The nice thing about Piketty is all his data is right out in the open, on the web, and not behind some kind of crazy academic journal paywall type of thing. You don't have to take him or his detractors at face value for anything.
Not that Piketty really has a theory - all he has is a big data dump. If you disagree, can you concisely state what his theory actually is?
The grammer-nazi type questions only matter insofar as they undermine the materiality of the analysis. What's important about picketty--notwithstanding the hype--is he's looking at balance-sheets not P&Ls. That is to say, he's barking up a different tree (than income obsessed economists). Probably the right tree--nobody would "analyse" the performance of a company without a blance sheet--for the task at hand.
But most macro-econ guys cannot link up the GDP equivalent to a balance sheet (they lack the data), and thus totally ignore everything a blance sheet would tell us about ROIC (eg: linkages of C & I). That is a huge "material mistake". And one that is not done or undone by general quality of the communication (eg: a typo in the maths, or a debate over "accounting adjustments")--provided those are not so massive as to be materially misleading.
Is it? I assumed you have to buy the book, which is the oldest incarnation of a content paywall.
If one wants the reader to be concerned about power inequality, then he should focus his efforts upon this dynamic. Whether or not wealth inequality is rising, falling, or remaining the same is essentially irrelevant to this issue.
And, in fact, it's quite obvious that the wealthy do not wield much power: Are we really to believe that the wealthy in some parts of the US prefer a 45% corporate tax rate, a 50%+ income tax rate, the inability to leave the country with their assets intact, a 50% death tax, and FATCA?
It is to laugh.
Well, there is that paper from Gilens and Page that argues otherwise (http://www.princeton.edu/~mgilens/Gilens%20homepage%20materi...):
Multivariate analysis indicates that economic elites and organized
groups representing business interests have substantial independent
impacts on U.S. government policy, while average citizens and
mass-based interest groups have little or no independent influence.I provided concrete examples of issues which impact all wealthy people in the US. If they could get behind any one policy with some degree of unanimity, surely it'd be the insanely progressive and aggressive nature of US taxation.
But no, there's a study on some other issue which shows that they're so well organized as to have a huge impact on US policy. Right.
It's obvious that, for a variety of reasons, at least some wealthy clearly prefer a corporate tax with a high headline rate but filled with complexity, deductions and loopholes rather than something lower, simpler and broader.
And, of course, the 50% income tax rate you cite isn't a tax on income from wealth - it's a tax on the income from labor. Perhaps you need to have a chat with Warren Buffett about his secretary.
As for the estate tax, in recent history the rate has been generally decreasing and the exemptions increasing (and most of the "increases" have been reductions of larger scheduled increases). There are also plenty of estates that don't want a full repeal - they gain more from the step-up basis than they lose to taxation above the exemption.
Finally, I think you radically overestimate the interest the truly wealthy have in leaving the US. US citizenship is still quite valuable and as long as they hold US assets (likely because of the breadth and depth of US investment options) they'll be dealing with some form of US taxes anyway.
But they are just that, myths.
1) Passive income (wealth income) is taxed as regular income. There is actually an extra 3.8% federal tax on passive income. You were probably thinking of capital gains in your reference, but cap gains aren't income. It's investment.
2) The low effective rates frequently cited for corporate income are well known to be false. For a primer: http://tax.org/TAXCOM/TAXBLOG.NSF/PERMALINK/MSUN-99DKXS?OPEN...
3) If the wealthy could live in Switzerland for a few months every year and pay 20% on their international investments, like every other wealthy person in the world, I think that they would quite like that option!