever. Given time, people will disagree about how to make actions in a society because of several factors. Rawls called these disagreements burdens of judgment. So Nozick's argument is a strawman, or mischaracterization of Rawl's argument. So when Varoufakis says that Nozick destroyed Rawls, I think he's being unfair to Rawls. Not really that summarized, but it's philosophy; it's all about being detailed and precise, and that requires a lot of words.
***** To a certain extent, yes. I'm a Marxist after all, so the whole "From each according to his ability, to each according to his need" mantra I believe in, but that's for a socialist/communist society which we're nowhere near. I believe in providing help for the poor, but if we're going to live in a capitalist society, we ought to at least do it efficiently and rationally. This means an equality of opportunity, not an equality of outcome. So a meritocracy. Rawls is advocating for an equality of outcome which, to me, is the end result, but we can't achieve that until we're a post-scarcity society which isn't for a long time.
Dialectical Materialism "Distributing wealth outside of the veil of ignorance leads people to strategic distributing, where their motives are not to maximize fairness toward everyone in society." This point/argument is moot. But, the whole reason that Nozick brings forth the idea of "strategic distributing" is because it works better than Rawls's Veil of Ignorance. The whole point of freedom is that you can make the choice to "distribute" your wealth where you deem it to be necessary and not be completely blind about it. You mentioned that " we can easily return to the original position by simply redistributing wealth once again."... but isn't that really something that is completely inefficient? You are essentially saying that you will let some third party (most probably a government) to stick its hand in the economy and re-adjust for inequality, every single time. How is that fair? As an individual I made the choice to spend my money where I want to, if it makes another rich, he's only rich because I, and many like me, chose to give him money for something in return. The beauty of economics (and capitalism in this sense) is that it works beautifully like a symbiotic relationship. This has occurred everywhere, when people don't like what a company is offering, then they won't buy it and the company will either do what people want or it will be rendered useless to society. What better rating system do you have than the market? IF it were up to the government, we would all be forced to carry around Blackberrys, even though the MARKET clearly spoke. People do not want them, they're to innovating - therefore they are useless to us. I see you mentioned you are a Marxist and you are waiting for some type of revolution in the future? Frankly, and because no one on UA-cam has been normal enough to have a conversation, sure there is inequality and sure capitalism may not be the BEST system out there, it is by far the best system we have at the moment and the best one we have seen. There's not need to keep lying to ourselves, and if you are a true marxist, you know that we have tried all forms of socialism and in every single case, it has failed... miserably. What growth has capitalism brought by? You have seen it, I'm sure you have. And I'm sure you are fully cognizant that you would not have everything you have if it weren't for capitalism. Many can say that "socialism would have brought about the same technological advancements (read iPhones, macs,... let's not even get into the value of the iPhone alone to society and the spurring of new businesses that it caused..) but do you really think socialism would have allowed for all of what we have? OR do you think that capitalism is as good of a system as we have at the moment, but it can be "edited"?
Dr Varoufakis offers Nozick's criticism of Rawls on the basis of the instability of Rawls's outcome to the basketball sensation. Varoufakis turns our attention then to the process rather than the outcome. But to have justice or equity in an economic system, I would suggest that BOTH the outcome and the process must be just. It is as unacceptable, I would say, that any outcome is acceptable so long as the process is considered just as it is to propose that any process is acceptable so long as the outcome is just.
i watched to 10.sth, where Yanis goes 'the first reason is a tautology, the third is trivial' doesn't explain what reasons he's on about - no use to me! Enjoyed up to then. Certainly the first time i've seen a finance minister from his computer's pov lol. Will definitely check out more in this series, it's irritating how the elite want us economically ignorant so they can lie to us better - at it's worst here in UK - self-education with your series and other tools is a must, thanks
The process is only important if it leads to a just outcome. I agree that the market is not the right process for SOME AREAS of the social contract. However, the "process" is meaningless by itself to achieve human wellbeing.
This is a hatchet job on Thomas Piketty. The language he uses throughout appeals to the emotions, the amygdalas, the chimps that people have in their brains, and the interviewer is not pretending to be impartial but joining in the attack. It is not a serious discussion but he has the nerve to use the word propaganda to describe not his own words but those of Piketty. I haven't heard Paul Krugman, Joseph Stiglitz or Thomas Piketty critiquing other contemporary economists at all but I'm sure that if they did it would be to make a point about economics, not to discredit someone. One of the central attacks was on Piketty's advocacy of wealth tax and they ridiculed it as if it was something crazy that had never been tried before. This could be due to their ignorance but I believe they knew that wealth tax already exists in many parts of the world, including in France, as Piketty makes plain, but this take down is not aimed at people with such knowledge.
How incredibly insulting Varoufakis is to Picketty's readers. I have no background in economics yet read the entire book without difficulty. It is clearly written for laypeople and I can assure you there are plenty of laypeople out there formulating their opinions of Picketty based on the WHOLE book. And I don't appreciate being compared to a mindless religious devotee.
Corporations chose to impose sanctions on workers rather than go bankrupt in the 1990s, which was only possible in an anti-labor government (Reagan Republicans). Inequality has political beginnings, but Piketty ignores them, according to Varoufakis. Systematic de-unionization is what Piketty ignores.
Eveything Yanis says in the interview is in the best interests of laypeople. And he also denotes that Piketty does a great job of revealing global inequality through a vast database of economic figures. But, when he fails is the other half of the book, the analysis. He doesn't leave any room for policy change, for any New Deal with the ruling financial elites. If you just tax them more, first you won't change the process through which this kind of tremendous inequality is being created, and second, should a Trump-like "politician" come into office, that tax ending up in the dustbin will take no more than around a year. We need to challenge the underlying framework, the rules governing the world economy, policy, education, and not just simply think that heavy taxation is a way out.
@@jtemple4009 Great approach, Jennifer. I can suggest another left-wing vs right-wing pair: Joseph Stiglitz's Economics and Thomas Sowell's Basic Economics. Too bad these are quite expensive books, should be possible to borrow them from online libraries though. It's worth it. Each is about 800 pages, both authors are important figures in modern economics and these works are economics textbooks in many universities.
@@jtemple4009 Good points! The only thing you left me to add is that the blame, in my opinion, is both on we the people's and they the power's shoulders. And power in turn is not only the government but also big business, corporations - the distribution of power has undergone a dramatic shift over the last few decades. There's no principle difference between corporate and political elites. Big business virtually writes a lot of the legislation parliaments, senates and other national assemblies vote on later on. It's crucial to understand that no form of democratic governance alone, per se, will ever do the job. People who think they shouldn't care about politics, economics and should only be enjoying life while professional politicians and economists and business people work hard for them in office and grapple with all the challenges society faces is exactly what has led the US and Europe to where we are today, along with, equally along with the self-centered efforts of corrupt elites. Philosophically speaking there's always more blame on those who possess more power, so say in a highly oppressive state like Russia, Turkey or China people have very little 'air to breathe', but in the relatively free societies of the West the average Joe or Jane too are responsible for the current state of affairs. Way more than those of China, Russia, Turkey, etc. So, as you said, education is one thing, political and social activism is another. Doesn't have to take up too much time, but even the most educated of people casting their vote on every election there is will still not make a big difference without enough political engagement of some sort. But even that is still to achieve :)
Varoufakis actually does take a solid stance on inequality and not only (answering to some of the comments). The diem25 movement co-founded by him is all about that. Very detailed proposal of a New European Deal, if anyone's interested. diem25.org/end/ I myself appreciate Piketty's effort a huge lot-humanity really needed detailed proof of global, perpetual inequality- but I totally agree with Yanis in that the analytical part of the book is in fact tremendously dangerous if to be adopted as "the only alternative." We can view it in the context of some complementary policy though.
Following the great Stephen Hawking's reasoning about the most existential questions about our origins I would respond to Piketty's statement that capital's returns are above the average rate of return of the economy that otherwise, there would not exist any capitalism at all. Incentives my dear...incentives, if capital's return would not be that way there were never existed the incentives to promote it. A very different thing is that governments doing it absolutely wrong pervert the real nature of capitalism...its inherent risk. A capitalist has not to be saved in any circumstance by governments because its inherent risk cannot be assumed by the whole society.
There needs to be some wealth inequality to provide incentives for people to work hard and create actual wealth . But since the change from Keynesian economics started to be phased out on the 1970's , and a twisted version of neo liberalism was ushered in , both income and asset inequality has grown to the extreme . Even Standard and Poors came out circa 2012 and said the level of wealth inequality will create political instability . [ and political polarization ] . After Covid , its like we have 2 economies now 1) those who work for a living and try to make an income 2) those who know how to use the capital printed by central banks - this printed fiat money is driving up asset prices ( real estate , stocks & luxury goods , art ) and its being used to create a renter - debt class . .
20:04 I wouldn't have left a comment except for that fact that I had conceptualised The Oracle in The Matrix as adopting a Pareto Long-Tail Distribution approach vs a Gaussian Normal Distribution approach (suitable for mechanical systems I guess) by The Architect. But, seriously, I don't know anything.
Piketty makes inequality natural n eternal. It shall exist after economists have done their good job! Tax it. It's up to govt. Let corporates n govt keep struggling on wealth tax.
I think Yani is experiencing a bit of envy! Picketty is quite humble, sees the book as a basis for ongoing statistical analysis, he welcomes critical analysis, & sees the role of the book to stimulate conversation. Yani has been de-throned!
I have a french friend who comes to NYC and takes photos of the homeless sleeping on the sidewalk and going through the garbage. He is fascinated by them as this does not exist in Paris. The french govt does not allow their citizens to sink so low. What does that say about the USA ?
33:00 - Wait, so does Yanis think that if the processes are just, then outcome should be ignored? What about the moral implications of a situation where someone has more money than they can spend in a lifetime even though through a fair and justified process? Surely some of that money should be redistributed?
