C (2:36)

Yeah, I mean, look, I'm an educator, so I obviously have a professional commitment to the view that education works. But I also think the evidence overwhelmingly shows that it works because you see in the data, the Way in which the kids whose parents put them into certain kinds of schools, get them certain kinds of tutors, get them certain kinds of additional training, then fly when it comes time to test taking and achievement, and totally dominate the top ranks of education.

A (3:04)

You're not just saying education works, you're also saying that there's a very strong positive correlation between price and quality in education and that more expensive education works better.

C (3:15)

Yeah, I mean, one of the things that's happened in elite education in the United States, both in the elite public system, and it's important to understand there is an elite public system so that rich school districts spend two or three times as much per pupil per year as middle class ones, but also in the elite private system, is that whereas these schools used to be sort of playing fields for the privileged, what they now do is they try in the most rationalized way they can to get all the latest education science research to direct the way they teach their children in order to maximize the output of what it is that they do. And you get that results like the gap on the SAT between kids whose parents make over $200,000 a year and kids whose parents have the median household income is now twice as big as the gap on the SAT between median household kids and kids at the poverty threshold. So that shows you just how powerful the effect of that kind of training is.

B (4:04)

So we're saying that education can be bought, that education must be bought if we want our kids to grow up and get these fancy jobs that you talk so much about, the superordinate jobs that pay the best, that get you into the 10%, the 1% essentially have to be, we call it a meritocracy, but it's really just a mask for the aristocracy. You basically need money to succeed and you have to work hard. And that's kind of the rub, right, that you have to. Still, in the old days, you could just be rich and kind of glide. And now you're saying it's not enough to be rich, you have to be rich still, but then you have to apparently work.

C (4:40)

Right. So there are two claims in this argument. Exactly. And they go together, I think, but they're not usually put together. So the first is that education is real. That is to say, these schools actually deliver training that makes people good at things. And then the second is that education can be bought. And what that means is that while we typically think of meritocracy and equality of opportunity as going together, actually they come apart. Because if education is real and can be bought, and some people are rich and buy more of it, then a system that measures actual achievement will block equality of opportunity because only the rich can get the thing you need to have in order actually to achieve. And that's the system we have now.

B (5:18)

Right. And that's actually. And maybe I'm getting ahead of the argument, but that is actually hurting these kids in the long run, hurting everyone. The fact that only a few people can afford to become educated and can afford to be in this higher class of worker, that hurts them because they have to work longer hours. And that's bad for them.

C (5:38)

Yeah, I mean, first of all, it hurts all the people who can't buy the education. So it hurts them by excluding them. We don't have a lot of social mobility. We have less social mobility in this country than in other rich countries in the world. So it hurts them by excluding them. It then hurts them a second time by insulting them because it characterizes what is, in fact, a structural inequality as an individual failure to measure up. So that if you're in the middle class or the working class in this country, you don't have a shot at real success. But the system says the reason you didn't succeed is that you weren't very good or you weren't very virtuous, when in fact, that's not at all the reason you didn't succeed. It's because everybody else paid for their kids to get something you didn't have. So it hurts people on the outside. It also hurts people on the inside. Because to live a life in which at every moment, your own person, your skills, your effort, your training is your biggest asset. It's sort of to manage yourself almost like you're a business. You're the manager of yourself as a business. And that's not a way that a human being lives a flourishing life. It's a way a human being alienates herself from much of her own life. And that shows up in practical ways that the elite works hours it never used to work. So elite lawyers today bill twice as many hours a year as they did in 1960, for example. But it also shows up in kind of existential ways that you have this sort of mechanical and instrumental view of your own life rather than it's being your life. It's an asset you trade in. And that's not good.

A (7:00)

This was a bit where I felt a bit weird about this, because for all that, you are right about a certain sort of subset of the 1% of children doing this thing and winding up, you know, working crazy hours at McKinsey or Goldman Sachs, like most of them don't. And the what you, you know, we all know lots of, you know, rich and privileged kids who wind up actually having perfectly pleasant lives and having happy families and making like, you know, low six figure incomes and like they actually seem to win this whole.

C (7:37)

So I think there are two questions here. First is just in the numbers in the present. If you add up the professionals who work in finance, vice presidents and above at s and P, 1500 companies, doctors in specialist practice, lawyers at law firms whose profits per partner are over about a half million dollars a year, and professional management consultants, you get to between half and two thirds of the 1%. So that just shows you how many of these people who work these hours there are. But of course it's also true that there are lots of people who have enough inherited money that they can opt out of this system and lead more modest professional lives but still have a very high standard of living. And one of the big questions for our society going forward is how much of this sort of ground out earned income that people have now is going to pass to their children as inherited income and then we're going to have an old fashioned aristocracy again rather than the thing I'm describing. And that's an empirical question which way things are going to go.

