French economist Thomas Piketty's grim view of the wealth gap

Thomas Piketty, the French economist who helped popularise the notion of a privileged 1 per cent, sounds a warning in his new book: The US economy has begun to decay into the pattern of aristocratic Europe of the 19th century. Hard work will matter less, inherited wealth more. The fortunes of the few will unsettle the foundations of democracy.

Capital in the 21st Century has drawn huge interest as US political leaders debate whether widening income disparity is a problem that requires action.
The 700-page opus has been praised as one of the most important economic works in recent years, using data from the past three centuries to argue that the wealthy are hoarding more of an economy’s income than ever and that existing policies only mean that will increase.

Supporters cite his work as proof that the wealth gap must be narrowed. Critics dismiss him as a left-wing ideologue.

Piketty’s book soared to the top of Amazon’s bestsellers last week.

Digging through 300 years of economic data, tax records, 19th century novels and modern television programmes, Piketty challenges the assumption that free markets automatically deliver widespread prosperity.

Instead, he writes, the rich will get richer, and everyone else will find it nearly impossible to catch up.

Investments in stocks, bonds, land and buildings – the “capital” in his title – almost always grow faster than people’s wages. By its nature, capitalism fuels inequality and can destabilise democracies, Piketty argues.