I strongly believe that we should stop using the terms Inequality or equality. We should instead use the words unfairness and fairness. People cannot by equal really. Its a pipe dream. Why would you want such a thing anyway. Pluralism is better. But things should be fair, fairer than they are now. Some people have everything and so much of it. That is not fair, that is greed, decadence, wasteful, obscene, selfish, solipsistic, sociopathic etc (I could go on). How much is enough?
Total equality is embedded in Communist ideology. Socialism approaches the issue that each person should be rewarded according to their work and contribution to society, emphasizing fairness. Social Democracy is more rational in that it eliminates Corporate Welfare and pays workers their true value. It caps rampant and uncontrolled wealth accumulation and income inequality to bring health and social programs to enhance the health and wealth of an economy. In the economic game there can never be any equality, thus, pluralism as opposed to elitism is much more realistic.
When most people advocate for equality, they are not advocating for total equality, they're arguing that we should have greater equality, that economic disparity should be lessened. The problem w/ "fairness," is that people can disagree about what is fair: leftists will say higher taxes on the wealthy is fair, while libertarians will say higher taxes is unfair. This problem doesn't come into play when talking about economic equality/inequality, because those things can be measured w/ some accuracy, which we can all largely agree on.
Andrew Mazzone takes the opportunity to vent his (superficial) opinions on the capital in the 21st century. He systematically misses the ways in which Varoufakis interprets Piketty. Particularly, Andrew's opinions on the book are lacking on substance and he repeats ad nauseam rhetorical questions of the sort "what can you take from Piketty? you can't anything!". Varoufakis on the other hand sees the 'necessity' of Pikkety's argument, though is nonplussed by Pikkety's suggestions on how to solve the problem. Piketty's main achievement is to give a complex systems+saturation understanding of the economic system, which is missing in the literature. It is saddening to see that the likes of Andrew throw the baby with the bathwater.
A Computer generated Yanis! The real Yanis is a gentleman. just saying that Thomas P is a dishonest person and his book is rubbish, stinks like jealously is in the air. I am half way through the book. The solution it proposes is a small part at the end, be reasonable. Thomas has to write with the same style as the establishment to be put on the table, all cultures do the same. He can't write screw everyone and here is why. And it is a book to bring on the discussion and we can criticize but not under the belt. I refuse, this is not Yanis. If it is he just lost all my deepest respect.
"....we are shocked to find out that there is inequality in this world...." Show me two human beings that are absolutely equal to each other in their genetic makeup, economic circumstances or experience?
@19:00 both claim Piketty is ignoring bargaining power. However in discussing the phenomena of super-managers & their labour income, he argues that they might have too much bargaining power. So it might be right that his model has no direct relationship to bargaining power, however I don´t see he wouldn´t agree to it?!
@@JamyOats More like gradual decline in the general rate of return leading to increasing pressure on the system. Have a look at this - thenextrecession.wordpress.com/2020/07/25/a-world-rate-of-profit-a-new-approach/ . As an aside, Marx isn't Jesus, he doesn't have to be 100% right on everything, but it's obvious that his models are not used for political reasons.
Haven't read the book, but this critique makes Piketty sound like Obama. He talks a good game, but when you look more closely he leaves himself plenty of wiggle room so he doesn't have to really do anything to change what's wrong. As for the basketball scenario, I don't see how it 'destroys' Rawls. There's no problem with LeBron taking home more than his team mates. He's the marque player, he 'ups the gate' as Ali used to put it. So, he makes more - fine. However, there is a problem if the other team members are on food stamps. As good as LeBron is, I doubt he could single-handedly win the games .
This is crap. The whole profession was in denial about this issue, the data for which hadn't been gathered or analyzed, before Pikketty, and now this guy is like "oh yeah, the first 90% of this book was obvious, but I disagree with the prescriptive part 4."
This is unfortunately full of envy. Referring to characters in Balzac's Père Goriot (1835) and Austen's Mansfield Park (1814), novels full of gripping entrepreneurial stories of the time, Piketty asks whether wealth today has lost its natural tendency to be transformed into rents (i.e. government bond yields for Austen, rents as a result of housing speculation for Balzac). He says that it has become very difficult for the young generation to finance housing just by labour income. Is that propaganda?
I feel a bit like I'm eavesdropping. Nothing wrong with this conversation, and I agree with yanis mostly but it comes off a bit like a conversation around a dinner table about an academic rival 😅. I guess that's the beauty of UA-cam, I get to hear it without being at the dinner table... But it is a bit uncomfortable
amazing! how is it that these two pretend to have read this book? piketty presents a history of capitalism based on statistical data. this data depicts the shift in wealth since 1700. piketty concedes that available data is lacking up to the present day. as such, he offers a picture of the production of capital using the rate of return (change in profit or wealth and assets or capital together, when compared to the change in income gives us the return rate). given the lack of consensus on factors like human capital and taxation - the latter being a historically recent part of the economy (and which figures into the basic figures - taxation of private income appears as a change in national income) - piketty indicates that they are nonetheless not absent from his analysis. i'm not an economist. the argument they put forth is based on their early assumption that i am too stupid to follow piketty. i don't bother to locate the point at which they assert my inferiority (as well as the stupidity of the teeming masses of which i am a member), it's pretty clear throughout. the extent to which the resort to morality, envy and other deadly sins escape these mouths indicates only their satisfaction with themselves. these men are on the defensive. tellingly, they refuse to identify the cause of their trepidation. instead, they attack the source. most of the flaws they attribute to piketty's work are the very flaws they display so unabashedly in this recording. taxation policies are at the heart of current inequality. the radical drop in the tax burden on wealth in the usa is the number one legacy of the reagan years. this is government policy. how do you paper pundits ignore this history? piketty's history is too difficult for these two. instead, they start to talk about other economists. piketty is like "X" who they are familiar with. but still, they say nothing about the book. "anyone who supports piketty" is an ass. why? we've said nothing about his book. that would give the viewer too much information on what scares the shit out of these propagandists of the status quo. read the book for yourself, people. these guys don't like it. it threatens them. that's a good sign.
Critique without construction is just useless and defensive. Mazzone just wants to destroy without seeing any good. What good can we take from the book to understand inequality better in order to reduce it? That's it!!!
I am no economist so I can only follow their criticism superficially. What I can follow though, is the discussion about Rawls and Nozick. Saying that Nozick ''destroyed'' Rawls seems kinda weird to me. A certain income distribution is not only fair/unfair in itself but also because it endangers the possibily of the least well of to exercise their more fundamental rights (Rawls' first principle of justice) which takes precedence over the fairness of income distribution. I respect Varoufakis on a lot of topics but it seems that he can only criticise and on this particular point he does not even seem to fully understand the political philosophy....
Varoufakis says you have to go back to Marx to understand capital. Marx says that capital (for Piketty "wealth") distribution needs to have the process of capital accumulation within its definition ("capital is a moving process," "bargaining," etc.). In Varoufakis' example, Nozick and libertarians think that the current distribution of wealth is absent of dissent from labor-that the current distribution of wealth (and capital) is as just as the basketball player example.
rubbish! poor analysis.. ! Pickety is like a 'finger pointing' to something all know and NO one in the neo-liberal political establishment will comply.. ever..!
Varoufakis has nothing to be jealous of Piketty's book or Piketty himself what so ever! ..and if you really have paying attention to Varoufakis's analysis.. please tell us where he's wrong... or keep your nonsense to your self..
IT was always ways great amount of inequality I have no Idea why some people was surprise and that great effort goes towards when we got off the gold standards.
if you still believe this please look up pragmatic capitalism blog and gold standard. The role of money and gold are a completely different concept to inequality.
America might be taking a huge step towards a socialist reform thanks to the notion of inequality becoming a mainstream pandemic and that is largely thanks to Pickett.
This video is wild. They start by saying no one has read the book but them... I guess I wasted that summer staring at nothing then. Then move on to say its impossible to tax wealth because grandma invested in silverware....1 millions dollars worth? and then proceed to say Krugman has it all right... jeeeeesus
The Greek Finance Minister ?? So let's consider the source here of this criticism....on the other hand Piketty is a visionary and he has written a book that brings his subject to the public in an understandable form. We all of course know how wrong the distribution of capital is and that it gets worse by the minute. Sometimes ( as in this case ) criticism is simply a way for someone who has no original thoughts of his own to grab some of the spotlight. BTW I read the whole book and I am sure many did. I assure you mister interviewer that the fact is that most books that are bought through Amazon that have gotten expert ( like Krugman and Stiglitz ) attention and the resulting exposure suffer a similar fate ( read to only page 12 ). That is they are barely read and the buying of them is an impulse buy in many cases by people with fleeting interest only. These buyers are the backbone of the industry. How many people have Shakespeare or Frost on the home bookshelf and have never read them. I know it is not the point of Mr Minister but it annoyed me for just that reason.
+tradeeagle Varoufakis was not FM at that point. The elections that first brought SYRIZA into power had not even happened at the time of that interview (and YV later sad he was never a member of SYRIZA).
You're right - he wasn't FM till Jan '15 -- since I (unknown person that I am) didn't write the intro, nor was I involved in this video production, I'll be more than happy to fix it!!
"The Greek Finance Minister ?? " I have heard Varoufakis speak/interviewed many times. He has a brain the size of a planet and is more than qualified and trustworthy to review this book. He Believes in the Common Good/Social contract. Something that the Right-wing could not say. The Right could not give me one example of them doing anything for the common good. The Rich have gotten richer. Money makes money. "The Walton family, which owns Wal-Mart, controls a fortune equal to the wealth of the bottom 42 percent of Americans combined." Jim Walton Decrease$36.5 billion Alice Walton Decrease$35.3 billion S. Robson Walton Decrease$35 billion Lukas Walton Increase$11 billion Christy Walton Decrease$5.5 billion Ann Walton Kroenke Decrease$4.9 billion Nancy Walton Laurie Decrease$4.4 billion Coincidentally 42% of Americans earn less than $15 per hour. Walmart workers are on Food Stamps.
