Tom does a good job of pulling out the news you can use.
The neat thing about this episode is even I learned something: At the end Tom asks Phil how he got interested in this. Phil answers that from his own work, he happens to know the 19th century U.S. tax data pretty well, and he realized that Piketty’s chart in his book wasn’t right. So he started poking around and learned that Piketty just made up some numbers for the early US history, rather than going and finding the available source data.
I have a similar story. Those of you who were reading this blog back in April may remember that I was minding my own business, reading Piketty’s book, expecting him to be one of the world’s leading scholars on economic history, when I saw him totally botch what happened with income tax rates in the 1920s and 1930s (which I know well since I wrote a book on the Great Depression). That’s when I went from merely thinking he was bad theoretically, to thinking he was either really sloppy or really slippery.
I don’t know if I have sufficiently stressed this point. I wanted Piketty’s historical data to be airtight, because I think he’s totally wrong on the capital & interest theory stuff, and that’s my area of expertise. After all, the book is Capital in the 21st Century. I was excited that Piketty had made capital theory relevant again.
Well shoot, now we can’t talk about capital theory, because Piketty can’t even get his minimum wage dates right.