‘Nationalism is not going to solve the big challenges of the day’

The basic idea of participatory socialism is where everyone has the power to participate in the economy, says the economist

The seminal work of Thomas Piketty , Professor of Economics at the Paris-based School of Advanced Studies in the Social Sciences and at the Paris School of Economics and Co-Director at the World Inequality Lab and World Inequality Database, is particularly salient at the present moment, when the first wave of the catastrophic human toll of the ongoing COVID-19 pandemic has been followed by the second wave of its severe economic consequences, including loss of livelihoods, internal displacement and starvation among the poor in India and elsewhere. Edited transcript:

Please explain what you mean by “participatory” socialism, a concept you discuss in your latest book, Capital and Ideology.

The basic idea of participatory socialism in my view is where everyone has the power to participate in the economy. This means access to private property — I believe in private property and do not want state property or communism — which requires a more progressive tax system in order to reduce taxation on the poorest groups in society and possibly pay for an endowment that everybody will receive. We say that we believe in equal opportunity, but we live in a world where the bottom 50% of the population does not receive any inherited wealth from the upper rungs, whereas some other people receive millions or billions. The other dimension of participatory socialism is that workers should be able to participate more in the governance of their companies whether or not they have a share in the capital. I think it could and should become the norm in the future.

If you look at different societies historically, prosperity comes from equality and education and not from the pursuit of more and more inequality. That is the basic idea of participatory socialism — to use the good aspects of private property and the market forces, but to put them in the service of a much more equal and equitable development model and economic system.

You argue that deliberation over ideology can change the political balance of power and resource allocation system, and that impacts inequality. Is this more important than redistributive conflict and property rights in historically driving economic development?

Both logics are at work. You have conflict between different interests and groups, but I also want to stress the dimension of learning, deliberation, and intellectual or ideological dimensions.

Pure class conflict in itself does not determine a unique outcome in terms of institutions, policy and legal systems. Your class position, though it is important, does not fully determine your view of the world about how the property rights, tax and educational and frontier systems should be organised. What kinds of relations should you have with other countries? There is an international and transnational dimension of the inequality regime, which is very important. The pure, class-conflict view of the world does not really allow for this rich set of ideologies to play their full role.

However, if you give a bigger role for ideas and intellectual transformation, that means that democracy has a role to play, that indeed you also have a theory of elections and deliberation, and you should pay a lot of attention to how this is organised, how you form political parties, and the role of the media.

We have in recent years seen the tendency towards the ideologies of nationalism, populism, protectionism and nativism, across countries. Do you think that this direction of systemic change, said to be linked to disappointment with Bretton Woods institutions, will be exacerbated or turned back by the COVID-19 pandemic?

There is a risk that the pandemic could reinforce pre-existing trends of nationalism and a return to the frontier and identity of the nation state.

But I think this will not last forever, because in the end, nationalism is not going to solve the big challenges of the day, including global warming, inequality, public lands problems. It will require cooperation, some form of internationalism.

Even in the short run, nationalism will not necessarily win the day if something else is being promoted and proposed by political actors. The problem that starting with the Bretton Woods systems and the rise of neo-liberalism, we have organised globalism, internationalism and the international economy in a way that has been very beneficial for the highest wealth and highest human capital individuals.

But that is forgetting social and redistributive objectives. We have to rebuild internationalism in a different manner.

For instance, you cannot trade or have free capital flow between any two countries, if at the same time you do not have some common regulation and taxation of the most powerful economic actors, or if you do not have some system or targets for carbon emissions, and taxing those who do not respect these targets, or if you do not have social rules about minimum wages.

If we do not move in that direction, then nationalism will win the day because it at least proposes to break with the current system of globalisation with no sort of regulation of any kind, and which people are not convinced by any more.

...prosperity comes from equality and education and not from the pursuit of more and more inequality

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