84 | MAY 23 • 2024
J
N
T
he most surprising
bestselling book in
2014 was French
economist Thomas
Piketty’s Capital in the
Twenty-First Century — a
dense 700-page-long treatise
on economic
theory backed
by massive
statistical
research — not
the usual stuff
of runaway
literary
successes.
Much of its appeal was
the way it documented
the phenomenon that
is reshaping societies
throughout the world: In
the current global economy,
inequalities are growing
apace. In the United States
between 1979 and 2013, the
top 1% saw their incomes
grow by more than 240%
while the lowest fifth
experienced a rise of only
10%. More striking still is
the difference in capital
income from assets such as
housing, stocks and bonds,
where the top 1% have seen
a growth of 300%, and the
bottom fifth have suffered a
fall of 60%. In global terms,
the combined wealth of the
richest 85 individuals is equal
to the total of the poorest 3.5
billion — half the population
of the world.
Piketty’s contribution
was to show why this has
happened. The market
economy, he argues, tends to
make us more and less equal
at the same time: more equal
because it spreads education,
knowledge and skills more
widely than in the past,
but less equal because over
time, especially in mature
economies, the rate of return
on capital tends to outpace
the rate of growth of income
and output. Those who own
capital assets grow richer
faster than those who rely
entirely on income from
their labor.
The increase in inequality
is, he says, “potentially
threatening to democratic
societies and to the values of
social justice on which they
are based.”
This is the latest chapter
in a very old story indeed.
Isaiah Berlin made the
point that not all values
can co-exist — in this case,
freedom and equality. You
can have one or the other but
not both: the more economic
freedom, the less equality;
the more equality, the less
freedom.
That was the key conflict
of the Cold War era between
capitalism and communism.
Communism lost the battle.
In the 1980s, under Ronald
Reagan in America (Margaret
Thatcher in Britain), markets
were liberalized and, by the
end of the decade, the Soviet
Union had collapsed. But
unfettered economic freedom
produces its own discontents,
and Piketty’s book is one of
several warning signs.
COMMITMENT TO
BOTH FREEDOM
AND EQUALITY
All of this makes the social
legislation of parshat Behar a
text for our time because
the Torah is profoundly
concerned, not just with
economics, but with the
more fundamental moral and
human issues. What kind of
society do we seek? What
social order best does justice
to human dignity and the
delicate bonds linking us to
one another and to God?
What makes Judaism
distinctive is its commitment
to both freedom and equality,
while at the same time
recognizing the tension
between them. The opening
chapters of Genesis describe
the consequences of God’s
gift to humans of individual
freedom. But since we are
social animals, we need also
collective freedom. Hence
the significance of the
opening chapters of Shemot,
with their characterization
The
Economics
of Liberty
Rabbi Lord
Jonathan
Sacks
SPIRIT
A WORD OF TORAH