Till Breyer and Felix Kersting review Capital and Ideology

Thomas Piketty. Capital and Ideology. Trans. Arthur Goldhammer. Cambridge, Mass.: Harvard University Press, 2020. 1104 pp.

Review by Till Breyer and Felix Kersting

3 June 2020

In his new book “Capital and Ideology,” Thomas Piketty provides a history of inequalities. In Marxist approaches, the “history of class struggles” is usually connected to a deterministic view of history. Piketty’s history of inequalities, in contrast, takes a different position: there is always an alternative. Again and again, the author insists that at different points in time, several political pathways would have been possible. This mode of analysis is also different from most approaches in mainstream economics, in which explanations for developments of inequality are often naturalized and, thereby, depoliticized.

According to Piketty, inequality regimes––the conceptual framework of his analysis––provide different answers to two fundamental questions of political communities: How is property organized? And how are borders––be they national, social, or bureaucratic––defined? In the twentieth century, Piketty diagnoses three major inequality regimes. First, the proprietary regime (a term with which Piketty replaces the less precise term “economic liberalism”), second, the social-democratic age, and third, contemporary hypercapitalism. Deficits in discursive legitimacy and the perception of increasing social contradictions constitute the central conditions for crisis-like transitions between these regimes. For example, in the crises and wars from 1914 to 1945, the increasing socialist protests against inequalities within nation-states and the resistance against global oppression in the colonies played a decisive role for the emergence of postwar social democracy (chap. 10).

By highlighting unrequited opportunities and ideological distortions, Piketty stresses the fundamentally unstable character of social reality. This emphasis might explain Piketty’s recurring references to nineteenth-century literary realism, like the novels of Jane Austen and Honoré de Balzac. In referring to these authors, he pays tribute to a narrative style that creates the illusion of social reality but also continuously foregrounds the social codes that constitute this reality. While in Balzac’s novels it is the money and credit relationships that allow the narrator to slide from one character and one milieu to the next, in Piketty’s book it is the inequality relation that enables him as sociological narrator to move through world history.

The concept of ideology represents a novelty in the study. The previous book Capital in the Twenty-First Century still excludes the realm of the ideological to let statistical results speak for themselves. Capitalist economies, as Piketty famously argued in 2013, drift into an imbalance between return on capital (r) and economic growth (g). In contrast, the new study asks about the ideological justifications for inequality and the “genuine autonomy of ideas, i.e. the ideological-political sphere." Apart from his refusal of determinism, however, Piketty does not elaborate further on the relation of thought and social group, also leaving aside more recent theorizations of ideology. But is it enough to take ideology as a detached phenomenon of its own? In fact, Piketty’s concrete historical analysis seems to run somewhat counter to this. His investigation, for example, of the violent encounter between Europeans and non-European societies (chaps. 6–9) continually proves that the change in ideological structures does actually not proceed “autonomously” but has, on the contrary, always been dependent on crises and struggles. Summing up his take on the Haitian Revolution, Piketty identifies quite bluntly “what was no doubt the primary reason for the abolition of slavery: not the magnanimity of Euro-American abolitionists or the pecuniary calculations of slaveowners but the rebellions staged by slaves themselves and the fear of further unrest” (chap. 6).

The central question of the last chapters is: Why isn’t there more demand for redistribution in times of increasing inequality? Here, Piketty builds on the results of voter surveys, which allow extensive analyses of electoral decisions over time in the US, France, Great Britain, India, and numerous other countries. Whereas in the 1950s a lower level of education correlated strongly with electoral preference for left-wing parties, over the last decades it has become more likely that the higher the level of education, the greater the probability of voting left-wing. This changing pattern reflects the emergence of two different types of elites: an educational elite and an economic elite. Piketty explains this reversal with the programmatic mistakes of social democratic parties, above all: too little commitment to an equal education system and a fair taxation of wealth. However, Piketty barely considers the accumulation crisis of the 1970s and the role of neoconservative and economic-liberal parties and strategies, for instance their antiwelfare state rhetoric. In Piketty’s approach to the present, the rise of identity politics (no matter from which side) appears as an expression of the neo-proprietary inequality regime itself. Questions of ownership and its distribution have hardly been asked and tax cuts are considered to be without alternative. Then, disputes concerning borders and identity remain the only ones left in the political arena.

To overcome the current political-economic situation, Piketty proposes a “participatory socialism” with transnational economic order based on high and progressive taxes on income, wealth and CO₂: The resulting state revenues will be invested in an egalitarian education system and guarantee every citizen a basic stock of wealth. Companies are to be managed cooperatively. Wealth taxes will give property in general a tendency to be temporary. In Piketty’s view, these redistribution policies must be linked to more intensive transnational cooperation, like a European assembly with powers to conduct EU-wide tax policy.

Will Davies has detected a conceptual heritage of classical Enlightenment in Piketty’s project, particularly in its claiming an external and "autonomous" perspective. At the same time, however, the study has shown that the world of ideas has always depended on crises and struggles to become effective. For the feasibility of “participatory socialism,” therefore, the same should apply as for the abolition of slavery as Piketty has described it: Progressive intentions and concepts must be on hand at the right moment, but this moment will depend on the outcome of material struggles. Thus, Piketty’s project can be understood in two different ways: either as a call for gradual reforms in the tradition of postwar social democracy, or––more in line with the old Marxist parties around 1900––as an ideological preparation for the next crises of our inequality regime.