TED Talk Video On Inequality From A Plutocrat

I think we should talk about inequality far more than we do. Even if I do not agree with the speaker, I would like to engage in the dialogue with anyone who speaks intelligently about the topic.

I’m embarrased to admit I haven’t yet read Pinketty’s Capital, but I will.

In the meantime, this is worth watching.

I don’t love his “We rich people should care about inequality because of the future pitchforks we face, so let’s be self-interested and work for more equality.”

I would prefer an argument that includes an ethical component, something along the lines of “equality helps increase human dignity.”

In his favor, however, he’s smart, provocative, and trying to be non-ideological, all of which I appreciate. Also, I like the examples he gives of the City of Seattle, and the Henry Ford theory of wages. Worth watching.

Please see related post:

Inequality in America – A must-see video presentation

Book Review of Plutocrats by Chrystia Freeland

Cash Transfers and Inequality

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3 Replies to “TED Talk Video On Inequality From A Plutocrat”

  1. Interesting and some good points. However some assumptions may be erroneous and some missing some points.
    1. Wage growth drives inflation. Folks could be worse off after wage growth than before.
    2.Assumption that folks want to get off welfare. I suspect that $15/hr isn’t enough to get many off welfare. Welfare reform has to go hand in hand with wage growth.
    3. America has a service based economy and it needs to move towards an economy that creates and builds “things”.
    4. The USA is part of a global economy. Wage growth in the USA will make it less competitive globally.

    I would challenge Nick to put money where his mouth is. Create a company paying $15/hr and staff it with folks from the welfare rolls. And do the hiring scientifically and statistically driven, not by advertising in the normal places.

  2. I was disappointed he did not talk about Fed policy or stable-state economics. In the beginning he states that economic growth comes from solving people’s problems, but doesn’t go on consider what happens when we begin to run out of new problems to solve.

    And he never mentions the role of inflation, probably because the Fed keeps denying its existence. I would love to show you my household budget from 2001 compared to now, but it would take up too much room. All things equal, the 2001 household expenses would cost at least 50% more now. Wages have also increased, but not by 50% by a long shot. I have no reason to think my experience is unique.

    It is a glaring omission, I think, not to at least mention how the Fed’s response to the recession may have exacerbated income equality (and still is.) For all of Hanaurer’s criticism of trickle-down theory (which I don’t think he fully comprehends) he fails to see how the “plutocrats” use the same logic in defending Fed policy: They drip money to banks (obscenely low interest rates), which goes to companies in the form of credit, which increases hiring, and benefits us all, or something along those lines. Yet somehow it’s all staying with the banking class, which now not only has more money than they can spend on goods and services (as Hanaurer mentions – he only needs a certain number of pants) but more money than they can even invest as capital.

    And yet he only talks about raising the minimum wage. I agree– let him put his money where his mouth is.

    1. I appreciate your comment. But just to play devil’s advocate for a bit: Inflation can be a great wealth equalizer. Generally speaking, inflation hurts people who lend money and helps people who borrow money. And generally speaking (not always, but generally, and in aggregate) lenders are at the top of the wealth pyramid and borrowers at the bottom. So inflation alone can lessen inequality. To the extent your logic is “FED POlICY—->causes inflation —->causes inequality” I think more explanation is needed, or allowance for multiple causes & effects.

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I founded Bankers Anonymous because, as a recovering banker, I believe that the gap between the financial world as I know it and the public discourse about finance is more than just a problem for a family trying to balance their checkbook, or politicians trying to score points over next year’s budget – it is a weakness of our civil society. For reals. It’s also really fun for me.

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