Closing the gap
The book that tops the bestseller list in the United States is about economic inequality, a subject that is as relevant there as it is in Hong Kong.
Thomas Piketty’s Capital in the Twenty-First Century, which is sold out on Amazon, uses historic data to strip the disguise of unfettered capitalism and exposes it as the main culprit responsible for the rising income inequality that has become a thorny political and social issue in the US.
In doing so, the book blows the lid off the myth of the trickle-down effect of wealth that many orthodox capitalists, or, in the case of Hong Kong, positive non-interventionists, would want you to believe.
French economist Piketty contends that wealth is not going to trickle down without government intervention in the redistribution process. He calls for legislative measures, including the imposition of a global tax on capital, to address the imbalance in wealth distribution.
Unsurprisingly, his book has won acclaim from liberal economists, including Nobel laureate Paul Krugman, who hailed Piketty’s work as “revolutionary”, and explained that income disparity is all about “r” versus “g” — the rate of return on capital versus the rate of economic growth.
Citing historical records, Piketty argues that the widening gap between “r” and “g” has resulted in a redistribution of income away from labor and toward holders of capital.
Krugman posits that a rising share of capital, in turn, directly increases inequality, because ownership of capital is always much more unequally distributed than