i am super delighted to be able

to introduce our keynotes. speaker nick romeo and i expect that all of you have read nick's work because this is the kind of demographic that is subscribe to the new yorker since you first got a job after college and so you've already read nick's work even if you might not be aware of it. one of the reasons is as soon as you look at the titles of his articles, you instantly have to read them. i will give you a few examples. too liberal. arts liberate an economics lesson from when philosophy become therapists. can companies force themselves

to do good? should gig work be government run and better business through sci fi? so i'm really excited to have gotten a chance to get to know nick chromeos work better. his new book i think is fantastic i loved every page of it. i recommend that you all buy it. absolutely immediately. you can go with audio ebook or kindle or a physical copy. all good. but the new book's called the alternative how to build a just economy, and it shares some his frontline reporting from around the world on experiments and trying create a more just economy. and i read the chapters of this book and left with hope mostly i read and i get depressed i read work and i felt hopeful about some of these great experiments going on in the world. that's something that we have in short supply these days. so please, let's welcome nick romeo nick romeo.

okay, thank you so much jerry, as is my audio coming through. okay? okay, perfect. i really appreciate kind introduction and it's very nice to be with all of you. we're actually going to start with a bit of british sketch comedy from the early 1990s, so without further ado. mr. lovely. that's correct, yes. i'm glad you can see me at such short notice not to get it done. thanks very much. i'm can for your coffee. oh, lovely. very nice. yes, thanks. right. how do you like it? decaffeinated jug method, low mineral content, spring water, not quite rocks like with semi-skimmed milk with one nutrasweet. understood. right, mark? yes. do we still have that chemistry set? the office. are well then just one coffee,

please. okay. right now, suddenly you're after a loan, is that right? that's about the size of it. yeah. you say in your letter that you're starting up a new business and you'd like to take advantage of our greedo stop packaging. that's absolutely right. yes, we didn't. as you say, what the product is, you're hoping to market as, it happens. i've actually brought along a couple samples me and we haven't actually on brand names yet but basically the blue sachet is cocaine and the red is heroin. sorry, the market research we've done so far has indicated that cocaine is thought of as a brighter, fresher product, and therefore the blue and heroin is warmer, more passionate, hence the red and if you disagree, i would certainly value your input. you're planning to sell and distribute drugs? yeah. the markets. i'm ready to go. and let's face it, europe's open for business. yes, i'm problem for a bit. well, i think perhaps i know what you're going to say. certainly up now, this is an

area which has been hedged with a lot of rules and regulations. and to be quite honest, when i first looked at this market, i thought to myself i'd be better off manufacturing red tape got red tape? yes. but thankfully those times it's a changing now. whole new markets are opening up and i'm ready to play them. yes, but the demand is there, no question. is it? well, one of the most exciting things for me is that it's such a young market. young. oh, immensely young, yes. consumer profiling indicates the 12 to 15 year olds segment. if you if we can instill brand loyalty into them at that age, well, that's going to be good news. but but but yes. you're thinking 12 to 15 year olds, do they have the income. well, what i always said of that is this. i'm the products, right. they'll find the income. you know, mothers, handbags, car stereos, old age pensioners, wherever it is. yes. i hesitate to use words like this and it's old fashioned, but do you think this is strictly moral? i modern moral.

do you think it's moral? moral? yes. you're actually going to be precise figures on that 60%. you give me a partial. no. is it moral to do this all you know, with children and so on? well, let me just say this. i mean, would you rather stood idly by and let the germans, the dutch, south americans over our market share? where's your precious morality then? well, up a country without a paddle. that's where it is. the question is this you believe in market forces or you don't? well, i can help you that because i don't don't know. i don't in market forces. i used to, of course, when i was a child but like everybody else, when i got older, i discovered it was all made up. i made up. yes, yes. i can still remember exact day i found out it was a christmas eve and i couldn't sleep and i crept and i heard my parents, they were talking and arguing and laughing about market forces and

saying how they were going to have break it to me one day it was a bit of a blows you can imagine. two years later i discovered that father christmas didn't exist either didn't exist. you did you still? i did actually, yes. i am sorry. growing up, i was. yes. okay. i'm tempted just to of see fry and laurie sketches for my whole talk but i'll i'll resist that. um, this is the one moment of technical skill, so let's see if. i succeed. i do. okay. okay. thank you. thank you so, the title of the book is the alternative. this is a bit of a deep cut, but it refers back to the old days of the 1980s, when margaret thatcher became famously

