Democracies are being unraveled with by a new class war. [inaudible conversations] good evening and welcome to Hudson Institute, stern policy center. Im john wallace, chief operating officer. Id like to welcome our audience here at our pennsylvania avenue headquarters and our cspan audience the our first ever podcast taping that is both live and marks the Second Season of the premiere podcast of the Second Season realignment hosted by our Hudson Institute fellows. The podcast launched last year, and i recommend end for those of you who havent been following it, that you take a look at the episodes from last year, particularly the conversation with secretary of state mike pompeo, josh haully, mike duran and others. Its an Excellent Program partly because of the two people who put it together and their ability to bring out topics and to move the argument along. So we couldnt be prouder of the work that theyve done and want to thank them for that, and we are happy to launch this Years Program with michael lind who is, as many of you know, a prolific writer of more than a dozen books, cofounder of the new America Foundation with Walter Russell mead. Michael is a professor if at lyndon b. Johnson school of Public Affairs at the university of texas. And important for tonights conversation, he is the author of the new class war saving democracy from the managerial elite. The book was just published today, so were here at the launch. Congratulations, michael, on the new book. Theres a direct line between the new class war and the work that michael has done and has been pursuing since the 90, maybe most exemplifieded by his book the fourth american revolution. Sorry, the next american nation nationalism in the fourth american revolution. Whether you agree with his interpretation of western politics sense world war ii, his work demonstrates a serious effort to understand the causes of and the solutions to seemingly are never ending cycle of clashes and shifting to coalitions, which is exactly what our realignment podcast seeks to explore. Also joining us is j. D. Vance, who fittingly was the realignments premier guest. J. D. , of course, is the author of the best sell ising and highly innine usual book hillbilly elegy. He recently cofound narnia capital, a Venture Capital firm investing in people and technologies working to solve significant challenges. Also a visiting fellow at aei. I have not, ive only started his book. Ive, of course, read j. D. Vances book which if you havent, you should. Its an important discussion of a part of america that maybe someone like Charles Murray would say is outside the bubble of the elite classes. At the beginning of michaels new book, he says dem gynecologygy populism demagoguery populism is the symptom, democratic pluralism is the cure. Im not sure if that is a throwdown for this evening with a room full of people in washington, d. C. , but we are pleased to start from that discussion and to take on that issue with his help. We will take questions later in the program, and you can email those to events hudson. Org, and well get them up to the, to marshall to use as we get to that part of the program. So please send them along. Everyone in here is, i know, technically sophisticated, so this will not be a problem. And without any further ado, let me, please join me in welcoming michael lind and j. D. Vance. [applause] one quick note, michaels going to be available after the talk to sign books, so if you found this great [inaudible] just to reiterate, if you have any questions, event hudson. Org, so at that point ill speak for you. With that, marshall, why dont you start us off. The book is called the new class war. First question, lets define terms. What is a class war . Well, a class war is a conflict among quasihereditary classes where your parent range is associated with a particular structure of occupations. We think we live in a meritocratic system, but if you look at what i argue is the fundamental cleavage in modern transatlantic societies which is educational, its not a matter of mere aftertax income, youre much more likely to get a diploma if one or both of your participants had diplomas parents, which are kind of the new degrees of nobility. So i argue that in europe as well as in the United States, i think both sides of the atlantic are similar enough now to make robust generalizations. That wouldnt have been the case 40 or 50 years ago. But as europe has become more multiethnic, as the United States has become more secular, i think theres some convergence. And what you see is, arguably, this widening divide socially and politically between the collegeeducated and the more or less twothirds which does not are have even a bachelors degree. J. D. , do you agree with that take . Because so interpret what youre saying, it seems like what youre saying is unlike in previous err maas, class status matters more than income. Well, yes and no. The average american who has a bachelors degree has an income of about 60,000 a year. The average High School Graduate with no Higher Education is about 37,000. So theres a correlation. But unlike in the past with class status was based on ownership of property whether you were a feudal landlord and you to owned land or you were an ebeneezer scrooge Small Business owner and the owneroperator of a business, the elites in the western world today, large wily their wealth, their power and their status tends to come from their position in a large bureaucratic organization. It can be a corporation, it can be a law firm, it can be a nonprofit, it can be the military. And access to those lucrative, influential positions is largely determined by education. What do you think, j. D. . Because i think one of the common retorts to that is, with well, its not why is it education is the great denoter of classes . Michael and i were speaking this morning, he said a plumber could be making 100,000 and be rich, still working class. Based on your own experience, how do you see that cleavage in American Society . Yeah. So i largely agree with mike. And, first of all, thank you