RationalPolitics

Friday, October 16, 2026

Thomas Piketty and Gabriel Zucman

My dear American friends, today I'm going to take apart the two most successful salesmen of economic snake oil of our time: Thomas Piketty and Gabriel Zucman.

If you read my last post, you know where this comes from. Gramsci told his heirs not to storm the palace but to capture the institutions: schools, universities, media, culture. I showed you how France became the laboratory. Today I want to show you the field where that strategy worked best of all. Economics.

Here's why. In physics, if your theory is wrong, the bridge falls down. In engineering, the rocket explodes. Reality grades your work. In the social sciences, reality grades slowly, and nobody loses their job when the prediction fails. You pick your data, you pick your assumptions, you build a model, and the conclusion you wanted at the start comes out at the end with a lot of equations attached. That's the perfect terrain for a war of position. You don't need to be right. You need to be cited.

Meet the two generals.

Thomas Piketty wrote Capital in the Twenty-First Century. It sold millions of copies and became the most celebrated economics book of the decade. Gabriel Zucman, his former student, wrote The Triumph of Injustice with Emmanuel Saez and helped design the wealth taxes that Elizabeth Warren and Bernie Sanders campaigned on. This is not a French problem. Their ideas are already inside your Democratic Party.

Now let's go through their theses one by one.

Thesis one: "r > g." Piketty's famous formula says the return on capital grows faster than the economy, so wealth inevitably concentrates in the hands of a few dynasties, and capitalism slides back to the aristocracy of the 19th century.

Look at the list of the richest Americans today. Elon Musk. Jeff Bezos. Jensen Huang. Mark Zuckerberg. Larry Page. First-generation builders. Not heirs. Most of the names on the first Forbes 400 list in 1982 have since fallen off it. Fortunes don't compound forever. They get split between children, spent, mismanaged, and overtaken by people who build something new. And when an MIT graduate student, Matthew Rognlie, looked closely at Piketty's own numbers, he found that the rise in capital's share of income came almost entirely from housing. Not factories. Not shareholders. Real estate, which is a story about building restrictions, not about capitalism. The law of history turned out to be a law of zoning.

Thesis two: "Inequality in America has exploded." Piketty, Saez and Zucman built the charts every journalist uses. Top 1% capturing everything, the middle class crushed.

Then two economists at the US Treasury and the Joint Committee on Taxation, Gerald Auten and David Splinter, redid the work. They counted what the famous charts left out or treated differently: taxes paid, government transfers, retirement income, changes in how people file. Their result: after taxes and transfers, the top 1%'s share of income has barely moved since the 1960s. Same country, same tax data, a completely different story. The difference isn't reality. It's the assumptions. And Piketty's data was already in trouble in 2014, when the Financial Times published an investigation pointing out errors and unexplained adjustments in his spreadsheets.

Thesis three: "Billionaires pay a lower tax rate than the working class." This was the headline of Saez and Zucman's book, and it went viral. The 400 richest Americans supposedly paid less than the bottom half.

To get there, they made choices that critics across the spectrum, including Larry Summers, Obama's own former Treasury Secretary, challenged: how corporate taxes are assigned, how refundable credits that put money into lower-income households' pockets are counted. Meanwhile, the IRS's own numbers say the top 1% of earners pay more than 40% of all federal income taxes. A viral claim is not a fact. It's a campaign slogan with footnotes.

Thesis four: "A small wealth tax on the ultra-rich will fund everything." In France, Zucman's proposal became the left's flagship measure: a 2% minimum tax every year on fortunes over €100 million.

Here's what they never explain. The fortunes of builders are not piles of cash. They are shares in the companies they built. Imagine a founder whose startup is valued at a billion euros but doesn't make a profit yet. To pay a 2% tax on paper wealth, every year, he has to sell pieces of his company. Year after year, he loses control, and the buyers are usually foreign funds. Congratulations, you just exported your best companies.

And we know what happens next, because it already happened. In 1990, twelve OECD countries had a wealth tax. By 2017, only four did. Nearly all of them repealed it, because it raised little and chased away capital. Norway raised its wealth tax in 2022 and dozens of its richest people moved to Switzerland. France ran the experiment for decades before abolishing most of its wealth tax in 2018. Their policy has been tested. It failed every time.

Thesis five: and here they stop pretending. In his next book, Capital and Ideology, Piketty proposes what he openly calls "participatory socialism." Taxes on the largest fortunes up to 90%. Property that is no longer permanent, but "temporary," returned to the collective at regular intervals. He's not hiding anything. The goal isn't to fix capitalism. It's to end private ownership of anything big enough to matter.

So why are they celebrated? Why do they have the prizes, the chairs, the front pages, the invitations to Davos? Zucman even won the John Bates Clark Medal in 2023, one of the most prestigious awards in economics.

That's not a refutation of what I'm telling you. That's the proof of it. That's what it looks like when Gramsci's long march reaches the economics departments. The institutions give each other medals, the media quote the medals, and the politicians quote the media. Nobody ever checks whether the predictions came true.

