at your piece, but before we start, can you tell us about your background and, frankly, about your wealth? >> guest: well, you know, i grew up in a family business, manufacturing business, but when i was in any early 20s i started starting other companies, and i've started -- i've either founded or helped finance and get off the ground, i think, now 35 companies across a range of industries, and i had a series of very fortunate things happen to. my was -- i had a very early interest in the innet and had a friend who shared the interest, named jeff bezos, and i became the first nonfamily investor in amazon.com. he came to my house in seattle and started that here, and then i also founded a company that became essentially the largest independent internet advertising

company in the world, the quantititive, microsoft bought that in 2007. i have started literally dozens of other companies, banks, healthcare, internet, retailing, across a range of industries, robotics, my partners and i helped finance a company that makes drones for surveillance and combat. we sold that to boeing for $400 million a few earing so a broad range of business experiences, and i am very, very wealthy, although i am worth less than $1 billion, but hundreds of millions of dollars. >> so to re-do the title "the pitchforks are coming, what's the message? >> guest: you know, the basic message is there's an old saying from the investment business

which is the pigs get fat and hogs get slaughters, and while i'm a vigorous capitalist, i brief in capitalism, the greatest social technology created to create prosperity, but some economic inequality is an essential and natural part of a high functioning capitalist system, but runaway economic inequality is a disaster. it's a death spiral of falling demand next problem of the country is it's getting -- not that it is unequal. it's that it's getting more and more unequal every day. and it's gone from rich guys like me in the top one percent controlling eight percent of national income 30 years ago when reagan was elected. now in the low 22, 23, 24%, but at current course and speed, in another 30 years it will be 37%, and that is untenable. that's not a capitalist system.

it's a feudallivity system, and you find an economy that concentrates wealths and bauer ends badly for everybody, in particular people like me. so, you know, i'm just saying to my people, let's use some common sense, reel it in, let's not kill the goose that laid the golden egg, which is the american middle class. >> host: as far as the best way of changing that inequality you say a higher minimum wage or living wage? >> guest: yeah. there are all sorts of ways that -- all sorts of policy options available if you want to build a high functioning, high growth capitalist economy. and the basic proposition is that the orthodox economic view held by people on the right and left, is this essentially the trickle-down idea. that prosperity in capitalist societies is a consequence of making rich people richer. if you give tax cut dozen people like me somehow that trickles

down. the pour money into us like an ingredient and jobs spit out. it's untrue. it's a misunderstanding how economies work. prosperity is built from the middle out. the true source of prosperity and capitalist economies is a thriving middle class, and investments in middle class work and tax cuts for rich people expressly do not. and the last 30 years of policy have done nothing but eviscerate the middle class and made rich people richer, all in the service of this ridiculous idea that if you make rich people richer ill it will benefit everybody. it hasn't. if there was a some red of truth we would be drowning the -- a shred of truth we would be drowning in jobs but we're not. so raising the minimum wage is a great way of bringing the wages for workers and the needs of

businesses for customers back into balance. and so i'm a big advocate for raising the minimum wage back into balance with the rest of the economy. as you must know, the minimum wage attractes inflation it would be ten and a half bucks. i itself tracked productivity gains the minimum wage would be $21. if i tracked the wages of people like me in the top one percent, it would be 28. so, yeah, it would be -- it is idiotic to keep it as low as it is. >> host: thoughts from our guest, nick hanauer of politico magazine, talking about issues concerning income equality, living wage. we'll talk more about his thoughts as we go along. of you want to questions, here's you're chance to do. so 202-585-3880 for democrats, 202-53882 for independents.

your political stripes? >> guest: i'm -- certainly in the context of our political environment today i'm center left, but i don't -- i don't consider myself a lefty. i don't consider rejecting trickle-down economics the sign of a lefty. i think it's sincible. people on the far left or anticapitalism. i'm very much pro capitalism, but thank you truth is capitalisms take many forms and either be managed to ben future the few where everybody in the long term and my view is it's stupid not do the latter. the fundamental law of capitalism is when workers have more money, businesses have mother customeres, and a thriving middle class is the source of growth and prosperity in the capitalist economy. it's not the consequence of growth and prosperity. and again, i'm just saying,

let's not kill the goose that laid the golden egg. >> host: first call for you this morning is robert, who is from san jose, california, independent line. go ahead. >> caller: good morning. i didn't get what your background is. do you hire people, mr. hanauer? >> guest: yeah, i've helped helped start or found 35 companies. >> caller: so there would be an array of -- first of all, have to say i'm retired. i'm getting to be in dire straits because of low interest and because of inflation. caused by the government, of course, and what i want to know is if the starting worker, the high school summer employee and then maybe drops out of high

school and stays on next year, is making $15 an hour, is his supervisor that was making $15 an hour -- do you expect this wage increase to propagate through the rest of the scale? and by the way, the middle class is the middle three-fifths. >> host: robert, thank you. >> guest: well, first, want to address the first few sentences which he said. which is this idea that minimum wage workers are teenagers. this is simply not true. it was true when you grew up and probably true when i grew up. today the average age of a fast-food worker in the country is 28 years old. our economy is changed. and it is mostly creating low-wage service jobs. 80% of the jobs the economy is creatings todaying those jobs.