for doing this. Next time you have me on a podcast, please tell me what color the couch is though. [laughter] i think whats true about mikes account i dont know that the i 100 agree with it, i9 5 i 95 agree with it. Whats true about that account is if you go to a suburb in cincinnati, ohio, and you go to a Plumbing Firm and you go to the guy who owns the firm, the people who work this and then the clear can call staff clerical staff, theres something much more similar about that group of people, about their spouses, about their children than there is, you know, between lets say the owner of the Plumbing Supply firm and a person whos a majority or large shareholder at google, for example. So i do think that theres something about the way in which Educational Status both confers but also sort of reinforces and signifies class status thats really important in our society. And, of course, you know, most people do not, the gross majority of people cannot earn their living off capital appreciation. So there is this weird way in which what mike calls the professional managerial class is coherent even though it might not have the, you know, the sort of person at the 91 per seven tile at the percentile of the income. So, mike, to tie a bow on, this on the managerial class, its like a slur, who are these people in particular . Large bureaucratic organization, corporate elite, government, or is it just in the transatlantic sense what is it that defines them as a class . Well, there are different definitions. The left has something it calls the p and c, the positional pmc, the professional man year class. And these tend to be people in the professions where you more or less set your with own hours; lawyers, doctors more in the past than present, professors, podcast hosts [laughter] and you can work from home, basically. So this kind of progressive theory is there are three classes. This is the working class, theres the professional managerial class, the podcasters and professors, and then theres the capitalists, right . Up there and i reject this. I follow james burnham, the trotzky of the early conservative movement of the 1940s who wrote the book with the managerial revolution. He argued that the independent owneroperator who was the capitalist but also ran his own business had been superseded already by the 1920s in the u. S. And europe by corporate managers. But he also included in the managerial class government officials, career civil servants, academics. And in a passage in 1940, he said the career military. Of the uniformed military which would become more and more important over time as one of the most organized. So long before the deep state, right . At which he was kind of part of, because he worked for the cia a lot in the ensuing decade. So i have a broader definition of it than a lot of people do. But again, its, i think if you contrast it with the working class, the working class is changing its nature because of the changing composition of jobs. Participant of it through parts of it through manufacturing, outsourcing but also through ordinary productivity growth. Manufacturing has she would a lot of jobs shed a lot of jobs. Almost all of the new jobs are created in three sectors. Its leisure and hospitality, retail and health care. And according to the u. S. Government, of the top ten jobs that are being created in numerical terms, only registered nurse requires any education beyond a High School Diploma. So the story that we are told at davos and aspen and not here, of course [inaudible] obviously. Yeah. The jobs of the future require advanced education and all that. Actually, they dont. Americans and their the counterparts, working class counterparts in europe are underpaid. They are not overeducated. And my argument in the new class are war is they are underpaid because they lack Bargaining Power of the kind that they possessed 20, 30, 40, 50 years ago. So before we move on, i think the thing that i havent quite understood yet from the conversation is the war part, right . We can buy that theres an educational system that preferences people with drees, Certain Industries are wheres the war . A war suggests theres a group of people thats elite that is not only looking down upon the working class, but actively trying to harm them to benefit themselves. And im curious what your taken on that is too, j. D. The book is not a Conspiracy Theory, not the protocols of the elders of zion. And i dont think theres, like, some secret, you know, office in washington or new york or San Francisco where the committee of the ruling class gets together. Its just that when power is unevenly distributed among social groups and individuals pursue their own interests, the result even though it is not, theres no coordination is going to look as though the class is doing it when, in fact, its just the result of lots of individual actions. If you look at Public Policy from the 1990 to the present, globalization, one of the things that just amazes me as a student of politics all my life is the unwillingness of people to acknowledge that there are tradeoffs with trade, with immigration, with investment that different groups of society some benefit, some lose. Theres this constant din of propaganda, free benefits for everybody. Large skill, low skill immigration benefits everyone. And you just think, well, this is totally unrealistic. There are winners, there are the losers. So thats part of the war. Of the policy that benefits the winners is the one that is the only one defended in public and the only one you hear. And it becomes taboo to discuss the views of the losers. Thats a kind of war. Yeah, and i want to, quick on that, the way that i think about, this marshall, one of the institutions that the working class has depended on in the recent past actually insure they have equally Bargaining Power, at least some measure of Bargaining Power. So, you know, classic story, labor union, right . Private sector labor union participation in the late 50 i believe was 33 , its now 6 , basically decimated. Its not sort of a right to work story, though im