It was something of a surprise when Thomas Piketty’s 700-page, statistics-laden economics tome Capital in the Twenty-First Century became a sensation earlier this year, selling out its early print run and even briefly passing Heaven is for Real for the top spot on the New York Times Bestseller list. Less surprising was the news last week that the 700-page, statistic-laden economics tome now tops a list of books people are buying and then not reading.
According to an admittedly non-scientific study tracking the most frequently highlighted passages in popular e-books, most buyers of Piketty’s book didn’t highlight, and thus probably didn’t read, much of anything beyond page 26. It is “summer’s most unread book” for 2014.
So let me confess at the outset of this review that I am one of the many who have not finished reading this book.
It feels more likely that Heaven is for real now that Capital in the 21st Century is above Heaven is for Real on the bestseller charts.
— Michael Moats (@EconomicMoats) June 1, 2014
I succumbed fully to Piketty mania, showing up late to a dinner with friends so I could buy C21C on the day it came out. I bought the “r > g” shirt from The Colbert Report in the middle of the episode in which it appeared. Over the last few months, I have made it well past page 26, but I still have a ways to go from where I am today in the mid-400s.
In defense of myself and many others, let’s clarify an important point: there is no rush. Piketty’s book is an in-depth analysis of multiple measures of economic inequality and the dynamics that have created them throughout a few hundred years of capitalism. It doesn’t require an in-depth analysis of our political system to understand that none of those dynamics is going to change anytime soon. You’ve got plenty of time to familiarize yourself with Piketty’s argument.
In defense of my own personal delinquency, in between starting C21C and today, I became a father. If you weren’t aware, taking care of a newborn tends to cut into one’s reading time. So I haven’t finished the book. But from what I have completed, I feel more than qualified to answer a few key questions for people considering picking it up, those being:
- Should I read Capital in the Twenty-First Century?
- Can I read it if I’m not an economist?
- Will I actually enjoy reading it?
Should I read Capital in the Twenty-First Century? The answer is a definitive “yes.” You should absolutely read it (cover to cover, I’m speculating). Believe the hype. This is an important book that clarifies a major challenge, not just of our time, but of many years past and almost certainly many years to come. If Piketty’s findings manage to become part of our mainstream understanding of the economy, it could radically change how we deal with these issues — which is to say, we might actually deal with these issues, rather than assuming that happy dust sprinkled by the Free Market Fairy will trickle down through the global economy. We might actually realize that, as Piketty puts it on page 424, “real democracy and social justice require specific institutions of their own, not just those of the market.”
Can I read it if I’m not an economist? Again, “yes.” Even with its copious charts and equations, Capital in the Twenty-First Century is not so much an economics book as it is a history book. And in history, the exact numbers aren’t as important as the trends and outcomes indicated by those numbers. The most mathematically important element of the book is the equation r > g, which explains that throughout the history of capitalism, the return on invested capital (r) exceeds the rate of overall economic growth (g). In other words: the rich getting richer is not a bug, it’s a feature. The brief post-war period (1950s — 19080s) of middle class prosperity that we elevate as a golden age of capitalism was the exception to r > g. There is much more to it, which Piketty explains better than I ever will, but you’ve seen all this. Look at stock market gains (r) versus real economic growth (g) in the last few years. Consider whether the rate of increase in your salary since college (your g) has matched the interest on your student loans (someone else’s r). Think about whether anyone you know has bought a house using just their income (g) or whether they needed a cash gift from parents or grandparents (r) to afford what is considered a fundamental economic action of the middle class.
You don’t need to be an economist to understand these and other points that Piketty is making. In fact, few readers will have a better understanding of our current reality of slow economic and wage growth than those of us with degrees in English, history and/or philosophy.
Will I actually enjoy reading it? If you’re going to care at all about C21C you have to be willing to respect evidence. However, evidence indicates that reading this book can sometimes feel dutiful — especially around pages 27 and beyond, it seems. We’re also talking about a book that outlines rampant and systemic inequality, so even if you find it a captivating page-turner, “enjoy” might not be the right word. The real pleasure comes from Piketty giving shape, with extensive data and clear language, to the nagging sensations that something is not quite right with how things are working out for most people.
But Piketty has also done something novel with this book, largely by linking his economic data to actual novels. Throughout C21C are references to Balzac, Jane Austen and Henry James, as well as Titanic, Damages, Dirty Sexy Money, The West Wing and The Aristocats. Some commentators seem to consider these inclusions a contrivance, a touching but ultimately pointless exercise in accessibility. Or, less charitably, a dumbing-down. In reality, this is one of the more revolutionary aspects of the book (that I’ve read so far). If Piketty can encourage us to see for ourselves the presence of r > g in more of the world around us, then the ideas in his book might actually stand a chance.
The bulk of what I have not read of Capital in the Twenty-First Century covers Piketty’s solutions to the problems created by r > g. I’m expecting I will enjoy imagining a world in which a global wealth tax fosters a strong middle class with access to well-built roads, cutting edge education, and clean water and air. But I suspect the solutions chapters will ultimately feel like an obligatory add-on, the one piece that is not dispassionate and scientific, and thus the only unpersuasive part of the book.
But that should not take away anything from the importance of this book. We tend to envision the future as a place where intellectual curiosity, science and mutual respect have propelled civilization into an age of peace, pluralism and prosperity. I am the kind of person who believes that to reach such a future, we need great books, with ideas that bring people together in agreement about how we make progress. Capital in the Twenty-First Century is that kind of book, and we can use it to change the world, just as soon as we finish reading it.
– Michael Moats