so we have a problem in our economy that extends far beyond the challenges of teenagers, to, frankly, americans in their 20s and 30s, who are trying to get by and raise families. and we have to find a way to make sure that the jobs they get pay them enough so that you and i, sir, don't have to make up the difference in food stamps and medicaid and rent assistance and other things. with respect to your second question, do i expect the wage increases to ripple up, absolutely do. and they will. and that's good for everyone. we want wages for everyone in the country to go up, with the exception of people like me, who make tens or hundreds of millions of dollars a year who don't need our wages to go up. we have to find a way to more successfully balance the income

of all americans so that we end up with a thriving economy. >> host: from cedar park, texas, kim. >> caller: hi, nick, and congratulations on being wealthy. i'm not but i had -- i didn't even have a high school education, and let's say in 17, 18, i lived in texas, i went to work for ti, i went to work in cellular mobile phones, and the moral of the story is i got this trade education through being naive, but i also as i went up the no ladder for blue color collar workers you see a change of legislation and it doesn't allow you to go up. so i can sit here and point out complaints but that's not the problem. the problem is when you get into sales and when you get people make six figures, they see there's no need for the bottom dung, and then they eliminated.

like the mitt romneys. so, what we need is trade. we need to teach people plumbing. we need to teach people ac. teach people hvac, medical, and make it not -- and then again, now you have your legislators. what did day do? they jacked up school and made it like a tool. their tool to get rich. here's the deal. open the borders, let people train, and jack up the middle, and put trade schools and let them do it in two years. i have a broke back from how hard i work. thererg --guest: was a lot there. but i heartily concur that we need to have better trade schools, better apprenticeship programs, better ways of teaching people skills that the economy needs. there are certainly huge gaps between what we need and what we have. but all of this comes back to

the same issue of economic polity. when you concentrate wealth and power in the hands of a few people you wind up with a system that benefits only them and no one else. that mayfield did to the people at the top for a minute but eventually it won't work out for anybody. you know, school is super important today. college, theo university of washington, a world class school, cost 260 dollars per quarter. today it costs $18,000. that is because in my state rich people have stopped paying taxes and it is just ridiculous and silly. byron, alaska, republican line. caller: good morning, congratulation on your new position. my dpe >> >> 100 shares because they

said seattle was growing. i agree seattle is growing but beside the point if i didn't listen you would imagine where i would be today if i bought 2,000 shares because of for there at today. but all three branches of the government using alaska as a primary example it is a republican state. with all three branches of government there are documents that are available with all three branches of the government there is a

decision making system in place to be made available to all parties involved to all three branches of the government if we don't teach the young people what the government's original intent would be. >> what about your views of the government and what it does for this congress or white house with the higher minimum wage? >> ; a lot of americans believe our federal government functions in a super effective way today. there is a bunch of reasons for that let me be somewhat optimistic one of the reasons it doesn't function very well by the ideologies

on the left and the rights that are bankrupt and fairly useless. so we have the same dumb arguments again and again to move the country for word. of and that old and boring argument is a consequence to look at the world in a similar way and there is an opportunity to present itself that allows us to look at the world in a different way in the more sophisticated way to imagine the economy rather than and up mechanistic and whittier equilibrium system is essentially is the ecosystem if you look at it a new way it makes the big difference is, you might proceed.

so my hope is we are entering a place where we start to think about our problems. >> michael is up next. >> caller: a short comment and two brief questions. i have the utmost respect for you i think it is a sign of high intelligence and character thought to know when you are in a system that benefits you've you can see it is not benefiting the rest of us if it needs to be adjusted. i have heard the bought and paid congress of plutocracy to say that's taxation is wealth redistribution. it seems the first transaction a willing buyer

and a willing seller, when that takes place there is wealth transfer right there. i'd like your comment and a second, what about the book capital? talking basically about the same thing and i will take my question of the of the error. >>host: thank you. >>guest: on the issue of redistribution, i actually hate that word because it does not describe how an economy actually works. the best way to think about the economy is the circulation. the heart does not redistribute the blood to the l.a. gear is simply move sit around the system and that is something that is extraordinarily important.