not a fan, it is a primarily localization story. The church, right, chat are you can institution that classic institution, the social fabric and also insures participants have some meaningful participation in the direction of the culture, the direction of the policies that influence that culture. Working class work participation has fallen off. And the big one is families. The place in which working class children grow up hopefully in stable, happy, healthy homes, we know marriage has become a luxury, the solution has dropped pretty substantially m professional class family formation and stability has a slight decline where it was in the 1950s or 60s so all of these institutions that are sort of necessary in insuring working class people both live happy lives but also have a meaningful stake in the class they live in have become substantially weakened in the past few years. So if theres been a class war in the past 50 or 60 years, its pretty clear whos losing. Right x. So from that perspective i mean, i agree with all of this, and the critics specifically of your book, michael, have come out and say you are apologizing and conflating economic anxiety which they say is a rightwing talking point for actual racial resentment. But you counter that in a recent piece you wrote in the wall street journal citing an mit study, counties that were hit hardest were most likely to support donald trump and Bernie Sanders. So if that were the case, why would they be supporting somebody like Bernie Sanders . J. D. , of course, i want to get you in on that after to talk specifically about the economic anxiety piece being really den monoized as just a demonized as racism. There are three narratives about this populist uprising that has produced trump in the u. S. One is its just this spontaneous eruption of neonazi racism which maybe was manipulated by Vladimir Putin from the kremlin, and he just triggered this wave of, you know, boys from brazil white nationalists about to overthrow democracy in the and the u. K. And france and so on. You can tell what i think of that. [laughter] thats a partisan alibi for the loss of Hillary Clinton andmy corbin. Its not and jeremy corbyn. Most serious, its the story about money. Its about rising inequality. And progressives in particular, they like to have this graph of the great compression, and it goes down from the 1920s, and then it goes up again. And if its just about money, then you have aftertax redistribution, and you just give these working class people checks, and theyll be happy. And the story i tell in the new class war is its about power. Power is independent of money. That is, power the ability to influence your life, to influence your society, and power exists outside of the narrow governmental realm. Is and libertarians get upset with me for this point, but there is economic power in the marketplace. You do not have equality of Bargaining Power between most employers and most employees. There is cultural power in the media. If you dont like the offered use for your children that you find on tv or in the movies, whatever, you cant just go found your own movie studio or found your own social media platform. Thats power. And particularly for americans, the basis of the american creed was in the 18th century what they called republican liberty. The idea that you could not trust concentrated power of any kind, economic they didnt have media back then, but, or political power. And diffusing power and having checks and balances is good in and of itself. And i think weve kind of lost this with this narrative about its all about money. And if we centralize and hoard power but we give you a 500 tax crept or a credit or a 2,000 tax credit every year, then you should be happy. Right. Yeah, please, j. D. Well, i was just going to say im not a fan of what i would call the crack materialistic view of economic ang sity led to trump. I think its much more complicated and difficult than that. Not having a decent job or not having enough money to afford the things you need, thats part of it. But also its looking outside your door and seeing a community that thriving 20 or 30 years ago, and now every single store downtown is closed up. Or finding out yet again that one of your friends, one of your kids friends has die of the opioid end epidemic. Its still very much this feeling of losing power over your own life. I make this point a fair amount, but i think its important so ill make it here again. You have to understand what the purpose is of the narrative the trump voters were motivated by pure racism or pure racial anxiety. If theyre just racists, if theyre just bad people, then you dont have to care about their concerns or worries. We know two thing very substantially about the trump vote. One is that it was really related to the decline of manufacturing jobs primarily caused by the china shock. We also know that it was heavily related and tied to the rise in what, you know, folks have called depths of despair. That when you see a rise in opioidrelated deaths in a community, you also see a significant shift from romney to trump in 2016. Well, if youre focus on the fact that all these people are racist and youre not concerned about the fact that a member of the elite that michael lind is so concerned about actually calls an open yield e epidemic opioid epidemic, Purdue Pharmaceuticals flooded these communities with drugs, and if were not talking about that, then were just participating in a war that elites, i think, have been winning for the past two decades. How do we balance the racial and cultural issue . The thing that the critics, the critics point out true fact which is the country is is changing. The countrys white majority is shrinking, and the places that are most experiencing that anxiety are also sort of, also being cross crosseshit by crosshit by economic factors. How do we handle that . I think the one legitimate part of the critique is the idea there is actually this big culturalling shift going on, and its unclear that the american right is doing a good job of handling that. I think part of it