In a single table, Piketty demonstrates that, in the abstract, it would be possible to finance a radically egalitarian economy if both income tax and inheritance tax for the rich were set around 60-70%. In this book, Piketty outlines his solution: a “participatory socialism” in which capitalism is gradually abolished via a progressive income tax and a tax on inherited wealth, which are used to finance both a basic income and a “capital endowment” for every citizen. Piketty’s socialism is not just a socialism without the working class. And as the incomes of the rich become reliant more on asset wealth than salaries, the old forms of redistribution, based on income tax and corporation tax, cease to work.
In a free-market economy, he argues, inequality inevitably rises faster than growth. Piketty’s 2014 book Capital in the 21st Century showed how inequality is baked into our current economic model. If we don’t do something radical to reduce inequality, Piketty argues, “xenophobic populism could well triumph at the ballot box and initiate changes that will destroy the global, hypercapitalist digital economy”.
The social coalition that drove redistribution in the mid-20th century has disappeared. But the main focus of the book is the present, which is marked by extreme and rising inequality, alongside the breakdown of traditional, class-based politics.
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