A (8:34)

I guess I'm saying I'm talking not so much about the inherited income, but I'm talking about, you know, if, if your typical member of the 1% has, you know, two kids and one of them goes, you know, to Harvard and McKinsey and the other one goes to, I don't know, Williams and becomes a. Yeah, a teacher at Williams, say, you know, a professor at Williams and has a nice little, you know, pleasant academic career and can support themselves perfectly happily on their perfectly good upper middle class income without having to do this crazy miserable working all the time life, then you know, that's not, I mean in, in one sense the, the privilege and the education isn't inherited, but the wealth isn't inherited. You don't need to inherit money. There, good.

C (9:19)

So I think it's not a coincidence that when you were trying to describe the other one's professional life, you kind of paused and said and becomes, you know, I don't know, a professor at Williams.

A (9:29)

I'm just looking at everyone in coffee shops in New York city at like 4 in the afternoon. Who are these people?

C (9:33)

Who are these people?

B (9:34)

Yeah, exactly, exactly.

C (9:36)

No, totally right, totally right. But when you try actually to identify the jobs that have the features that you describe high social status, right? You know, high social status, enough income to pass status down generationally through the family. There are fewer and fewer of those jobs and more and more of the jobs that you need in order to be a member of the economic and cultural and social elite are jobs that are grinded out, high wage jobs. And that's happening because the way we educate people is changing the way we work and hollowing out the middle of the labor market.

B (10:09)

I want to talk a little bit more about that because reading your book, I mean, you start out by saying meritocracy is a sham and I'm with you. And but you also, throughout the book talk about these really well trained, highly skilled, superordinate workers who make multiples, multiples, multiples, more money than everyone else. And implicitly and explicitly my conclusion was, oh, these people are smarter than me. And all the poor people and all the middle class people, they're better trained, they deserve million dollar salaries. And that these other jobs, the subordinate jobs, they're not working as hard. And I just, that troubled me because they are working as hard, they're just not making as much money. And the reasons they're not making as much money is because we have these elite, well trained people who have been led to believe that they want a meritocracy, they know better, and they want to cut those corners and keep those subordinate workers making less money, maybe sometimes working fewer hours. But like the value judgment that, you know, the person who went to Harvard Law School and has an MBA is like working harder and smarter, that's just, that's like a false, it's a false creation. It's not in my, to my mind it's not actually true at all.

C (11:28)

So I agree with you that the value judgment that the person who goes to Harvard and works all these hours is smarter or more deserving is false. I completely agree with that. But I think we may have two points of disagreement. One is descriptive and then one is more sort of argumentative. The descriptive point, and this is important, and it's sort of a clinical way to describe something that's not at all clinical, is that we've created, I think the first society in human history in which in fact those who are in the bottom half of the income distribution don't work as hard as those at time the same top. If you look at all the data about average weekly hours worked, it turns out that over the past 50 years, the bottom half of the income distribution is working fewer and fewer hours. Labor force participation is going down even in boom times. And the problem that we have in every other society, the problem that the society had, was that those at the bottom were working too long and too much was being extracted from them. And the problem we have is that we've constructed an economy in which that group doesn't have enough to do productively and so they don't have enough work. Now it's also the case that some of them work very, very hard because the jobs that are available to them are terrible jobs and don't pay a lot. Both those things can be true at the same time. But fundamentally we have to come to terms with the fact that we need to restructure our labor market to create more jobs for middle and working class people, which are good jobs, which they would then work harder at and that would be better for everybody. So that's the sort of descriptive part. The more argumentative part is I agree that the whole thing is a sham, as I say right at the start of the book. But it's a sham in the following way. Within the existing system. It is true that the manager at a large company, the CEO, is adding a lot of value to that company, but the only reason she's adding so much value to the company is that we've stripped every other employee of the company of discretion and the management function and concentrated all the managerial aspects of running the firm in her. And so what she's done is she's stripped everybody else of the thing that she's now hogging. And when she hogs it, she gets a lot of income. And so that's the way it's a sham, it's kind of a circle. She's created a world in which she's essential and now claims to deserve it. But that doesn't mean she's not essential in this world.

B (13:38)

One quibble I would say is back in sort of the halcyon days that you talk about, that everybody talks about, when middle class people and working class people actually made more money, it wasn't because they're necessarily because their jobs were more interesting and their CEO hadn't stripped away the value of the job. It was because of like we had a really strong union presence in the country and, and workers with kind of crap jobs fought really hard and were paid very well for them. And that's kind of, you know, kind of vanished. Right now union membership is low. The, the low skilled jobs don't pay as well as they used to. Used to not have to be a superordinate kind of person to have like a Decent, a decent job. And that was, wasn't because of any meritocracy, it was because of hard, you know, it was workers fighting for their rights and fighting to be paid well.

C (14:24)

Well, partly what unions did is they got workers to be paid better for doing the same work. But a lot of what unions did actually is they changed the kind of work that workers did. So unions got lifetime employment, they got workplace training, they got some measure of worker control over the local production process.

A (14:41)

And in Germany, of course, they got seats on the board.

