Capitalism is losing its luster. Most millennials in the U.S. now say they prefer socialism. Inequality is rising, as those at the top take more of economic winnings.
– Good evening.
I'm Janet Gornick, Professor
of Political Science
and Sociology here at
The CUNY Graduate Center
and I'm also director of The Stone Center
on socioeconomic inequality,
one of the hosts for this evening's event,
and it's my pleasure to
welcome you this evening.
Welcome to those of you in
the Elebash Recital Hall
and welcome to our viewers
joining via live stream.
Let me just say a few words about
the City University of New
York and The Graduate Center
for those of you who might
not be familiar with CUNY
or The Graduate Center.
CUNY, which of course
serves the city of New York
is the country's largest
urban public university
and the third largest university system
in the United States.
We have 25 campuses, about
275000 matriculated students
and nearly 7000 professors.
Among the overarching themes
to be raised this evening is inequality,
and in my view, there's no
more appropriate setting
in which to discuss
inequality than here at CUNY.
CUNY itself is a massive project aimed
at reducing socioeconomic inequality
and enabling intergenerational mobility.
When our first college, The
City College of New York,
was founded in 1847, it was
described as an experiment
whose purpose was to educate
the children of the whole people.
And over 170 years later,
our mission is intact.
CUNY, with a design unique
in the United States,
has dedicated one of its
campuses to graduate study
and that's The Graduate Center
where we are this evening,
The Graduate Center, a
small school embedded
in this large system enrolls
nearly 5000 graduate students
across an array of disciplines.
The Graduate Center is strongly committed
to CUNY's historic
mission, we provide access
to doctoral education for diverse groups
of talented students including those
who have been underrepresented
in higher education.
In the last decade, the
graduate center has set,
among its highest priorities,
expanding our capacity
in research and teaching in the field
of socioeconomic inequality
with an emphasis on empirical work,
high quality data and
quantitative methods.
One of our primary goals
is to contribute to
and to deepen the complicated national
and international conversation
about economic inequality
that has received so much
attention in recent years.
This evening's event will
address several of the economic,
political and institutional
challenges that many of us here
at The Graduate Center and throughout CUNY
have grappled with in recent years.
The Graduate Center is now home
to more than 30 research centers
and institutes including our own,
The Stone Center on
Socioeconomic Inequality.
The center's mission is to
build and disseminate knowledge
related to the causes,
nature and consequences
of multiple forms of
socioeconomic inequality.
The Stone Center has six
core faculty members,
myself, Leslie McCall who's on stage,
Miles Corak, Paul Krugman,
Salvatore Morelli and Branko Milanovic.
Tonight, The Graduate
Center and The Stone Center
are delighted to be
partnering with The Guardian
whose new series, 'Broken Capitalism',
addresses the question of why
discontent with capitalism
is rising and asks if it can be repaired.
Richard Reeves, from whom
you'll hear in just a moment,
is the guest editor for
this Guardian series.
Richard is bringing together
an extraordinary group
of scholars, politicians,
writers and activists
to reflect on this critical topic.
I encourage you to follow this series
which will run throughout the summer
and we're extremely pleased tonight
to offer this companion live event
which will examine the topic
of democracy and capitalism
asking the fundamental and
rather ambitious question,
can they co-exist?
Tonight's event is also part
of The Graduate Center's
two year initiative of
scholarship and public programs
called the Promise and Perils of Democracy
which is supported in part by a grant
from the Carnegie Corporation New York.
And now without further ado,
I'd like to introduce our moderator
for tonight, Richard Reeves.
Richard is a senior
fellow in economic studies
at the Brookings Institution
where he's also co-director
of the Center on Children and Families.
He's author of the highly praised book,
'Dream Hoarders: How the
American Upper Middle Class
'Is Leaving Everyone in the Dust,
'Why That's a Problem,
and What to Do About It.
'Richard will introduce
our distinguished panel.'
Richard, I turn the evening over to you.
– Thank you Janet for
that great introduction.
(audience applauding)
It's my great pleasure to be
moderating this panel today
and to be guest editing
The Guardian series.
It's a deliberately
provocative title of course,
the idea that capitalism
and democracy can't coexist
is a provocative one.
It's one we wouldn't
have even asked ourselves
not so very long ago and
probably the thinking behind
the title of this evening's
event but also this series
is to think about the connections between
our political system, our forms
of governance and democracy
and our economic system.
So it goes, it wasn't that long ago
when we wouldn't even ask,
not only not asking a question
whether they can coexist
but also they seem like
natural bedfellows.
Those long enough memories,
we remember the end of
history being declared,
the end of the Cold War
and there's just this sense
that broadly market based economies
would come together, converge together
with broadly representative
political systems.
It seemed to be the way
the world was converging
but now we're seeing the rise
of illiberal democracies,
the rise of state forms of capitalism.
And a real question being asked now
which is how do the traditional ways
in which market based economies operate,
really interact with political systems
and particularly with democratic systems.
And Janet has already set up very well
by talking about the rise in inequality,
sluggish income growth
especially in the middle
and the bottom and growing
fears about climate crisis.
The promise of capitalism is
one that is being questioned
as, I would say, as never before
but certainly more strongly questioned
than in recent history.
In some polling you'll now see
significant numbers of
Americans especially millennials
and those who support a democrat party
saying that they actually
kind of veer more
towards socialism than capitalism.
On closer investigation of course,
what they really mean is
more social democracy,
something more like a welfare state
and so being clear in our
definitions is important too.
And so what I'm gonna do is
introduce our three speakers
who are gonna speak to
this kind of question
and what does it mean to be a citizen
in both a political
democracy and a participant
in a capitalist economy,
what does that mean now?
Where are the pressure points?
Why are we having this
conversation at all?
They'll each give some brief comments,
I'll then moderate the
discussion between the panelists
and then we'll throw it
open to the floor for Q&A.
I'm gonna offer brief introductions
because obviously you can look online
to see more about our distinguished panel.
And I'm going to introduce in the order
in which they're going to speak.
So first we're gonna
hear from Andrew Yang.
Andrew Yang is a tech entrepreneur,
he's a philanthropist,
he founded 'Venture for America'
and he's author of most recent book of
'The War on Normal People:
'The Truth About America's
Disappearing Jobs
'and Why Universal Basic
Income Is Our Future.'
I apologize in advance
to the other panelists.
I don't have their book in my hand.
That's because they
didn't just give it to me
whereas Andrew cleverly gave me the book,
literally as I'm walking on the stage
so that's excellent marketing.
And Mr. Yang is of course
well known for other activities.
He's enjoying a particularly
high public profile right now.
Many people are supporting him
and are interested in his policies.
That of course he is here
today as a thought leader.
And then we're gonna hear from Leslie
who's one your far right.
Leslie McCall, Janet's already mentioned.
She's presidential professor
of sociology here at CUNY
and she's the executive director
of The Stone Center that Janet runs.
She is the author of 'The
Undeserving Rich: American Beliefs
'about Inequality, Opportunity,
and Redistribution.'
And then you'll hear last
from Vanessa Williamson
who's on your left.
Vanessa is a senior fellow
at the best think tank
in the world, the Brookings Institution.
It's just, there are surveys
of these things apparently,
and she is author of 'Read
My Lips: Why Americans
'Are Proud to Pay Taxes.'
And so between the panelists
we have really rich experience
of both business but also
academia and political science.
And so I'll stop talking and hand over
to Andrew to kick us off.
Welcome.
– Thank you Richard and thank you
for the generous introduction.
It's true, I do carry
copies of my book around
just wherever I go.
So I was fascinated by the question
and scaffolding for this
conversation as well
because I grew up thinking
that capitalism and democracy
were natural bedfellows.
And that the problem right
now is that we're dealing
with this distorted version of
each and so now it seems like
neither is functioning very
well, which is accurate.
And one of the quotes I like to share
is from a friend of mine, Eric Weinstein,
who said that we never
knew that capitalism
was gonna get eaten by its son, technology
which is unfortunately
the era we're entering
where we're entering this
win or take all economy
that is breaking down many of
the capitalist relationships
we take for granted.