associated with the phrase there is no alternative. fry and laurie very much poking fun at that thatcherite zytiga used from the 1980s. you might think what if anything, does this still have to do with the today? one thing i think is a little unsubtle thing is that this became more or less the business strategy of companies like jewel which were in fact in the same position as for people who don't know, hugh laurie is the guy selling or trying to get the loan. stephen fry is the bank officer who sort of a bit troubled. and then says the word moral, thereby shattering the worldview right. so jewel more or less adopts this as a business strategy. and even beyond that, i think the deeper point, in fact generalizes that the danish king of moral concerns from markets,

a very serious issue there's a quotation attributed to the greek philosopher, a epicurus. epicurus once said death where death is, i am not and where i am. death is not too simplified. one might say that many people still view the world of markets and morals in the same way where markets are morals are not where morals are. markets are not. you won't be surprised to learn that the books of pushes back on that narrative. it's an attempt to argue for the value of re injecting ethical and moral concerns into thinking markets. so just to just a little longer with fry and laurie because i think they're actually quite and they're poking at something which gets at a really deep issue at heart of economics. you know one of the things that makes this sketch is there's role reversal, right?

normally the kind of no nonsense, tough adult growing up position is, the one that says morals, nothing to do with markets. right. if we want to be realistic, if we want to be adults, we pay attention to the bottom line. so flipping that and exposing that is a sort of childish mythology, while provocative, i think is actually quite insightful. you might think about many, many other types of issues that in fact already reflect this worldview, right? what sorts of things are even available on markets? who's allowed work in the labor market and at what age? this has recently been a matter of enormous. hannah dreier at the time has won a pulitzer prize for reporting on underage workers around america. so who and at what age works within a market? what products are produced, under what conditions, what sorts of safety conditions, what sorts of profits do the companies i mean, ultimately,

this is a policy that reflects some sort of previous moral or political worldview. so, in fact, the fry and laurie point, i think, generalizes quite nicely. i think many people sort of already hold intuitively, but this is just a very pointed reminder that in fact, we forget it at our own peril. now, to put that the other way around, never a question of free versus unfree markets, right? markets, institutions that reflect policy policy in turn reflects, morals. so the question is never between the presence absence of regulation, it's which regulations. this is a matter of intense change throughout many of the things we now take for granted from the 40 hour workweek to child labor laws to workers comp were once intensely lobbied against and opposed. hard to imagine, really come to the end of history. i think that's probably one thing. despite all of the diverse backgrounds people might agree on, there's enormous change the

future. so i've spent the last years covering a kind of political economy for the new yorker magazine. and i say political economy intentionally harkening back to an older tradition in which the field of economics really self-identify as part of political philosophy that goes away to a large extent in the 20th century. and the first chapter of the book is all about the battle for academia for the heart of the econ 101 curriculum. this also maps on to business schools and more advanced beyond econ 1 to 1. so i just want to do a little of brief intellectual history about the field of economics, a little bit of insider detail on how economics presents itself and thinks of itself. then i'll move on to a series of case studies from around the world. as jerry mentioned that are actually kind of reported examples of hopeful paradigms policies and actual businesses that are, in some broad sense injecting moral concerns back into economic ex pushing back on

the kind of hyper naive market forces worldview. so that's a rough road map for tonight. so, okay, some very rapid, very rapid intellectual history. if you go back about hundred years at the dawn of, the field of modern economic looks, i mean, some people might go even further to adam smith. i'm just going to start with david ricardo, who who's an english political economist. and if you're wondering, what was the pre-history of market forces narrative, who up with this? well, there are lots of plausible candidates, but i think david ricardo is an interesting one. writing in the early 19th century in opposition to poverty relief for the english poor, ricardo invokes the of gravity and he says anyone who attempts to intervene is essentially as naive as someone who were to oppose gravity. so there's a comparison between market forces to physical forces using this metaphor of gravity.

and he's doing this to oppose poverty, the sorts of policies that became a mainstay of social safety nets around the world. leap forward 100 years. you an american professor who is writing at the turn of 19th or 20th century. so is the era of enormous corporate power and the antitrust movement is just taking off. so this professor says, and he's not a household name, so don't worry about the name. but he says almost identical language. anyone who opposes the constant transition of corporate power is as naive as a critic of gravity. same maneuver, right? there are natural law like forces, just in the same way that are laws of physics. there are laws of economics never mind that the laws of economics happen to tell us that poverty, relief or opposition to antitrust are fundamentally impossible. zoom forward another hundred years. you probably supply your own