So stop calling them neutral economists. They are activists with PhDs. Their work starts from a conclusion, that private wealth is illegitimate, and builds the data to justify it.

And understand where that conclusion leads. I'm not saying Piketty or Zucman want camps. I'm saying every regime that tried to abolish large private property ended in poverty, and the worst of them ended in prisons and mass graves. The intellectuals who cheered Lenin didn't want gulags either. Many of them ended up in one. Good intentions have never been a firewall.

Next time someone quotes Piketty or Zucman at you, don't get angry. Ask questions. Who are the richest people today, heirs or builders? Why did almost every country that tried a wealth tax repeal it? Why do two teams using the same tax data reach opposite conclusions? What does Piketty mean by temporary property?

You don't need to win the argument. You just need to make them check.

I come from your future. We gave these men our universities, our newspapers and our budget debates. Don't give them yours.

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Brivael Le Pogam

@brivael

Oct 15

My dear American friends, in my last two posts I showed you where France stands and how our economy got there. Today I want to go deeper, because the economics were only the symptom.

Here is my message to every American: you have been infected by a virus that 

Socialism: world of bits vs world of atoms

Key point: "The enemy is not capitalism. The enemy is a state captured by insiders, blocking the builders who would solve your problems."

Brivael Le Pogam

@brivael

My dear American friends, in my last post I showed you a number that should terrify you: 70% of Millennials say they're pro-socialist. Today I want to show you why. Not with emotion. With pure logic. Step by step, A plus B, until the conclusion is impossible to escape.

Adults, this one is for you. Read it, then explain it to the young people in your life.

Start with Peter Thiel. Years ago he summed up our era in one line: we wanted flying cars, instead we got 140 characters. His thesis is that since the early 1970s, the world of bits has kept racing forward while the world of atoms has stalled. Computers, phones, software, the internet: incredible progress. Housing, energy, transportation, medicine, education: stuck. We build almost nothing physical faster or cheaper than our grandparents did.

Why would progress stop in some places and not others? Same country, same people, same capitalism.

The only thing that differs is how much the state is involved.

Here is the proof.

Step one: look at prices. Since 2000, in America, the price of TVs has fallen by more than 90%. Software, phones, toys, clothing: cheaper and better every year. Over the same period, college tuition, hospital services, childcare and housing have more than doubled.

Step two: look at which is which. The goods getting cheaper are the ones where companies compete freely and the state mostly stays out. The goods exploding in price are the ones where the state regulates the most, subsidizes the most, or controls who is allowed to sell.

Step three: look at what young people complain about. They don't complain about TVs. They complain about rent, student debt and healthcare. Exactly the three sectors the state controls the most.

That's not a coincidence. That's a pattern. Let's go one by one.

Housing. In many American cities, most residential land is zoned for single-family homes only. Building an apartment building can take years of permits, hearings, environmental reviews and lawsuits from neighbors. When you make it nearly illegal to build, supply can't keep up, and prices go up. The young don't have a capitalism problem. They have a permission problem.

Education. Washington hands out loans without asking whether the degree is worth it, so universities raise prices because they can. The money doesn't go to better teaching. It goes to layers of administrators that have grown faster than the faculty. And the accreditation system makes it extremely hard for a new, cheaper school to compete. The incumbents are protected. The students pay.

Healthcare. In many states, if you want to open a new hospital or even buy a new MRI machine, you need a "certificate of need," permission from a board where your future competitors often have a say. The number of residency slots that train new doctors is effectively capped by Medicare funding. Getting a new drug approved costs billions. Every rule adds a layer. Every layer adds a cost. Every cost lands on the patient.

Energy. America built dozens of nuclear reactors in the 1970s. Since then, only a handful, years late and billions over budget. Not because physics changed. Because the rulebook did.

Now step four, the most important one. Who benefits from all these layers?

Not the young.

Not the poor. 

The incumbents. 

The big hospital systems, the big universities, the big developers, the big pharma companies, the big unions. Every complex regulation is a wall that only the giants can afford to climb. So they lobby for more of it. They fund the politicians who write it. They hire the regulators when they leave office. That's not capitalism. That's cronyism. 

Capitalism is a newcomer allowed to compete. Cronyism is an incumbent paying the state to stop him.

Step five: so what do young people see? They see prices going up, a system rigged for insiders, and no way to build anything for themselves. Their anger is legitimate. Their diagnosis is wrong. They look at the result of the state's capture and call it capitalism.

Step six: and what cure are they offered? Socialism. Which means giving the state even more power over housing, education, healthcare, energy. Giving the keys of the house to the exact institution that locked them out of it.

Follow the logic to the end. If regulation creates cronyism, then total regulation creates total cronyism. If a little state control makes things expensive, total state control makes them scarce.

That's not theory. 

The Soviet Union had a ruling class with its own shops, cars and dachas while ordinary people stood in line for bread. Stalin's collectivization caused a famine that killed millions in Ukraine. Mao's Great Leap Forward caused a famine that killed tens of millions. Venezuela went from one of the richest countries in Latin America to a nation where millions fled. Every time the state got all the keys, the insiders ate and the people starved.

