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| Depressing, to me, that nearly 40k people had Liked this by the time I had saw it today. Reich’s is a false narrative |
There’s no doubt professor Reich is intelligent. Wouldn’t be a professor if not, right? And he did do some good things, when he was Labor Secretary under Bill Clinton. Things like job training schemes.
But he’s also an idiot. [ADDED: I wrote this before I found out Musk called Reich the same]. Provably so. He pushed the NAFTA accords. At the time he said the labour unions were “absolutely wrong”, to fear massive job losses in the car industry. Turns out he was the one “absolutely wrong” -- NAFTA led to 50% job losses, loss of well-paying jobs in middle America.
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| 50% job losses after Reich’s NAFTA deal US Bureau of Labor Statistics figures |
So while this Washington gnome destroyed tens of thousands of well-paying American jobs, he now berates people who create jobs. For without Musk, no Tesla. Without Elon, no SpaceX. Without Bezos, no Amazon. Without Jobs, no Apple. Without Buffet, no Berkshire. And without them all million fewer jobs.
As for “inherited wealth”, those he mentions in his odious little hit job of a video, had none. Musk certainly not, as shown here. [LATER: Reich says Musk “came from a wealthy family that owned an emerald mine in Apartheid South Africa”, a story that is completely false; Reich either couldn’t be bothered finding out, or knew it and lied knowingly. Either way, that’s shocking. Full background here]
Bezos was born to impoverished teenagers. Much later his wider family scraped together some starting capital for his new business idea (Let’s sell books online!). But that is what everyone, everywhere, every time, does to get started. It’s what we did with the business we started here in HK. You borrow money from family and friends. To class that as a version of “inherited wealth” is ludicrous.
As is classifying Gates’ mother giving him an intro to IBM as some kind of privilege. It’s always what you do with the chances that counts. What you do with that fortuitous introduction.
Same with Warren Buffett, who grew up with entrepreneurialism in his blood. Not wealth, just a burning desire to make money -- delivering papers as a youngster and selling used golf balls. Which he parlayed into a gargantuan empire. Not just for himself but for millions of workers and shareholders in his company.
Buffett classed his business as “Asset Allocation” and that’s what he did -- allocate capital, in ways so productive it energised thousands of companies, shareholders and employees around the world. I’ve seen the Asset Allocation capacities of Red Raw Socialism in China in the seventies. It’s horrible and wasteful and inefficient and demoralising. China's “State-Owned Enterprises” behemoths of blah.
I’m no mind reader and I don’t want to try to read Robert Reich’s thoughts. From his presentation in the video, one gets the impression -- at least I do -- that he’s jealous of the billionaires. And so he plays out his jealousy by demonising them as a group, those whose money is a measure of their success, not of their wickedness. Those without whom the world would be a worse place. Whereas, without Reich pushing NAFTA in 1995 the US would also have been a better place. At least for the workers that Reich pretends to care about.
PS: Larry Summers, the Democrat and ex Treasurer of the United States, agrees with me!
ADDED: Amazon Anecdotes: Last year I tried to buy some ecologically sound goodies as Xmas presents and found some on a British website. Got all the way to the check out, all the way to the very end, putting in the credit card details, only to be told, at the very very end, that they don’t ship outside the UK. Sigh. Back to Amazon.
Another time a friend who’d just published a book asked if I could buy it via the publishers, not Amazon, as she made clear she though it a horrid capitalist company. So, again, I hie me to the publisher’s website, only to be told they don’t ship outside Australia. In both cases I ended up back on Amazon. And thinking: the only reason those companies don’t ship internationally is laziness. Or short-sightedness. Or both. In any case, not doing what Amazon has done for years, which is, go the extra mile. People love to hate on Amazon. But ask them if they’d rather not have Amazon?
An Amazon trope is that it underpays its staff. It does not. Its least paid workers get a little over $US20/hour. The US minimum wage is $7.25. Amazon is paying its least paid 2.75 times the minimum wage. Hardly enough to support a family for sure. But consider: unless you have zero drive in your life (something which all billionaires have in abundance) you’re not there to stay at minimum wage. That’s just entry level. It’s clear from the Amazon employee structure that there’s plenty of opportunities to move up the ranks, right up into the senior management ranks, if you’re good enough and -- again -- if you’re driven. Drive is the key, despite Reich pooh-poohing it.
ADDED (2): I haven’t touched on other bits of “Reich’s recap”, like the “government subsidies”. In the Tesla case, it was a government loan (not a subsidy) and Reich fails to mention: Ford and GM both got more than Tesla and Tesla has repaid it in full (the others have not). On “Tax loopholes”, I won’t go there, save to say they are also known as “tax planning”. And if you don’t plan your tax, you’re a fool. If you’re a public company, if you don’t tax plan, you’re failing in your fiduciary duty and shareholders will come after you. Simply saying “tax loopholes” is smearing these companies, to no end, save to get foolish folks to Like.
ADDED (3): Reich is talking about America. If we look at the billionaires in Hong Kong, they virtually all arrived here as penniless refugees. That’s the case of our richest man, Li Ka-shing, who famously left school at 15 to start selling plastic flowers. Which he parlayed into a global empire, employing tens of thousands. It’s true that his wealth and that of fellow tycoons is now being passed on to younger generations so they there’s that inherited wealth angle; as they say “we ought have a discussion around that”. Similarly the inequality of wealth issue. Reich raises a large straw man here, for I don’t know anyone claiming that it’s due to the “choices of everyday Americans”. At least not as the only reason. If you look it up, you find quickly that it’s multi-factorial. “Choices of everyday Americans” is part of it; must be. And part of it must be the negative effect of Americans of Color, everywhere everyday being told that there’s systemic racism in the country, that it’s irredeemable and that therefore they can never succeed. That surely is counterproductive and horrid message to give out to a huge section of America. How can that be a good thing? And how can that provide the grit needed to succeed, to work to be a billionaire?
