Via The New Yorker: Piketty in South Africa. Excerpt from a long, informative, and discouraging report:
The French economist Thomas Piketty’s visit to South Africa began with some bad luck. Because he did not have two blank pages in his passport, he was not allowed to board his flight from Paris, and he missed the lecture he was due to give at the University of Cape Town.
As the audience waited for a video connection to Piketty in Paris to start up, a small but vocal group of student protesters from the Rhodes Must Fall movement—which recently succeeded in its efforts to have a statue of Cecil John Rhodes, the British colonial governor, removed from the campus—briefly took over the stage.
The video connection still wasn’t working, so Murray Leibbrandt, an economics professor at U.C.T. and a leading researcher on inequality in South Africa, gave an ad-hoc presentation of Piketty’s slides.
“I wasn’t sure what the punchline was, but it had to be about South Africa, so I thought I would tease out the main points,” he later said. The protesting students left without listening to Piketty’s evidence about inequality, but about half the audience remained. “It was a remarkably South African thing, this type of dialogue,” Leibbrandt said. “We couldn’t have contrived it if we tried.”
Piketty arrived in Johannesburg the next day, in time to give the Nelson Mandela Foundation’s annual lecture in Soweto, the township where Mandela had lived before he was imprisoned. Some two thousand people snaked in lines around the Soweto campus of the University of Johannesburg to get into the hall where Piketty, whose book Capital in the Twenty-First Century has sold more than one-and-a-half million copies, was to speak. Local newspapers had described him as “the rock-star economist.” The Mail & Guardian, a Johannesburg weekly, took the analogy further: “It’s almost the equivalent of the Rolling Stones playing at your neighbourhood bar.”
In South Africa, Piketty, whose book chronicles the growing gap in wealth in developed countries, had come to the equivalent of the Hall of Fame. South Africa is the most unequal country in the world. The top ten per cent earn sixty to sixty-five per cent of the income; in the United States, by comparison, their share is forty-five to fifty per cent, and in Europe it is thirty to thirty-five per cent. Even in Brazil, long held to be one of the most unequal countries in the world, the top ten per cent’s share is fifty-five to sixty per cent of income, and falling, Piketty said in the Mandela lecture. “South Africa is really at the top of the class, so to speak.”
It’s no coincidence, then, that Piketty’s book begins with the story of the Marikana massacre, in which police opened fire on striking platinum workers, killing thirty-four, in a bleak mining settlement northwest of Johannesburg in 2012. The miners were demanding that their wages be doubled. “This episode reminds us, if we needed reminding, that the question of what share of output should go to wages and what share to profits—in other words, how should the income from production be divided between labor and capital?—has always been at the heart of distributional conflict,” Piketty writes.
At the U.C.T. lecture, Leibbrandt showed a graph that tracked the income of the top one per cent in South Africa, the United States, and France from 1913 to 2012. It tells an unsurprising story of the years of apartheid, but a rather bleak one of the post-apartheid period. In 1948, when the formal policy of apartheid was enacted, the top one per cent of the population received about twenty-two per cent of income (compared with about nine per cent in France, and eleven per cent in the United States).
By 1975, the share for South Africa’s top one per cent had dropped to about ten per cent, where it remained until 1991, still “at world-beatingly high levels,” Leibbrandt told me. But in the twenty years since the demise of apartheid, the top one per cent’s share of income has increased to nearly twenty per cent.
The South African shift is “extremely puzzling for all of us,” Piketty told his Soweto audience. This was partly due to international factors beyond South Africa’s control, he said. But it was also partly because “the South African revolution, so to speak, did not deliver as much as one might have expected.”