everybody redistributes everything in the economy at all times. those settle while the economy to redistribute that is the lifeblood of the economy is the essential role which is why all high functioning economies have governments which do that. here is one way to think that there are 205 countries on earth have a simultaneous experiment and 50 or 20 are working and you can name those countries. united states and canada and austria and germany and so forth they have high rates of progressive taxation and high amounts of regulation every place on earth where you don't have that you have a hell hole poverty-stricken because these are required

for a capitalist economy. with redistribution is an important part of that. with respect to the book i of 500 pages into it and i've not finish but thomas has made the great achievement bridal believe it is economic or historical in the sense he has gathered the best set of data and the world has had about the accumulation of wealth and what he can show is a concentration of wealth is inevitable part of a market system. he misidentifies the causes which is the rate of return and the simple fact is the economy is a complex system that is technically speaking

multiplicative that the advantages and disadvantages compound and if you don't take steps to make sure they don't infinitely they will. >>host: our guest roche a piece for political magazine looking at minimum-wage issues and joins us from seattle this morning now in the midst of adopting $15 an hour minimum wage. >>guest: yes. one month ago the of mayor sign that isn't too long and it will implement over seven years and that $50 an ounce like the insane departure but here is the thing. washington state already has the highest minimum wage at $9.32 that is 28% higher but

more particularly workers that make up the big portion also makes $9.32 that is 427 percent difference. and they said washington state would have slid into the ocean but yet small business job growth is the highest in the country seattle washington with the second-highest minimum-wage in the country is the second fastest growing metro in the country and the only place in the country the only major city with more small business job growth is san

francisco with a higher minimum wage. this is because when they pay enough to eat restaurants that is not bad for the restaurant business is good for them despite what some owners may tell you. when people have more money restaurants have more customers. and a sensible and fair way is extremely effective to generate prosperity for everyone and growth for business. >>host: of "forbes" magazine. >>guest: he loves may. [laughter] >>host: he writes about seattle's runaway age and also that there will be job losses. >> of course, he says that. that is the orthodox view.

and speaker boehner if you raise a it he will get less of it. but this is odd since 1980 the wages of ceos have gone up 30 times media wage up at 500 times since 1950 they have gone up 1,000 percent. not one that has outsourced the ceo job where automated we have more than ever before. so to for financial services workers. higher wages created less employment then they could not be growing. silicon valley has highest

wages in the country and unemployment is virtually zero. it is not true when wages go up employment will go down. is a corkscrew has cost increase business hope to hold them down in a shed workers but that is the third order of fact the first when people are paid enough money to shop in the stores, they can't and that generates then need for those businesses to hire more workers. this is why high wage places around the world have low employment and low wage places of high unemployment the congo is a plays a very high unemployment and switzerland has very high wages have very low unemployment. it is obvious if for first don't have money businesses

don't have customers. >>host: caller:n. >> caller: i am happy to talk with you today i find it is refreshing to hear someone with so much common sense but that being said that would like to mention during the '50s through the early '70s wh%during the '50s te early '70s when predator could go out to make a living and the wife could stay home with the kids and bring them up and teach them and you have one guy close to the car restorer could buy a house and sent his kids to college and have a middle-class life. the saying is during those years the union membership was at its highest.

and wages rather highest. as a portion of the economy and now it is right to work and people are not hurting trades and cannot learn how to keep our economy going and it is the dumbing down of america. >> i could not agree more. we used to have an economy where jobs paid people fairly and where able to have a family and raise children to have a decent life. the autoworkers who weren't good things did not create more value led those folks

who worked in the factories were not better trained. the simple fact is they negotiate a fairer share of the enterprise created because they had power. and there is simply no reason economically white people like me should get most of the value and people who work in the factories and the stores should get none of it. wal-mart is a fabulous example our largest employer with 1.4 million workers earns $27 billion of pretax profit per year but the largest group of food stamp

recipient are wal-mart workers. there is a reason on earth where it could not pay $10,000 more per year to the 1 million workers raise them all out of poverty and to make them all better customers for wal-mart and other businesses. now people like you and we don't have to make up the difference with bet assistance and food and medicaid. wal-mart will stiller and 17 million of pretax profit and prices to consumers don't have to go up 1 penny breaches have to share the value in a slightly fair way and everyone is better off eventually even the shareholders of wal-mart. we have just forgotten common-sense to keep these