examples. one that i like comes from science where they're justifying the distribution of income in the world and it's a sort of declining exponential curve. and the maneuver here. well, doesn't invoke gravity. it evokes a kind of biology metaphor, and it uses the same language of inevitability. the idea is, look we see these patterns, these same curves, all sorts of domains, whether it's the size of colonies or the distribution size of newspapers. this is a deep pattern in nature. there's something inevitable. anyone who wants to oppose that is opposing a market force right? so we might laugh at you in the sketch, right? but in a deep she's actually winning. that world view is incredibly powerful. and you can probably think of many other. whether it's increasing wages for, workers giving workers actual ownership equity stakes in companies, whether it's the elimination of poverty as a policy at some level of these

ideas are opposed with a version of the market forces. objection. so that justifies a little trip back 200 years in intellectual history. now, you might wonder who, if anyone, is the tradition. of course, there is one. this has been a raging debate for centuries. i'll just choose a few examples. they tend to be people from cambridge based on my observation. so there's john maynard kane's. keynes famously says the master economist has four elements. there's sort of one fourth philosopher, one fourth statesman, one fourth historian, one fourth mathematician. so not that you get rid of modeling statistics. these are very important and powerful tools. but you're three fourths humanists basically. again, political economy versus, economics, that's keynes in the early 20th century, one of his colleagues at cambridge, john robinson, a wonderful economist, famously that the answers to economic questions, sorry,

answers to economic problems are always political questions. so once again, you have a very sort of capacious view of economics that recognizes that it's situated necessarily within a previous of moral, political, ethical reasoning and fast forward 100 years, another economist, he actually just moved. but was at cambridge for most of his career hodgson chang highly his books if you don't know his work i'm going to read a quote from from one of hodgson's books. he says is a political argument. it is not and can never be a science. there are no objective truths in economics that can be established independently of political and frequently moral judgments. so if you don't trust journalist, take it from a cambridge professor or don't take it at all. but i wanted to just sort of give you a sense this debate, the first chapter in my book, sort of follows some of the

skirmishes happening around this issue within academia. so there are people around the world trying to make the economics much more capacious. after all, business is the most popular major for undergraduates in america by a long margin. so as a kind of hidden battleground for ideological economics is perhaps so many people here would pick on milton friedman. that would be the traditional move. and i'm not going to resist doing that. but i have a slightly different spin. the kind of famous statement of this by milton friedman is in 1970, i say, in which he says, the social responsibility of business to increase its profits. i think this is maybe not the most interesting or essay by milton friedman go back a few as a few decades in the early 1950s, he writes essay in which he claims that economics is fundamentally reducible to

objective questions along the same model as all the natural sciences economics essentially is a positive science positive in the sense of positive mistake can know things about the world the same way physics chemistry can. right. why do i say that's the more influential essay? well, if economics is not a science and you have someone writing that the only social responsibility of a business is to increase its profit. that's just one opinion, among others. that's sort of a crank. maybe. or maybe it's very persuasive, but it has a different epistemic status. if this is a scientific truth to the law of gravitation or some deep law in the natural world, suddenly you foreclose and a much, much more powerful way you foreclose. the debate in perhaps a generation defining way. so for what it's worth a little bit pre-history. american economics education for a lot of the 20th century was dominated by a textbook written by someone named paul samuelson,

who was at mit. samuelson was quite aware of his influence, and he's going to come up again a little bit later in this talk. but one of his more famous remarks near the end of his career, he said, i don't care who writes the nation's laws, if i can write it, economics, textbooks. all right. so he absolute understood the power of economic textbooks as a sort of shaper of cultural, common sense in social jargon. people talk about the overton window who is shaping and sizing its dimensions. i think economists are one among many forces, but i think they're especially an important one. so this new curriculum that i go into in the book, it's been adopted around the world. it's called core. it's an entirely free textbook. many undergrad textbooks cost well over $100. it has a much more sort of capacious use historically situated ethically complex view of economic mix. and many people, it doesn't go far enough. so it's not that the debate is settled, but the sort of

dethroning of the neoclassical paradigm. first established maybe by samuelson, i would say today the throne has probably passed to greg mankiw at harvard. that was my intro to econ textbook. i don't know who else might have read mankiw was an undergrad. a few nods. okay, so let's move beyond academia and move beyond education and take a quick tour through some ideas that i think are especially promising. some of these are not new ideas at all, but i want to give you a little bit of narrative, a little bit of context and hopefully a bit of hope as gary. so we're going to start with the of living wages. what is the living wage? this is actually a surprisingly suffice located and difficult question, which necessarily has some kind of moral or ethical presupposition. right. it's the sort of question that data alone can never answer. you have to have some sense of