Despite all the economic analysis also from Yanis Varoufakis and Thomas Piketty have not helped to identify a viable and practical solution to reverse inequality. Not in Europe, not in the USA and not anywhere. What seems to happen is that empowerment contributes to a change of heart that corrupts the leadership. While there should be a way out of this predicament there is no way out of it. This is not about the last 200 years. Economic inequality has existed for at least 30,000 years.
The resources belong to everyone buy divine providence, share and Save the World, without sharing there can be no Justice, without Justice there can be no Peace in the world.
So ? I'm still wondering what's new in all these "new" explanations of the capitalism that are not already better studied in the books of Marx, Engels "The Capital" or Lenin's "Imperialism, the Highest Stage of Capitalism" ? Oh, yes, they want to "adapt" capitalism not get rid of it. Idealists...
+MHscrewdriver I completely agree with you, but for what it's worth, Piketty's book is pretty useful for statistic information and solid data. As for his proposed solution, yeah, it's reformist garbage trying to stick a band aid on capitalism, rather than getting rid of it. Idealism at its finest.
I wouldn't bother with Lenin. In the 1920s shortly before he died he wrote a tract in which he took stock of what the Bolshevik seizure of power had achieved and he described it as it was , state capitalism. George Kennan , the US diplomat acknowledged the fact as did John Foster Dulles a Secretary of State in the Eisenhower administration. The lie of it being anything like a communist society should have laid to rest long ago, but there is an ideological interest to be catered for in continuing to describe what Marx said were the attributes of a capitalist society as its very opposite.
In Islam at least for the average Muslim faith and theology are distinct. Theology is totally subordinate to faith. Indeed theology to be credible has to based on an uncritical and unconditional acceptance of faith. There is no assumption that some contemporary doctor of the faith is taking care of its details. There are the 4 Sunni schools and the one major and a few minor Shia schools of the faith. But their details have been settled a thousand years ago. There is no room for a Muslim theological Piketty. This may or may not be a good thing. But it is the way it is.
So one needs prodigious Macro knowledge to successfully argue their case or convince Y. Varoufakis of their argument. Anybody opting out of using the Macro for a fulcrum is bound to end up in a heated exchange as the former is his substratum that defines and expounds the crux and individual cases in economics.
Good grief.... does anyone still take this lying hypocrite that constantly contradicts himself seriously?!?!?! He just goes round regurgitating his often contradictory "theories" and rehashing the obvious with his conflicting waffle depending on the audience and who's paying... Just look at the results of his "policies" and "predictions" - why do you think he was dropped kicked out of government by his "communist" comrades who were initially selling him as a "rock star" politician?!!!! Don't fall for his duplicitous waffle and delusions of adequacy... he is little more than a narcissistic, treacherous little "populist" stooge peddling his books and - to quote the pathetic clown himself - "a comedy of errors wrapped up in harmless waffle" - which sums up this champagne socialist perfectly - just ask his former "communist" comrades who also betrayed Greece - or those holding his off shore accounts... Time to wake the fracking hell up! It's actually slimy treasonous "populist" stooges like this and little niggle fartmirage that are undermining Europe!
You guys are critiquing Piketty's book from technical, economic standpoint, which is very important and should be done. But let me offer a social theory of why Piketty must be wrong from my simpleton mind -- Piketty is being talked about in the mainstream. "Liberal" outlets like NYT, etc., have reviewed his book. Other such status-quo entities are debating his ideas. That itself tells me he must be doing something wrong somewhere along the line.
what a jerk, I don't understand this guy he never misses an opportunity to make a bad desicion, Pikkety never ever said this is the solution (part 4 of his book) and you have to follow, he instead urges the reader to come with his own solutions, incredibele sad person this Varoufakis, I think he is only living for the camera
Funny he claims Piketty lives for the cameras. Piketty is playing to be the darling of the discredited radical egalitarians and their income inequality meme.
The idea that Piketty is looking to ingratiate himself with mainstream economics is laughable. I acknowledge some criticisms, but is this professional jealousy? The Global Minotaur was hardly without criticism.
"Profit" means "value gained that you did not put into the exchange": taking more than you give. You use profit to create its close cousin-word, "advantage"---and the more people you DIS-advantage by taking unfairly from exchange, the richer you get/the poorer others get. This lie, these words for a core generic scam, have another close cousin: "progress." (See Oxford English Dictionary) Like "advantage," it's a RELATIVE term. Hence, what surprise that Piketty's data show capitalism screwing more and more people all the time? Time for the human race to Walk Out On Profit.
15:38 of Ted talks He says he prefers " A progressive tax." I feel if inequality is just a fact of Capitalism. Why choice that standard. "Inequality " means to me. "This person is not living the European or western culture ideal. Maybe in the future if you are safe, fed and have loving group of people that surround you. This capitalist system will be irrelevant.
22:39 sees a strange edit - somehow imagine Yanis did a reverse deconstruction of the self-negating Picketty utopia which appeared off-message; or listening to too much Slavoj Zizek?
I never heard the word "land". Does that mean that Georgists have now conceded that it fits into the categories of either wealth or capital? Double lunch-bag let-down.
Okay, you progressively tax the basketballer and then charge a high inheritance tax which preserves both the incentive structure of capitalism in the medium term and the ideal distribution in the long term?!
hymnofashes High tax is only possible in extreme capitalism. Extreme capitalism leads to government incentive to extreme tax. A sensible economy would reduce the gap between "money" and resources because there will be less parasites. That is the main factor to make a stable economy. If not, there can only be good economies in a small portion of all states in a bigger market, and heavily depending on intelligent/disciplined culture like Singapore and to some degree Finland and Germany. Realistically anything stable and progressive needs a firm and predictable system, to free time available for progress.
Yanis is indeed a brilliant mind. It is so rare nowadays to hear such an eloquent economist with such clear and deep insights!
Yanis nails it. Economics isn't an analytical science like physics or biology, it's a philosophy that's taken on the trappings of religion. With numbers as icing on top to legitimize political-economic decisions.
It's time we bring back the concept of the political economy and stop pretending that society-wide resource allocation can be totally apolitical.
I'm listening to the opening of this discussion. Mr Mazzone opens with a condemnation of the book, and Prof Varoufakis is explaining why the book is telling the story it is. He states that it is a not a text book on the mechanics of economics, but a description or perhaps a non-defensive apologetic of an outcome where capital outpaces labor. That outcome is the further difference between the very few "haves" (who have it all) and the growing multitudes who have very little.
Mr Mazzone states that there is not capital, but only wealth discussed, Professor disagrees and say they are (to Piketty) essentially one and the same. Both gentlemen come to a discussion where the book is almost theological, but without a means to apply it. In Professor Varoufakis' attempt at an application (than narrows the gap through redistribution) he discusses a tax on wealth, including possessions. He concludes however that the book, and its author, only mean to be voices of change, but not agents of change. After all, according to both gentlemen, there is no approach, only a deformed theory.
I'll have to read the book. I take it, the book is a warning, a harbinger of something. It seems odd to me, that the two gentlemen discussing the book, who seem like decent folks (I've heard the Professor and Noam Chomsky discuss eco-politics) don't take hold of the problem Mr. Piketty describes and champion it. Instead, they give it an F as n economics paper. Toward the end of this discussion, the Professor brings up, finally, the subject of Piketty's book, justice, and uses John Rawls as a person who really knows how to tell that story. Rawls (liberal) believes that the fairest distributions pour out until the lowest levels of society are satisfied (the greatest benefit). He then adds, in shadow boxing fashion, Robert Nozick (libertarian), who runs the Rawls model in order to prove it unjustifiable. Instead let the process determine it.
In the end, the final critique is, as there is not process described in Picketty's book. And if that is the case, any libertarian would crush the liberal who seeks to promote the egalitarianism promoted in the book. I'd like to see Monsieur Piketty and Professor Varoufakis hash this out. My guess is the author will admit to all charges but then engage in substantive methods to close the gap. I've ordered the book.
I understand Mr Mazzone has passed away. I echo his obituary pages that he will be missed, I know I shall miss his lectures and wisdom..
Superb commentary. Thank you, Joe Ciliberto.
@@josephorlando5244 Thank you Joseph! Check out Piketty's latest book here:
news.harvard.edu/gazette/story/2020/03/pikettys-new-book-explores-how-economic-inequality-is-perpetuated/
Joe C.
So I'm the Isaac Newton of inequality. Now follow me.
Good line. Best Varoufakis interview I've ever seen.
This man has such an excellent analytic mind
Varoufakis is absolutely correct; Piketty's statistical analysis re: economic history "legitimizes" of economic inequality into the the neo-classical economist profession establishment mainstream. However, the Picketty book which I am currently reading does provide legitimate argument as to the source core drivers of inequality. It is unfair to criticize Piketty for him not to provide specific solutions. There is no other book that I have read which has so much good use of statistics to prove the point.
Let's rob all the rich people and divide their stuff amongst the workers
@@Confucius_76 its not robbery when the value is created by the workers
Nor it is socialism when scarcity is split 99:1 for the rich. Marx had good criticisms then and bad solutions. Lets not do that again. People die.
@@theartemisgland agreed
@@confusedarmchairphilosopher if the workers agreed to work there for the agreed wage then it is.
Is envy a way of admiring?
Piketty's book is weak on solutions granted, but its historical analysis is solid and impressive. Picketty's solution to the inequality of capital, involving international financial transparency and a worldwide tax on wealth, could be revolutionary, albeit highly unlikely any time soon.
