Essay for Economic

Econ 394 FI 8 November 2018

Essay 4

I think it is fair to say that Piketty does not believe that capitalism is necessarily “doomed”, or that ever-rising inequality is inevitable. There were times, like the so-called Golden Age {1945 – 1975}, when the incomes of the rich and the poor in America were converging and the living standards of “the masses” were increasing at a steady pace. We were, in effect, living the “American Dream”.

But Piketty does argue that the 1945-1975 period may have been an historical exception. And that the “forces of divergence can at any point gain the upper hand, as seems to be happening now at the beginning of the 21st century”.

If he is correct in that view, it seems two outcomes are likely during the next 20 or 30 years. Either we get (a) things like higher top income tax rates, meaningful taxation of wealth and income, more generous public pensions, “debt jubilees” and much higher minimum wages, or (b) massive bankruptcies, wars and revolutions.

Please pick either (a) or (b) or some different scenario of your own design {c} and tell us why you made that choice the “likely outcome”. Please base your essays on the information in, and your interpretations of, the three books we have read during our class this semester.

This essay is due in class on Wednesday December 12th

Please submit a hard copy, about 1100 words, double-spaced.

Thanks!