Thomas Piketty — Towards a Union in the Union

After the Italian elections and Trump’s commercial antics one might well feel depressed and be tempted to use Europe to play the same silly game of introverted assertion of identity – strengthening immigration laws and ramping up protectionist measures. In so doing, we would be forgetting two key points.

One: contrary to what we sometimes hear, the rise of European populism is not explained by any flood of immigrants. The truth is that the number of migrants entering the UE was much higher before the financial crisis (1.2 million per year between 2000 and 2008). The numbers then collapsed (500,000 per year between 2008 and 2016) whereas the geo-political situation would have demanded greater openness. If we had not made serious mistakes in managing the economy, provoking a further recession in 2011-2013, and an explosion in unemployment in Southern Europe, then Europe could have been– and still could be – more open, and we could have avoided the abandoning of our responsibilities and relying on the camps in Turkey to manage the refugee crisis. Those responsible for the rise in populism are those who implement these ill-timed austerity policies and not the migrants and the people who support them.

Two: the American trade sanctions, stupid as they are, are merely symbolic gestures enabling Trump to differentiate himself from the Democrats and to surf the nationalist wave at little cost. At the core of Trump’s programme are the hundreds of billions of dollars spent on the tax reform adopted in December, and which aim to considerably reduce the taxation on company profits and the income and wealth of the richest taxpayers. The threat to the world today is not a trade war but a social war, conducted by means of aggressive policies of fiscal dumping which benefit the wealthiest and the most mobile. This nurtures the sense of abandonment felt by the working classes and leads to the impoverishment of the public sector: public capital is becoming negative in all the rich countries, which means that the holders of private assets not only own all the public assets (schools, hospitals, etc.) through their holdings in financial assets, but they also have drawing rights on future tax revenues....

Le blog de Thomas Piketty — Le Monde
Towards a Union in the Union

Thomas Piketty | professor (directeur d'études) at the École des hautes études en sciences sociales, associate chair at the Paris School of Economics. and Centennial professor at the International Inequalities Institute at the London School of Economics