Solutions are tricky, how is Varoufakis's democratic socialist revolution going? His game theory 'game of chicken' with the EU didn't end well.
Pikettys book is great! I tend to agree with yanis more than anyone, and MMT is a close second, but i think it's important to read piketty for the numbers he provides. It's a great starting point to think about the scale of the problem
I read Piketty's book, not just to page 12. I don't think these guys read the book. Yanis suggests, and Andrew agrees, that the only POLICY idea from the book is taxing capital. That is ridiculous. The book talks a ton about how elite schools get their students in France and the cost of schools in the US and how both impact inequality. Additionally it talks about political party cleaveges and the need for Identity Politics to split the poor. All of these have policy implications. There are dozens of other examples that have policy implications. Yanis claims Piketty is not honest. Perhaps Yanis needs a mirror... No?
I think Yanis draws to many conclusions from the book. The critizism in the interview is weak and undefined. The interviewer, Mazzone, is obviously biased against Piketty and does not have any solid arguments of his own.
That r > g is the central theme of the book. That means that currently the return of wealth is larger than the growth of the economies. That will imply that having a large bank account is more profitable than working and receive a salary because salaries will never grow as fast as wealth in a bank account (or shares/infrastructure investments/real estate). While g was larger than r during the eighties, the numbers are now rapidly going back to the earlier state. Piketty uses the available data, but that data is limited to a few countries. He, however extrapolates the findings and based on the growing inequality figures from many western countries, that method seems viable. The critizisers should themselfs bring data to disproof him. That has not yet been done.
In the interview Yanis implies that Piketty is insincere while Krugman is sincere and judgements like that are not possible to make on the basis of the books. However, as Krugman, but also Piketty, draws a multitude of critiscsm from economists and politicians. Since they argue for a global wealth-tax on the richest percent, their adversaries will be rish and powerful. I would say that probably both Krugman and Piketty are sincere in their efforts.
I disagree strongly. I find the criticisms made by YV and by AM cogent and pointed. I have not read "Capital" but the criticisms may be understood from the discussion. After all, that is why we value book reviews: they help us decide if the book is worth buying and reading. The basic criticism made by YV is Piketty's avoidance of the issue that capitalism and egalitarianism, indeed capitalism and democracy are incompatible. Piketty argues, we are told, from within the premises of classical economics to show, with data so interpreted, that inequality is a condition that derives from it and therefore is a proper subject for inclusion within classical economics. That inequality is an inescapable result of capitalism itself, Piketty avoids. Thus, as YV makes clear, the author remains within the graces of classical economics and the establishment while accruing credit for allowing the long shunned subject of inequality to be a part of the economic academy.
Björn Magnusson I don’t think you understood the point. It’s not that the return in wealth is necessarily greater furthermore. What it is is that the total capital of the top is increasing at a larger rate than economic growth and the great of the lower classes.
Björn Magnusson 21:02 Listen. That is a good critique.
@@goedelite you haven't read the book so, quite frankly, your view doesn't matter.
Well, most marxists have been and are strongly against the idea of marginal utility, remember marx died before he was able to finally publish his critic, further economics on a whole dismisses social action, which marxists again consider a cogent part of economic policy framing, so you see, where yanis is coming from is systemic PoV.
The value of this talk was in the last three minutes or so. What was important was the idea that the process needed to be fair, but the outcome was not something you could control in detail. The rest of it was frustrating because of the generality of it. For instance there was a discussion of three points made by Piketty, the first was deemed a tautology, the second was of some value, and the third was also dismissed. There was no discussion of what the three points were and why their description of them was true. I have read the entire book, but I cannot recall what were the three points they were talking about.
The discussion of how Nozick destroyed Rawls' thesis by asking a simple question was very informative. The fear that the same thing would happen to Piketty as what happened to Rawls was also a lesson well worth learning. I also valued the insight by Varoufakis of what was right and what was wrong with Libertarian philosophy. In essence the focus on process is right, the thought that unfettered capitalism was a fair process was wrong.
Much of the rest of the discussion was useless to me. I can't pass judgment on how useful it was to anybody else, because I cannot know what prior knowledge someone else brings to listening to this discussion.
Steve I also found this discussion informative as I have listened carefully to a number of presentations made by Mr PICKETTY, without reading the whole book. I am grateful to him for attempting to alert the so called “Economics Profession” to the importance of discussing the awful and tragic consequences of growing inequality on the current & future generation. Even though I come from an Engineering / Science background, following the “Great Crash of 2008”, I was compelled to learn as much as I can about how the world of banking & finance functions, its impacts on the real economy as well as the ideological foundations of the economics profession. I spent a great deal of time reading & listening to people like Joseph Stieglitz, Paul Krugman, William K Black, Robert Sheer, Steven Keen, Max Kieser, Yanis Varoufakis & others as well as going over material written by the greats like Keynes, Marxs and Hayek. So I would say by 2011, I had formed a view as to what was going on "under the surface" as well as the evolving nature of this global phenomena. So one of the things that I understood early was that indeed the Economics Profession had developed a sophisticated & mathematically beautiful set of equations (based on the world of physics) to explain how our social economy is supposed to work, but that these models explained very little about real world capitalism as well as the sophisticated power games that are played out by various actors both locally, regionally & globally. So it appears to me that the western world’s economic priesthood have created a narrative that helps them to retain their power over us mortals as well as allowing so called political elites to institute toxic solutions to perceived economic issues.
Alex Khalif
I have a story that is similar to yours. I am an Electrical Engineer by training and profession. I have done some of the same reading that you have. One question though, was Hayek one of the greats? He did win the Nobel Prize, but I thought that his Austrian Theory is the opposite of what the people in this interview would espouse. Reading the WikiPedia article on him was somewhat confusing if you look at his friends and "enemies". Although Milton Freidman was a friend, he was a critic of his writings. He was awarded a medal by Margaret Thatcher. So which side of the debate is he really on?
Steve Greenberg Briefly, I personally dont agree with Hayek’s views & prescriptions, but I acklowledge his contribution to shaping Neo-Liberal agenda in the 70s, 80s & 90s. The important historical & moral lesson for me cames more from FDR’s “New Dealers” who I think experienced the results of WW1 followed closely by The Depression & WW2 which I think forced those in positions of power & influence to review their own ideas about society & economics.
***** Thanks Serban
Alex Khalif I respect your opinions so much more, because a lot of people, especially on the left, never bother to read anything that goes against their believes.
I'm usually a fan of Yanis Varoufakis, but I don't know the other guy. I think they have both missed some of the intention of Piketty and his book. I'm just an engineer, but I have read a good bit (slogging through the rest) of Piketty's book. So far, the main point it makes is that wealth tends to grow exponentially, faster than the economy (of revenue). With time wealth gets bigger and bigger, almost without effort, whereas "wage slaves" have to continue to work harder and harder for their money.
I do not like the dismissive "tone" of either of these participants. Valid criticisms are fine, and there are some. Dismissive sneering, and attributing motives, impugning character are not. In some parts, I found both were trying to further complicate any concepts, so that nothing can be proved or even discussed, rather than trying to clarify ideas. They criticize Piketty for not providing policy prescriptions. My impression was that Piketty's purpose was to outline a trend, back it up with 200 years of data, and just make the suggestion that "perhaps one should tax wealth", to try to prevent runaway concentration. Otherwise, as a TED presenter quipped: some few people will end up with all the money, and the rest of us will be lining up to give them foot massages!
Varoufakis's example of grandma's silverware is ridiculous. One of his other comments was that taxing machinery of production is effectively a tax on investment. I'll have to mull that over, as to its implications. If the machinery is not producing revenue which can supply money to pay such taxes, maybe it should be taxed away (as useless).
BTW, what Varoufakis disparages is actually happening! Grandma is already being forced to sell her belongings to pay taxes. I lived in St. John's in Newfoundland, Canada. Property values were rising rapidly (from depressed levels to approach the rest of Canada). Tax rates were also rising (both mill rate, and evaluations). People who had paid off their homes in the centre of town could no longer afford to pay the taxes! They were forced to sell their homes and move to cheaper accommodations, out of town.
What Varoufakis was getting at was that Piketty assumed neoclassical principles in his book and disagreed with the way he used them to derive his big theory. It sounds very nuanced to ordinary readers.
The part about grandma's silverware is the neoclassical inability to distinguish between different forms of wealth/capital (which Piketty conflates in the book), so the heirlooms would look the same to Piketty's taxman as highly speculative financial derivatives, as would good capital equipment in a factory.
And he does bring up the point about Piketty having little to say about the 'process' and only having blunt tool of a 'global' wealth tax which would hit the middle classes disproportionately.
Some very good points Absoleet. I just wanted to add that it's one thing when you write a book revealing ironclad proof of global inequality rising exponentially, and a whole different beast doing a monolith study of inequality - what Piketty indeed tried to do in his work. Then you get the responsibility of the way inequality is explained to the public, and that's where Piketty didn't do a good job, and what's more, after taking the reader "through 700 pages of inequality" he comes out suggesting "perhaps one should tax wealth." No nothing about policy, no nothing about the fundamental flaws of neoliberalism, really existing capitalism, and that if you impose a net wealth global tax system it a) won't do anything about the way this horrendous inequality is produced, b) dismantling it would be a no brainer (it took Trump less than a year to push through his tax cut legislation).
None of what you say is news to anyone outside the mainstream economics departments. Piketty comes out with the most arrogantly titled book in the history of the profession and is hailed as a genius simply because he comes from the same background as the rest of the courtiers in the economics profession.
Who was surprised to hear that there is inequality in this world?
Since I am into the third of a series of Yanis's books, I value his voice.
I find Piketty's book first as an empirical compilation of dissimilar data over a longer period, and a reasonably convincing overall observation. I am very glad to see such an effort, and consider this a substantial and superbe effort. This of itself was worth the cost of the book.
