Piketty and inequality
Sir, – Chris Johns (July 29th) presents a profound misreading of Thomas Piketty’s analysis in Capital in the 21st Century.
The core argument of the book is that wealth has become more and more concentrated in fewer hands due to the effect of high returns to capital income and low economic growth. The ESRI report on income distribution actually confirms a core finding of Piketty’s analysis, namely that the middle class carries the heaviest burden in funding the social state.
The increasing concentration of wealth suggests that inheritance and rent rather than hard work or merit will determine the politics of distribution in the 21st century. The core policy recommendation is to tax global financial capital to ensure the stability of the democratic state. In Ireland, corporate tax rates have remained unchanged while public services have been decimated. Yet the Government opposes a financial transaction tax and actively promotes tax competition in Europe. – Yours, etc,
DR AIDAN REGAN,