what defines living the people who are living deserve to go on vacation. do they deserve to save for retirement? do they deserve to ever eat in a restaurant? should their kids go to summer camp? should they have a little bit of a rainy day fund if the car breaks down right? these are all questions that data alone will not answer. data will be very useful for answering them, but the keynesian conception of economics, where you need history, you need philosophy, is especially relevant to living wages and go 100 years. teddy roosevelt says the following about living wages. a living wage must be sufficient to secure the elements of a normal standard of living. okay, tautology too helpful. yet then he gets a little better, including education, recreation, childcare, a cushion for periods of sickness and saving for old age. this is about 100 years ago. samuel gompers, american later labor leader, had a similar view. the person who coined the term

in america earnings, it was john ryan, a catholic priest. he also adopts a similar view with a kind of interesting twist where he says actually the definition of a successful is one that pays such a wage and then does well. right. i mean, if you have to cut that particular corner that should disqualify you from the very notion success, you're not succeeding. you're doing so by underpaying your workers. and underpaying has a specified content which again must involve moral debate. right now, today, in a real sense, we've backwards in our moral imagination on what constitutes living. many of the most influential calculators are not nearly as capacious as roosevelt's conception. so there's a movement now, and you can understand of the challenge to the movement. there's a movement to say, well, here's the real living wage. you almost have to add word before because the term living wage itself is now hard to take

seriously. you might call it the dying somewhat less rapidly, but it's not actually enabling living, right? it's just sort of dying at a slower rate. arguably. so the the example i'll tell you about just briefly is a millennial from washington d.c. and aaron seddon started company called well-paid maids. maybe of you heard about it. aaron was the former management consultant who got sick of being what you called a mental mercenary. he started this company explicitly as an intervention on the kind of stagnant debates in washington over whether or not it's possible to raise minimum wage, which is a whole nother issue, hasn't gone up since 2009. 725. the federal minimum wage sort of outrageous. aaron said, look, it's hugely overstating the issue when people object that raising living wages will necessarily result in widespread unemployment. not only is there sort of nobel prize winning by people like

cart and krueger out of berkeley saying that this has been overstated through empirical studies, but it's also just a sort of media and education issue. they're obviously very deeply conflicted interests with the people funding a lot of the campaigns around wages are also trying to keep them low as possible. so aaron said, i'm going to prove you can do this and succeed. he's had enormous growth year after year. he's oversubscribed. he's expanding to other cities on the eastern seaboard. so it's one example, but it's kind of hopeful case that he pays well above what the actual couch violators that call themselves living wage calculators pay. he also promotes internally, which we've heard a bit about this afternoon, where a lot of his cleaners end up as operation managers making close to six figures. so there are other examples in the book, but that's a kind of quick and dirty look at living wages and where that debate is.

i don't have a timer, but am i doing okay on. yeah, we're good. okay. okay. i have a sense of how long i've been speaking, but. yeah, i was also thinking we could play a drinking, but most of the glasses are empty, so let's take seriously for a moment the objection that aaron and many other people hear so often, which is that, look, if we really did pay genuinely living wages and notice you always have to insert kind of adjective before it. but if you if we really did pay true or genuine or actual living wages and in many coastal cities that would be 50 or $60 an hour, partly because of the absence of a social safety net. that's worth noticing as well. but maybe there would be something to the concern that this level of wage increase really would drive a rise in unemployment. so what could we possibly do with that to about. well, another chapter in the book explores the idea of a job

guarantee. and for this chapter, i went did some reporting in a small town outside of vienna, austria. i spent a few years training just to pronounce name, which i'll now try to do. it's grammar, not noise signal. so this is a small town of vienna, the industrialized region. it's the site of a famous study, a sort of classic of sociology from, the 1930s on the psychological of unemployment. there was a textile in town that shut down. essentially, everyone lost their jobs. some researchers from the university of vienna went, hung out with people, just sort of got a sense of what their lives were like. it will probably come as no surprise at this point that unemployment is psychologically devastating. it's deeply implicated in addiction, depression, anxiety, all sorts of very profoundly distressing psychological effects related to unemployment. this was a sort of pioneering study document, some of that in very granular detail. fast forward 90 years, the same

becomes the site of a job guarantee, essentially a reversal of what happened during the great depression. then lots of people wanted a job. no one could get one today. whoever wants job absolutely can get one. so i'll just tell you a little bit briefly about how it works. if you've been unemployed for a certain period of you're eligible, but you're not compelled to join. so it's important to distinguish it from what's sometimes called workfare where you're sort of forced into the private market, threatened have all of your benefits yanked if you don't sort of comply? this is quite different. people meet with a social worker and collaborate to identify something at the nexus of sort of two sets. one set interest of workers, others that needs of community. what's in the overlap of the two sets that's the question. so people have been talking a lot about like worker voice. you say that the unemployed people, while not workers when they join the job guarantee they