Second, he offers some theories to perhaps explain the data. Somewhat interesting, and certainly worth a try. But the theories of economists I very often find not convincing.
Third, having identified a problem, it would be somewhat lame not to at least attempt to suggest a solution. Piketty suggests one perhaps-workable solution.
I place overwhelming value on the first aspect of the book. The secondary aspects are a reasonable exercise, but only that.
This is a few years back in Yanis's timeline. Where is he now?
Watched this video as for several years I have been trying to understand the moment when TDR offered JP Morgan an argument, and Morgan folded. That moment caused shock in that time among the rich.
Following the threads lead to Henry George, which in turn lead here.
I am more interested in finding a hard empirical base for economic theory, and less in fuzzy "moral" arguments (though I might have some sympathy for the outcome). Piketty offered a very solid step forward.
He is all over youtube, I like the talk he gave at Tubingen University a few years back.
Not true Yanis. I'm a language teacher with little knowledge of economics and the 'theology' section was simply put for the average man of no knowledge, definitely didn't want to not read it just because the field is unknown. To the Texas guy, who wants another book of statistics? Piketty explains the complexity of it well for lays and it can only encourage civil society to educate themselves on the subject of inequality.
Religions also have a history of falsifying ancient histories in order to make them look more important. Piketty didn't falsify anything, but I think people might think that inequality mysteriously "sprouted up" on a 500-year graph on page 850 of Piketty's "Capital." Varoufakis says we ought to read Marx for our theory of capital and recognize that anti-union politicians are to blame for inequality today.
you don't have to be illiterate to be ignorant
All Piketty says, and documents, is that returns on capital grow faster than the economy in general...increasing the gap between those with huge capital and the rest of the world that lives on wages and market growth.
+Ronald Reagan2000 always thought you can exchange it for money, but may be I am wrong...
+Ronald Reagan2000 no youy don't lose it, you,just have exchanged is for an equal amount money, with this money you can make more money in different ways, the point is that the person whodidn't have gold in the first place can not do this and thus having gold indeed contributes to inequality
I admire Varoufakis, but this critique is terribly unfair to Piketty. Piketty doesn't attempt to recommend taxing granma's silverware or jobs producing investments. What I'd love to see is just what these two would recommend we do about inequality. That would be much more revealing in terms of critique. If Piketty is "wrong," what is "right." So easy to find fault when you do not have to take a stance on the solution.
Dale Walker Democratize business
Dale Walker You're watching this video on channel which has the name Henry George in it; George's name alone might be a massive hint at their preferred alternative.
Dale Walker
oh but it is. Look at the French estate tax at 60% for second level relations in a family context.
+John McIntytre Wut? I'm french. Where did you saw this kind of tax? lol
So much minutious work, data and information that was put into this book, it's ridiculous to talk about any bias from the author, little or more it may be
"Minutious"?
@@37Dionysos
Definition of minutiose: attentive to or dealing with minutiae precision of.
E.g.:
minutiose observation- J. A. Thomson
minutiose and troublesome attentions - Metropolis
They both had a lot of cynicism and criticism but never really fully explained why.
In an interview Piketty confessed he never read Marx or his Capital.
@@RoniiNN Yes it's true. The way he defined capital as mere asset n not RELATION also proves his simplistic view n mediocre understanding. A paper on value throry by English teacher James (or John) ******** mentions it. Even Isaac Deutcher biogrsoher oc Marx didn't n found it tough. He mentions a series of cases up to dome MP who only heard but never read it. Same way in India n everywhere.
@@RoniiNN Seriously Yes! There r mainstream economists who feel giddy n vomiting n pain in stomach or start sneezing in cold if asked 2 read Capital or Marx in general. At d same time there r those (reactionaries) who boast "i read all 3 volumes of capital". If u asked them what vol 1 n vol 2 is about they start seeing roof of d room as blanks! Talib rightly says Umberto Eco's Library of unread books!
He rode it he just said that it spend tome to read it but he rode it
@@RoniiNN because Marx isn't taken seriously by any stream of Economics today. Most of Marx's Theories are debunked and discarded.
From surplus value to Marxian class analysis. All of it is in the garbage bin. Even welfare Economics or keynesians avoid Marx's views because they are so irrational.
@@gabbar51ngh Marx may not be of much use to modern day economics, but his historical significance both in economics and elsewhere is so, so vast that absolutely everyone dabbling in social sciences would benefit so much from reading his works. It also makes it ever so easy to counter Marxist arguments when you know the core works that their ideology draws from, better than them themselves.
Reduce inequality by LVT - Land Value Tax!
Henry George suggested LVT in 18th C. 👏
Tax all private ownership of land. Not buildings, but raw undeveloped land. Remove income tax n wealth tax. No need.
“We could tear this apart”
“Yea we could”
“He’s so wrong”
“Yea I know”
“Liberalism is wrong, we’ve proved it”
“I know, we could do it right now if we wanted to”
“Yea, we totally could go into detail about what makes our perspective better”
“Yea we totally could”
“Great critiquing man”
“You too bro”
Travis C when you don’t understand.
Actually krugman has hugely changed his tune recently. He has dropped his sanity in exchange for a job in Hillarys establishment. He went back on many of the things he said in 2008. As for Picketty....maybe his book simplifies capitalism. But shifty? Seriously?
I'm a huge fan of yanis. But he missed the mark a bit on this one.
Pickety is a capitalist showing the obvious and no policy of change ( ?? taxes) but yes 'shifty" in that he is not a ' change agent' is he?
18:00 thank you for making me understand why Krugman is wrong as often as he is, despite his great insights.
No reason to be fictitious about what taxing wealth means. By not stating what does "tax wealth" means, Piketty has prevented himself from getting banned from places like the WEF and alike. As long as he provided other researchers with a theoretical framework for other researchers to build on in their writings. Tax wealth can be easily translated to what imagine Piketty meant to write about a higher inheritance tax that will reduce intergenerational privilege. Don't have to be a PhD economist to figure this out or stand behind it.
it’s not that there’s no labor bargaining but that that’s very little bargaining
There is a strong tendency by those who are against Piketty's ideas or theories of overcoming the level of inequality that we are currently dealing with to criticize without talking about the ideas specifically- I don't know who the older person is but he doesn't sound like an enlightened economist. It must be understood that in most cases of theories being developed and consequently adopted there is a generational gap where suddenly predictions that were mentioned by an obscure figure 30 or 50 years ago are suddenly coming true and therefore his ideas are now valid, and so we should adopt them - lest the house burns completely.
Everyone knows that no real political figure with aspirations to a government post is going to adopt 80% tax on the wealthy, even if it theoretically makes sense. What is important is that through calculations they are being left as evidence until they can be validated. Marx's ideas were not common-place in 1850, he died poor, at the turn of the century people still remembered what he had held.
I am not declaring that he will be remembered as Marx or Smith, but if you are reading this in March 2020, we can definitely see the fragility of an unfair system and how it can collapse.
The tacit aim in Piketty's book is to popularize shaming the disparity of wealth ...again. That shame has to be reset occasionally because it never reaches the level of potency it needs to inspire results. If you can avoid Shame, you've got it made.
Varoufakis started losing me at the end. I do not see Nozick as destroying Rawls in the slightest. Let's examine the points Nozick made and why they aren't really problems for Rawls.
Rawls argues that economic inequality ought to be redistributed such that they benefit the poorest in society. This is his second principle of justice. (the first principle really isn't contentious in this context.)
Rawls defends this point with his Original Position behind the veil of ignorance, where everyone is to assume they know nothing about their identity or status in society, and to make a choice on what society they wish to live in. Rawls contends that people will use simple game theory and choose the low-risk-high-reward option of choosing a society which is just to all; as their place in society might possibly be as someone who is socially or economically disadvantaged. From this thought experiment he derives that second principle of justice.
Nozick responds by stating that if Wilt Chamberlain were to accrue money from people paying him to play basketball, his economic standing would not the same as it was in the original position. Nozick argues that this alternative standing for Chamberlain is just, since people are freely offering their wealth from the original position, and the distribution from the original position was just, then how can this subsequent distribution not be just as well?
The reason this argument doesn't refute Rawls in the slightest is because the reason the original position's distribution was just was because it took place behind the veil of ignorance which renders people as objective as they can be. Distributing wealth outside of the veil of ignorance leads people to strategic distributing, where their motives are not to maximize fairness toward everyone in society.
Secondly, nowhere that I know in _A Theory of Justice_ does Rawls argue that the original position solves inequality period. Rawls specifically states that even with the veil of ignorance, people's experiences in life, conflicting evidence, and other subjective factors will result in disagreements about what decisions we make on social and economic issues. Rawls refers to these differences as the _burdens of judgment._ Thus, it is entirely concievable that these differences in decision-making also apply to people's expenditure of money. If this is true, then economic inequality will continue to occur irrespective of how much we futureproof society with principles of justice. That said, with those principles in place, we can easily return to the original position by simply redistributing wealth once again.
Perhaps you disagree with the concept of redistributing wealth. As Rawls said; reasonable people can disagree. However, I just don't see how Nozick's point sufficiently refutes Rawls in any way.
Lastly, the notion that "the only thing that matters is the process" is just absurd to me. So if we have inequality in the end, do we just shrug and accept the inevitable plutocracy that is to follow? Is this some sort of advocacy for social darwinism whereby the people who are best at "gaming" the system are inherently superior, so they just get to ruin the society for everyone else because they "won the game of life", and "the system is all that matters?" This seems like a horrible way to run a society and I vastly prefer Rawl's method of determining justice through fairness.
