tv Overheard With Evan Smith PBS January 2, 2016 4:30pm-5:01pm PST
>> funding for "overheard" with evan smith is provided in part by mfi foundation, improving the quality of life within our community. also by hillco partners, a texas government affairs consultancy. and by the alice kleberg reynolds foundation. >> evan: i'm evan smith. two decades ago he was bill clinton's secretary of labor. today he teaches public policy at u.c. berkeley and he's just published his 15th book, "saving capitalism for the many, not the few". he's robert reich. this is "overheard". [applause]. >> evan: let's be honest. is this about the ability to learn or is this about the experience of not having been taught properly? and how have you avoided what has befallen other nations in africa? you could say he made his own bed, but you caused him to sleep in it. no, you saw a problem and, over time, took it on. let's start with the sizzle before we get to the steak. are you going to run for president?
i just got an f from you, actually. this is "overheard". [applause]. >> evan: mr. secretary, welcome. >> robert: thank you, evan. >> evan: very nice to have you here. >> robert: good to be here. >> evan: when did income inequality become a thing? i realize that's kind of a metaphysical question. i don't mean it in the broad sense. i know that you have a specific answer when it really became part of the conversation nationally, but when did it become the thing that consumes all of us in every political debate? >> robert: well, i don't think it does consume all of us. >> evan: you don't think so? >> robert: not to the extent that it should. because income inequality is part of wealth inequality, which is even worse, which is also part of political inequality. >> evan: yeah. >> robert: in terms of all that money. >> evan: all related. >> robert: they're all related. >> evan: yeah. >> robert: and we ought to be talking about it even more than we are. i think that i would say over the last four to five years, people began, at least noticing something was really wrong. >> evan: was there a catalyst? was there one moment that you think in the news, some incident that happened out in the world that got us focused on it? >> robert: it was my documentary. [laughter]. >> evan: it was.
inequality -- >> robert: "inequality for all". >> evan: now available on itunes. [laughter]. >> robert: no, i think thomas piketty, a very, very important book contributed to it. >> evan: yes. >> robert: you know, you get with political understanding, a public understanding, there are tipping points. >> evan: yes. >> robert: people just start realizing something's wrong. you know, i'm working harder than ever, i'm not getting ahead. you know, the game seems to be rigged in some way. and i think elizabeth warren has contributed, bernie sanders. there's just sort of a moment where people look around and say, something isn't -- fundamentally askew. >> evan: but of course you go back. you've written -- others have said that if you really go back to the reagan administration, that was when a bunch of regulations on business began to go away and the climate changed a little bit, the discussion of these issues maybe came a little bit more into focus, or the degree to which the problem was exacerbated at that moment, made it so that we couldn't help but notice that this gap exists. >> robert: well, we went for a long time without noticing it. >> evan: right.
>> robert: partly we didn't notice because, you know, it's 1978, it really started in a big way. >> evan: yeah. >> robert: male wages started to drop. women went into the workforce largely because they had to prop up family income. >> evan: right. >> robert: it's not because there are all these wonderful opportunities or professional opportunities. >> evan: right, or that they were paid the same amount as men. [laughter]. >> robert: no, they weren't. and then when that coping mechanism was, in a sense, exhausted, the second coping mechanism was everybody's working longer hours. >> evan: right. >> robert: by the time i became secretary of labor, i'd look at the data and was amazed americans were working, not only longer than the europeans, but longer than the enormously industrious japanese. >> evan: right. >> robert: and then when that coping mechanism was exhausted, we went into debt using our homes as collateral -- >> evan: yeah. >> robert -- to either refinance or to simply get more money. but you see that coping mechanism also kind of came to an end.
and then, of course, we had the great recession. i think that's when people started to wake up to the fact that there is a structural problem in the economy. it's not just the business cycle. >> evan: yeah. >> robert: there's something deeper going on. >> evan: what exactly is it and why can't we fix it? can we identify what the problem is, first of all, and second of all, why can't we fix it? if you could say, instead of the ceo being paid some multiple 300 times the lowest paid employee at a company, we're going to regulate it so that it's only going to be ten times. if you could actually get your hands on that device, would you be able to fix the problem? would that be it? >> robert: well, a lot of things that can be done. and we could spend an hour. if you had an hour or two -- will you give me that? >> evan: i'll give you whatever you want. >> robert: i mean, we could talk public policies. >> evan: yeah. >> robert: you know, you don't allow companies to deduct any ceo pay or any executive pay over a million dollars, you have a corporate tax rate that really does rise or fall depending on the ratio of ceo pay to average worker pay. all kinds of things can be done. the real issue is do you get the political will? where do you get the political will to do any of this?