gain worker voice. they get to say, i'm good at this. i'd like to do this, etc. huge range of people. this trial as well worth noticing that everyone from phds to mbas to very little formal education, maybe immigrants from from syria or the middle east, very broad range of participants in the g really defies any kind of easy stereotype about who's unemployed or who's unemployed. bull another interesting of the g in austria is that it costs slightly less than what the government is already spending on unemployment benefits. this was a kind of important design feature. the people implementing it because it forestalled or prevents the natural conservative objection that we can't afford this. so the idea is looking fact, we're doing this already, but now people have something that tremendous psychological benefits as well as meets genuine community needs. so it's common to think about

this sort of becoming a transition or whatever you to call it, and maybe then job guarantee comes up as a kind of after in a very defensive mode like, okay, maybe that could work. strong political headwinds but we could try it. i think it's also worth thinking about it in a more offensive mode. in fact, the private labor market is quite bad at meetings of very fundamental human needs and thinking, especially of care, work and green work. so people in the g are often doing one or the other of those things, often sort of working with other people or they're doing sort of and this is a municipality. so it's not like the national experiment at this point, but they're doing something around infrastructure, greening community, and there are other jobs as well. so i just wanted to share two things that i thought were especially interesting from from some of the folks i talked with in austria. so the first is actually someone

i could not have spoken with because she was alive the 1930s and was speaking to the original researchers from the university of vienna. this is what she says about unemployment. if i could get back to the factory, it would be the happiest day of my life. it's not only for the money stuck here alone between one's own four walls. one other one isn't really alive. so the idea that a job is much, much more than a source of income, i think is very poignantly expressed in that quotation. one isn't really alive. she's doing very sort of difficult. repetto in some sense at work and yet it was abso lutely a core part of what she wanted to do. not that this is an argument for, a bad job, but it's an argument for the idea that are much, much more than a source of income. so fast forward, this is from guy who i won't name, but he is he is quoted in the book. so it's not confidence. i asked him essentially same question.

what was it like to be unemployed? he says, i was destroyed. if you've worked your whole life, even with a lot stress, then suddenly you have nothing to do. you think you're not needed anymore. you have breakfast and then what am i going to do all day? very similar quotation people separated by almost a century. different backgrounds, different genders, different jobs, different worldviews. same deep insight into the extreme psychological of unemployment. so i won't go on too much more about job guarantees. i mean, i think one other thing to think about is the potential for upward pressure on wages. if was a robust public option for employment. if you knew that you could a good job in the public sector or doing meaningful care or green transition work that paid a genuine living wage. why take a bad private sector job? it would immediately put upward pressure on what are sometimes euphemistically called low road

bad employers would have to pay more. they would also perhaps have to make their jobs less bad, more humane, less surveillance, more meaningful. many of the things we've been hearing about that sort of one macro level function to keep in mind with the job guarantee. some of the economists studying this, they're from oxford. they're also from university of vienna. they definitely have this expanded view of economics that goes beyond the market forces mythology. one indication of is what is a good or thing about a job guarantee entirely depends on your sort of previous moral commitments, right? if you understand cycle logical dimensions of flourishing as a core function of a job job, guarantees are very attractive. and if you can do so, if you can find one without spending any more than a state is already spending on an unemployment, you also have at least some possible path to political plausible, unexpectedly alliterative. okay, so let's let's move on from job guarantees.

i'm going to i'm going to talk quickly about something that is a little bit more embryonic, but is in america. it's in america by virtue of someone, england, whose name is william rowe. and he's a sort policy entrepreneur. and he had the idea of making a public sector option for gig work for irregular workers estimates and data as. you all know much better than i are very, very bad and hard to come by on numbers of gig workers. but it's reasonable to think something. the order of 70 million people by the end of this decade may be working in freelance gig work jobs. so it's an enormous percentage. the us workforce even with a large margin of error. i think that's a reasonable claim. it's an enormous percentage. so instead of having those workers siloed among lots different private companies, often with venture capital investors who expect a high return, who are willing to lose money for decades to gain market share, what if you had a public

option suddenly, instead of a 20 to 40% cut per transaction, sometimes higher, you might have a 2 to 4% cut the entire network would function the public interest. it would be a sort digital infrastructure whereby demand and supply for unmatched and in the same way that other infrastructure like roads, systems water systems fundamentally at least theory, exist in the public interest, the profit imperative goes away and it's a public utility. so imagine a sort of public utility job model matching supply and much smaller cut per transaction flowing away to enrich distant shareholders. that leaves more money that can be returned to workers in the form of wages. it also leaves some sort of interesting questions around career training portability of benefits across many different jobs use of data to chart paths upward so that if i'm delivering burritos today but would actually like to be a home