***** Are you serious or being sarcastic?
***** Nozick is effectively saying that if people freely choose to give money to someone in exchange for their actions, then that proves that the original position that Rawls was advocating is wrong, because if Rawls's original position was the most just, then how could this other redistribution be just as well? (Nozick merely claims that giving money to the basketball player is a just action, and we're just taking that to be true for the sake of the argument)
But Rawl's position isn't that the Original Position cures a society of inequality forever. Given time, people will disagree about how to make actions in a society because of several factors. Rawls called these disagreements burdens of judgment. So Nozick's argument is a strawman, or mischaracterization of Rawl's argument. So when Varoufakis says that Nozick destroyed Rawls, I think he's being unfair to Rawls.
Not really that summarized, but it's philosophy; it's all about being detailed and precise, and that requires a lot of words.
***** To a certain extent, yes. I'm a Marxist after all, so the whole "From each according to his ability, to each according to his need" mantra I believe in, but that's for a socialist/communist society which we're nowhere near. I believe in providing help for the poor, but if we're going to live in a capitalist society, we ought to at least do it efficiently and rationally. This means an equality of opportunity, not an equality of outcome. So a meritocracy. Rawls is advocating for an equality of outcome which, to me, is the end result, but we can't achieve that until we're a post-scarcity society which isn't for a long time.
***** Disagreements in philosophy rarely end; they usually just change form and continue on.
Dialectical Materialism "Distributing wealth outside of the veil of ignorance leads people to strategic distributing, where their motives are not to maximize fairness toward everyone in society."
This point/argument is moot. But, the whole reason that Nozick brings forth the idea of "strategic distributing" is because it works better than Rawls's Veil of Ignorance. The whole point of freedom is that you can make the choice to "distribute" your wealth where you deem it to be necessary and not be completely blind about it.
You mentioned that " we can easily return to the original position by simply redistributing wealth once again."... but isn't that really something that is completely inefficient? You are essentially saying that you will let some third party (most probably a government) to stick its hand in the economy and re-adjust for inequality, every single time. How is that fair? As an individual I made the choice to spend my money where I want to, if it makes another rich, he's only rich because I, and many like me, chose to give him money for something in return. The beauty of economics (and capitalism in this sense) is that it works beautifully like a symbiotic relationship. This has occurred everywhere, when people don't like what a company is offering, then they won't buy it and the company will either do what people want or it will be rendered useless to society. What better rating system do you have than the market? IF it were up to the government, we would all be forced to carry around Blackberrys, even though the MARKET clearly spoke. People do not want them, they're to innovating - therefore they are useless to us.
I see you mentioned you are a Marxist and you are waiting for some type of revolution in the future? Frankly, and because no one on UA-cam has been normal enough to have a conversation, sure there is inequality and sure capitalism may not be the BEST system out there, it is by far the best system we have at the moment and the best one we have seen. There's not need to keep lying to ourselves, and if you are a true marxist, you know that we have tried all forms of socialism and in every single case, it has failed... miserably. What growth has capitalism brought by? You have seen it, I'm sure you have. And I'm sure you are fully cognizant that you would not have everything you have if it weren't for capitalism. Many can say that "socialism would have brought about the same technological advancements (read iPhones, macs,... let's not even get into the value of the iPhone alone to society and the spurring of new businesses that it caused..) but do you really think socialism would have allowed for all of what we have? OR do you think that capitalism is as good of a system as we have at the moment, but it can be "edited"?
This was extremely good from Yannis Varoufakis. My respect for him has gone up exponentially with this analysis.
Dr Varoufakis offers Nozick's criticism of Rawls on the basis of the instability of Rawls's outcome to the basketball sensation. Varoufakis turns our attention then to the process rather than the outcome. But to have justice or equity in an economic system, I would suggest that BOTH the outcome and the process must be just. It is as unacceptable, I would say, that any outcome is acceptable so long as the process is considered just as it is to propose that any process is acceptable so long as the outcome is just.
i watched to 10.sth, where Yanis goes 'the first reason is a tautology, the third is trivial' doesn't explain what reasons he's on about - no use to me! Enjoyed up to then. Certainly the first time i've seen a finance minister from his computer's pov lol. Will definitely check out more in this series, it's irritating how the elite want us economically ignorant so they can lie to us better - at it's worst here in UK - self-education with your series and other tools is a must, thanks
The process is only important if it leads to a just outcome. I agree that the market is not the right process for SOME AREAS of the social contract. However, the "process" is meaningless by itself to achieve human wellbeing.
Thanks for the headsup, to be honest I fell for it.. If it had not seen this.
your grandmothers silverware......jesus ,how about the ******** derivatives market.I like varoufakis ,but not sure what the point of his criticism is.
His point was that not everything valuable is productive or able to be easily converted into money to pay the wealth tax.
This is a hatchet job on Thomas Piketty. The language he uses throughout appeals to the emotions, the amygdalas, the chimps that people have in their brains, and the interviewer is not pretending to be impartial but joining in the attack. It is not a serious discussion but he has the nerve to use the word propaganda to describe not his own words but those of Piketty. I haven't heard Paul Krugman, Joseph Stiglitz or Thomas Piketty critiquing other contemporary economists at all but I'm sure that if they did it would be to make a point about economics, not to discredit someone.
One of the central attacks was on Piketty's advocacy of wealth tax and they ridiculed it as if it was something crazy that had never been tried before. This could be due to their ignorance but I believe they knew that wealth tax already exists in many parts of the world, including in France, as Piketty makes plain, but this take down is not aimed at people with such knowledge.
So explain the huge inequality! Explain the stagnant growth. This was just a bashing....
How incredibly insulting Varoufakis is to Picketty's readers. I have no background in economics yet read the entire book without difficulty. It is clearly written for laypeople and I can assure you there are plenty of laypeople out there formulating their opinions of Picketty based on the WHOLE book. And I don't appreciate being compared to a mindless religious devotee.
MrAlicelauren It's because Varoufakis' whole social construct is in line with that of Marx. Varoufakis seems to be living in a different era
Corporations chose to impose sanctions on workers rather than go bankrupt in the 1990s, which was only possible in an anti-labor government (Reagan Republicans). Inequality has political beginnings, but Piketty ignores them, according to Varoufakis.
Systematic de-unionization is what Piketty ignores.
Eveything Yanis says in the interview is in the best interests of laypeople. And he also denotes that Piketty does a great job of revealing global inequality through a vast database of economic figures. But, when he fails is the other half of the book, the analysis. He doesn't leave any room for policy change, for any New Deal with the ruling financial elites. If you just tax them more, first you won't change the process through which this kind of tremendous inequality is being created, and second, should a Trump-like "politician" come into office, that tax ending up in the dustbin will take no more than around a year.
We need to challenge the underlying framework, the rules governing the world economy, policy, education, and not just simply think that heavy taxation is a way out.
@@jtemple4009 Great approach, Jennifer. I can suggest another left-wing vs right-wing pair: Joseph Stiglitz's Economics and Thomas Sowell's Basic Economics. Too bad these are quite expensive books, should be possible to borrow them from online libraries though. It's worth it. Each is about 800 pages, both authors are important figures in modern economics and these works are economics textbooks in many universities.
@@jtemple4009 Good points! The only thing you left me to add is that the blame, in my opinion, is both on we the people's and they the power's shoulders. And power in turn is not only the government but also big business, corporations - the distribution of power has undergone a dramatic shift over the last few decades. There's no principle difference between corporate and political elites. Big business virtually writes a lot of the legislation parliaments, senates and other national assemblies vote on later on.
It's crucial to understand that no form of democratic governance alone, per se, will ever do the job. People who think they shouldn't care about politics, economics and should only be enjoying life while professional politicians and economists and business people work hard for them in office and grapple with all the challenges society faces is exactly what has led the US and Europe to where we are today, along with, equally along with the self-centered efforts of corrupt elites. Philosophically speaking there's always more blame on those who possess more power, so say in a highly oppressive state like Russia, Turkey or China people have very little 'air to breathe', but in the relatively free societies of the West the average Joe or Jane too are responsible for the current state of affairs. Way more than those of China, Russia, Turkey, etc.
So, as you said, education is one thing, political and social activism is another. Doesn't have to take up too much time, but even the most educated of people casting their vote on every election there is will still not make a big difference without enough political engagement of some sort. But even that is still to achieve :)
Varoufakis actually does take a solid stance on inequality and not only (answering to some of the comments). The diem25 movement co-founded by him is all about that. Very detailed proposal of a New European Deal, if anyone's interested. diem25.org/end/
I myself appreciate Piketty's effort a huge lot-humanity really needed detailed proof of global, perpetual inequality- but I totally agree with Yanis in that the analytical part of the book is in fact tremendously dangerous if to be adopted as "the only alternative." We can view it in the context of some complementary policy though.
Following the great Stephen Hawking's reasoning about the most existential questions about our origins I would respond to Piketty's statement that capital's returns are above the average rate of return of the economy that otherwise, there would not exist any capitalism at all. Incentives my dear...incentives, if capital's return would not be that way there were never existed the incentives to promote it. A very different thing is that governments doing it absolutely wrong pervert the real nature of capitalism...its inherent risk. A capitalist has not to be saved in any circumstance by governments because its inherent risk cannot be assumed by the whole society.
There needs to be some wealth inequality to provide incentives for people to work hard and create actual wealth .
But since the change from Keynesian economics started to be phased out on the 1970's , and a twisted version of
neo liberalism was ushered in , both income and asset inequality has grown to the extreme .
Even Standard and Poors came out circa 2012 and said the level of wealth inequality will create political instability . [ and political polarization ] .
After Covid , its like we have 2 economies now
1) those who work for a living and try to make an income
2) those who know how to use the capital printed by central banks - this printed fiat money is driving up asset prices ( real estate , stocks & luxury goods , art ) and its being used to create a renter - debt class .
.