is, it has to be managed in a particular way. Im married to, i guess, a first generation immigrant. I never felt once in my life we didnt belong to the same national commitment. Thats important. You want people who are, who feel like they themselves are asimilar hating, that theyre newcomers, you want people who have been here for multiple generations that they are themselves assimilating as well. I think one of the problems, we talk about it in economic terms and thats fine, its an important piece of the story, but unless youre sort of thinking about intermarriage rates, unless youre talking about other metrics of assimilation are, unless youre trying to manage and control that in a way thats good for the overall population, for the overall country, then i do think youve sort of enflamedded some of these cultural, racial or ethnic techs. That is true across history hisd across society. There is no good example of a society that has absorbed a large number of outsiders sr. Very quickly, very easily. You can blame that on racism if you want to, but its a fact of life are. You have to deal with it, you have to try to tamp it down and, i think, sort of suppress it in a certain way. I i do think one thing american heats who are so uncomfortable talking about culture and the importance of assimilation, that we stop trying to manage it, we stop trying to actually build a unified nation out of the multiracial democracy that we have. And i like that multiracial democracy. I think it brings a lot of benefit. But i also think that it brings some challenges too, and if youre not smart about those challenges, you can call a lot of cultural strife. Western europe is a much, much worse example of this problem than the United States is. What do you think, michael . Well, 100 years ago in 1920 there was a deep, deep divide between protestants and White American of recent immigrant descent or sometimes not so recent in the case of irishamericans and the germans. And it gummed up redistricting because of the ballot between the rural whites battle between the rural whites and the urban socalled ethnickings. You had prohibition, that was a war between the catholics and the protestants. You know, you had the beginnings of multiculturalism, people saying why should the european immigrants speak english. Okay, Flash Forward to the 1970s. The european diasporas had collapsed in most of the big cities in the north or were moving very quickly. By the 1970s, the average White American was partly of british and partly of nonbritish descent. So my question is we hear about the rising nonwhite majority, but thats counting every descendant of someone who is not a Nonhispanic White lebanonwhite for the next 200 years will be nonwhite for the next 200 years. Richard alba and a professor at the university of texas at austin have looked at latino rates of assimilation and intermarriage. Latinos lose spanish as the primary language and marry outside of their group at exactly the same rate that the irishamericans and the germanamericans and the polish and italianamericans did a century ago. So i would go further. I think the supposed racial polarization of politics is greatly exaggerated. If you look at every group except for africanamericans who have this kind of 90 10 pattern with 90 with the democrats and maybe 10 with republicans, the other groups are less polarized including asianamericans and hispanicamericans and Nonhispanic Whites. Nonhispanic whites are very evenly divided. I mean, that was Hillary Clinton and donald trump. So its not polar used in that sense polarized in that sense. Latinos, depending on and state politics in my home state of texas, about 40 went for governor abbott, 29 voted for donald trump. Well, if you, if your definition of polarization is anything thats not 50 50, thats polarized right. But its not enormously polarized. I want to shift the discussion more to one of the criticisms of populism, of people who advocate for populist politics, im not saying thats what youre doing here, is that, oh, you guys are just shouting at the system, and you dont actually advocate for anything. You just want to tear everything down. Finish youre actually somewhat sympathetic to that view. So tell the us about what the actual why do you think it is that populists themselves are not actually good at governor nabs . Governance . Well, im a critic of populism. I argue we dont want to be caught between exclusive insider politics, wellconnected establishments and the occasional outsider or who comes and, you know, represents protest. Thats a terrible situation to be in. It was the politics of the American South between reconstruction and the civil rights revolution. Youve heard of the southern dem gosh right . When you get a condition when much of the population is just disconnected from everything and excluded from politics and cultural authority, youre going to get demagogues, a rise to represent them. So i think this is dangerous. The demagogues, and if you look at the southern example, if you look at latin america, in the north you find this with socalled white ethnic politicians in the northeast. Mayor michael curly, has anyone ever heard of mayor curly from boston . So he represented the irishamericans rebelling against the angloamerican wasp mayflower protestant power structure. You know, in the south it was huey long representing poor whites against the establishment. They almost always fail because the odds are stacked against the outsiders, right . They dont have the money, the power or the connections, and so they can get elected once or twice, but they lose. They dont have the people willing to work for them who are insiders because thats a career suicide. When they do succeed, often its through dubious, a combination of criminality e and charlatanism because they have to be financed somehow, you know . You get this situation, in my own native texas, we had james and miriam ferguson, his wife with, they succeeded even other in the 1920s known as pa and ma ferguson, and they did some good things for the farmers who were froans out. But they