Skipped one day. Today Thiruvonam, but managed to finish the chapter on Hypercapitalism. Next is the fourth and the final part of the book. Great discussion on the illusion of meritocracy as an instrument to perpetuate inequality. How higher education has been used effectively to maintain the stratification.
Tomorrow Sept 1. Hoping to finish the book by mid September.
40 days up. Nearing the final part 4.
Today's reading was on hypercapitalism. The surprising twist of lack of data in this era of Big Data when it comes to finding out people's real wealth. The inequality is amplified by the flow of capital across borders. Tax havens and their importance. Great comparisons between nations. Some of the methods that are being used to estimate wealth under these opaque circumstances.
Slow day as far as the book progress is concerned. Got carried away reading the paper on Socotra.
Read the sections on carbon footprint inequality and intellectual property hijacking that could aggravate inequality in the coming years.
Tomorrow will be day 40 of the reading. Hoping to make good progress.
The chapter of hypercapitalism begins with an analysis of the Middle East. From 1980s, the inequality has spiked. More than Gini index or GDP, the inequality index between share of national income paints a clearer picture of the state of the society. The number of times the top decile earns more than the bottom 50 is staggeringly high in many countries including India.
Hoping to work through the book faster during this Onam break.
Finished the chapter on Postcommunist economies with a good discussion on the transformation of Eastern European bloc. Their slow acceptance of shock therapy post soviet collapse which helped them avoid the Russian oligarch trajectory. Poland, Hungary and Slovakia compared to Sweden, Germany etc. The level of inequality. The capitalist exploitation by the West thats used by the social nativist political parties. European union issues faced by labor movement and attitude towards immigration.
Next chapter is on Hypercapitalism.
Chugging along nicely with China's case after Russia. The growing inequality and inegalitarianism. How there is no inheritance tax so now ultra rich in Taiwan prefer Chinese administration. Xi and Global Times continue the decry the failure of Western Democratic model. China glorifies market with zero tolerance for corruption. They point to how Chinese administration respects African leadership in contrast to the West's attitude.
Moved from Russia to the mixed economy case of China. Interesting info about chinese rural vs urban residency cards. How chinese govt owns more than half of firms but almost nothing in housing. USA, UK, Italy are now in negative public income as in govt debt exceeds total value of govt assets. But Piketty points out how the estimation of "value" is faulty since we talk only in the narrow economic sense comparing goods and services which can be ascribed a price. Life in a society is much more than that. 1980s Reganomics is enlightening about the way Modi govt is moving in India from public to private transfer of assets.
Slow Day due to other developments in life :-)
Decentralisation must have been tried in USSR. Probably EMS understood that in Kerala in the 1950s. Almost equivalent amount of national income of Russia now sits in offshore accounts. So illegitimate money has equal significance. Comparable to 4% of USA and 60% of Middle Eastern oil economies.
More Russia. Today the pages described the transition into kleptocracy and oligarchy. How the state owned production systems were siphoned off to a few hands under Yeltsin and Putin. Gorbachev's views on drinking. How the life expectancy had reduced and infant mortality remained the same indicating collapse of the health care system. Now Russia leads the world in maintaining overseas accounts and having billionaires and multimillionaires. And no reliable data is available. System stays opaque.
600 page landmark crossed today.
Started the chapter on Communist and post communist societies. Russia, China and Eastern Europe covered in this chapter. Brief history of USSR. How Lenin was ok with mix market economy? How the massive inequality of Tsarist society with 40% serfdom led to the revolution...Stalin's totalitarian approach...5% of adult male population imprisoned. Russia grows between the wars but then stagnates. 1970 edition of Samuelson's Economics textbook expected USST to overtake USA by 1990 in production, but then total collapse. Inequality grew in terms of privileges though private property wasn't there. And now Russia is a symbol of hypercapitalism with maximum oligarchs.
Took a break yesterday.
Finished chapter 11 on socio-democratic countries. From education, the discussion moved onto various experiments with progressive taxation. Piketty points out that no country has arrived on a good combination of inheritance, wealth and property tax which can be sustained. After their imminent banking collapse, even Sweden brought down their wealth tax rates. As we enter into the need for universal tertiary education around the world, the money can only come from progressive taxation. But international free flow of capital and the heavy influence of wealth in politics will make it extremely difficult to implement. Before getting into Part 4 of the book about possible paths ahead, the next chapter analyses communist societies and their impact.
