New French Book on Growing Inequality

It sounds like Thomas Piketty, who is French, has written an important book about the trends of distribution of wealth and income in 20th-21st century economies, primarily in developed economies.  The general story is that the “natural” rate of accumulation of capital is on the order of five-six percent per annum, while the natural rate of overall growth in GDP in advanced economies is 1-1.5 percent annually.   Thus, without major changes in political institutions, inherited private wealth will dominate the societies in advanced economies by virtue of the tendencies inherent in them.

I was alerted to Piketty by this column in the NYT:

http://www.nytimes.com/2014/01/29/opinion/capitalism-vs-democracy.html?ref=thomasbedsall&_r=0

Questions that will have to await reading of the book include the following.  (1) How independent is the rate at which private capital accumulates of political institutions?  That is, the implication is that capital will accumulate, over the long run, at five-six percent annually, when redistributive mechanisms are below some threshold.  What is the threshold?  (2) How independent are the rates of capital and GDP growth from the rate of population growth?  This second question is almost certainly not addressed in the book, but, in general, I think that macroeconomics should attempt to incorporate demographic analysis.  More generally, I speculate that those who are interested in reducing inequality of wealth and income should also be interested in reducing the human population, both within advanced economies of larger nation states and globally.

An introduction to the book by Piketty himself on French television can be seen here:

http://www.youtube.com/watch?v=27oDSki8yGw

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Scorsese’s “The Wolf of Wall Street”

I hope that the reader will allow me to offer a dissenting view of Martin Scorsese’s “The Wolf of Wall Street.”  It’s too long, much of it is boring, and considered even as satire or black comedy it is unconvincing.  I did laugh heartily at a few points in the movie, in particular at the physical comedy of the two main characters overdosing on quaaludes.  I have done a short sampling of critical response and am somewhat baffled by the highly positive reactions engendered in the main by this film (although I am aware that not everyone liked it).

My problem with the movie, apart from its inordinate length, is that it falls into the same trap as many of Scorsese’s movies:  it has no moral compass and ends by glorifying empty and loathsome people, simply by devoting so much time and attention to them.  Just to pick on a comparatively minor point, but one which is telling, at no point in the movie does a salesman of a financial security fail to make a sale.  At the outset of the movie, Jordan Belfort, the anti-hero played by Leonardo DiCaprio, is hired to make cold calls at L.F Rothschild, he is looking for wealthy clients who will be new to the firm, and he is told by his immediate superior to get on the phone and to stay there all day.  But the tedium of this job, and the psychological toll it would take on the vast majority of people, is nowhere depicted, not at the beginning of the movie, not in its middle, and certainly not in its denouement.  The movie gives no sense, none whatever, of the reality of cold-calling.   So one of the few things that might actually seem to the informed and sensitive viewer to offer something redeeming about Jordan Belfort, that he is good at a very difficult job, is never shown.  Belfort never has to overcome obstacles.  Incredibly, on the one occasion, early on in the film, when Belfort is shown making an actual sale of a penny stock, the fish at the other end of the telephone line makes no objection, offers no resistance.  But nearly every sales course ever given is about overcoming objections and resistance from the “client.”  Speaking generally, a film so ungrounded in reality cannot be saying anything from which a sentient viewer can learn, or by which she could even be moved.

Instead, the viewer is led to believe that Belfort’s sales rhetoric is so mesmerizing that hordes of salesmen follow his prescriptions with unquestioning zeal and hero-worship.  This has nothing to do with the real world, where salesmen of financial assets are likely to be cynical, back-biting, treacherous, and envious of their bosses or of more successful salesmen.  People around the world are now engaged in telemarketing, they interrupt me at the lunch or dinner hour at least once a week in rural France.  In Scorsese’s topsy-turvy world, however, every cold-call results in a sale and leads to financial success for the salesman.  Scorsese trivializes everything he touches.  Most of the crimes he depicts are victimless, in the sense that the harm done to the victim is not depicted.

The role given to Kyle Chandler, as the FBI agent pursuing Belfort, after Belfort has become a successful white-collar criminal, is a comic-book caricature of the G-Man who refuses to be bribed.  Yes, Scorsese does not flee from telling us, in a brief concluding scene in which Chandler’s character is shown riding home on the New York subway (the only occasion in the film when this character is given the slightest hint of depth), that it might be unreasonable to expect people who are not paid very much to resist the blandishments of wealth.  There are other moments of modest ethical significance.  It is gratifying to see Swiss bankers engaged in money laundering depicted as the sleazy crooks they are, but the point is made so offhandedly and light-heartedly that one barely notices it.

Nothing about this movie contains enough psychological or socio-economic weight to make it believable, even as metaphor.  It’s just a highly self-indulgent romp, and it is painful to see so much time, money, and talent wasted in this excess.  If I want to watch a movie about salesmen, I would rather watch “Glengarry Glen Ross” ten times than be forced to endure having to watch this bloated entertainment more than once.  Once was more than enough.

I suppose that the performances of the principal actors are good.  I certainly will not say that they are bad.  On the other hand, this sort of broad black comedy does not strike me as being particularly demanding of actors.  There is no subtlety to be had anywhere here.  This is an excessive portrayal of materialistic and sexual excess, but it is simply not believable and therefore not really engaging.  I was bored.  Too many of Scorsese’s movies (“Goodfellas,” “Casino,” and the hugely overrated “Raging Bull”) are exactly like this.  This is not my idea of entertainment, and it is certainly not my idea of art.

I cannot say whether the memoir or novelistic memoir which formed the basis for the film script could have been made into a much better movie than the present one.  Certainly, it could have been made into a shorter movie.  Why does a movie that has so little to say have to be so long?  At the risk of sounding like a moralizing prig, Scorsese is part of the problem, not part of the solution.