20:04 I wouldn't have left a comment except for that fact that I had conceptualised The Oracle in The Matrix as adopting a Pareto Long-Tail Distribution approach vs a Gaussian Normal Distribution approach (suitable for mechanical systems I guess) by The Architect. But, seriously, I don't know anything.
Piketty makes inequality natural n eternal.
It shall exist after economists have done their good job! Tax it. It's up to govt. Let corporates n govt keep struggling on wealth tax.
I think Yani is experiencing a bit of envy! Picketty is quite humble, sees the book as a basis for ongoing statistical analysis, he welcomes critical analysis, & sees the role of the book to stimulate conversation. Yani has been de-throned!
I have a french friend who comes to NYC and takes photos of the homeless sleeping on the sidewalk and going through the garbage. He is fascinated by them as this does not exist in Paris. The french govt does not allow their citizens to sink so low.
What does that say about the USA ?
This is complete bullshit, we have plenty of homeless persons. BTW, there is plenty of fine food in the dumpsters !
I was in Paris around when this comment was made (5 years ago from when I am writing it now) - and I was shocked by the level of homelessness.
33:00 - Wait, so does Yanis think that if the processes are just, then outcome should be ignored? What about the moral implications of a situation where someone has more money than they can spend in a lifetime even though through a fair and justified process? Surely some of that money should be redistributed?
This is very helpful, thank you. Phony progressivism is the curse of our time.
I remember in the book. He says he will not speak on " human capital " it was too complex. I guess..
Didnt Varoufakis propose basic income? isnt it atleast as anticlimactic of a solution as the wealth tax?
I strongly believe that we should stop using the terms Inequality or equality. We should instead use the words unfairness and fairness. People cannot by equal really. Its a pipe dream. Why would you want such a thing anyway. Pluralism is better. But things should be fair, fairer than they are now. Some people have everything and so much of it. That is not fair, that is greed, decadence, wasteful, obscene, selfish, solipsistic, sociopathic etc (I could go on). How much is enough?
It's reference to economic inequality
Total equality is embedded in Communist ideology. Socialism approaches the issue that each person should be rewarded according to their work and contribution to society, emphasizing fairness. Social Democracy is more rational in that it eliminates Corporate Welfare and pays workers their true value. It caps rampant and uncontrolled wealth accumulation and income inequality to bring health and social programs to enhance the health and wealth of an economy. In the economic game there can never be any equality, thus, pluralism as opposed to elitism is much more realistic.
When most people advocate for equality, they are not advocating for total equality, they're arguing that we should have greater equality, that economic disparity should be lessened. The problem w/ "fairness," is that people can disagree about what is fair: leftists will say higher taxes on the wealthy is fair, while libertarians will say higher taxes is unfair. This problem doesn't come into play when talking about economic equality/inequality, because those things can be measured w/ some accuracy, which we can all largely agree on.
Andrew Mazzone takes the opportunity to vent his (superficial) opinions on the capital in the 21st century. He systematically misses the ways in which Varoufakis interprets Piketty. Particularly, Andrew's opinions on the book are lacking on substance and he repeats ad nauseam rhetorical questions of the sort "what can you take from Piketty? you can't anything!". Varoufakis on the other hand sees the 'necessity' of Pikkety's argument, though is nonplussed by Pikkety's suggestions on how to solve the problem.
Piketty's main achievement is to give a complex systems+saturation understanding of the economic system, which is missing in the literature. It is saddening to see that the likes of Andrew throw the baby with the bathwater.
Capital efficiency, more capital input gives increasingly more value in absolute terms.
A Computer generated Yanis! The real Yanis is a gentleman. just saying that Thomas P is a dishonest person and his book is rubbish, stinks like jealously is in the air. I am half way through the book. The solution it proposes is a small part at the end, be reasonable. Thomas has to write with the same style as the establishment to be put on the table, all cultures do the same. He can't write screw everyone and here is why. And it is a book to bring on the discussion and we can criticize but not under the belt. I refuse, this is not Yanis. If it is he just lost all my deepest respect.
You need to write properly Ricardo Murillo, some people might be confused with what you said. But I sort of agree with you.
yeah, I think he's being a bit harsh with pikity.
Why the actual fuck am I here?
"....we are shocked to find out that there is inequality in this world...." Show me two human beings that are absolutely equal to each other in their genetic makeup, economic circumstances or experience?
@19:00 both claim Piketty is ignoring bargaining power. However in discussing the phenomena of super-managers & their labour income, he argues that they might have too much bargaining power. So it might be right that his model has no direct relationship to bargaining power, however I don´t see he wouldn´t agree to it?!
Compared to Marx, all theoretical models of capitalism to this day are infantile.
Didn't Marx predict a collapse in the return on capital?
@@JamyOats More like gradual decline in the general rate of return leading to increasing pressure on the system. Have a look at this - thenextrecession.wordpress.com/2020/07/25/a-world-rate-of-profit-a-new-approach/ .
As an aside, Marx isn't Jesus, he doesn't have to be 100% right on everything, but it's obvious that his models are not used for political reasons.
right in the beginning.. economics IS a social science. Rhethorically diving the two adds to the illusipn of the "exactness of economics".
Haven't read the book, but this critique makes Piketty sound like Obama. He talks a good game, but when you look more closely he leaves himself plenty of wiggle room so he doesn't have to really do anything to change what's wrong.
As for the basketball scenario, I don't see how it 'destroys' Rawls. There's no problem with LeBron taking home more than his team mates. He's the marque player, he 'ups the gate' as Ali used to put it. So, he makes more - fine. However, there is a problem if the other team members are on food stamps. As good as LeBron is, I doubt he could single-handedly win the games .
This is crap. The whole profession was in denial about this issue, the data for which hadn't been gathered or analyzed, before Pikketty, and now this guy is like "oh yeah, the first 90% of this book was obvious, but I disagree with the prescriptive part 4."
World leaders should pay heed to Yanis, not walkstreet and billionaire investor class.
This is unfortunately full of envy.
Referring to characters in Balzac's Père Goriot (1835) and Austen's Mansfield Park (1814), novels full of gripping entrepreneurial stories of the time, Piketty asks whether wealth today has lost its natural
tendency to be transformed into rents (i.e. government bond yields for Austen, rents as a result of housing speculation for Balzac).
He says that it has become very difficult for the young generation to finance housing just by labour income. Is that propaganda?
This was a great conversation, really useful stuff thank you.
Dn't get your ego involved, Yanis. Keep fighting
I feel a bit like I'm eavesdropping. Nothing wrong with this conversation, and I agree with yanis mostly but it comes off a bit like a conversation around a dinner table about an academic rival 😅.
I guess that's the beauty of UA-cam, I get to hear it without being at the dinner table... But it is a bit uncomfortable
What you ought to be considering is why they feel so threatened by Pikkety. They are fully and totally co-opted by the Capitalist Corporatocracy.
amazing! how is it that these two pretend to have read this book?
piketty presents a history of capitalism based on statistical data. this data depicts the shift in wealth since 1700. piketty concedes that available data is lacking up to the present day. as such, he offers a picture of the production of capital using the rate of return (change in profit or wealth and assets or capital together, when compared to the change in income gives us the return rate). given the lack of consensus on factors like human capital and taxation - the latter being a historically recent part of the economy (and which figures into the basic figures - taxation of private income appears as a change in national income) - piketty indicates that they are nonetheless not absent from his analysis.
i'm not an economist. the argument they put forth is based on their early assumption that i am too stupid to follow piketty. i don't bother to locate the point at which they assert my inferiority (as well as the stupidity of the teeming masses of which i am a member), it's pretty clear throughout. the extent to which the resort to morality, envy and other deadly sins escape these mouths indicates only their satisfaction with themselves. these men are on the defensive. tellingly, they refuse to identify the cause of their trepidation. instead, they attack the source. most of the flaws they attribute to piketty's work are the very flaws they display so unabashedly in this recording.
taxation policies are at the heart of current inequality. the radical drop in the tax burden on wealth in the usa is the number one legacy of the reagan years. this is government policy. how do you paper pundits ignore this history?
piketty's history is too difficult for these two. instead, they start to talk about other economists. piketty is like "X" who they are familiar with. but still, they say nothing about the book. "anyone who supports piketty" is an ass. why? we've said nothing about his book. that would give the viewer too much information on what scares the shit out of these propagandists of the status quo.
read the book for yourself, people. these guys don't like it. it threatens them. that's a good sign.
Critique without construction is just useless and defensive. Mazzone just wants to destroy without seeing any good. What good can we take from the book to understand inequality better in order to reduce it? That's it!!!
I am no economist so I can only follow their criticism superficially. What I can follow though, is the discussion about Rawls and Nozick. Saying that Nozick ''destroyed'' Rawls seems kinda weird to me. A certain income distribution is not only fair/unfair in itself but also because it endangers the possibily of the least well of to exercise their more fundamental rights (Rawls' first principle of justice) which takes precedence over the fairness of income distribution.
I respect Varoufakis on a lot of topics but it seems that he can only criticise and on this particular point he does not even seem to fully understand the political philosophy....
Varoufakis says you have to go back to Marx to understand capital. Marx says that capital (for Piketty "wealth") distribution needs to have the process of capital accumulation within its definition ("capital is a moving process," "bargaining," etc.). In Varoufakis' example, Nozick and libertarians think that the current distribution of wealth is absent of dissent from labor-that the current distribution of wealth (and capital) is as just as the basketball player example.
finish your comment
I get the feeling of jealousy. 'Why couldn't I write a book like this?' Well, then rip it to pieces in a jealous fit.
rubbish! poor analysis.. ! Pickety is like a 'finger pointing' to something all know and NO one in the neo-liberal political establishment will comply.. ever..!
Varoufakis has nothing to be jealous of Piketty's book or Piketty himself what so ever!