financed themselves by selling pardons to the parents of criminals in huntsville prison. Huey long in louisiana couldnt get any money for his populist insurgeoning city, so he went into business with Frank Costello of the chicago of mafia and brought in slot machines. So the source of his patronage as populist governor was slot machine money and was also something they called the deduct box. Every two weeks a certain portion of every state employees pay was deducted and put in it was the actually a chest. It was a box. He was assassinated. It was like the atomic nuke hard football with the president. So i think its, at best, populism introduces new themes and outsiders, but you have to have some kind of reconstruction program. So lets talk about that, j. D. , as somebody who has a foot in both worlds. How do you navigate the professionalism needed to enact populism . And what do you think of michaels prescription here going to the cure that he proposes later on for an actual settlement . Yeah. Well, i do think, you know, on the one hand there are some specific policy ideas out there. I mean, you know, something im a big fan of is the views on how you might reinvigorate a private sector labor union in the 21st centurily with all the pressures that exist, try to make them a little bit less confrontational, a little bit more come prohissing but also give them benefits that they may we survive in a 21st century hyperlocal localize ld economy. I do think that most of the details of what a modern, call it populist, call it class compromise politics would look like not actually there. We have to figure that stuff out. I will say that, you know, i really worry about sort of the political economy piece of this. This goes to your question about navigating various worlds. I mean, or mike and i were talking about this earlier. If you were to sort of collect the call it right populist people who can engage meaningfully with a quantum economics pauper, maybe 40 of them are on this stage right now. [laughter] take out warren katz, youve got another 60. So it is a small group. There is a way in which the institutions, you know, of this town in particular, i think, are just not really well suited to this particular moment. I really worry about the fact that we dont actually have enough of the sort of think tank inte intellectuals, we dont have enough of the administrators, enough of the people who would actually work in government. Theres a lot thats missing. Theres a lot of Institution Building that needs to be done. And is so i think the criticism that there are a whole lot of pop list policies is fair, i also think you first have to sketch out a general way of thinking about how to settle these issues and then, hopefully, start to build the institutions out from there. Were still pretty early days on that. I think the sumup idea that you have, michael, is that postworld war ii we can sort of frame this three different ways. You have economic power, cultural power and political power. On the economic side, if youre a working class, you could check corporate power. On the cultural side, and this is sort of funny, i learned this from the book. You had censorship organizations that checked hollywood and produced bad cultural stag mission when bad movies came out, but at the same time if we look at movie being financed by Chinese Companies and throw up our hands and say, well, i guess tom cruise is going to be antijapan now [laughter] you can see why those matter on the political side. And this was another thing that was hard for me to reconcile, you had the sort of local, corrupt political strongmen back home in the state legislatures who on the one hand we sort of see as corrupt, we see the primary system. But on the other hand, they were much better, capable of checking political power in washington. Why did that whole status quo fall apart . Well, there were Different Reasons for these different realmings. The realm of censorship let me preface this by saying that the working class exercised its power by veto power. It did not have the resources or the expertise, you know, to come up with its own plans. The strike or the threat of the strike is a veto that forces management to reconsider. The catholic legion of decency got the hollywood producers to run hollywood scripts past them in advance. Right . They would say, no, they didnt write movies themselves. The local political bosses could say no to a candidate, right . We didnt have selffinanced candidates. The local political bosses were important because this someone u could go to see in your neighborhood if you had a problem. They connected you with the state party and the national party. Many of them were quite corrupt. A friend of mine used to go around in the 1960s with Bobby Kennedy giving suitcases of Walking Around money to boss of the bronx, and we had the equivalent in the south in the courthouse gangs. So the only thing worse than having these local Party Power Brokers is not having them, is not having them. Because when they all vanish, then the party becomes a label that billionaires like tom steyer and Michael Bloomberg and donald trump can buyment buy. Before coming here a few days ago i went to the west side just to the Democratic Party out of curiosity. So my grandmother grew up on a farm in central texas. She and her africanamerican friends after the civil rights revolution, very similar backgrounds, high school educated, they were participant of the Travis County Democratic Party, you know . And they were part of the precinct machinery and all of that ask and did rex work and so on election work. So so i went to the Democratic Party to see how i could join. And they just had a donate button. I tried the national and the state and the county, and it was donate, right . Which kind of tells you something about the structure of politics. Now its a spectator sport unless youre a donor, a pollster or a candidate. To finish up then, what does, in both your views, a new 21st century class element look like politically, economicically or culturally . And last thing on top of