i think there are many, many policy ideas that are good, but we have got to get the public to the point where the public really is -- like the public was in 1901. i mean, that's the progressive era. very similar parallel. >> evan: so you want us to be brandishing pitchforks and torches. >> robert: no, we didn't brandish pitchforks in 1901. i think the progressive era started because people looked at the excesses of the gilded age and the robber barons, the corruption, the inequality, the degree to which corporations were basically dominating the economy. the concentration of power and wealth. >> evan: yeah. >> robert: and people said this is so antithetical to american ideals. let's put aside our politics for ideology, let's roll up our sleeves -- >> evan: right. >> robert: and we're going to do something about it. >> evan: yeah. >> robert: the most unlikely person in the world, the vice president of the united states who became president, teddy roosevelt, happened to be at the right place at the right time and he could do it. and then taft and wilson. and that was a very important --
very important corrective mechanism. >> evan: right. >> robert: it will happen again. >> evan: it will happen -- well, i want to come back to the public and the public's engagement in this in a second, but i want to stay with something you alluded to, the political conversation around this. in this book you talk about markets versus government as if there's a choice. can't we have both? can't we have markets and government? because it seems as if in the conversation we're having politically today, it's either/or. >> robert: and i think that's the mistake. >> evan: yeah. >> robert: because you can't have a market without government. government sets the rules of the game. >> evan: right. >> robert: the issue is not the size of government. the issue is who government is for. is it working in terms of the rules that are created in the market? is it working to enrich the people at the top and have a lot of internal pre-distributions upward that are kind of hidden from view or is it organized for most people, for the benefit of most people? so that when productivity improves, everybody gets a raise. since the late 1970s, the market increasingly has been organized to reward huge benefits to the people at the top.
it's not just ceos going from an average of 25 to 30 times the average worker, up to 300 times the average worker. it's taxes, it is bankruptcy. >> evan: right. >> robert: if you look at the rules of the market, you see that it is increasingly rigged to improve the fortunes of the people at the top, and most people can't get by. >> evan: and even -- yeah. >> robert: but the point i want to make is this internal debate we have between government and free market is a decoy. it's a distraction from what's really going on. >> evan: which is? >> robert: which is really about power. >> evan: it's all about power. >> robert: i mean, our fundamental economic problem is a political problem. >> evan: yeah. >> robert: can i repeat that? >> evan: i wish you would. >> robert: because i think it's really important. >> evan: it's the key part. >> robert: our fundamental economic problem is a political problem. no other rich economy, subject to the same forces of globalization and technological change has succumbed to as wide an inequality of income and wealth as the united states.
>> evan: and what is it about our system, in particular, that makes us so different? is it that the lobby -- i mean i hear you talk about how markets have prevailed for a certain period of time. to borrow from your book, you know, the title of your book. the few have lobbyists, the many do not. is it that the few's lobbyists are prevailing here in this conversation? >> robert: it's lobbying, it's money, generally, it's campaign contributions, it is the setting the agenda. you know, i first came to washington in -- now i'm dating myself -- 1967, to work for robert f. kennedy. >> evan: yep. >> robert: washington was kind of a seedy town. >> evan: yeah. >> robert: you know, i remember going into -- >> evan: how has that changed, exactly? [laughter]. >> robert: well, now it's a very rich town. it may be seedy in terms of what happened -- >> evan: rich and seedy as opposed to not rich and seedy. >> robert: that's right. it was poor and seedy in those days. i mean, i would go into restaurants on pennsylvania avenue and there were cockroaches on the walls. but it was also a town where more public servants, i think genuinely wanted to work for the public. there was less money, there were
fewer lobbyists. and i have seen, over the course of my life, a fundamental change. washington is now an emerald city in terms of the number of lobbyists and the amount of money that -- and it's true of state capitals as well. >> evan: you talked about the distraction that's keeping us on focusing on the real problem. you wrote a column that was posted on your website and it widely circulated this week, as we sit here, about public morality versus private morality. the whole focus on private morality seems to be, in your construction, maybe another distraction from the discussion that we ought to be having about public morality. >> robert: i think it is a distraction. >> evan: can you talk about that? >> robert: well, i mean, you know, you do have a tremendous division in this country about whether gay people ought to be able to get married or whether women should have -- >> evan: right. >> robert: -- power of reproductive -- over their own bodies. and issues of what happens in bedrooms. but the real moral crisis is not in bedrooms, it's what happens in boardrooms. the real moral crisis is not the