health aide or if i'm home health aide, but would actually like to be an architect, you a sort of built in public interest platform where the data be through democratic processes is used in a way to workers rather than to sort of surveil and control them. so this is being trialed at municipal levels and there in america, typically in fairly narrow markets, you need anchor employers. these can be public or private sectors. there's interest from larger levels of government. i can't say too much about that or where that exists, but i think is a compelling model. we're going to go back to europe, perhaps not surprisingly, and talk a little bit about worker ownership. now, worker ownership will be the sort of the thing that we can thread throughout europe, in america, it takes very different forms, but i'm going to kind of spend the rest of the talk just outlining some of those briefly. i think it's very relevant to thinking about the questions that have already been raised at

the conference. before we get into worker ownership too much. remember paul samuelson, he doesn't care, writes the nation's laws if he can write it's economics. paul samuelson goes on 60 minutes in the 1970s and says the following in response a question about worker ownership. so the host says that there's this newfangled idea maybe workers can some equity in the companies. what do you think of it? this is samuelson's response. oh, yes, and it would be nice to have lollipops grow on trees for the picking. it really has a marie antoinette ish to it. so remember the market forces idea? this is contravening a fundamental of the universe. if you give workers some capital, you might as well expect lollipops to grow on trees. you're breaking the law in case you're not persuaded by the argument. they'll throw in an allusion to the french revolution. you'll have american heads rolling in the streets. marie antoinette has ring to it.

samuelson in the 1970s, interestingly, i got into this more in the book. samuelson in the fifties was almost from mit because he was perceived as a communist. so this is a this is communism in america, apparently is that sort of robust defense of any kind of capital to workers. so fortunately, many many lollipops have grown on trees since the 1970s, the kind of workhorse model in america is called the esop. employee stock ownership plan used to be called the kelso plan. that's what they call it on 60 minutes episode. there are about 14 million american workers who have esops today. in 2020, they received over $149 billion in payouts from those plans. those are those are a lot of lollipops. and yet one does wonder, had samuelson and others of his ilk not been shrink playing down the size of the overton window in the seventies. what if it now the default model

for business ownership right. 40 million is not bad. it's not 140 million. i think these are rough figures. but the last year i checked, there were about 4000 private equity deals in america and there are about 400 esop conversions. so the role economists. right, it's a counterfactual hard to prove, but one does wonder how worker ownership and by implication, wealth inequality might have been different without that sort of constriction of the political imagination through the market forces analogy. so one other statistic i can't resist is. an analogy between and amazon. so in fact, worker ownership goes way back before the 1970s. the kelso plant is the of innovation, which i, i won't get into much but in the 1950s, sears department stores had some

level of worker ownership and someone did a calculation how much wealth amazon workers in 2018 would have had if they'd had the same as sears workers in the 1950s. so sort of a fundamental all american brand of sears, amazon and separated by about 70 years just asking question, what would it have looked like had amazon the same thing? the answer was close to $400,000 per worker. and this is in 2018. so think about the stock price that is now more than doubled size of the workforce is, more than doubled since then. so you might have close to a million workers who would have $1,000,000 in equity. it's getting close to a strategy to rebuild the middle class class. one thing that i think is important to remember about worker ownership is, you know you often hear conversations around general national wealth building for all of the value of living wages and job guarantees.

those strategies alone unlikely to result in $400,000 of equity sitting around that you could use to buy a house. unfortunately, to send a kid to college is getting close to that figure. now. you're just unlike free to get there through wage increases alone. so i think that's one thing that makes worker ownership especially attractive. if you're thinking. closing generational wealth gaps and helping families build generational wealth. so. there are a few other things i want to touch on briefly. i'm happy to get into more of any of these models. and there are others as well. but i'm happy to go deeper on any of this in the question or just in conversation. two final things i want to say. employee ownership. one will take us back to europe. lots of transatlantic travel here. if you go to the basque region of northern spain, the largest network of worker owned co-op natives, the mondragon company,