So for example, in the 1970s,
if I started a successful company,
you could make a number of assumptions.
I would have to hire lots
of people to feel my growth,
I would need to treat them moderately well
maybe so they could buy my
offering like Henry Ford
and buy my car and I would need to care
about what happens in my backyard
because my workers live
there, I live there et cetera.
Today none of that is true.
I can start a successful
company that does not need
to hire lots of people
or if I do hire people,
they have a very specialized skill set.
If I hire lots of people,
let's call them Uber drivers,
I do not need to treat them very well,
I do not need to give them benefits
and I don't have to care
about my own backyard
because I don't sell in any
one place, I sell everywhere.
And so there are all
of these underpinnings
of what you thought the
economic benefits would be
to growth that are not translating
to the broader population
and then you have a democracy
that's being held captive
in many ways by the
same moneyed interests,
and that's why young people
today are coming of age
where they think capitalism hasn't served
their interests very
well and they're correct,
so you can't fault them.
And so if I had grown up during this era,
I too would be very dubious given
the record levels of student loan debt
and the underemployment
and everything else.
So we need to fix both systems.
We need to fix both
capitalisms that it functions
better for more Americans and then we need
to return democracy to our
people as fast as possible.
– [Richard] Thank you, Leslie.
– Thanks, thanks very much Richard.
So I wanna back to this
specifically looking
at the issue of economic
inequality which is what I study
and which has already
been raised as perhaps
one of the central
tensions between capitalism
on the one hand which fosters inequality
and today fosters extreme
levels of inequality,
and democracy on the
other hand which seeks
to alleviate inequality and in fact
does alleviate inequality but certainly
not to the extent that it should nowadays.
And I wanna illustrate
this tension first with
an anecdote that I think also offers
a little bit of historical
context for the discussion
that we'll have tonight.
So I started studying the
politics of inequality
in the early 2000s, and
specifically public opinion
and public views about
economic inequality,
about the economy, about
related public policy issues
and starting with the 2004
presidential election,
friends and colleagues of mine who knew
that I studied this issue would say to me,
"Wow, Leslie, isn't it
great that the issue
"of economic inequality is receiving
"so much attention these days?"
And then they said it again,
a different group of people
said it again in 2008
and then in 2012 and 2016
and of course nowadays everyone says,
isn't the most important
issue in this year's
or 2020's presidential election
is in economic inequality.
And so this has been a real
concern because in fact
economic inequality hasn't
really changed very much
over that time period,
really hasn't changed at all.
If anything it's grown.
And so my response has always been,
throughout this period,
pretty much the same
which is yes, it's a step forward,
the politicians and other thought leaders
and influential groups
such as journalists,
academics, policy advocates,
business leaders even
that they're starting to
catch up, is what I argue,
they're starting to catch up with where
the American people have
been for a long time
which is actually
opposed to extreme levels
of economic inequality.
So they're catching up but one
thing that they have avoided
talking about is what I
consider, based on my research,
the central problem that
Americans are concerned about
which is the lack of a fair economy
and the lack of a broadly,
broadly inclusive economy,
what some people call
stakeholder capitalism
and which I also see as very much rooted
in the civil rights movement
and in particular equal
employment and equal pay doctrine.
So coming back to the present,
I think the fact, as Richard said,
the fact that we are
talking about this issue
in such bold grandiose terms as capitalism
and democracy, I think is
very much a step forward
because up until this point,
the discussion in the past
presidential elections,
and I'm just using that as an example,
and this has been true throughout
in the political discussion,
I don't believe that that elite
level political discussion
has fairly represented the American people
and the public interest on
issues of economic inequality
and maybe that is starting to change.
– I just wanna say it's
past time talking about it,
we should do something about it.
– Yeah, absolutely.
(audience applauding)
– [Richard] Vanessa.
– So when I was asked to
think about this question
of whether capitalism and
democracy can coexist,
the sort of punitive
into that occurred to me
which I'm gonna try and
defend is that we don't know
because we haven't tried.
I really do mean that in a way
because when you think about,
the basic tension which we've
already been talking about
is if capitalism concentrates wealth,
it thereby concentrates power.
And if we concentrate
power, that is at odds
with the democratic system, right?
And you might consider that
there are some kind of threshold
below which a little bit of
concentration, not so bad
but certainly I think we'd all agree
that we're on the far side of
whatever that threshold is.
But when we think about how
we've developed capitalism,
we've never done it in a way
that valued people equally.
And you only have to look as
far as the gender pay gap,
the racial wealth gap, to
see that some people's labor
has never been fairly valued
and those are the same people
whose political voices have
never been fairly valued.
And so I think that if we're gonna think
about whether capitalism
and democracy can coexist,
we first have to ask ourselves
if we've ever given either
the testing that it might warrant.
And in particular I think
we should think about
whether we can imagine a system
that creates immense
inequality as acceptable
if we actually do think
of all people as equal.
– Thank you.
And thank you to all of you for keeping
your comments so brief at the beginning
and giving us plenty
of time for discussion.
I wanna push, I think I'll
probably push all of you on this,
the nature of the problem
and whether it's an economic failure
or it's a political failure
to deal with economic trends.
And I think this is quite
an important distinction
to make in this debate 'cause
you can say that capitalism,
market economies generate
inequality, yes they do,
they're supposed to, they only work
if they generate inequality
but we then have a
collective responsibility
to ensure that the
winners don't win too big
and the losers don't
get kind of left behind
but that's a political decision.
And in fact, depending
on how you calculate it,
if the US just redistributed more
along the lines of other countries
then the resulting levels
of inequality wouldn't be that different.
So I guess what I'm asking
is there a danger here
that we're blaming
capitalism for the failures
of the political system
and that we should instead
just be trying to fix
it a political level.
So you could do two things for example,
you could redistribute
more but you could also
reform, camp and finance.
So the cumulation of
wealth as power can have
a very different effect in a country
that doesn't have funding of
politics to one that does.
So the broader question is
who's really at fault here.
Why don't we start with you Vanessa
'cause you kicked me off.
– So I think that it's
a mistake to imagine
that markets aren't political by nature.
Markets are a political outcome,
exactly the same as the tax system
because markets are governed by laws
and laws are made by lawmakers
who in our country we still elect for now.
I always do.
My point is that when you're
thinking about a market system,
it's not something that somehow
precedes the political economy.
The market isn't something that happens.
It's not that everyone has
a couple of apple trees
and then goes to the market and exchanges
and then the king came
along and took some taxes.
It's not sort of a simplified
version of the economy.
Entire industries rise
and fall based on whether
we enforce antitrust laws.
The legalization of marijuana
has created entire industries
that are now legal industries
that never existed before.
So I think it's a mistake to
imagine that market economies,
there's an economy that preexists
the political institutions.
And I think that when we think
about what the solutions are
to the concentration of wealth,
we need to think both
about the laws that govern
how money gets distributed
first and the laws about
how the money gets
redistributed thereafter.
– [Richard] Right, so markets
are political institutions
and predistribution as
well as redistribution
is a political decision.
Andrew, do you wanna weigh in?
– The example I use that everyone
understands most directly
is how did Amazon pay
zero in taxes in 2018,
how did the trillion dollar tech company
pay less than the federal taxes
than the vast majority
of people in this room?
And that is a colossal political failure
at the highest levels.
It's clearly completely
opposite of what you'd want,
particularly because Amazon is soaking up
another 20 billion dollars
in commerce every year
that is now pushing 30% of malls
and main street stores to
close, and being a retail worker
is still the most common
job in this country.
The average retail worker
is a 39-year-old woman
making between 10 and $11 an hour.
So if you look at that equation,
30% of the stores close,
cashiers get sent home, meager savings,
not much in the way of path
forward and zero in return.
That's public policy and political failure
at the highest levels.
So we've created this system
and then people look around
to your point that's like market.
And every other advanced
economy already has a mechanism
in place to avoid something
like Amazon paying zero taxes.
And that was not an anomaly.
Their lifetime tax rate is only 3%.
And so you look at that and you say
any of the cries of
where are the resources?
It's like where are the resources?
So you just look around and
who's benefiting the most
from our current arrangement which I agree
is a completely political
decision that we've done
but we've done it very passively
and now we have to
actively correct for it.