C (14:43)

They got seats on the board and in the US even at mid century in non unionized jobs. So if you look for example at retail, retail in the US in 1960 was a mid skilled middle class sector. And if you were a retail worker, you had discretion. You were probably the orderer for your firm, you were the stockist for your firm, you were the advertiser for your firm, you did some accounts for the firm. And what that meant is you had a job that demanded things of you and you were paid accordingly.

A (15:09)

I think a bit about bank managers. Once upon a time bank managers would underwrite loans. Now they're just all they can do is type pieces of information into a computer and see what the computer spits back out.

C (15:21)

Exactly. And those guys were not unionized at mid century. But the way in which we did lending required those people to have skills and discretion. And what we've done now is we've stripped them of all their skills and discretion, concentrated everything in the securities traders and derivatives constructors who are superordinate workers. And now they're getting all the surplus because they have all the relevant skills. So that's the kind of story I want to tell. So unions are a big part of it. I totally agree. And the decline in private sector unionization has been a catastrophe for the country. But part of it is because it's changed the way in which we make things to the detriment of the union.

B (15:55)

Members and the way in which we sell them. I had an experience last week where I spent the beginning of the day I was at the Apple store where every three feet I walked, someone else asked me if I needed help. And like finally someone did, you know, I did need help. And I said, oh, how much did the AirPods cost? And you just rattled off the number off the top of his head and then showed me different chargers, blah, blah blah. He was obviously very skilled and knowledgeable. And then at the end of the day I went to Kmart and wandered around for like 15 minutes, never encountered a Human person that worked there. And then I finally did. They didn't know where I could find anything. And I was just wondering what's the difference in how much they're making? I bet it's not that much.

A (16:32)

Surprisingly little.

B (16:33)

Yeah.

A (16:34)

It's amazing how little Apple Store workers get paid. And like they have this thing called the Genius Bar, which is stocked with geniuses. And these geniuses are making like $17 now.

B (16:43)

Right. So, I mean, while I, I agree with you, that's a very compelling argument how sort of the skill and discretion has been stripped away from the subordinate workforce. I'm just thinking about those Apple workers who only make a couple bucks more than the Kmart workers. And it just kind of blows your mind.

C (16:57)

Why is that happening?

B (16:58)

Yeah, and I think it's because the super rich people at the top of Apple pulling the money away for themselves.

C (17:03)

I think there's a lot of that.

B (17:04)

Why would they give it up?

C (17:05)

Yeah, I mean, there are other companies. So Costco, for example, pays its workers substantially more than other retail firms, hires them for longer, trains them more, and produces much more selling productivity per worker. So there are models that are economically viable for the firm and have workers who have more discretion, more skill, and are treated better. And I don't understand exactly where and when they rise up and where and when they don't.

A (17:32)

Right. The whole like Ursula Burns story at Xerox of like, you know, you start at the bottom as a sort of janitor and work your way up to CEO. It kind of feels like that's the thing of the past now. Yeah.

B (17:45)

Another thing I was wondering that is sort of bad about meritocracy and the elite training these people get is sort of the attitude that you walk away with when you get your Yale law degree. Like I was watching your commencement speech and you were saying such nice things to the graduates and commending them on how hard they've worked and like how skilled they are and how proud they should be. I don't take away from any of that. But I wonder when you then get out into the workforce and you're overseeing people who didn't, you know, do all those great things and they didn't get to Yale and they didn't have all these great accomplishments and how they perceive those people and how they then treat those people, I feel like it's all kind of playing together and it's, it's not good.

C (18:23)

I think that's totally right. You know, Dryden has this line about he who most achieves alone should rule or Something like that. And it's terrible. And. And it's made worse by this, the fact that this is a system in which the elites know only one another. They live in enclaves, they send their kids to schools where nobody else goes, they stay married. Everybody else is having a marriage crisis. So there's this way in which the elites have constructed this sort of idealized world for themselves, which puts them in bad faith with respect to sort of the human condition, actually. Right. They give themselves credit for things they don't deserve credit for. They sneer. It's not a good situation.

A (18:59)

And I mean. And talk about the narcissism of small differences. We are both familiar with the sneering, you know, where even sort of the sneering between Yale Law School and Harvard Law School, you know, it never ends.

B (19:11)

There's sneering between Yale Law School and Harvard Law School.

A (19:14)

Yes.

C (19:15)

Since you have the accent that enables me to put in this little dig. I was once at Oxford in a seminar on Marxist thought, and somebody observed that it was ironic that we should hold the seminar in All Souls College, because, of course, the egalitarian college was Lincoln.

A (19:34)

Which is the perfect segue, I think, to talk a little bit more about academia. And I had a piece in my Axios Edge newsletter this week about the MIT Media Lab, which followed up from some amazing reporting done by Ronan Farrow in the New Yorker, also about the MIT Media Lab and the connection it has with money. And one of the things that is interesting about the MIT Media Lab is that it was built from day one with purely private sector money. There was never any kind of hint of public good or university dollars or anything going into this. It was built on this idea that you'd get a bunch of massive corporations to sort of subscribe to the Media Lab and brilliant things would go on in there. And it wouldn't really be an academic institution, but it would create amazing things, and then the companies would somehow benefit from this. And it's a very American institution. I don't think. I don't think it could exist in any other country. And now we are beginning to see this sort of dirty underbelly of what happens when you wind up being beholden to, you know, private donors and money.