i guess you could say, although cooperative, they're a network of cooperatives, has about 80,000 workers across a huge range of industries. they do everything from manufacturing of jet engines subway cars, elevators to something more consumer facing. they have banks, grocery schools. they have a kind of mckinsey style consulting firm. they do a lot of original r&d. they have over 500 patents. the defining feature of mondragon across all these different sectors and industries, well, two defining features the you hear most about is the 6 to 1 ratio of highest to lowest paid. so fairly self-explanatory. occasionally they'll break it if there's a coding language that only three people in europe know, and they have to have it for a product. maybe you break it temporarily. second, basic of moderate on is worker voice and this is quite directly to exercise to a democratic government where

there's a one worker, one vote policy. they form committees. those committees are then in charge of various aspects of operations and people are very directly deciding on important decisions. strategic acquisitions of, competitors, amount of annual operating budget that gets invested in benefits versus reinvest it in research and development. so during the pandemic, this was especially interesting because there were some very hard questions and there's some level of solidarity between cooperatives. if one is doing well, there's some sharing financial upside. there's also sharing of workers, there's reallocation, you're cooperative, goes bankrupt. you're very, very likely to a position somewhere else. so that's the mondragon model, you know, you can take your sort of favorite american ceo, find amount of pay that the lowest worker at that company makes multiply by six. that's what it would look like if mondragon style salary caps

came to america. there's a reason this strikes some people as sort of science fiction and. it shows up in science fiction. kim stanley robinson loves mondragon. he wrote the book ministry of the future. for folks who don't know, he spent a lot of time and money on. but i can tell you it's a real place and it's kind of wild when you go and spend time there because the level of culture shock like i was speaking to the ceo, it's even strange to call him the ceo because he too has the 6 to 1 ratio and he's very down to earth. but we were we were chatting about american company. you know, he reads the news, he's informed and just the idea that the people in your country, they're the ones who own the companies, their to pay the workers less just does not compute as a sort bizarre bizarre worldview. why would people behave that way? absolutely. so it's very useful to sort of get out of the bubble of your own acculturation and education. i mean, even if you're sort of critical of the market forces mythologies, if you grow up in

america to some level, you've absorbed them, right? to some level we are all in the position of hugh, who looks and says moral, moral couldn't have anything to do with markets where i am. death is not where death is. i am not with markets and morals, right? so okay, the final thing i want to sort of talk about is back to america. back to america, a huge footprint for this talk. we're going back and worker ownership in america. there's sort of two other interesting things that i get into, too some extent in the book. one is called employee ownership trust. some claims called perpetual purpose. we got a lot of news attention after patagonia, the retiring founder of patagonia, set up a perpetual purpose trust the basic is to dethrone profit maximization as the fundament whole value of a company. so you stipulate some other purpose in a legal document, a

trust. the trust then owns company and there's a board of overseers who have a fiduciary duty to make sure that the trust is executing on its function and one person i spoke to and i am proud to say i wrote on this for patagonia, one person i spoke to ran an optics, manufacturing firm in upstate york, a guy named rick plimpton. they make sort of precision optical lenses. they show up in in nasa products. there's lot of blue collar work, but it's also sort of kind of job that you learn a lot and advance internally, so many of the things you've been about on previous panels are relevant to how aftermarket functions. so rick was thinking about his own retirement. one option was an isa, and he actually decided against piece despite having very pro social values esops have some downsides. they're expensive to administer. often they have to comply with a risk. laws. they also are technically a

retirement plan so workers don't access that you stop until they retire or until they leave the company. rick wanted a sort of more in real time profit sharing model, so he set up an employee ownership trust. the concern that motivated this, they were sort of offense and defense. again, defense was against private, right. he'd watched other companies in that area, acquired their workforce got offshored or the entire plant shuts down. so he wanted to make sure that with a very profitable company, his values would persist long after he and his co-founder or co-ceo retired. the purpose trust was a mechanism for promoting the es things profit sharing but other people i spoke to also had a broad range of things. one of them had a cap of 10 to 1 where the highest paid could never more than ten x, the lowest paid. another person i write about in the book prioritized hiring people were formerly homeless or

incarcerated at a bakery actually in oakland, so they were concerned if they had money coming in from outside investors, this would be cut. it's expensive to have that sort of a purpose as a company. and yet it was fundamental to why the founder had started the bakery. so how can you protect it? that's the sort of problem that purpose trusts are helping to solve. final thing on employee ownership is a little bit of a mixed success is there are now many investment funds some of them private equity some i wouldn't really characterize in that way that have as their basic the acquisition companies on the point of transition the conversion of those companies into shared ownership model of some sort could be a esop could be an employee ownership trust and then some hold period probably followed by a sale of the company. so we're probably familiar with the much touted statistics around retiring baby boomers over tsunami. there's no shortage of