So here's the conclusion, and there's no escaping it:

Where entrepreneurs are free to compete, prices fall and life gets better.
Where the state controls, prices rise and insiders get rich.

Young people are suffering in the sectors the state controls. Socialism means handing the state everything. So socialism gives you more of the very thing that's hurting you.

The enemy is not capitalism. The enemy is a state captured by insiders, blocking the builders who would solve your problems.

Adults, this is your job now. Don't tell the young they're stupid. Don't tell them their anger is fake. Tell them they're right to be angry, and show them where to aim it. Ask them: what got cheaper in your lifetime, and what got more expensive? Who controls each one? Let them do the math themselves.

The real counter-revolution isn't against the young. It's with them.

Free the builders. Let people build homes, open schools, open clinics, build reactors. 

Give the next generation a stake in the system, and they'll defend it with their lives.

I come from your future. We gave the state the keys. Don't make the same mistake.

https://x.com/brivael/status/2110867077300977742?s=20

_____

Brivael Le Pogam

@brivael

My dear American friends, I've shown you where the disease came from and who sells it. Now I want you to look at this email.

January 5, 2020, 2:44 in the morning. Peter Thiel writes to Mark Zuckerberg, Nick Clegg, Sheryl Sandberg and Marc Andreessen. It became public years later, in a lawsuit between the state of Tennessee and Meta. The subject line is one word: Millennials.

Thiel starts from a number: 70% of Millennials say they are pro-socialist.

Read that again. Seven out of ten young adults in the richest, freest, most innovative country in human history say they want the system that ruined every country that tried it.

And Thiel, one of the sharpest minds in Silicon Valley, says something important. Don't just dismiss them as stupid or brainwashed. Understand why. His answer: when you're crushed by student debt and housing is unaffordable, you have no capital and no way to build any. And if you have no stake in capitalism, you turn against it.

He's right. But follow the thread one step further, because that's where it gets interesting.

Who made college unaffordable? Washington flooded universities with easy federal loans, and universities raised their prices year after year, because they could. The same universities that then taught those students, for four years, that capitalism is the problem.

Who made housing unaffordable? Zoning rules, permits, environmental reviews, endless regulation that makes it nearly illegal to build. Remember Piketty's famous rise of capital? It was mostly housing. Scarcity created by the state.

So here's the full picture. The state creates the scarcity. The universities teach that capitalism caused it. The politicians sell socialism as the cure. The arsonist is selling fire insurance.

That's why 70% is not a natural opinion. No generation wakes up one morning wanting central planning. It takes decades of teaching, a captured culture, and an economy rigged to give young people no stake in it. In a healthy country, that number would trigger a serious public investigation into what American universities have been teaching for fifty years. This is not a debate. It's the result of a long, patient operation, exactly the war of position Gramsci described from his prison cell.

Now let me tell you what history says happens when an ideology captures a generation and turns it against everything that came before.

China, 1966. Mao unleashes the Cultural Revolution and hands it to the youth. Students become Red Guards. Their mission: destroy the "Four Olds," old customs, old culture, old habits, old ideas. Temples, books, art, centuries of history, smashed.

In August 1966, at a girls' school in Beijing, students beat their vice principal, Bian Zhongyun, to death. She was one of the first. Teachers across the country were humiliated, tortured, killed by the children they had taught.

In 1970, a 16-year-old boy named Zhang Hongbing denounced his own mother for criticizing Mao. She was executed. He spent the rest of his life trying to apologize for it.

Children were taught that loyalty to the Party came before loyalty to their parents. Historians estimate the Cultural Revolution killed somewhere between hundreds of thousands and millions of people.

The Soviet Union did it first. It turned a boy named Pavlik Morozov into a national hero for denouncing his father. Generations of Soviet children were raised on his story.

Cambodia, 1975. The Khmer Rouge declare Year Zero. Teenagers with rifles empty the cities. Wearing glasses was enough to mark you as an intellectual. In four years, roughly a quarter of the population was dead.

Every time, the same pattern. Take the young. Teach them that the past is guilty. Teach them that their parents, their teachers, their history are the enemy. Then give them power.

So when you see statues pulled down, words banned, books rewritten, and parents treated as obstacles in their own children's schools, understand what you're looking at. It's not the end of the story. It's the opening act. It always starts with the young, and it always starts with good intentions.

If the West ever gets its Marxist youth revolution, it won't end in Scandinavia. It will end the way it has ended every single time it was tried for real. And we will have learned nothing.

Thiel saw the number. I'm telling you where it leads.

The answer is not to hate the young. It's to give them back a stake in the system. Let them build. Let them buy a home. Make college worth its price or skip it. Let them start companies instead of drowning in debt. A generation that owns something defends it. A generation that owns nothing will burn it down.

I come from your future. Don't let your children write the next chapter of this story.

(click to enlarge)