B (20:45)

In that sense, you should maybe pull back and explain why you're talking about the MIT Media Lab.

A (20:50)

So why am I talking about the MIT Media Lab?

B (20:52)

Bring up the Voldemort name. The Epstein name.

A (20:54)

The Voldemort name. Exactly. So there was this guy, Jeffrey Epstein, who I'm sure We've all heard of who, you know, was a really, really, really nasty piece of work who was known as Voldemort within the MIT Media Lab development department because his name could not be uttered. And he would funnel millions of dollars into the department through various channels mysteriously as a result of, quote, unquote, favors that, you know, people owed him.

B (21:23)

And this was after he was officially banned from giving money by mit. Yes, yes.

A (21:30)

And this was after he had been tried and convicted in Florida and sent to jail and all of this stuff. And this was after, by the way, Harvard had completely stopped accepting money from him. This is really interesting. The president of Harvard came out with a letter this week saying, yeah, we took $9 million from Jeffrey Epstein. The last donation was in 2007. Then he goes to jail in 2008. After that, he continued to try to donate money to us. And we said no. And this in no way excuses what may or may not have happened at Harvard before 2008. But it does look as though, and I'm not, you know, I'm doing a little bit of reporting about this, it might not be entirely true, but it looks on the surface as though the Harvard Epstein connection, at least people can't.

C (22:17)

See our expressions right now.

B (22:19)

Yikes.

A (22:21)

After. After 2008. Whereas the MIT, that was when. That's when he just, like, moves across town to MIT and starts buttering up Joey Ito, who's the director of the Media Lab. And Joey just bends over backwards for him. He makes. He gets his star professor, Neri Oxman, to make one of these precious orbs for him, and he gets the full VIP treatment. He gets thrown out to Palo Alto to have dinner with Reid Hoffman and Mark Zuckerberg and Elon Musk and Peter Thiel. And like, what is this?

B (22:53)

So that's my question, and maybe, professor, you could help answer it. So Epstein was giving this money ostensibly anonymously, so he wasn't doing it to burnish his reputation as what I'm understanding, maybe he was doing it to sort of keep in the game, to stay.

A (23:11)

This is. This is. This is, I think, a really important misuse of the word anonymous.

B (23:16)

Okay?

A (23:17)

Because there's the high highest form of anonymous giving. If you read your Maimonides, you know, is basically where the recipient doesn't know who you are. In this case, this was in no way anonymous in that sense. The recipient knew exactly who Epstein was. And then when Bill. When Epstein asks Bill gates to give $2 million to the MIT Media Lab, you know, the letter arrives on Bill Gates. Letterhead saying, hi, I am Bill Gates. Here's $2 million. Can you please make sure this is an anonymous gift? The gift is not anonymous to the Media Lab. It's just that the Media Lab doesn't publicize it to the outside world. But everyone within the Media Lab knows who the gift comes from. And Jeffrey Epstein is then invited into the Media Lab. This money is ostensibly unrestricted. Joey can use it as he likes. But Jeffrey Epstein is invited into the Media Lab to meet with professors and help choose what the money gets spent on. So he has all of the influence. He just doesn't have the sunlight.

B (24:16)

So he's buying the influence and the power and the connections.

A (24:19)

That's what he's doing. So what I'm really keen on is that we stop using the word anonymous for these donations and start using the word secret.

B (24:26)

I like that.

C (24:28)

Yeah. So it's a manipulation of the work of the Media Lab. That's at least one thing. It is. And it's also a continuing insertion of Epstein the donor, into the circles of the great and good, whatever that is, without telling the public.

A (24:44)

And I'm not in. But this is also interesting. Like, in what sense is it a manipulation of the work of the Media Lab? Insofar as all of the work of the Media Lab is funded by, you know, private sector contributions, and they all get a say in one way or another over what happens to that money.

C (25:00)

So this, I think, is an incredibly important point, which is that the way in which American universities, private but also to some degree public, fund themselves through these kinds of donations in which the donor sticks around and is associated with the gift, dramatically distorts what American scholars work on and what kind of research universities produce. And to my knowledge, these things don't happen in lots of other rich countries. You know, I was having lunch a couple years ago with a guy who was the provost of a major German university, and he told me he had received a 20 million euro gift to fund research into a particular disease. And then the donor had asked whether the institute that it funded could be named after his father who had died of the disease. And the provost looked at me with shocked anger, said, of course. I said, we have to give the money back. That's totally unethical. How could the donor think he has anything to say about this?

B (25:53)

And that's tame compared to what's going on.

C (25:55)

Exactly. You know, Harvard University, Yale University will sell a bathroom.

A (26:01)

The phallic men's room.