..and if you really have paying attention to Varoufakis's analysis.. please tell us where he's wrong... or keep your nonsense to your self..
@@nicolasbouyiouclis4726 there are two vultures around the carcass, not just one.
IT was always ways great amount of inequality I have no Idea why some people was surprise and that great effort goes towards when we got off the gold standards.
if you still believe this please look up pragmatic capitalism blog and gold standard. The role of money and gold are a completely different concept to inequality.
America might be taking a huge step towards a socialist reform thanks to the notion of inequality becoming a mainstream pandemic and that is largely thanks to Pickett.
This video is wild. They start by saying no one has read the book but them... I guess I wasted that summer staring at nothing then. Then move on to say its impossible to tax wealth because grandma invested in silverware....1 millions dollars worth? and then proceed to say Krugman has it all right... jeeeeesus
poor sound quality
PhD is worthless even in medicine, doctors skateboard without helmets now. hahaha c'est la vie
The Greek Finance Minister ?? So let's consider the source here of this criticism....on the other hand Piketty is a visionary and he has written a book that brings his subject to the public in an understandable form. We all of course know how wrong the distribution of capital is and that it gets worse by the minute. Sometimes ( as in this case ) criticism is simply a way for someone who has no original thoughts of his own to grab some of the spotlight. BTW I read the whole book and I am sure many did.
I assure you mister interviewer that the fact is that most books that are bought through Amazon that have gotten expert ( like Krugman and Stiglitz ) attention and the resulting exposure suffer a similar fate ( read to only page 12 ). That is they are barely read and the buying of them is an impulse buy in many cases by people with fleeting interest only. These buyers are the backbone of the industry. How many people have Shakespeare or Frost on the home bookshelf and have never read them. I know it is not the point of Mr Minister but it annoyed me for just that reason.
+tradeeagle Varoufakis was not FM at that point. The elections that first brought SYRIZA into power had not even happened at the time of that interview (and YV later sad he was never a member of SYRIZA).
You're right - he wasn't FM till Jan '15 -- since I (unknown person that I am) didn't write the intro, nor was I involved in this video production, I'll be more than happy to fix it!!
"The Greek Finance Minister ?? " I have heard Varoufakis speak/interviewed many times. He has a brain the size of a planet and is more than qualified and trustworthy to review this book. He Believes in the Common Good/Social contract. Something that the Right-wing could not say. The Right could not give me one example of them doing anything for the common good. The Rich have gotten richer. Money makes money. "The Walton family, which owns Wal-Mart, controls a fortune equal to the wealth of the bottom 42 percent of Americans combined."
Jim Walton Decrease$36.5 billion
Alice Walton Decrease$35.3 billion
S. Robson Walton Decrease$35 billion
Lukas Walton Increase$11 billion
Christy Walton Decrease$5.5 billion
Ann Walton Kroenke Decrease$4.9 billion
Nancy Walton Laurie Decrease$4.4 billion Coincidentally 42% of Americans earn less than $15 per hour. Walmart workers are on Food Stamps.
There is no free market or invisible hands. Remember Adam Smith? The masters of mankind, Smith's words, determine the allocation of wealth and power.
Found reading the text too much to grasp on a first read. It requires a good deal of thought to evaluate this model.
Despite all the economic analysis also from Yanis
Varoufakis and Thomas Piketty have not helped to identify a viable and practical solution to reverse inequality. Not in Europe, not in the USA and not anywhere. What seems to happen is that empowerment contributes to a change of heart that corrupts the leadership. While there should be a way out of this predicament there is no way out of it. This is not about the last 200 years. Economic inequality has existed for at least 30,000 years.
The resources belong to everyone buy divine providence, share and Save the World, without sharing there can be no Justice, without Justice there can be no Peace in the world.
the sound is to low!.
Twelve minutes in they are still merely conjecturing about his assertions which they are even failing to identify. Silly.
So ? I'm still wondering what's new in all these "new" explanations of the capitalism that are not already better studied in the books of Marx, Engels "The Capital" or Lenin's "Imperialism, the Highest Stage of Capitalism" ? Oh, yes, they want to "adapt" capitalism not get rid of it. Idealists...
+MHscrewdriver
I completely agree with you, but for what it's worth, Piketty's book is pretty useful for statistic information and solid data. As for his proposed solution, yeah, it's reformist garbage trying to stick a band aid on capitalism, rather than getting rid of it. Idealism at its finest.
I wouldn't bother with Lenin. In the 1920s shortly before he died he wrote a tract in which he took stock of what the Bolshevik seizure of power had achieved and he described it as it was , state capitalism. George Kennan , the US diplomat acknowledged the fact as did John Foster Dulles a Secretary of State in the Eisenhower administration. The lie of it being anything like a communist society should have laid to rest long ago, but there is an ideological interest to be catered for in continuing to describe what Marx said were the attributes of a capitalist society as its very opposite.
In Islam at least for the average Muslim faith and theology are distinct. Theology is totally subordinate to faith. Indeed theology to be credible has to based on an uncritical and unconditional acceptance of faith. There is no assumption that some contemporary doctor of the faith is taking care of its details. There are the 4 Sunni schools and the one major and a few minor Shia schools of the faith. But their details have been settled a thousand years ago. There is no room for a Muslim theological Piketty. This may or may not be a good thing. But it is the way it is.
At 33:46: " ... the lives of it's [sic] citizens." Can't you afford to hire a proofreader?
So one needs prodigious Macro knowledge to successfully argue their case or convince Y. Varoufakis of their argument. Anybody opting out of using the Macro for a fulcrum is bound to end up in a heated exchange as the former is his substratum that defines and expounds the crux and individual cases in economics.
Good grief.... does anyone still take this lying hypocrite that constantly contradicts himself seriously?!?!?! He just goes round regurgitating his often contradictory "theories" and rehashing the obvious with his conflicting waffle depending on the audience and who's paying... Just look at the results of his "policies" and "predictions" - why do you think he was dropped kicked out of government by his "communist" comrades who were initially selling him as a "rock star" politician?!!!!
Don't fall for his duplicitous waffle and delusions of adequacy... he is little more than a narcissistic, treacherous little "populist" stooge peddling his books and - to quote the pathetic clown himself - "a comedy of errors wrapped up in harmless waffle" - which sums up this champagne socialist perfectly - just ask his former "communist" comrades who also betrayed Greece - or those holding his off shore accounts...
Time to wake the fracking hell up! It's actually slimy treasonous "populist" stooges like this and little niggle fartmirage that are undermining Europe!
You guys are critiquing Piketty's book from technical, economic standpoint, which is very important and should be done. But let me offer a social theory of why Piketty must be wrong from my simpleton mind -- Piketty is being talked about in the mainstream. "Liberal" outlets like NYT, etc., have reviewed his book. Other such status-quo entities are debating his ideas. That itself tells me he must be doing something wrong somewhere along the line.
what a jerk, I don't understand this guy he never misses an opportunity to make a bad desicion, Pikkety never ever said this is the solution (part 4 of his book) and you have to follow, he instead urges the reader to come with his own solutions, incredibele sad person this Varoufakis, I think he is only living for the camera
+Patrick Van Gelder - you are correct sir !
Funny he claims Piketty lives for the cameras. Piketty is playing to be the darling of the discredited radical egalitarians and their income inequality meme.
It appears Varoufakis is a bit pissed that Piketty’s book has outsold any of his tenfold.
The idea that Piketty is looking to ingratiate himself with mainstream economics is laughable. I acknowledge some criticisms, but is this professional jealousy? The Global Minotaur was hardly without criticism.
"Profit" means "value gained that you did not put into the exchange": taking more than you give. You use profit to create its close cousin-word, "advantage"---and the more people you DIS-advantage by taking unfairly from exchange, the richer you get/the poorer others get. This lie, these words for a core generic scam, have another close cousin: "progress." (See Oxford English Dictionary) Like "advantage," it's a RELATIVE term. Hence, what surprise that Piketty's data show capitalism screwing more and more people all the time? Time for the human race to Walk Out On Profit.
15:38 of Ted talks He says he prefers " A progressive tax." I feel if inequality is just a fact of Capitalism. Why choice that standard. "Inequality " means to me. "This person is not living the European or western culture ideal. Maybe in the future if you are safe, fed and have loving group of people that surround you. This capitalist system will be irrelevant.
Janis is my favorite
Marx: if the process is just, and everybody soon dies horrible deaths as an outcome, no problem.
22:39 sees a strange edit - somehow imagine Yanis did a reverse deconstruction of the self-negating Picketty utopia which appeared off-message; or listening to too much Slavoj Zizek?
I feel like mazzone is far more critical of piketty than yaniz lol
A critique that is much ado about nothing. This @36 minute video is well-nigh incoherent. It definitely is extremely vague and defensive.
Have these guys even read the book?
Dear Friends,
world economics are like a big Pizza with slices for every single man on earth but if someone eats 2 slices someone else will starve.
32:25.And on. Brings me to a question.. How many black men should be making millions playing sports like football and basketball???
Why does their colour need to be mentioned you bigot ?
I never heard the word "land". Does that mean that Georgists have now conceded that it fits into the categories of either wealth or capital? Double lunch-bag let-down.
Okay, you progressively tax the basketballer and then charge a high inheritance tax which preserves both the incentive structure of capitalism in the medium term and the ideal distribution in the long term?!
hymnofashes High tax is only possible in extreme capitalism. Extreme capitalism leads to government incentive to extreme tax. A sensible economy would reduce the gap between "money" and resources because there will be less parasites. That is the main factor to make a stable economy. If not, there can only be good economies in a small portion of all states in a bigger market, and heavily depending on intelligent/disciplined culture like Singapore and to some degree Finland and Germany. Realistically anything stable and progressive needs a firm and predictable system, to free time available for progress.
Now I feel bad for liking Piketty...;)