A very good day of reading. Crossed the half way point in the book. Excellent writing on educational policies fostering inequality. How USA led the world in achieving universal primary and secondary education but faltered when it comes to higher education. Can India do something different in higher education? The Covid crisis has definitely affected higher education severely and should either render the unequal access immaterial with companies like Google providing cheaper, faster certifications online.
Happy Chingam 1, 1196: the Kerala New Year.
Not a day of much reading as it involved traveling. Nevertheless, more progress in understanding the German model and how US-UK reject it. France seems to be reluctantly moving towards having more worker representation in corporate boards. No idea how things will shape up in the USA after Covid.
Tomorrow expecting to be a day of substantial reading progress. It will be 30 days into the reading.
The 500 page milestone reached. Almost half the book. From the Crisis of Ownership Societies moved onto the chapter on Social Democratic societies. Interesting history of Sweden and France. German model of shared ownership of corporate governance. Konrad Adeuner's policy making. As an alternative to sanctity of private property, it is either state ownership, shared ownership or temporary ownership (where tax is progressive and high). Good account of the inequality climbing in societies after 1980s. India leads in the increasing inequality between top 10 and bottom 50% of the population. Sweden has the highest percentage of national income coming from taxes now. The importance of keeping health, education etc in the socially embedded fiscal and ownership policies.
Need to reflect on how computation as a new human cognitive leap has triggered a new inequality. Here the division is perhaps deeper that those created by Industrial revolution. This is close to perhaps the invention of writing, then the printing press and even comparable to the Hunter Gatherer to Agriculture leap. For those who can use this new tool are going to move into an entirely different class as opposed to those who cannot.
One more slow day. Will pick up pace tomorrow. Still read a few pages about the severe economic penalties placed on Germany that led to the rise of Hitler. Interesting to see Hilter's writing from the prison against France and stressing on the need to be military super power.
Should reach the 500 page mark tomorrow.
Another slow day. More reasoning from Piketty about how the wars and other social factors worked in different countries to bring about the Transformation from ownership to social democratic. And how economic model should be embedded in the society. Surprising how everything went back to hyper inequality after 1980s. Each country had unique trajectory. Hayek briefly mentioned and would come into focus later on the discussion of neoliberalism. Need to check out Polanyi's book The Great Transformation written in the mid 1940s.
Less progress today as I am focused on completing the reading of Ezhuthachan's Adhyatma Ramayanam in the next three days. After that will be able to do more of Piketty daily. Nevertheless read more sections about the 20th century reduction in equality coming progressive taxation.
Finishing this book which started off as a 100 day project, now looks doable in 50 days.
Chugging along nicely. Discussion on change in inequality in terms of wealth and income in the 20th century. The impact of two wars. Drastic drop in rental income. Public debt. Inflation. Plenty of graphs.
On Day 23 entered the Part 3 of the book onto the 10th chapter.
The last segment of 9th chapter was about Iran, the clerical republic. Interesting info of the rise of Sunni and Shia sects from the original military and priestly division. The history neatly sets once that context is laid. Strange trajectory and continuation including Shah, Turkey and Oil Barons.
Next chapter is the great transformation of the 20th century starting with June 28, 1914 and ending on Sept 11, 2001.
Reached the 400 page milestone.
Good discussion on Japan and China.
Interesting how Japanese students saw the Indian kids diving for pennies to the amusement of British. This motivated them to study hard and make Japan incredibly quality conscious in science and tech. Shogun, Meiji etc. And how Japan likes to take claim as liberator of Asian colonies while the colonies don't think so. The racial aspects of treaties before world war 2...shipping tonnage.
China's Confucian administrative service and its survival for close to 2000 years. Opium wars. Weak empire. Rebellions. Boxer War. Jesus complex of the rebel leader. Americans getting busy with their civil war which helped European powers support the empire instead of rebels. How the administrative test was corrupted by the landowners and wealthy who could pay for the services. Sun Yat-Sen and communism. Communist parties claim of being a continuation of Confucian ideals!
Tomorrow Iran.
Skipped one day in between.
Finished the first of the many chapters on India today.
Good review of how the affirmative action through quotas and reservation managed to make a difference after independence. Especially striking the comparison of income levels of SC ST to be 80% of the rest of the population compared to the 60% level of African Americans in USA and 30% only for Blacks in South Africa. Sections on electoral politics based on castes and the idea of reserving seats for women.
Started the next chapter which will discuss China, Japan and Iran. Interesting comparison of the coloniser economies in terms of tonnes of silver to standardise the size of their economy. How England and France charge ahead of others in 19th century. Also fiscal tightness of taxing as a percentage of national income rising to 6-8% from 2-3%. This then jumps to 20-30% only after 1980s.