that, like you say, theres no victory in these wars. Theres no world where conservatives win everything, liberals win everything, thats the problem with our political discourse. So what does the new settlement look like. To preface that, i argue you want to have class peace. Industrial capitalism is the great engine of Economic Development in history. So you do not want the employer class to run amok, but you also dont want the working class to be so powerful it stifles growth. If we were in a different situation where the managerial class was too weak and organized labor was too powerful, i would have written a different book. So what i say is we need to have the functional equivalent of some of these membership organizations. And in the new class war i call them the ward; that is, the local political entity of some kind. It doesnt have to resemble the old political machine. The congregation which can be and increasingly will be a secular creed, not necessarily a religious greed as the u. S. Becomes more secular like western europe. And i just determined the guild to encompass all kinds of alternative the Labor Organization of the kind that j. D. Was talking about in connection with warren cass ideas. So these things will not look like the unions and churches and political machines of 1950. But they would serve some of the same purpose, mainly in pooling numbers of working class people. Because if youre working class, you dont have accesses to financial resources, you know, to influence society. You dont have expertise to influence policy. All you have is your members. And unless those numbers are organized in some kind of disciplines, institutional way, you lack power. J. D. , one thing id like to ask get from you before you launch into your settlement idea is what type of mental break does this require from a kind of bakedin ideology that has been on the right now for decades to even consider these as Viable Solutions to help the working classes . [laughter] well, i think that it, first of all, you know, it requires us to think about how i i think it requires us to imagine a world in which effective government is actual better than no government. And i think it requires the willingness to acknowledge that Public Policy at Different Levels actually might be useful in solving some of these problems. I do think that weve undergone this weird transformation in the last 30 years, and i grew up in, you know, this world reading conservative publications, being influenced by them where we made some leap from the private sector is generally the right engine to do things to Public Sector is always the wrong engine to do things. And thats a pretty terrible way to think about the world when youre engaged in politics and Public Policy. Its like surrendering before you even start the conversation. So, you know, my answer on class settlement, i mean, i dont know that i have a very good answer. I would say it probably looks Something Like what mike just said it looked like, you have reinvigorated Community Institutions at the working class level, you have some, you know with, rise in participation in whether its church or something thats local and communal. Its you have actual worker organizations that can push for their interests and advocate for their membership. But i do worry are. You know, when i think about this book which, by the way, i think is excellent and i encourage everybody to buy it, to read and engage with i worry that were incapable of actually solving a lot of the problems that mike writes about. And if im going to put my pessimist hat on for a little while, its not that weve reached this sort of juncture five or ten years from now where we really start to solve things, but that we undergo a 10 to 15, 20year period of sort of managed decline and then, hopefully, well solve those things. I to think theres just a way in which our politics is just so fundamentally broken, the institutions are broken. You know, i dont even know what Congress Actually does right now. Its apparently sort of, you know, looking at an [inaudible] yeah. It seems sort of, its all very late roman republicish, and that really worries me. I dont know what the answer out of that conundrum. But i think that if there is an answer that were willing to push for, then we, you know, we should be paying attention to this guy. One optimistic note. We need those. [laughter] bleak. Well, theres a story that of the economist and philosopher adam smith had a Young Research assistant who was reading the newspaper one day and the british fleet had suffered some reverse in a battle with the french somewhere, so he excitedly came to professor smith, and he said britain is ruined and professor smith said, young man, theres a great deal of ruin in a country. [laughter] so more to come. [laughter] so were going to move a little on to q a. Ive got some, actually, really Great Questions here. And i think one of the names, and we only talked about it once, was actually donald trump. Its interesting, on this podcast a political realignment sparked by the president of the United States, how actually often we dont end up talking about it. And i think that this is one of the central questions aye seen about this ive seen about this administration. Is trump still at the forefront of the realignment, or has he governed more like a pretrump republican, prioritize thed tax cuts, business needs. Im assuming highskilled workers is a what they meant here, etc. How do you think of trump within the context of the new class war . Let me say that from the beginning i thought trump had less to do with mussolini and hitler than with Arnold Schwarzenegger and his friend jesse ventura. They tried to take over the reform party, and when you get these celebrity outsider prime ministers, they have two president s, they have two choices. One is if they run nominally as the leader of one of the two parties in the United States, they can either govern once theyre elected as more or less republicans or democrats, or they can try to go between the two. From the very beginning trump became a republican. He