businesses in america that be transitioning in the next, capturing more of funding, some sort of conversion. that's the basic strategy behind these investment funds, for what it's worth for institutional investors. the room every single person i talk to at these funds said that there's no issue finding candidates businesses with strong financial years that would make wonderful transition targets into some kind of shared ownership model. the issue is getting capital they do not have enough access to institutional capital. many people i said i talked to said know i could execute a fund ten or 100 times the size of my current one tomorrow. if people would write the checks. so for people who write checks, i'll leave it at that one. one person who started one of these funds, this is a fund called mosaic capital. another is called apis and heritage. someone at mosaic told me something just didn't feel right the folks that do 99% of the

work, these everyday workers have no piece of the pie. they just sit on the sidelines. they're sort of collateral damage. so powerful articulation of maybe what's wrong with the private equity approach to the world. interestingly, equity is also now trying to be what's right private equity in the world, partly this strategy. so there's some bigger players. the space like kkr famously. i won't get into the controversy around that but many people would say it's really employee ownership. the owners come out with 2 to 5% ownership whereas many esops 100%. on the other hand the sort of supporters say well look to 2 to 5% is much more than zero. which is true. and it's hard to argue with those stories where get enormous windfalls. then the debate goes back. well, the other 5% is a lot less than a hundred. so where you settle on that, i don't know i guess, you know, my my sort of my final thought i am i good time is going to wrap it up maybe.

yeah. okay, so so final thought for you is like the subtitle and in fact the title of books are often not chosen authors. so this is obviously wildly ambitious subtitle which i am now pleased to disclaim in public. i think even if we do everything in my book and probably many other things beyond we be at a just economy right that's a very lofty goal and the of sensibility of the book and maybe of many people in the room is not like, here's a silver bullet. do this and it fixes everything. the sensibility much more. here's a curated of strategies and policies that to some extent we know already work because they exist in the world. this is sort of me saying, wouldn't it be nice if this me looking at actual examples and yet all of them are solving a very small piece of a very big problem. so there is interesting potential for kind of aggregate aggregating multiple policies

and having cumulative impact by doing many of these at once. it starts to get very interesting when you think what if a job guarantee were, the mechanism by which wages became widespread or if a job guarantee could be sort of harnessed in some kind of employee ownership and what if you combine that with climate budgeting and participatory budgeting, which i don't have time to talk about tonight, but those are also important parts of the book. i think the aggregate of potential of policies is really where, when i think about it, the most hope lies, my sort of final for the talk is i, i start the book with a story from. tolstoy jerry was nice enough that i just-i know jerry was nice enough. mention this this new yorker piece on tolstoy as economist, which might seem far fetched, but i think actually is a very insightful observer of. economic dynamics. and this story is called how much land is a man? it's about a russian laborer in

the 19th century who makes deal with the devil. the devil says, you can have as much land as you can. walk in one day. you just have to make it back to the spot before the sun goes down so the guy goes off, starts and sort of appetites get aroused. the land is looking good, thinks i just keep walking a little further, a little further, a little further. looks back, sun is setting. finally his his common sense prevails. he starts rushing back to the starting point, hoping to make it in time, exhausts himself, does make it back only to collapse and die. so tolstoy's moral much land is in many well, he needs six feet because now he's buried underground in a plot that is six feet large. two interesting resonance to this story in my mind, one in a very different context. maynard keynes famously said in long run, we're all dead right. it does put things in perspective i mean, when you actually think like, what is the point of it all?

why we doing this? why do we show up at work every day? why are we accumulating endlessly? there's a sort of value to that framing. i think perhaps put a little bluntly. second thing, the guy i mentioned in upstate new york, rick plimpton, who runs optimum or did intel quite recently, he was considering his options when he retired. he could have made hundreds of millions of dollars selling to a strategic buyer or private equity. and i'm fairly sure on intention leap she paraphrased tolstoy, how much does one guy need? why would i do that? i'll spend my whole retirement doing management. he's still comfortable. didn't want the hundreds of millions. even more interestingly, thought he very much rejected the framing of his decision as somehow morally exceptional right because in a way if he's extraordinary, then the rest of us can just keep on profit maximizing as much as we want and there's strange weirdos who do things like that, who show up in a kind of strange book now and but that's not normal.

he's like, no, no, i'm normal. i will tell you, i am a normal guy. i do not need hundreds of millions of dollars. how much land is a man need? thank very much. and it is late in the evening. i know if we have any immediate, pressing questions or do we want to come up and hang out with nick in front, let him get a chance to eat some dinner. all right. thank you so much much. gave mesusan, barbara walters w,

known as a history maker, a groundbreaker, but why a rule breaker? you know, weug