Excellent critique by Richard Epstein, Professor Emeritus of Law and Senior Lecturer at the University of Chicago Law School, of the thesis and policy recommendations of French economist Thomas Piketty from his recent book, Capital in the Twenty-First Century.
With voluntary bargaining, one can assume that both parties will benefit from the transaction: they are unlikely to enter into a bargain where there is not at least some benefit for themselves. What Epstein does not address is crony capitalism, where special interest groups (either corporations or unions) may influence government to act (or fail to act) in a way that benefits the group at the expense of the whole. Wal-mart profits, for example, may rise as a result of China’s suppression of the yuan/dollar exchange rate, but the same exchange rate may cause the loss of manufacturing jobs and exports, and depress wages.