So one suggestion that would
help everything is that
if we just gave every American
citizen 100 democracy dollars
that you could then
contribute to any candidate
or political campaign, that would wash out
the lobbyist money by a factor of five.
That would actually make
it so that politicians
would listen to constituents
as opposed to people
because right now as a politician,
if you get people behind you,
you then have to get the
money some place else
and who has the money?
Rich companies and rich individuals.
So who do you listen to?
Rich companies and rich individuals.
If you could get 10000 people behind you
and that's a million dollars
and then the company starts
waving 50, 100000 at you
you'd be like I don't care
about your 50, 100000,
I'll just listen to the people
who voted me in the office.
So that's the kind of
dramatic fix that we need
to try and strengthen a democracy
that would then turn to
the Amazons of the world
and say you're paying zero
taxes make no sense at all.
– So rather than trying
to stop corporate money
you crowd it out with
citizen's money basically.
I wanna tell us about the Amazon thing.
I'm gonna come to you in a little bit.
The Amazon is a great example I think
because if you're sitting
on the board of Amazon
on the current regulator
environments and you're making
a decision about what to do
about reducing your tax bill
you've got shareholders
then the right thing to do
is try and reduce your tax
bill as much as possible.
But there are people who
are attacking Amazon.
They're saying there's
something wrong with Amazon.
What I think I'm hearing you say,
Leslie's gonna weigh on this
is Amazon aren't doing anything wrong,
they're playing by the rules of the game.
It's the game that's the fault.
And it does seem to me that's
quite an important distinction
in who we decide is at fault
here, who are the villains.
If people are just profit
maximizing in a market economy,
that's kind of what they're
supposed to do, isn't it?
Or are they supposed to work differently?
– Leslie come in and we'll come back.
– I just wanna say it's ridiculous
that we're berating
these corporate leaders
like they're supposed to self regulate.
That makes no sense.
It's their job to make as
much money as possible.
– [Richard] I think that's an
answer to the question then.
What about you Leslie?
– I wanna take the
question really seriously
because in reality what
politicians are doing
is they are taking a hands-off
perspective on the economy,
that there's technological
change, there's globalization,
there are these dynamics
that we as politicians
can't interfere with
or if we do interfere with them
then there might be job loss, for example.
And so we can see what Amazon has done.
This very issue of threatening job loss
and imposing or intervening
in political processes
in the City of Seattle,
in New York City all throughout,
actually overturning past
legislation in Seattle
that was meant to increase taxes
on individuals within,
actually on corporations
that make more than 20
million dollars in revenue
and the tax would be on the
corporations per employee head.
This was passed by the
Seattle City Council
in order to help fund housing,
more affordable housing.
Apparently, I'm not an expert on this
but I think there are parallels
to the New York City case
but apparently Amazon had said that
they were supportive of this policy.
Well, it turns out they weren't supportive
and they created an
organization with Starbucks
and other large companies
called, what was it called?
No Taxes on Jobs.
So the fear is about if you do regulate
then corporations can come back and say
I'm taking my jobs and leaving.
So that's the reality.
– They're able to do what
Vanessa's talking about
which is to turn economic
power into political power.
It's the way that these spheres of power,
how porous are the
boundaries between them?
But Vanessa I wanna come to
you and ask you to respond
to my challenge on Amazon
not doing anything wrong
partly because your own work
is about attitudes towards tax,
I think more among individuals
and wrapping a question
which I wanna ask all of
you but I'll ask you first
which is the sense of
what does a citizen owe
to the collective and what does it mean
as an act of citizenship
as an individual to be
paying taxes or contributing
but maybe also as a company.
– Yeah, so I think that first of all
if we're gonna talk about the ways
in which economic power
affects our political system,
part of it is campaign finance
but the other part is that
we have starved the public sector
in these really critical ways.
Legislators don't have
the resources they need
so they rely on lobbyists.
So people don't like
to talk about the fact
that congress needs more money,
not so we can fly congressmen around
in planes more effectively but so that
they can hire they staff that they need
so that the only information
they get about legislation
doesn't come from the
Amazons of the world.
So I think that's a really big piece of it
when we think about how to
rebalance political power
and economic inequality.
On the question of taxation,
so my book has a controversial title.
I say that Americans
are proud to pay taxes
but being proud is not
the same as being happy.
And if you look for this rhetoric,
you really hear it all the time.
People talk about themselves as taxpayers.
They say, I pay my taxes which is weird
because paying taxes is mandatory
so giving yourself credit for
doing so seems a little odd
but it's a really common rhetorical device
in the United States.
And it's actually backed by
a lot of civic sentiment.
People see tax paying as
part of their obligation
as a citizen, right?
And as something that
they do to contribute
to their community.
I sort of push people in these interviews.
In surveys the rates are remarkably.
You get 90 plus, 95 plus and
10% of Americans agreeing
that tax paying is a civic duty
which is almost unheard of in survey data.
Similar questions can be asked about
whether all this still
alive then you get 90,
90 plus percent of Americans
agreeing on something.
But I thought this was just
nice, happy talk in a survey
but the thing is it
comes up in interviews.
So if you talk to people about taxation,
it doesn't take long before
they start talking about,
they feel that their
government owes them something,
and not necessarily in the
form of a check holder,
I would imagine that's pretty popular too
but in the sense that they chipped in
so they deserve to be heard.
And people get very very angry.
They bring it up without being asked
which I always think it's a real sign
that if someone actually
cares about this idea
that these corporations they
are paying less in taxes
than I did and I'm making
$30000 a year, whatever it is.
Those kinds of comments are very common
and I think fundamentally
it's a very positive trait
that Americans still, after
many decades of antitax rhetoric
in this country still
use taxation as a way
of talking about what contribution,
what part of one's labor one
should give to the public.
– So I'm gonna put some of these together
and I'll ask the question.
And we'll start with you
Leslie and come back this way.
So what we're hearing is
economic inequality is real
and is growing, it's a very
salient political issue
within huge economic
divisions geographically,
occupationally, certainly in
terms of people's pay packets,
big wealth gaps, so any iconic
inequality, big problem.
People are really worried about that,
people are proud if not
happy to pay their taxes
and they know that the
system's not working for them.
I'm just summarizing
kind of various things
that I've heard from three of you so far.
So why are we where we are then?
If all of those things are true,
why are we actually going through,
if anything, policy is
going the other way.
Policy is going to increase inequality.
Certainly, fiscal policy
will at the moment.
If the ingredients that you've
all identified are correct
why are we getting this dish served to us?
Because the way you've just described it,
we should be living in a democratic
socialist America already.
So what's the gap between
the analysis and action?
Leslie, why don't we start with you.
– Sure, so we've already
talked about one pathway
which is the economic power and influence
that people with a lot of
money have on public policy.
So I wanna talk about the
sort of other side of this
which is even apart from the influence
that money has on
politics, I actually think
that politicians genuinely believe
that they cannot affect the economy,
that they cannot intervene in the economy
in really significant ways.
Maybe the only exception
is the minimum wage
which is hugely popular but
yet there's a lot of debate
and controversy over
the minimum wage as well
lifting it up to $15.
So I think this is really a major hurdle
and because politicians
don't offer genuine remedies
to the problem of low wages,
to the lack of benefits,
these are workplace problems, right?
So we're not talking about solutions
like increasing taxes on the rich.
I'm talking about changing
the work environment,
compensation, benefits and so on.
These kinds of policies are
just pretty much off limits.
And what I would argue, is
that that discourages voters.
They're not interested in politics
because the kinds of policies
that they would like to see
which is essentially a stronger
more thriving economy for everyone,
that that hasn't been on the table.
So that discourages participation
and I think that's extremely important.
There's this mismatch in other words
between what politicians are offering
in terms of solving these problems
and what people actually want.
– We say collective fatalism
about our ability to do it.
But you've already the fact
and this, I think, will help
you Andrew mope and motivate
some of your own work.
If you say this is gonna kill jobs
then it's not quite game over
in terms of political debate
but it's really difficult
to recover from that.