C (26:02)

Yeah. No, really, I can tell you a story. Yeah, exactly. So it's completely different and it distorts things in a big way. So this is speculation, but I think one reason why didn't Obama, following the financial crisis, fill up the leading economic policy jobs in the US Government with left wing radical economists? So there are lots of reasons why, but one reason why he didn't is that there are no US left wing economists, whereas there are French or German left wing economists. And one reason for that is that the way in which American universities are funded is through capital and finance, which bends the economics profession in this country in a neoliberal direction. And so it has huge consequences to what the state and society can do that were funded in this way. And Epstein is, as it were, the fulcrum or the crucible that sees this. But the problem is so much bigger.

B (26:53)

There's also, we have to say that the gender dynamics here are so interesting because I imagine in academia, the academics who can pull in the money, the Joey Ito's who can email Epstein and say we need 100,000 more, no, it's.

A (27:06)

Coming like those academic stars, this is considered small. I love this little factoid so much, is that Joey Ito was like, oh, I need to re up this professor's project for another year. Can I have 100 grand to do that? Jeffrey's like, sure, no problem. And he has like this little slush fund where he can just ping $100,000 into the media lab and it's all, you know, quote, unquote, anonymous, so that no one can see that it's coming from Jeffrey Epstein. Although of course Joey knows that it's coming from Jeffrey Epstein and that's somehow fine. Even though Epstein is barred from giving money to the university because it's such a picayune amount of money, it's like.

B (27:44)

He picked a quarter up off the floor.

A (27:47)

It's only when you start getting into the millions that you need to do what the MIT development officer Richard McMillan called, quote, unquote, the Leon Black route, where like, somehow this is money that Jeffrey Epstein wants to give, but it can't be seen to be coming from him. So it somehow winds up being seen to come from Leon Black, who maybe owed that money to Jeffrey Epstein and wound up giving it to MIT instead. No one really knows or understands how that works.

B (28:13)

Just to finish my gender thought it was the academics who have the power to get the money from the powerful people are elevated in status. And those academics in the Epstein case, Joe Ito, the whole circle, it's all men. It's all men at the dinner.

A (28:28)

Well, there's one prominent example. Well, those aren't academics at the dinner. Well, there's two academics at the dinner, Ed Radefact. But there's one prominent counterexample at the MIT Media Lab, which is the professor at the MIT Media Lab who's probably most closely associated with Epstein. Money, as far as I can make out, is Neri Oxman. And she is force of nature and wonderful, but she is definitely not a man. But other than that, you're absolutely right.

B (28:52)

Yeah. And I think all these circles of influence are very male, especially when we're talking about big, big donors, millions of dollars. And I think it, again, it influences what gets researched, what's considered important, and who gets a seat at the table. And all these female academics aren't getting the seats at the table. And there's that part of the Ronan Farrow piece in the New Yorker where you'll say her name talks about how Epstein comes into the lab with like these two women in tow and they're not even Swenson. Yeah, maybe the women aren't there voluntarily and they feel so uncomfortable. It's just what kind of sign does it send? Does it signal that we're okay, that the Media Lab was okay with Epstein?

A (29:30)

Yeah, the gender dynamics of Epstein walking into the Media Lab with his, you know, very young Eastern European assistants in tow and assistants asked to sit in the, you know, waiting room outside. And there's lots of talk among the women at the Media Lab that maybe they should try and effect some kind of an intervention and rescue these women if they're not there on, you know, voluntarily.

C (29:55)

But I'm just gonna. Again, it's so important that the fact that Epstein sort of was personally vicious about gender is part of this. But the problem is much broader and structural. If you have money being given by finance, which is overwhelmingly male dominated, if you have money given by CEOs, was it Forbes this week who released the 100 million, the hundred most millions of people, one of them is a woman. So if that's who's giving out the money. And these are people who are not just in male dominated fields, they're also people who by and large don't deal very well with women. Of course female professors are going to be substantially damaged by this. Quite apart from whether any of them is individually a sleazoid, that's in some sense the least important thing about these extreme examples. That shows what's going on.

A (30:40)

But also, like, attitudes become entrenched among the powerful, like Marvin Minsky, who is, you know, basically the godfather of the Media Lab was named by Virginia Giuffre as someone that, that Epstein would farm girls out to, to sex. You know, say, have, go have sex with Marvin Minsky even though you're like underage, it's like super rapey and disgusting. And you know, there was just an email this week from Richard Stellman, who's this, you know, huge name in, in open source computing and that kind of stuff. And he was like defending Minsky and, and there's this feeling, and I get emails, like after my email went out on Thursday talking a lot about this, I would get replies from my always male readers saying, well, you know, whatever Epstein did, which was, I'm sure very horrible in his private island, that really shouldn't be allowed to detract from the fact that he was a philanthropic man and the money was put to good use at mit.

B (31:40)

I mean, I think that is an argument that people make. Like, what does it matter the money's going to good use. What does it matter where it came from? I read that Harvard Law School was started with slave money.

A (31:49)

Maybe.

