BEFORE all the money turned a little funny, economists were held in some esteem.

Their habit of telling politicians what politicians wanted to hear about the ­magical disappearance of inflation, risk and consequences won some nice gigs for the dismal scientists. In a normal world, meanwhile, the great crash of 2008 would have reduced economics to the status of voodoo, to poking hopefully at poultry entrails. Not only did economists fail to see the great catastrophe coming, many swore blind that it couldn't happen. Those who picked up big wages on Wall Street and in the City of London made a fine art out of demonstrating that nothing could possibly go wrong.

We no longer take them seriously, of course. No country suffers the hell of infantile austerity thanks to "sound economics". We have all learned how to spot a pseudo-science when we see one. No-one confuses malleable numbers with morality, or snake oil with sustenance. We know better now. We don't trust those soothsayers with their graphs and their seats in the boardroom.

Alternatively: "We still take them seriously. Whole countries suffer the hell of austerity thanks to 'sound economics'. Everyone goes on confusing graphs and dodgy numbers with morality. We know no better. We still trust dodgy soothsayers. If an economist states a case, at the behest of a government or a corporation, that's good enough for us."

In a world with consequences, economists would have been run out of town. Leave it to actual philosophers to define a pseudo-science: the proof of the great intellectual pudding of 2008 is in the gruel we have consumed since.

It wasn't true; it didn't work; it had no basis in reality. What we were told about the nature and tendencies of the globalised economy turned out to be as good as the word of the great and ­powerful Oz.

For a couple of years after the stuff hit the fan you would hear about this economist or that analyst who "saw it all coming". The claims were supposed to be proof of something. It was as if to say: "Almost all that we told you was rubbish, apart from the warnings by a few brave souls we ignored and told you to ignore. So there's no problem here. Move along."

Extraordinarily, capitalism is in no political trouble in the developed world. The crash has not caused governments to fall. Witness the likes of our own dear George Osborne: they are, beaverishly, still at it. Their simple task, in every corner of the planet, is to shift money from those with no culpability for the crash to those who made it happen. Rich gamblers need to have their bets covered. As they would put it, "or else".

The rest of us still need to know how the world works. We still ask simple, peasant questions. Questions like: "So what happened to all the money amid this global collapse?" Around $35 trillion is still out there, somewhere. Or we ask: "How come the very rich have continued to grow more rich, hand over fist, while countries - where even the rich must live - have tottered?"

When historians come prowling, they will want to know what happened. It already seems obvious that traces of a gigantic fraud, intellectual and political, will be evident. It also seems plain that one of the central "sciences" of the age was corrupted in ideology and methodology.

Why didn't we see it? What was so wrong with our politics, our journalism, and our common sense that we chose to ignore the bags marked "swag" while global capitalism went belly-up, the politicians closed ranks, and the discipline of economics was excused? The great mystery of the age, nevertheless, is that the mass of humanity continues to allow itself to be deceived.

In the advanced economies, the issue of inequality counts as the case in point. Some in the ­political class are still telling us that it doesn't truly exist, or that it doesn't matter much, or that it is no bad thing, really, in a thriving, competitive society.

Thomas Piketty has no head start in these arguments. First, he's another economist, albeit of the dissident minority. Secondly, he's French, and therefore suspect amid the Anglo-American consensus. Third, he has mined a mountain of facts, chiefly tax records, to make points about the nature of capital, inheritance and inequality. Lastly, Piketty suggests remedies - above all, the redistribution of wealth.

The last detail has caused the most outrage in conservative circles on both sides of the Atlantic. Piketty's book, ­Capital In The Twenty-First Century, is in part an attempt to show that "capital accumulation" has depressed incomes generally, and that the phenomenon of great wealth for a small minority obstructing progress for the majority is as marked now as it was a century ago. The American phrase "the 1%" explains a lot.

Things are worse in the US than in Europe because, even during the past 40 years, European countries have deployed their tax systems to address the problem. Year by year, however, the difference is fading: wages stagnate, the rich get richer. "Patrimonial capitalism", dynastic inheritance, is back. It qualifies to be described by the old cliche: parasitic.

The reaction to Piketty has been almost comical. He is talking about 80% tax rates, they shriek. This subversive would deprive billionaires of a whole 10% of their wealth. Outrageously, he suggests that taxes be imposed globally, leaving no hiding place for footloose entrepreneurs. My favourite is the claim that we don't "really know" what capital is, so we shouldn't bother our heads with critiques of capitalism.

The reaction amounts to the claim that their tax rates are inviolable and must never be increased; but yours are fair game. It is an insistence that neo-liberalism is the only possible world this side of Stalinism. The fact concealed throughout is simple: the hyper-rich have had an excellent crisis. The idea that they should pay their share and pay their way is anathema.

Piketty's book is a 685-page lump of a thing. It's a bestseller already, as these things are measured, but unlikely to give Dan Brown competition. This is not bedtime reading. Nevertheless, the book's appearance and reception are important. Those who brought us the biggest crisis capitalism has seen go on insisting that nothing fundamental can be changed. Truly?

What are we, in our democracies, if we agree to be fooled twice? Some of us remember the world before the 1% seized power. The point of redistribution was both understood and accepted. It worked. And that imperfect world was a better place than the predatory society we call normal today.