And so a higher minimum
wage does reduce employment
at the margins in some circumstances
but the benefits will mostly outweigh it.
The best studies, I think Kruger Card,
this will get boring really fast
but Kruger Card, they show some
effect or be of some effect.
It's almost impossible to
believe that raising the price
of labor would have some
effect on labor market
but they tend to be pretty
marginal in the long-run,
probably increases in
productivity bla bla bla.
But f there's any evidence
it's gonna cost any jobs at all
then all the other
benefits that come from it,
reducing poverty et cetera,
just get blown out of the water
because jobs, everyone
cares so much about jobs
and if they're afraid of jobs
and it almost ends the debate right there
which is why we think
about something else.
– Just one last point on this.
The problem is that then people think
that it's jobs and that's
it versus what kind of jobs.
That's they key thing.
– [Richard] Any job will
do if it's not true.
– The example of Amazon in New York City,
a very very tough issue,
I'm not gonna pretend
that there was a right
and wrong answer here.
So the loss of 25000 jobs,
you can't treat that lightly.
On the other hand,
then that becomes the
center of the conversation,
that it's only about those 25000 jobs
versus all the other aspects
of the inequality issue
that are so central.
It's not just about the jobs
but the character of the jobs,
the pay, the benefits and all
of the other surrounding jobs
as well as lots of
infrastructure and housing.
There are so many issues involved.
– [Richard] Okay, Vanessa then Andrew.
– I think that one of the
sort of paradoxical aspects
of this is that as the economy gets weaker
and as the social safety
net has been weakened,
your need for a job gets stronger.
So you might imagine that
some part of that rhetoric
actually grows as you undercut
every kind of security.
I wanted to make one
additional point about why…
– [Richard] It's a very
interesting point there
'cause then it's a
viscous circle, isn't it?
Then you've created a situation where
the very absence of support
means that the job…
– Right, so it can actually
get harder to convince people
to believe that change is possible
when peoples lives get harder
and that just makes sense.
It's unfortunate and it's
something we have to overcome.
The other point I wanted to make was that
when we're thinking about why
we don't get policy outcomes
that look like what any
regular poll of Americans
would tell you which is that
there are all sorts of things
like family leave, minimum wage, Medicare,
all these policies that
are hugely popular,
why we don't have them and
why instead we have policies
that were hugely unpopular
like the tax cuts and jobs act.
I think it's important to
remember that in general,
public opinion does
not make public policy.
What makes public policy
is organized interests
operating for the party system.
And there's no reason really to expect
that average opinion would
drive policy in general
because politics requires organization
but especially in a system like ours
which is so inert about
and we're certainly built
to avoid majority rule, right?
– Andrew you might have
thought a little bit
about the intersection
between policy and politics.
– So first, I think we
should all be offended
by the spectacle of
Amazon pitting communities
against each other to see who
could bend over backwards more
for a pure ordained process.
That's thousands of man hours put forward
by hundreds of communities
around their country
just to show again the primacy, again,
of a company saying I
have jobs, you need jobs,
let's see what you can do.
We shouldn't make any of
these local tax inducements
just 100% taxable and just get rid
of the beauty contest forever because
from a national point of view
it makes no difference to us
which city or state a company is based in
as long as it's in the
United States of America.
So having someone move within the country
produces no net economic benefits.
All we're doing is giving
the companies more money
that some of these
communities can't afford,
a lot of the benefits they
promise don't materialize,
we should all be offended by that.
But what that does is it
illustrates what Leslie is saying
is that we have so
brainwashed into thinking
that human worth and economic
worth are the same thing
that we are contorting ourselves
and increasingly attenuated
in ridiculous fashion.
Why else would we imagine
that we could turn
thousands of coal miners
into software engineers.
That actually makes no sense.
But when you look at, you say,
well, your current function
has zero market value
thus you have no market
value, thus we will pretend
we can turn you into something
that does have market value
because we can't even tell
the difference anymore.
My wife is at home with our two boys
one of whom is autistic,
what is her market value?
What is her work calculated at in GDP?
Zero, and we have to get
beyond the market's estimation
of our worth because the
market is about to turn on us
in historic catastrophic fashion.
When artificial
intelligence lands for real
and there are 3 1/2 million Americans
who drive a truck for a living right now
and the trucks start driving
themselves in five to 10 years,
do you wanna be the person that say,
"Hey, you were worth $46000 last year
"and now you're worth zero."
Tell that to half a
million 49-year-old men
who see their livelihood
about to go down the drain.
We have to get our heads up
and realize that the market
is a highly flawed determinate
of what our value is.
We have to unbrainwash ourselves really.
'Cause this is what Leslie's point is.
It's like hey, we haven't
been presented with an option
and the American people are
getting increasingly desperate.
Bernie Sanders legitimately
could have won the nomination last time
if the DNC hadn't sand
bagged him and kneecapped him
and we all know that happened.
And then Donald Trump,
this avatar of distorted,
dark tainted populism, actually
he's our president today.
And people are looking
up being like 'Huh.'
Like well, this is an aberration.
This is not aberration.
We're in the historic
disintegration of our way of life.
Our life expectancy has declined
for the last three years
due to and suicides and drug overdoses.
Cheerleading this GDP
number being at record highs
makes no sense when your people
are dying younger and sooner.
This is the desperation we are in.
People are looking around and saying
what does the democracy hold.
And our politicians aren't able
to respond to that challenge because
they're too busy doing
the fundraising for this.
– I'm gonna stop you there
'cause I got a feeling
if I don't stop you soon
we're gonna keep going.
And it's not that I don't
appreciate the direction
you're thinking in but I do
wanna bring the conversation
to the next part which I
think you'll appreciate
which is what does the state owe citizens?
Would it be something like a UBI?
But there's a prelude to that.
I do wanna guess one more go at
how deep this problem is economically.
Because I would say there's
the prevailing consensus
would be yes there are problems,
there is too much inequality,
we should be doing more to help workers
but it's a question that
kind of fixes, essentially,
that that can be done
through a series of reforms
many of which have already been mentioned,
but it's not a profound shift
in the capacity of markets
to deliver increased
well-being to most citizens.
It's a failure to regulate
the market to do that.
But what you're now saying Andrew
is something's about to be very different
and maybe we're already getting the start
of that big difference which
is actually we're gonna see
a detachment between economic growth
and people's well-being.
The connective tissue
between the economy growing
and people getting better off
is stretching and might break.
It seems to me that the
answer to that question
profoundly influences everything we think
about policy and politics from now.
So I'm pretty sure I know
where you're gonna come out
on that Andrew but I'd
like to hear, first of all,
Vanessa and then have
Leslie on do you think
it's as deep as not just fixing but really
it aint gonna deliver in the way,
the machine just is not
gonna deliver in the way
for the reasons Andrews suggests.
– I have pretty dim view of the future
but not for the same reasons precisely
but the dimness is similar.
I feel like a kinship on that front.
And to me the, and the place where I go
where I worry is climate change.
I don't think that there's
any evidence right now
that our current economy has any capacity
to deal with the problem that
is absolutely cataclysmic.
I don't think that there
is any reason to believe
or there's any evidence
that the kind of economies
we've built in the past have any capacity
to deal with genuine resource shortages.
That is not what market economies
have shown any of it.
And so I think that we have
a very very limited period of time
to make some absolutely
revolutionary changes.
– But that's, I do wanna
come on but that's again
whose fault is that?
The fact that the market
doesn't care about the planet
is not the market's fault.
Any more, like capitalism
doesn't care about a planet
but actually communism
wasn't great either.
And in fact I think you can then argue
that the kind of despoiling
of some of the lakes
in the former Soviet Union is
what would have been unthinkable
in the great lakes of the US.
And so I don't think that that's something
we can put at the door of capitalism.
And so the point of a
political system of any kind
that just fails to act in
the long run, is that fair?
– I think that it's clear
that the economy of the future
can't look like any of
the economies in the past.
I don't think mercantilism
would have handled the
problem well either,
at least as far I can think
off the top of my head.
But the point is that we clearly
need to make major changes
and those changes have to be
different from what we've done,
different from what's
been tried in the past,
and I wanna add one more point to this.