C (31:50)

I think all these universities were. There was started a time when the whole country was slave money.

A (31:55)

Right, right.

C (31:55)

You can figure out how close it is.

B (31:57)

But yes, but that's like, that is the argument that people make. But I feel like with this latest story, the MIT story, Farhad Manju had a really good column sort of breaking down why. Actually, yes, it does matter where the money comes from, and especially in the Epstein case, how the money came, which was secret and it has all these kinds of effects that we're talking about.

C (32:18)

And this goes back to where you started, which is. And I know what, I know about this from listening to and reading you, but the MIT Media Lab was not a traditional academic department, which means it didn't have the forms of institutionalized, professionalized scholarly control over its work product that could possibly resist the distortions that come from donors. It was designed to serve to embrace the distortions that come from donors, as I understand it. And that's a completely different model and much dodgier.

A (32:50)

Well, I mean, I think ostensibly the idea is that the corporations subscribe to the school and in return they get nothing. But, like, who would do that?

B (33:02)

I don't understand what it is the Media Lab. I still don't. I've read all the articles.

A (33:06)

It's such a good question. And I've been there. And it's an amazing building. It's this, this Fuma Hiko Maki like crazy gleaming white building and you walk in there and if you get a tour of it, there's all manner of fascinating things going on. And people are creating, you know, musical instruments and. And robots and beautiful 3D printed glass orbs, and you're like, ooh, isn't this fascinating and amazing? But what it is on some kind of fundamental level is, yeah, I've never really been able to get my brain around it.

B (33:35)

I really thought you were going to say what it is. You could be like, for example, they did xyz, and I'd be like, oh, thanks.

A (33:40)

So one of the interesting things about MIT is they had this very famous. It was basically, it was like a very, very temporary building called Building 20, which was put up in the Second World War, and it was designed to last until six months after the war, and then it would get torn down and replaced by a real building. And it was just like. It had, like, drafty windows, and it was just made out of wood and plywood. And basically every single major invention in the history of America happened within Building 20. And Building 20 lasted until, like, the mid-1990s, in the end, because it was just this sort of blank space that if you wanted to, you know, drill a hole in the ceiling and, you know, grab some electricity, you could. You could do anything you want. It was very, like, open to invention that way. And it had this. It became the most legendary building in the history of American academia. And somehow the MIT Media Lab is like a super expensive, super glossy version of trying to recreate that. And it's not clear that they have, but.

C (34:38)

So can we go back to your question? Is there something that we use every day that was made or invented in the MIT Media Lab?

A (34:46)

This is an incredibly good question, readers. Yeah, yeah. Listeners, right in. I wouldn't be at all surprised to learn that, like, some kind of clever, you know, voice recognition software or something like that might have come from there at some point. There probably is, you know, buried in your iPhone somewhere, but I don't know what it is. Um, let's talk about Bill Gates in Slate Plus.

B (35:08)

Oh, okay. Okay.

A (35:09)

Because we do want to talk about Bill Gates.

B (35:11)

Yeah, I'm just. I don't. We'll talk about. In Slate Plus.

A (35:13)

We'll talk about Bill Gates in Slate Plus. But first, let's talk about Volfefe, because this is a fun little thing, but I think, also weirdly important. I am old enough to remember many years ago on Slate Money, when Donald Trump was elected, there was a brief period when everyone was terrified of his tweets and he's like, and one tweet can move the stock market. And everyone was like, oh, we have to really worry about. He's going to tweet about some company and the stock's going to go down and this is going to be bad for our shareholdings. And then after about five minutes, he just tweeted a lot and everyone sort of said, oh, he's tweeting a lot, and ignored it. And now what's happened is that Citigroup and JP Morgan have independently come out and said, wait, hang on a sec. That was true in sort of the first year or two of his administration. It is no longer true. And now his tweets are actually making incredibly big differences to especially the fixed income and the FX market.

B (36:12)

Right. So JP Morgan unveiled the Vol. How do you say it? Volfefe index to look at his tweets effects on the market. And they found of 4,000 non retweets since 2018 that Trump wrote 146 move the market. And they're more likely to move the market. If the tweet includes like the word China in it, then it's even more likely to move the market. Although someone pointed out in China they ignore the tweets and they don't really do much. But yeah, I guess. And the other fascinating thing they found out about Trump's tweets, I'll just add, before we get into our deep analysis of this, is that Trump tweets the most between noon and 2pm, peaking at 1pm but also based on his tweeting activity, he sleeps until 10 in the morning.

A (37:01)

No, he doesn't. He's always up at like 6 in the morning.

B (37:04)

Based on the. There's the fewest tweets between 5am and.

A (37:07)

10Am I don't believe that. I don't know.

B (37:10)

I think he sleeps really late.

A (37:12)

As someone who has the misfortune to be subscribed to a Slack channel where every single Twitter Trump tweet gets tweeted in automatically.

B (37:21)

Right.

A (37:23)

Whenever I wake up in the morning, there's a huge thing of Trump tweets.