had not been for most of his life, but that was the fundamental strategic decision he made, i think, with the tax consistent, with a lot of other things. With one exception. The exception is Foreign Policy. The president has far more discretion than in domestic policy where youre much more dependent in your own party in congress. And there i think he has made a difference. That is, his george w. Bush left the country with two ongoing wars in afghanistan and in iraq. Obama was elected because he was going to end the wars, so he added three more in syria, in libya and in yemen [laughter] to date, despite the iran thing, trump has not added a, you know, a sixth war. And he seems to favor theatrical displays of force as an alternative to deeper engagement, right in kind of postponing it. The other area where i think he has shown his own predilections is trade. By bringing in robert lighthizer, very accomplished ustr, who is a democrat, right . Hes not a republican up until he switched in, i think, 2016 or 2017. So i think, you know, trump and im just, you know, inferring this from his actions decided, okay, im going the write a blank check to the bushryan republicans in congress on domestic policy, but im going to push my priorities in Foreign Policy and particularly in trade. What do you think, j. D. . Yeah, i think the first couple years the administration definitely illustratedded institutional weakness that weve been talking about this evening where the an rat discuss of republican apparatus of republican domestic policy, this is not heritage in 1981 that was ready for the reagan revolution. This was a group of people who were largely blindsided, and when they got the opportunity to actually govern, they went back to old playbook of the past 20 years. So i dont think youve seen a substantial sort of realignment in how things have actually gone. The political piece of it still continues. Uhuh still think that you see the shifts. I think republicans now in 20 of the congressional districts in the country, there is a weird way where the policy hasnt quite caught up to politics. The one thing id add sort of as a specific iteration of what mike talked about with trade and about lighthizer is that the china issue trump, i think, deserves remark bl credit for shifting the entire national conversation. Its tough to overstate how different the elite consensus was in 2014 even relative to today. We all sort of get, with the exception of maybe the democratic frontrunner, that china is a significant problem both economically and in the National Security sense. And i really think that credit for changing that conversation, that narrative goes largely to the 2016 election and donald trump. I think thats absolutely right. You see on the democratic stage only one candidate said he would take away the china tariffs, and most of them said they were going to vote for his trade deal with nafta. If thats not political realignment, im not sure what is. I think this is an interesting one. What are system of the i do want to this is a lightning round. Oh, sorry. It could be implemented to restore a more even balance of power between capital and labor . What do you think, michael . I guess well keep it to one. Tight labor markets. There we go. Labor naturally wants to have a sellers market a buyers market in labor. And employers want a buyers market in labor. Thats the basic. Thats why from the 1820s up until the 1990s the American Labor movement tended to be for more restrictive immigration policies, and the employer elite wanted looser and more generous immigration policies. As the former Country Club Republicans have become the new, you know, coastal democrats or their children and grandchildren have, you know, you have seen that shift and the Employer Perspective versus the but even if you dont do anything else for labor, if you have tight labor markets, and its not simply immigration. Its paid vacations, its maybe early retirement, things like that. Anything that makes employers compete for workers is, can help their Bargaining Power. J. D. . I agree with that. If i was going to give a second answer, maybe a substantial increase in r d spending. I do think we do have to actually restart productivity. Its sort of second in the last 20 or so years, and i think thats a technological innovation story. I do agree, more spending on r d so we can get the Economy Today like it was in the 50s and of 0s. Next question. Is incorporating the these are very well researched and written, so so thank you. Incorporating not just an attempt at safing capitalism to insure the system remains viable. And if we do redistribute power and money, would this not make the current winners losers and the current losers winners and not actually correct anything, mike until. No, i disagree with that. I agree with the fdr parallel, but it was alsoture also churchill in 1945, it was Charles De Gaulle in france. You had these postwar settlements, and they had a vision at least for a while of capital and labor as partners in a common project of national and regional reconstruction. They werent battling to the death. Obviously, there were marxists on the left and some libertarians on the right, but that was the vision. I think we can go back the that. The people who benefit from this in the long run are the privileged if they can preserve their privileges by making strategic concessions to the working class. Theres a story about joseph kennedy, the financier father of john f. Kennedy and bobby and ted kennedy. He was asked why he supported Franklin Roosevelt and the new deal, and he said i would give away half my fortune to keep the other half. What do you think . Yeah. I just, i agree with mike. I would say historically if you look at the postwar and sort of, you know, postdepression call it societies that engaged in, you know, whatever we want to call it lindian class compromise, if you look at those who refused to engage in that sort of compromise, youd include russia, italy e and germany, and we know how it went for those guys. I do i think theres something, you know, pretty