The other piece that I
think is really critical
to thinking about climate
change is to get back
to this question of whose valued
because I think that when we think about
what jobs have market value, it's striking
how often it is women and people of color
whose jobs have no market
value and that is true
no matter what work women
and people of color do.
When computer coders were women of color,
they didn't get paid real well.
It was still computer coding,
now it's really well paid.
There are some other reasons as well
but the primary one I would is say is
that people with power get money.
– Leslie go first and then
I'm gonna come to you Andrew, I promise.
– I do think there's a debate on right now
among economists which is fairly new,
it's not my field, I'm not an economist
but it's about the
anticompetitive behavior
of corporations, it's about
the concentration of power
in corporations, it's about
the things that they do,
there are mandatory arbitration systems,
there are no disclosure contracts,
there are no compete contracts,
there are all kinds of
anticompetitive behavior
that are creating greater
power for corporations
and reducing the power of workers.
And workers don't have, just
in the absence of unions
there's no one able to
represent the workers.
And even if unions are not going
to be the solution in the future,
that doesn't mean that
there isn't gonna be
some other institution
that needs to be created
and that's why I think
actually the talk is important,
at least talking about these issues.
The new research in economics
is just that, it's new.
We were not talking about
these things five years ago
and about this severe
anticompetitive nature
of some corporations.
And then what are the solutions to those.
I think we're in unchartered territory,
not just because of technology but because
of the structure of
capitalism and the need
to create new institutions
that are not gonna be
like the old institutions necessarily.
We don't know what those
are gonna look like yet.
– But let's say you
could unrig the market,
you could have a properly
competitive market,
move more from crony capitalism
to a healthier form of capitalism
which there are countries
that are doing it
in a healthier way.
Not everywhere do you get
such kind of political power
being brought about in the economy.
Let's say you could use a carbon tax
and other incentives through the market
to actually just politically
embed into the market
action on climate change,
that might be enough is what I'm hearing
but I'm not hearing from you Andrew.
What I'm hearing is
that even if you diddle,
and I'm well aware how utopian that is,
you're saying no no no
'cause the tax coming,
the AI is coming and that's
gonna change everything.
– Yeah, there are two parallel crisis
that are working in tandem.
One is climate change,
two is the fourth industrial revolution
that we're in the midst
of the greatest economic
and technological
transformation in human history.
And Donald Trump is a symptom
of this transformation.
The driving force behind
his victory in 2016
was that we'd automated away
four million manufacturing jobs
in Ohio, Michigan, Pennsylvania,
Wisconsin, Missouri, Iowa
and now we're going to do the same thing
to millions of retail
jobs, call center jobs,
fast food jobs, truck
driving jobs as well as,
I was an unhappy corporate
attorney for five months
and I can guarantee you
can automate that job.
So we have these two crises
that are unfolding in tandem
and we are completely ill
prepared for either of them
so that the best path forward is
to try and humanize our economy.
And by this what I mean
is GDP is a measurement
we made up almost 100 years ago
and even the inventors had three things.
One, this is a terrible
measurement for national well-being
and we should not use it as that.
Two, we should include parenthood
and motherhood in the number
because they are so important
and three, we shouldn't include
military defense spending
because it has no economic value.
And of course we ignored
all three of those things
and now we're riding GDP off a cliff.
And so what we should do is
update our very measurements
so that something like
environmental quality,
mental health, childhood success rates,
life expectancy, proportion of elderly
who can retire in quality circumstances.
We have numbers for these things.
We can turn them into the new
GDP and then we can channel
our market forces to try
and improve our lives
because the market is doing
what it's designed to do.
The problem is that capital efficiency
and human well-being are diverging.
So what you have to do is you have
to actually make the measurements,
human well-being itself
and then have that be the
measurement of progress.
That is our best path forward and
that actually gives us a chance
to try and make progress on climate change
and the automation of jobs simultaneously
in the timeframe we have.
– So I just wanna move
on to what the state
or the collective owes the
citizen, let's go back to that.
If we think that there's
some social insurance system
and the people should be in
some way deserving of that
because it strikes me that
the US does pretty well
insuring some people and
social security system
full of it's faults has massively reduced
pension and poverty,
Medicare is there et cetera
but other people really, under
insured children I would say,
especially there is no social insurance.
So it shows that it can be done,
that the collective world can be there.
The problem is the kind of politics of it.
And I'm thinking particularly here about
something like a universal basic income
which obviously you've
argued for here Andrew
and I really wanna, I'm gonna come
to you last on this again Andrew
'cause I just wanna hear
from political scientists.
What do we know about attitudes
towards different kinds
of transfer payments
or different kinds of public goods
to different kinds of people
and what light would that
throw on attitudes towards
and the successful politicization
of something like a UBI.
Do you wanna go first Leslie?
– Sure.
Well, actually Vanessa said it earlier.
Most of these policies are hugely popular.
The fact that they're not
enacted is not the fault
of a public that is rejecting
the sort of social classic,
social democratic welfare state.
In fact, and I know Vanessa
has done some research on that,
when you look at the state level
you do see initiatives to raise taxes
particularly targeted taxes
on high income households
in order to do a few very popular things,
programs that actually
have been really cut
by the fiscal austerity in states.
First and foremost, education
spending, hugely popular
and it also is something
that supports jobs
because teachers are employed
through those dollars
but also funding healthcare
at the local level
and the third thing that's often
very popular is public safety.
Also funding gets cut for fire and police.
These are the sorts of things where
if you look at it at the local level,
they work in a sense because
people can see the benefits
that they're gonna receive
at the local level.
They can see a targeted tax that says
these revenues are gonna go to
these very popular programs.
That's accountability, it's
transparency of benefits.
At the federal level we
lose that transparency.
– Unless it was straight cash
in which case it's
actually very transparent.
– Which we're gonna get to absolutely.
But Vanessa you've done a
lot of work in this field
so I'm not gonna try and do justice to it
but I do think there's a sense anyway
that certain kinds of transfer payments
seem more politically sellable than others
depending on who they go to
and in what circumstances.
– That's right, and this sort of gets back
to the point I was making earlier.
One of the challenges of
providing benefits to poor people
is that traditionally,
certain groups of Americans,
particularly people of
color have been seeing
these undeserving people
who do not work hard enough
and therefore why would
we be giving them money.
And so there's a great classic book called
'Why Americans Hate
Welfare' and it demonstrates
that when welfare became a
program that was racialized,
that is to say it was perceived
to be received by African Americans,
popular opinion turned
against the program.
And I think that that is a legacy
that we have been dealing with
from the beginning in this country,
it's a legacy we will
continue to have to deal with
but I think that there
is nothing more important
than dealing with it and
in particular I think
what is vitally important,
especially as the country's
demography has changed,
mathematically it's easier
to make this change.
We need to think about what
we provide our citizens.
I wanna answer the question you asked
about what the state
should give to citizens.
We need to think about programs,
not about whether someone might
become dependent upon them
but what programs can
we provide to citizens
to make them independent?
And this is a very old republican idea,
that in order to be an effective citizen,
you had to be independent,
economically independent.
If you had a boss who could
tell you you had a vote
back then when there
wasn't a secret ballot,
that was a danger to democracy.
And so many of the founders
decided that what we should do
is we disenfranchise the poor.
The alternative approach,
which I think is a better one,
might be to make sure that no one's poor.
And so I think that for
me telling the story
of why we need to provide
for every American
in terms of making sure that
everyone can be a citizen
is the story that I would
personally want to tell.
– But I think most people
might react to that
by saying the way you become
independent is through skills,
education, all of those
services you just talked about
and you're gonna correct
if I'm wrong about this,
a lot of people would say
giving someone a check
doesn't make them independent,
you've just argued that it does
but I'm not sure that
that's the general view.
(audience laughing)
– So the conventional recipe
is education and retraining
but when you dig in the success rates
of federally funded retraining programs
for, let's call them, manufacturing
workers in the mid west
have a success rate of
between zero and 15%.
They essentially do not work.
And if you look at the education,
about 33% of Americans
graduate from college.
So if you subsidize that further,
you're essentially subsidizing
the top third of your population.