B (37:27)

They said it's more likely that he tweets at 3am than he tweets at.

A (37:30)

3Pm I think what they're talking. I think they're only talking about the market moving tweets. I don't think they're talking about all of his tweets and the market moving tweets. I think that's true. But the. But yeah, he's up and tweeting crazy Hours, like suddenly when I'm asleep.

B (37:45)

All right, well, I'm not letting go of this belief that he sleeps.

C (37:47)

Can I ask you one more question about the market moving tweets? These move the market in the very short term, and then there's a reversion. Is that, Is that the story or is that not the story?

A (37:56)

That's. So this is why it's called the Volf FA Index. It's because what they do is they increase volatility.

C (38:03)

Right.

A (38:04)

So it's not a directional thing, but it's. It's a, you know, first derivative thing.

C (38:09)

Right.

A (38:10)

And the markets being highly abstracted at these points, people don't just buy low and sell high anymore. They're trading volatility. And so if Donald Trump is contributing to that volatility, that is something you can trade.

C (38:26)

But does the volatility diminish shortly after the tweet? For how long after the tweet is the volatility?

A (38:31)

No, the volatility is showing a secular upswing. Got it. As the.

C (38:35)

Got it.

A (38:36)

Influence of Donald Trump's tweets has become greater and greater on the market. And when I say the market, I need to be very specific about this because this is also not the market that people expected. The stock market has actually been quite good at ignoring Trump all along. The markets that are moving here are the markets and bond markets, which of course, are much more important.

B (38:57)

Oh, and I also, this, looking at the Volfefe index took me back to May 2017, when you did the covfe.

A (39:04)

Tweet, which is why they named it that.

B (39:06)

And it was a different time because there were so many articles about the covfefe tweet. And what could this. It was just a typo. But there were. I mean, I think as a country, we've really, we've gotten used to the tweets by now, is what I'm trying to say. So it is actually surprising that they would have this effect now, like you were saying. But they were also saying that the, the tweets where he mentions trade or China or whatever, the least engaged tweets, they might be volatile.

A (39:31)

His Twitter audience does not care about this.

B (39:33)

No, not at all.

A (39:33)

It's the markets who care about this. And I think what we're seeing here is this weird thing that you can say about most presidential administrations. They come in with a clear vision of what they want to achieve, and they go at it hard, and then eventually they kind of run out of momentum. And in the back half of the four year term, not much gets. Well, not much happens with this administration. Like he came in with a bunch of vaguely normally sensible Gary Cohn types, you know, surrounding him, you know, Reince Priebus and these kind of people. And he felt frustrated. And at this point he's pushed all of those out and it's just a bunch of crazies. And he's becoming more dangerous and more volatile and less predictable. And the effects of his actions are greater than they were in the first half. And I think I can't remember the last time you could say that of any presidency.

C (40:38)

Do you think that's actually true in the policy space that he's also proved himself relatively ineffectual? So in the first half of the term there was the possibility that he might actually achieve some of the things he did.

A (40:53)

Push through the tax cuts.

C (40:55)

Yes, he did that.

A (40:56)

And all those judges and the Supreme Court.

B (40:59)

Yeah, the Supreme Court and the whole judiciary.

C (41:02)

Yes, I should say I may be a self hating lawyer. I am very dubious of the long term impact of judicial appointments.

B (41:09)

Really?

C (41:10)

That's another conversation that's so interesting.

A (41:12)

I mean, now you've said it. I think we need to do a little sidebar, explain, given how terrified every single Bienponson liberal I know is of having a Supreme Court dominated by very Republican judges and how bad it is, again, according to everyone who knows about such things, to have a politicized Supreme Court explain the other side of that.

C (41:35)

Well, I think there are two other sides. First of all, there's the backlash story, which is what happened when we had a progressive Supreme Court which mobilized the mass politics against it. And that's happening again now, I think. And the second part is, you know, if the left wins two presidential elections in a row, the Supreme Court will largely fall in line, I predict. Now the one is that like demographically.

A (42:00)

Just according to the ages of the conservatives.

C (42:02)

No, I think partly some people will get replaced, but partly someone like Roberts has shown he doesn't want to undermine completely the legitimacy of this court, and there's a limit to how far the court can be away from the center of the country on core questions.

B (42:16)

But what about all the wackadoo judges he has put into, you know, under the Supreme Court, into the federal judiciary itself.

C (42:22)

They'll be, I think, significantly disciplined by the structure of precedent and doctrine. Now again, the one thing I haven't said anything about is this body of judges is also giving at least cover to, and possibly more a massive effort at voter suppression and disfranchisement. And the One way that I think this can really go south is if that effort is powerful enough to stop the Democrats from winning elections, then it will have been a very consequential part of an overall strategy. But if the Democrats win elections, I'm much less worried about what the courts do than most people on the left. Well, that's very expensive for what it's worth, anyway. But back to Volfefe.

A (43:00)

I think that's a good place to leave it. Let's have a numbers round. Emily, you can go first on this one. Okay.