unpredictable about political instability, and its best in general to try to reform the system as best you can as posed to assume that one group is going to triumph because they typically dont. If they do, its not necessarily good for anybody. Another theme that we touch on here, with the current information revolution ongoing, that unincludes commuters, social media, its, talk about the cumulative impact of the revolution on class war. I think, you know, specifically framing kind of a big tech and the internet specifically. Yeah, i think you theres a radical difference in how media with are used by the social classes. There are all these studies showing that people on twitter are overwhelmingly collegeeducated people. The working class gets much more of its information from oldfashioned television. And from podcasts, of course. Yes. No, i think this is probably more the first group. [laughter] and from radio. Finish because theyre in their cars, you know, in their jobs. I wouldnt exaggerate the role of media that much because first with television and then with, you know, the internet theres this tendency to think that people are terribly malleable and can be mesmerized and hypnotized by the media. I mean, this is the basis of the whole russian Conspiracy Theory that russian memes brainwashed africanamericans into not voting for hillary and, you know, this other group into voting for trump. I remember back in the 70s there was a study that showed when norman leers all in the family came out, it was supposed to promote liberal values, but most of the people who watched it thought around chi was the hero archie was the hero and the whole point of the show was to make fun of the collegeeducated. People have mentalities and cultures of their own. I may be a little more conspiratorial, worried about this modern i. T. Than mike is. When i go to a restaurant with my family and and i see, basically, half of the tables in use all the kids are sort of staring at their devices and the parents are even staring at their devices and not speaking to each other, and you recognize fundamentally the modern i. T. Model is based on what others have called information arbitrage. Every second youre spent on looking at your device is a dollar of revenue that they make. Theyre very are good at making at you stare at those things as long as possible. And i think theres something very disturbing about the way that it captures our attention, about the way that it makes us less productive. Ive talked to a lot of entrepreneurs who are really worried about the effect that it has on productivity in their work force. The people are working 8, 9 hours but maybe only actually working 4 or 5 hours because theyre so absorbed in their devices. I do worry about this, and i think one way of taking power away from the working and middle class is to hypnotize them. I think its probably truer than treating cell phones as just comparable to tv or some other electronic innovation. Is so the last question that we have here is about education. Its about if education is the crosscutting political cleavage that transcends shared interest, how are we defining some ec quit bl Equitable Society that doesnt share the same level of education . What do you think, michael . It depends on if the education is useful to people or not. As i pointed out earlier, arguably americans are overwith educated inasmuch as, you know, different studies show 10 or 15 of jobs being done by people with b. A. S do not require anything more than a high school education. Again, so i think, if anything, its worse for society to have people is have this sense of disconnect between their highfalutin degrees and their perfectly respectable working class jobs that they feel theyre degrade because these are not, its not the income they expectedded from the degree or the status they expected. So now in terms of theres a kind of version of positionivism that says progressivism that says, well, if professionals make more money, well make everyone a professional, and everyone will make more money. If you give everyone a b. A. , it then becomes like a High School Diploma or a ged, and you get a society of don quixotes. He was an aristocrat who had no money. And thats, you dont necessarily want that kind of society. [laughter] yeah. You know, im pretty skeptical that our elite Education System works especially well. Theres always this debate about whether elite education is primarily signaling or whether its primarily Human Capital development. And if you want to test that theory on the people who are the most powerful advocates of this Human Capital development, go to Yale Law School which has an average class size of 200, its, of course, with i went to school and tell the administrators, tell the students, tell the donors, tell the people who are alumni that we should triple or quadruple the average size of Yale Law Schools class. If its such a great education, we should be giving it out to as many people as possible. But, of course, that deflates the value, the exclusiveness of the degree. And i think so much of what were doing with modern education is just social signaling. And, you know, if we dont get out of that trap, if we dont stop spending so much money on it, i think were just screwed. Well on that note. Very optimist inning evening, thank you all. [applause] [inaudible conversations] tonight on booktv in prime time, historian gretchen sor remember will look at how the introduction of of the automobile impacted the lives of africanamericans. Washington post columnist e. J. Dionne will offer his thoughts on how more democrats can win in the 2020 election. George Mason University professor talk about the strengths and weaknesses of president trumps Foreign Policy. Lee drutman, and former chief of staff to president Obama Rahm Emanuel will offer a firsthand account of how innovation is taking place in cities across the country. Booktv in prime time starts tonight at 6 30 p. M. Eastern here on cspan2. Check your Program Guide for more information
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