Desigualdade renda, concentracao de riqueza: Piketty novamente contestado pelos seus dados errados (Wall Street Journal)

Morning Editorial Report

Piketty's Numbers Still Don't Add Up

More errors exposed in a popular book on income inequality, plus ObamaCare costs unions and carbon regulation will cost everyone.

James Freeman

The Wall Street Journal, May 27, 2014

 

MORE FLAWS EXPOSED IN LEFTIST BEST-SELLER
In a recent Journal op-ed, Harvard economist Martin Feldstein ticked off a series of errors in Thomas Piketty's "Capital in the Twenty-First Century." Now the UK's Financial Times also sees "data problems and errors" in the popular screed that has been lauded by economists including Paul Krugman.

After reviewing Mr. Piketty's work, the Financial Times finds "unexplained entries in his spreadsheets, cherry picking data sources and transcription errors. Taken together, these problems seem to undermine his conclusion that wealth inequality is rising in the US and in Europe."

Two weeks ago, Mr. Feldstein noted a series of fundamental errors, including those related to Mr. Piketty's practice of comparing the incomes of top earners with total national income. "National income excludes the value of government transfer payments including Social Security, health benefits and food stamps that are a large and growing part of the personal incomes of low- and middle-income households."

Mr. Feldstein wrote that "Mr. Piketty's theoretical analysis starts with the correct fact that the rate of return on capital...exceeds the rate of growth of the economy. He then jumps to the false conclusion that this difference between the rate of return and the rate of growth leads through time to an ever-increasing inequality of wealth and of income unless the process is interrupted by depression, war or confiscatory taxation."

"[Mr. Piketty's] conclusion about ever-increasing inequality could be correct if people lived forever. But they don't," observed the Harvard professor. "The result is that total wealth grows over time roughly in proportion to total income. Since 1960, the Federal Reserve flow-of-funds data report that real total household wealth in the U.S. has grown at 3.2% a year while the real total personal income calculated by the Department of Commerce grew at 3.3%."