things in balance. i am drone date on but if workers, if wages tracked productivity gains instead of the median wage pin 50,000 to of the close as 75,000. now you don't have the debt, you can afford to send your kids to college and you pay more taxes and everybody is better off. does not make sense. >>host: the republican line the go-ahead. >> caller: good morning. i call into a dispute some of the metrics you are using i will not get into them i will speak generally so we can have the discussion i will not speak to the example is co pay is rising and we don't give you were ceos fear that will create

fewer minimum-wage jobs. what does not comport they get better paid because their union members that is the low hanging fruit. why the focus? i know the answer is a loaded it question why on paychecks and wages? to apply when you're thinking if they had grown finish to be 10 or 1 million times higher but at the same time those items go into the

quality of living standards the latest smart phone or transportation if those costs had risen at the same rate or even close then they would be substantially higher the point is living standards for the united states is substantially higher than anything reasonably comparable. >>guest: where to start. you are correct that living standards in the united states because of improved over the last 30 years. but if that is your metric

have the living standards for the typical family grown faster than any place on earth which should be our goal the answer is definitive leave no. have a simple truth is that 30 years ago the american middle-class was undeniably the most affluent middle-class on earth and today that is no longer the case. swedish middle-class are better off in a strike in a middle-class so the problem with the way we measure these things with the cost

of a phone and it has improved living standards. with the cost the the kids to stagnating wages. for most of the key things as wages have stagnated on a relative basis. five phone does not make a life the a good education makes alive. and then annually earn 35,000 that is a big problem. we have to find a way where

a typical middle-class families to build a decent life for them and their children. >>host: and author of the true patriot and former clinton and speechwriter? >>guest: he was. he has a new book out today to talk cappella ethnicity -- about ethnicity. >> caller: i am so happy to get on i wish you would run for president or secretary of treasury at a 82 year-old retired black physician and i pulled myself up but my bootstraps. and we had 94 shoes but you

cannot afford them. [laughter] since corporations honor people why not have the of robots of the automated systems to pay the social security trust fund? to the social security trust in the middle-class market is necessary but the businessman has shifted overseas because the african market creates the middle-class to make more cars in china even in germany. and because the wages are 20% lower.

>> i love that phrase. pull yourself up from your bootstraps without shoes. tribasic me@ bootstraps without shoes. tribasic message is markets in the economy is are constructions and people make them. what is not surprising they make them to benefit them and ready to make it in the way not just the tippy top this ridiculous ideas that if you health -- help people at the top it helps everyone. please stop the beating that it is untrue. we have to have an economy that benefits everyone not

designed around the needs of corporate executives. erratically pro-business but those that are completely a different from policies from generally to believe otherwise anything that is good for donald trump is good for new york it is not true. behalf to find a way for the economy to work for everybody or be the economy that works for no one. >> joan crawford was quoted by sega said they would force me to move the organization at $15 an hour we would be all in six months. period. >> a fabulous cl and good friend and he is dead wrong.

[laughter] and here's why. it is very difficult for joe as well as every business person to find cost. i have a 14 year-old son if you have a boy and that means rage it will identify but what i could tell you is 90 billion% that homework is useless and costly exercise and in obliteration of their liberty because 13 year-old boy days can very easily calculate the cost of doing the work but not the benefit. from a small business person

to the ceo of a giant corporation can quickly calculate the cost and the risk to pay workers more benefif operating in an economy where everyone earns higher wages. they cannot mitigate the risk in their head of everyone having to pay that new wage. understandabley that many, many business people look at things like that and see only negatives and not positive's. if i said to the business people, the people running restaurants here in seattle that i was going to double their rent , all of them would tell me that they were going to go out of business and that it would be impossible to operate a restaurant paying that kind of rent. yet new york city is filled with those kinds of restaurants, possibly more density than in seattle, but those folks a two times, three times, four times as much as we do.

it is clearly possible to operate playing -- while paying a higher rent. to do have struggled this. if all of the companies pay $15, not only would we survive but now twice as many people in the country would be forced to buy pillows every year and a business would be far better. what i have often said is -- look, the problem with our economy is that even though i earn 1000 times the median wage buy 1000 i do not kilos per year. my head, no matter how rich i get, continues to only need one pillow. an economy in which one pillow can afford to buy a pillow every year is good, even for me, the guy who owns the pillow business. it is just common sense. host: the house of representatives is just about in.

if you want to read our guests writing it is on "political magazine." you can find it on our c-span

"the revolution" a manifesto 2009. "end the fed" and his latest release the school with revolution. >> host: dr. ron paul in your book from 2011 "liberty