Rising inequality is eroding Australia's "egalitarian ideal", says French economist Thomas Piketty. "The risk is that people don't trust the tax system any more. People at the bottom or the middle feel that people at the top are paying less than they should. I think this is a serious threat for our general compact." Professor Piketty said populist nationalist movements Brexit and the Donald Trump campaign were symptoms of a failure by governments to curb rising inequality. "I think all this nationalism – and sometimes racism – that we see in a number of European countries and in North America is to some extent the product of rising inequality. If we don't find a peaceful solution and a reasonable collective solution, in terms of progressive taxation and access to education to reduce inequality, then it will always be tempting for some politicians to blame others [like foreigners]." With Australian property values now "historically very high" compared to incomes, Professor Piketty said it was time to reform the tax system to cut income taxes on lower and middle-income earners and boost taxes on the wealthy.

Capital In the Twenty First Century by Thomas Piketty. "For the young generation today, it's much more difficult if you want to access property and become an owner ... if you don't have family wealth, and if you just have your labour income, as compared to the generation of your parents or your grandparents, this is much more difficult. "Certainly there are tax loopholes in Australia, and in other countries, which sometime allow people who are multiple owners to make deductions so that, in the end, they pay less than people who are just trying to acquire their first property. "Definitely I think Australia, like other countries, should pay a lot of attention to all these loopholes and tax deductions which tend to favour the more wealthy groups. "I'm not advocating a revolution, or changing the tax system in its entirely, but this is the general direction I think the system should be redirected and rebalanced in favour of the young generation, who mostly have labour income."

Professor Piketty's 2014 book Capital in the Twenty-First Century has sold more than 2.5 million copies worldwide. The central thesis of the book, which is 700 pages and which Piketty admits is "a bit too long, and I'm sorry about that", is that rising inequality is a natural tendency of the capitalist system. Over large time periods, the rate of return to owning capital has exceeded the rate of economic growth, deepening inequality between the owners of capital, and the rest. The fall in inequality seen in the US, Britain and Australia, in the post-World War II period was something of an anomaly – explained by rapid economic growth and highly progressive taxation systems. But, beginning with the economic shocks of the 1970s, growth has since slowed, taxes have been cut, the returns to skills have increased and wealthy financial elite have exploited the tax system to accumulate large fortunes. The share of income going to the top 1 per cent of Australians has nearly doubled since the early 1980s, rising to 8.3 per cent – the highest since the 1950s – according to the World Wealth and Income Database, which is maintained by a group of economists, including Piketty.

"But there has been a trend towards rising inequality in recent decades, so that the latest figures that we have for the most recent years show levels of inequality – top income and top wealth shares – which are the highest in the history of Australia since the 1950s basically. "So, there has been rising inequality in Australia, from the data we have, starting from a level which is lower than in some other countries – which shows that there is an attachment to an ideal of egalitarianism that is strong in Australia. But this ideal, in recent years, has been eroded somewhat." ​Professor Piketty will speak on the topic: "Is rising inequality inevitable?" at the Sydney Opera House on October 23, before travelling to Melbourne to speak at a Monash Business School event at Melbourne Town Hall on October 28.

Perhaps surprisingly, given his book's central thesis, his answer is: "No". "I am a very optimistic person and I am always sad when I see some people who have a very negative reading of my book, because this is not at all how I view the future. I think knowledge and democratic debate can make a difference and lead us to a different decision and a better world."