And right now the underemployment rate
for recent college
graduates or the proportion
that are doing a job that does
not require a college degree
is between 40 and 44%.
So it's not like if someone
graduates from college
there's this college appropriate
job waiting for them.
94% of the new jobs that are being created
in the last number of years have been
at a temporary gig or contractor jobs
that don't have meaningful
benefits hence this entire panel
which is that capitalism is not working.
So the great thing is that
if you were to, let's say,
issue a freedom dividend
of $1000 per American adult per month
then that would shore
up many of the problems,
it would create over two million jobs,
it would start recognizing
and rewarding women
for their vital and unrecognized
and uncompensated work
that we all know women do more of
in our homes and communities,
it would also help
marginalized communities
and people of color disproportionately
because they have lower access
to wealth and education opportunity.
And the great thing is
this would become universally popular.
There's one state that's had
a dividend for almost 40 years
and that state's Alaska
where everyone in Alaska
gets between one and $2000
a year, no questions asked.
And Alaska is a deep
red conservative state,
it was passed by a republican governor.
This is not necessarily
left or right, it's forward.
Martin Luther King championed this,
Milton Friedman championed this,
Thomas Paine championed this,
Jamie Dimon, the CEO of JPMorgan Chase
just came out last month
and said America is having
a national emergency
in terms of the failure
of our capitalist system
and we should declare
a negative income tax.
You know what that is?
It's an income floor
where just everyone gets
a certain amount of cash if
you're below a certain level.
So we need to get with
a program, own the fact
that our economy has
evolved in fundamental ways,
get the public will to
match up to the policy
and the only way to do
that is just send a message
all the way to the top
because unfortunately
most of our legislators are held captive
by corporate interest and
there's a very limited way
to make the feedback
mechanism of democracy work.
– Is there a big difference
though between one
or 2000 a year in a state
that had a natural resource
that you could kind of
argue was just chance
and so we should all benefit from it
than 12000 a year out of
general federal spending?
Just in terms of how it's perceived.
I'm not sure that the analogy holds up
between a pretty small dividend payment
based on a natural resource
and a much bigger one based on.
– Well, the argument that
one could easily make
is that technology is the
oil of the 21st century
and that we are the owners and
stakeholders of the society
and as the incredible wealth
that is being produced in part
by our own information,
then we deserve a dividend
and that's an argument I
will be very glad to take
to the American people.
– And then we'll see
how the tech companies
feel about having drilling rigs arrive
to extract all the money
which is in my mind now
to go just suck it now.
– I'm friends with dozens,
hundreds of the technologists
and some of them don't
like this projection.
But if you go to them and say
hey you're automating away
the jobs is inequality
just completely rampant
and out of control,
half of them will say yes.
– Exactly, it depends what
the alternative is, isn't it?
And if you'll turn just to continue
living in a gilded age, wonderful.
– It's worse because what
you say to them is like
is life better inside the
bunker or outside the bunker
and half of them own bunkers
and they've tested them out
and they've decided
the sunshine is better.
– They do.
I'm gonna give applaud to
Heather Boushey's piece
in our series we just
republished at Brookings
which argues for a more
inclusive definition of GDP
including a distribution analysis
which actually the bureau of
labor statistics are working on
but then I'll open this up.
Let's get some questions
from the audience.
There are microphones at the front,
I think only at the front
so sprint to the microphone.
Please identify yourself
and keep your question short
and please we do want,
please make it a question
or at least have a slightly rising tone
in your voice towards the end.
Would you agree that?
All right, start there, gentleman there.
– [Man] The first
question, can you hear me?
Is that a question?
– Yeah, but get a bit closer,
everyone needs to get
close to the microphone,
yeah, lift up.
– [Man] I wonder if there's
an obstacle to all of this,
it sort of makes this conversation's mood
if that obstacle as it is is united.
Is there any possibility of progress
of challenging the interest
you were just discussing.
I know Andrew you're a
constitutional member to overturn it
but is there anything we can do,
I'm sorry, that's a stupid question.
Is this just an impediment
that's not gonna go away
unless there's something like
constitutional amendment?
– [Richard] The game's
just gonna be rigged
unless that gets out.
What I'm gonna do is take two
or three if that's okay people
and then redistribute them.
Yeah, the lady right behind you.
– [Martha] Thank you, my name is Martha
and this question is mostly for Leslie.
I have noticed a kind of a revolving door,
politicians and rich people
from different sorts of life are the same.
So what would be the point
of changing the political structure
if the people who make
policies are the same
as the ones that benefit
from the policies they make
and if anybody else wants to contribute
and that would be great.
Thank you.
– [Richard] It could be a different bunch
of rich people making policy basically.
Okay, the gentleman
over here on the right.
– [Man] I enjoyed this series
on this year a few months ago
when a number of economists
including Paul Krugman was speaking
and the area that they spoke about,
one of them was guaranteed income
and the other was the idea that
automation was taking away jobs.
And it was unanimous among the economists.
– [Richard] I don't believe it.
– [Man] Yeah but it was
unanimous so they said that,
well, I think it was
overblown that technology
was taking away jobs
because 120 years ago,
80% of the people lived on farms,
now it's 3% work on farms
and we have a 3.6% unemployment rate.
So where do those other people go?
They somehow got absorbed.
The other thing on guaranteed
income they said well,
they said giving people
money, why not just hire them
to do the things that we need.
We have have plenty of infrastructure.
– A guaranteed job rather
than guaranteed income.
That's the lively debate in
policies focus right now.
So thank you.
I'm gonna come back to the panel.
So we've got, this is all
just smoke until we change
the way that financing happens.
We're just gonna, the problems
rich people say in policy
is not gonna go away and then this time,
is it really different
and I'd say the gentleman
has properly, I'd say,
summarized the medium position
of economic thinking
right now which is that
we just don't know yet whether
it's really gonna be different and that
we've always had this fear that technology
is about to wipe out all the jobs
and not enough evidence yet to suggest
that this time really is any different,
certainly not to do
anything as radical as that.
And if we were rather than
just to give them a check,
give them a job.
Leslie, don't feel like
you have to take all three.
Just pick and choose.
– I'll just say very simply.
We do know that the ground game,
person to person contact
in campaigns makes a huge difference.
We know that very few people
turn out at local elections.
This is doable.
We know that it's doable.
There's a lot of
political science research
that talks about how to
launch a successful campaign
without a lot of money.
So I am optimistic actually,
I think it's possible.
I think it's possible.
Pardon me.
– [Richard] We need one
optimist on the panel.
Okay, Andrew.
– Oh well, we're testing it our right now.
It's actually easier to
pass the democracy dollars
and they can give us all
$100 to help balance out
the lobbyist and a constitutional
amendment and to fight it.
But to the concerns about the fact that
we're not sure about what's
happening to the jobs.
I wrote a book on this subject,
I've looked at the economic underpinnings.
The labor force participation
right now in the US is 63%
which is close to a multidecade law
in the same levels as
Costa Rica and Ecuador.
And this is your tad of an expansion.
Of the four million manufacturing workers
that lost their jobs in the
midwest, I studied economics.
Who here studied economics?
Let's try this.
What did our macroeconomics
text book would happen
to those four million workers
after they lost their jobs?
– [Man] They get new ones.
– They get new ones, retrained, reskilled,
higher productivity,
economy grows, all is well.
So what actually happened
to the four million manufacturing
workers in the mid west?
Almost half of them left the workforce
and never worked again and
of that half have disability
and then you saw surges in suicides
and drug overdoses and Trump voting.
None of that was in my economics textbook.
So we need to actually get
our heads off the textbook
and go to communities
and go on the ground.
Then you get a sense of reality.
So if someone talks about the
headline unemployment rate,
they're just ignoring
the depressed labor force participation,
the lack of affordability,
the underemployment that's
ripping through the economy.
– [Richard] Okay, Vanessa.
– I will just say a
couple of quick things.
First of all, in terms of citizens united,
I think it is correct to
imagine that the supreme court
is going to be an issue
for any of a number
of progressive reforms
as it long has been.