B (43:07)

My number is $240. That is the amount that women get for passing go in a new version of monopoly called Ms. Monopoly.

C (43:19)

Ms.

B (43:19)

Monopoly, yes. Which is an effort by Hasbro to be. I don't really understand. Feminist.

A (43:26)

This is the Pinkett and Trinket version of Monopoly.

C (43:28)

Yes.

B (43:28)

Instead of buying property, players invest in female created inventions such as wifi and chocolate chip cookies.

A (43:38)

Wow.

B (43:38)

Yeah, this really annoyed me. So then, of course, I did my reporting on this, which is. I googled Hasbro's board, and, okay, it's fine. It's 40% women. I was like, okay, can't tweet about that. It's not. That's not egregious. But then I Googled their C suite, and lo and behold, there's eight people in the C suite and one woman. So if they want to fix the gender pay gap, why don't they start in their C suite?

A (43:59)

Is it the chief people officer? It's always the chief people officer.

B (44:03)

It might have been. I didn't write it down. I think it. Oh, it was the cfo, actually. Oh, yeah.

A (44:08)

Oh, all right.

B (44:08)

Yeah. Even the HR person was a dude. I couldn't believe it.

C (44:12)

Wow.

A (44:13)

My number is 6, which is the number of inches long that the gash was. That was caused by the guy who attacked the Wall street bull with a metal banjo. You might have missed this story in the crazy, but this guy, like, walks up to the famous bull on Wall street with this metal banjo and just starts wailing on it with it and leaves this gash, which is long and 3/4 of an inch wide. And it's just a hole in the bull. I mean, obviously, it's not, like, solid bronze. It's just, like, a shell. And now no one knows who's going to pay for it, because, of course, the whole point about this bull is that it was placed there, like, as a piece of guerrilla art by the artist many years ago and then became beloved and no one pulled it away. But it's not really owned by anyone, and no one's really responsible for it. And apparently it's going to cost $150,000 to fix this. And is the artist going to pay that?

B (45:16)

Just leave the gash. It's symbolic.

A (45:18)

Oh, and did I mention that while he was wailing on this bull, he was just shouting, fuck Trump. Fuck Trump over and over again? Oh, my. Amazing.

C (45:27)

Well, My number is 11.8%, which is the poverty rate in the United States that was just reported by the Bureau of the Census this week, which, on the one hand, is a lot and a disgrace given how much less poverty is in other rich countries in the world, but on the other hand is near historic lows for the US and right thinking opinion for decades has had the view that as long as poverty is getting less bad, who cares about concentrated wealth? That would just be envy. And we're in a time now where poverty is nearing historic lows, but there's enormous agitation about inequality, which just goes to show that wealth is a problem.

A (46:04)

Well, I mean, I looked at the data series two ways, and it's true that 11.8% is near historic lows, but it's also true that we were pretty close to that at, you know, the end of the LBJ war on poverty. You know, it's kind of been going sideways for the past 45 years or so. What's more interesting to me is that the. And you actually mentioned this in your book, the impetus for the War on Poverty, which began in 1964, was a book and a New Yorker review of that book all about, like, how many poor people there were in America and how dreadful this was and how important it was to do something about it. And if you look at the number of people in poverty in 1964 and compare it to the number of people in poverty today, it's actually higher today. Now, as a percentage of the population, it's lower. But we still have 38 million people in America living in poverty. That's the population of California.

B (47:05)

And are there any issues with the way we measure poverty, which is we haven't broadened it enough. Like, it's. It's a very, very. It's hard to get measured as poor. Am I right?

A (47:15)

I mean, so there's a couple of weird issues about that. There's that they do a lot of work trying to set the levels every. Every year. Right now, it's about if you're a family of. With, like, two parents and two kids. I think it said about $24,000, something like that. But I think one thing you can say is that if you are right on the poverty line today, you are probably objectively better off than if you were right on the poverty line in 1964.

C (47:42)

I think that's right. And deep poverty is much less. There are a thousand issues about how this is done and adjusted every year. But there's one maybe nice story, which is that we have the poverty threshold and the way of measuring poverty. We do on account of a woman named Molly Orshansky, who was an economist in the Department of Agriculture and had become interested in poverty long before anybody else was, at a time when it was quite gendered. So that she had a woman's interest at a moment when that interest was not highly respected partly because of its gender. But then LBJ came and things changed, and suddenly she became one of the most important economists in America. So that's sort of a nice story.

B (48:17)

She should be on the Ms. Monopoly board.

C (48:19)

She should indeed.

A (48:20)

She should be on the $10 bill.

C (48:21)

Yeah.

A (48:22)

Okay, I think that's it for this week, unless you're a Slate plus member, in which case you get to learn about the connection between Bill Gates and Jeffrey Epstein.

B (48:30)

Click.

A (48:31)

Other than that, many thanks for listening. Many thanks to Jessamy and Molly for producing, and most of all, many thanks to Daniel Markovich for coming all the way to Brooklyn to record this.

C (48:41)

I think most of all, thank you to you for letting me.