On the question of the job guarantee,
I think that it's important to remember
that there is no contradiction
between a job's guarantee and UBI
but they could happen
simultaneously there or not
in any way at odds in terms of policies.
The last thing I'd say is that
it is possible the technology
will eliminate jobs,
it does not seem obvious to me
that technology will innovate work
because for it to
eliminate work you'd have
to believe all the children were educated,
all the old people were cared for,
all the parks were clean, all
the roads had potholes filled
and I don't think we're anywhere
near running out of work.
So the question is to how
to convert work into jobs.
And I think that's a
third piece of the puzzle.
– [Richard] Great, we're gonna
take some more questions.
The gentleman there.
Let's do the same again,
I'll do a round of three.
– [Man] I appreciate Andrew's point on
what's in the textbook and
what's not in the textbook,
that comes up very often in the classroom,
what we expect it to come
from international trade
it was not what actually happened.
To that point thought,
the textbook does bring up
the movement of capital
and labor across borders
and I wonder, from your perspectives,
how much of the issue that
we're dealing with today
is because we've globalized capital,
we've allowed businesses
to go across borders
and to expand the region in that sense
but we haven't necessarily applied
the level of globalization to citizenship
where you can just move between countries
when work is not available
and when you're not trained
for the work that is
available within your borders.
So I know it doesn't necessarily
address all the automation
and questions that come up as well
but I wonder how much of a
role that globalization make.
– [Richard] I'm very glad
you asked the question
because free trade is obviously
a very big issue right now
and it was one of the things
that I think was taken for
granted in the previous consensus
was that it was gonna be good,
we're gonna move together
and now that has been
seriously threatened.
Yeah, gentlemen.
– [Man] Yeah, listen,
I moved to a small town
in Fishkill, New York
and it was a perfectly
well run little town.
We had grocers,
we had butchers, you had
whatever and so forth.
Then there was an attempt
and it was successful
to have Walmart come into the town.
Here's the cracks which I
think you need to address,
which I think you need a
social psychologist here.
The whole town voted
to have Walmart come in
and what happened as a result of that
the butcher went out, the grocer out,
the hardware store went out and so forth.
And all that panacea of
voting for a big corporation,
it was terrible.
Well, they got jobs at Walmart
but they made them poor.
Those jobs made them poor whereas before
you had a perfectly functioning town
where the butcher paid the grocer.
– [Richard] Is there a question?
– [Man] Yes, why is there no
social psychologist on here,
in this panel?
– [Richard] All right
that's a fair question.
– [Man] And also I want to
have you address consumerism.
– [Richard] Consumerism, okay.
– [Man] And the flow of
money from a little community
into overseas banks.
– Thank you for that.
It's fascinating that they voted for it.
That's democracy in action.
So it's a good tension that
you've identified that.
And the gentleman here.
– [Ray] I'm Ray and I almost feeling like
I'm hearing the answer that I'm aware of
which is a gentleman who
believed in free trade,
no taxation but sharing the
natural resource dividend
and the natural resource
exist in every square inch
of this country, not just in Alaska.
The planet is the natural
resource and could pay
for all these problems
and send everybody a check
for tens of thousands a year, their share
of the natural resource
dividend for being alive.
Human beings have a right to live,
human beings require
natural resources to live,
human beings have a right
to natural resources.
That was Henry George's syllogism.
He got twice as many votes
as Theodore Roosevelt.
– But he was gonna do it
through land tax, right?
– [Ray] According to Joseph's
legalist and others, yes,
land rent, in other words paying rent
for something you did not create
that if it ever belonged to anybody,
it was stolen to begin with
but the Indians didn't
claim ownership of the land,
they didn't believe
you could own the land.
– So there's something here which is,
I think is quite profound which is
the very idea of private property.
So now we're getting some
really good socialist thinking
and I do not mean that
in a disparaging way.
This is actually properties theft.
Very idea of private property is
at the heart of a market economy
and that's absolutely true in US
it's why Henry George was
not very popular in the US,
he was much more popular in Europe
where the ideas of land taxation
were taken much more seriously.
But we should be thinking
much more radically.
Please feel free to come
around that if you like.
The fact that a small
town voted for Walmart
and then didn't like the results.
I'm not quite sure or you don't
think the results were good.
Maybe people didn't know what
they were voting for et cetera
but that seems like a
really good test case
of allowing people to decide
whether they want a Walmart
or they want lovely butchers et cetera
and then the trade point
which is are we moving away
from free trade and how do we
feel about free trade anyway
and how the politics of
free trade changing too
which I might ask
Vanessa to come around to
but let's start with you Andrew this time.
– According to the studies I saw
automation is a much
bigger driver of job loss
and maybe this community
is in the globalization,
the ratio, something like 75, 25 or 80/20
in the studies that I saw.
So globalization is a big issue.
One of the things that
we as a society have to,
in my opinion, correct is
that it's not immigrants
that are driving economic dislocations,
it's a transforming economy.
And that if you go to an
Amazon fulfillment warehouse,
it is not wall to wall immigrants,
it's wall to wall machines.
And so that is the real
driver of the anxiety
and stress that many
Americans are feeling.
And unfortunately immigrants
have been scapegoatted
and that's one aspect of globalization
that I think America's going
to have to grapple with
over the next number of years.
– [Richard] It's fascinating people now
are really freaking out
by the falling birth rate
'cause the labor force but
you can solve that with immigrations.
So Leslie.
– I think that the issues
of sort of local politics,
one question I would have is
how many people voted for Amazon?
Of course there have been
a number of movements,
did I say Amazon?
I meant Walmart.
There have been a number of
movements against Walmart.
Generally they've occurred in places
where there are other jobs, larger cities
or suburban areas that I know of.
But again, these are
tough issues to tackle
in a relatively depressed area.
It's not depressed.
It's difficult, as Richard said,
at one point it's difficult
to regulate one company.
You mean to take regulation
throughout the country
and it's same with wages.
You need to take wages out of competition
throughout the country so
that corporations can't move
from one place to another.
Same with international trade.
International institutions
and agencies need to tackle
these kinds of problems about
labor standards, about wages
and about the environment.
These are the kinds of institutions
that will solve these
problems internationally,
nationally and it is a tall order.
I'm not saying that it's
not incredibly challenging
to do these things but
that's what we need to do
if those problems are gonna be solved.
– We don't know that Walmart had a budget
of millions of dollars to convince towns
that it was a good idea
to bring them in there.
And that the butcher and the
baker had a budget of zero.
And so that town council had
this really fancy document
showing them that Walmart's gonna be great
and there was no countervailing
sense of documents,
the local businesses were outgunned
and even if the community,
after the facts said,
you know what, this is a terrible idea.
I really miss my main street.
You can't undo that decision.
You can't all of a sudden be like hey,
Walmart, turns out we made a mistake.
So this is unfolding in
communities around the country.
Like the companies have
all of the materials
and the resources and
the people have none.
– And the capacity
to make the different trade-offs as well.
Fighting gets market logic,
I think is what we're
kind of hearing a lot of
on the panel so far that
other kinds of social value,
other kinds of ways to job success
but these are kind of hard facts.
I wanna let Vanessa in now.
– Yeah, I think that you're
exactly right to imagine
that we need to have a different narrative
of how the economy works
because the one that
has been sort of sipped in
to popular consciousness
about as if corporations just
have jobs sitting on the shelf
and if you're nice to them
they'll release those jobs
into the wild which is total nonsense.
I bet that's the image that
I think operates in people's minds
and it's a real problem.
I think it was worth
seeing a little bit more
in the question of
immigration which came up
in passing on the trade question which is
at the end of the day people
are not a box of widgets
that you can just ship to another country.
People live in communities
and it's hard to uproot themselves.
So I think that we can't
imagine that labor can ever flow
the way that imaginary dollars
can fly over the internet
and that's something that
creates a power imbalance.
The other thing I'll say
is that when we're thinking
about support for a social safety net,
in the United States,
that has been undermined
by racism for centuries.
In Europe it has, in recent decades
been substantially undermined
by antiimmigrant sentiment
in a very similar way and I
think that we're obviously
also seeing that here as well.
So I think that's a
third piece of the puzzle
that's really challenging in addition
to whether there can be the right jobs
and whether there can be, small town,
they're ever gonna have the
power to deal with corporations.
The capacity of people
to resist economic power
is related to their sense of
solidarity with one another
and all too often immigration,
people don't feel the same
solidarity with new immigrants.
– It's interesting to see
that any economics place
is now making a real resurgence,
the idea that places
matter wasn't something
that traditional economics
took very seriously.
The idea was you just move.
Basically you're just a unit
of human capital, you can move
and that's been a real shift I think
just in the last few years.
– Yeah, I think economists
may have encountered
a sociologist at some point
and learned of the subject.
– And sociologists got the better
of them in many of these areas.
So I'm basically, pretty much out of time.
I'm gonna get into trouble if I take
another couple of questions
so I'm just gonna risk it.
But, in exchange you gotta
keep them super short.
I'm gonna cut you off
after the 30 seconds.
I'll do a lighting round, okay?
You and then you, really short.
– [Chirag] Very short, I'm Chirag.
The statistic that you mentioned about
life expectancy going
down is really troubling
and it's very new but
as a biotechnologist,
even by the shortest of
estimates it looks like overall
human longevity for some
people can be extended
maybe modestly 150 years.
Certainly about a more,
a non-reasonable estimate
which right now seem
crazy or 200, 300 years.
So if people can live this long,
I'm almost 50 and I got tests for.
– But you do look very good.
(audience laughing)
– [Chirag] It's because of
automation so I just wanna know.
– All right, is there a question there?
Obviously we're admiring
you but what's the…
– [Chirag] Can capitalism help us
the same way information technology
made people addicted to information?
– Great, the lady here, really short.
– [Woman] I understood Vanessa to say.
– Can you go to the microphone.
– [Woman] Microphone,
microphone microphone, okay.
I understood Vanessa to say
that politicians believe
they can't interfere in the economy
and I wasn't sure what you meant by that.
Did you men that politicians
think it's inappropriate
for them that they don't
have a method of interfering,
that they fear it would be ineffectual?
Exactly what did you
mean, it's fascinating.
– Well, I'm going to ask Vanessa
but I guess it means is
that politicians treat
market economies as if some
naturally preexisting thing
that you can't, there's just
something magical about it
that you can't mess with rather
than a deeply political institution
that they can mess with pretty seriously.
Why don't you take that directly Vanessa
and then we'll come back to the…
– I'm gonna say two things.
One, a point I meant to make earlier
which is that legislators
all have a very bad sense
of the political opinions
of their constituents
and there's more and more research on this
so to some extent
legislators are not acting
in the public interest in
part because they misperceive
what the public interest is
but I think Leslie made that point.
I think you are the one
who was talking about
the capacity to intervene in the economy.
– I think you both made the
point in different ways.
– I think you summarized it exactly.
It's the power of the economy,
what we were talking about earlier
that jobs are supreme and…
– [Woman] It's kind of untouchable.
– In a very minimalist kind of way.
It's sort of a lack of
political imagination
about the future I would argue
and how we control the transformations
that we're undergoing in the economy.
How we again politically
control those transformations.
– So I'm gonna ask you each to.
I'm gonna throw in my own question.
This will be the final final round.
The point about life expectancy allows me
to kind of point out that
whilst average life expectancy
might be dropping slightly
is because inequality
in life expectancy is growing.
The life expectancy among
those who are at the top
of the income distribution,
I'm not suggesting they're
gonna live to be 200
although you clearly will.
(audience laughing)
But it's the inequality in life expectancy
which is reflective of all
the other deep inequalities.
That's one of those
occasions where the average
is really dangerously
misleading in some ways
'cause it's disguising
this huge inequality.
Andrew, I'm gonna give
you the last word Andrew
but I just wanted to
invite all three of you.
I'll start with you Vanessa.
Some of this feels to me as if
people believe and I'm
gonna say I believe it
if it helps with the argument
but there's an individualistic
ethos in America,
it's in the DNA that you
do make it on your own,
you're a mistress or
master of your own destiny,
that government overreach gets in the way
and everybody can make
it and every Americans,
however poor, sees themselves
as what someone described
as a temporarily embarrassed millionaire.
And if everybody sees themselves
as a temporarily embarrassed
millionaire and you know what
in America you can make
it and we're on our own
and it's a meritocracy at the end of it.
Is that ethos as deeply
rooted as I think it is
because if it is then maybe
all of this is for know anyway.
And if not, why do we keep
getting the outcomes that we get.
Why do we still keep talking
about ourselves that way?
Vanessa and then I go to you.
– So classically, people would say
that Americans are
theoretical conservatives,
they say like like small from
an operational liberalist
which just means if you ask
them about any major thing
government does like
education, healthcare,
I think we should be spending more on it.
So no, I don't think Americans
are components of government at all
because they have so consistently said
that they would like the
government to be doing more
when it comes to looking
after the American people
where I think you'll find the tradition
of antitax sentiment in the United States
actually stems from slavery.
But if you look at, for instance
the parts of the constitution
that make it very difficult
for the federal government
to tax, those are intended,
one of them is embedded in the 3/5 clause.
They are intended to protect
a certain kind of property
and to maintain a certain
kind of racial divide
that would prevent solidarity
between working people
but I think that idea that Americans
insist upon doing it on their own
is just not backed by the data.
– Leslie, did you wanna add anything?
– The only thing I would add to that
if that if there is anything to it
and I think it's very relevant
to something like the UBI
is that there is some value to work
and some kind of
fundamental value to work.
I don't think that's
particularly American by the way
it just happens to be part
of the political environment
here in this part of our history as well.
We don't have a history part,
probably because of racial inequality,
we don't have a history
of a strong welfare state.
It's not embedded in our culture.
I don't think it's inherent in any way
and also the US had wild economic growth
in the post World War II
period that was widely shared.
So work was, I mentioned this
in my opening statements,
the civil rights movement
was about economic inclusion.
It was about inclusion in the economy
to the valuable work and employment.
It wasn't about extending welfare benefits
although that was important too.
– I think it's important
and I do agree with that
but also think Vanessa's
point is gonna be a kind of
a mythical thing about US individualism.
And I'm just thinking
about UBI in that context.
On the one hand it seems
like this incredible piece
of social insurance, very
expensive checks being cut
for 12000 to everybody.
On the other hand it's
incredibly individualistic
because it gets you away from sort of
more paternalistic forms
of welfare and it just says
here's the money and then how
you then decide to top it up
or do it is kind of up to you.
So I can't figure out whether UBI
is actually quite an
individualistic policy
or whether it's a deeply collectivist one.
You know.
– The one reason why it
has such universal appeal
is that libertarians love it
because they like as long as
the government's not making my decisions.
I like economic autonomy and freedom.
Liberals and progressives
and democrats like it
because they know it'd mean more money
in the hands of children and families,
it would mean better
health, education outcomes,
mental health, lower stress levels.
It would empower millions
of American women
who are right now in
exploitative or abusive jobs
or relationships to
actually improve their lives
and the democratic party came out
to talk about empowering
women or do something about it
and I believe we should
do something about it.
But I wanna look around this room and say
there are a couple of a
hundred of you here tonight
and I have a feeling you're all here
because you sense that things are trending
in a very negative direction,
like no one saw this topic and was like,
"Oh, things are fantastic.
"I suppose I will come here
about how great they are."
Like you sense that there's
a real ill afflicting
our body politic for sure and our economy
and it is becoming increasingly
punitive and inhuman
and we're not sure what to do about it.
But the people in this room,
it's actually a very high level commitment
that you can I'm gonna
spend a couple of hours
and learn about this.
We need to do something
about is as fast as possible
for the sake of our
children, our grandchildren
and leave the society that
we're still proud of to them
because we do not have limitless time,
and we know what must be done.
The time talk is well
past and now we must act.
(audience applauding)
– Thank you.
I'd just like to thank
all of you for coming,
I encourage you to check out
the work of The Stone Center
here at The City University of New York,
check out the 'Broken Capitalism' series
of The Guardian and the
work of all the scholars
that you've heard from tonight.
Please join me in thanking
our distinguished panel.
(audience applauding)

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