choices that women make about their own bodies, it's the choices that big corporations and very wealthy people and wall street make about basically plundering our democracy by imposing so much money and so much power that average people no longer have any voice at all. that's the moral crisis. that's a public morality crisis that we have to be talking about. >> evan: why don't average people know it or why don't average people care? >> robert: they know it. you know, i go around the country, i talk to people of all kinds of political persuasions. >> evan: yeah. >> robert: even republicans are talking more and more about crony capitalism. but i think what happens is people have become so cynical that they drop out. they say, i don't want to be involved. i'm not going to vote. you know, just to hell with all of that. which exactly is what the moneyed interests want, because then they have it all. >> evan: right. low turnout is a positive for them. >> robert: yes. and cynicism -- >> evan: and low participation. high cynicism. >> robert: high cynicism is a positive. >> evan: low engagement. >> robert: so that i think the
real challenge is to turn the public from being cynical to be outraged and active. >> evan: yeah. so you mentioned this earlier about the idea that this system is rigged and that there's a perception out there, whether it's widely held or just in places that you've been to talk about this that the system is rigged. it kind of is rigged. i mean, there's not really any way to get around that. >> robert: well there is a way. let's talk about specifics. let's talk about something that is as dry as bankruptcy law. >> evan: oh, can't be drier than that. >> robert: well, i mean you have chapter 10, chapter 11, chapter 9. people's eyes glaze over. the fact is that you have the donald trumps of the world -- now this is not a partisan -- it's going to sound partisan when i say it, but you've got big corporations and wealthy billionaires who can use corporate law and bankruptcy law to shield their own fortunes. >> evan: well, but he bragged about it earlier in the campaign, did he not? he bragged about it. >> robert: he did. but then what about -- what about graduates that have huge amounts of student debt. >> evan: student loan debt. >> robert: they can't really deal with it. congress specifically said in the bankruptcy law students cannot declare -- you know, graduates cannot declare bankruptcy.
you can't declare bankruptcy to handle if you're overwhelmed, you're underwater with your home, on home payments you can't use bankruptcy. >> evan: so then why should corporate titans be able to? >> robert: why is it the bankruptcy law draws that sharp a distinction? well, it's because of how the bankruptcy law was created. >> evan: right. >> robert: credit card companies, big banks, big creditors. >> evan: again, the lobby for those guys were successful in getting those things -- >> robert: absolutely. >> evan: -- in the legislature. >> robert: absolutely, absolutely. and this is true of every corner of the law right now. >> evan: yeah. >> robert: and, again, it's these details that make the law what it is. and make, in fact, our economy what it is. >> evan: right. >> robert: without all of these details there wouldn't be an economy. >> evan: i want to stay on this topic but i'm tempted to ask, since we're talking about the system being rigged, if you feel that beyond just the question of wealth and power if the system is rigged. you and i were visiting before we came out here about redistricting. you know, the whole system, whether it's campaign finance, redistricting, wealth inequality, the whole thing, i mean these are related topics but they're also topics under
themselves. it all feels kind of rigged the way it's written right now. >> robert: and, again -- >> evan: so why would the public be -- and we talk about how voter turnout is down, lower levels of engagement. the public is not engaged or turning out to vote because they think it doesn't matter. >> robert: right. and it's a vicious cycle. >> evan: right. >> robert: it's a self-fulfilling prophecy that gets worse and worse. because as the public gets more cynical and basically decides not to vote, not to be involved, then, obviously, the system gets worse and worse. so the real question is how do you turn a vicious cycle into a virtuous cycle? how do you get people to believe that they can make a difference if they really, really feel that it's important enough? >> evan: yeah. >> robert: if they want to leave their children and grandchildren a democracy that works and an economy that is fair, fundamentally. >> evan: right. >> robert: there's fair in terms of equal opportunity. i think that it is only through such a movement that we get any kind of positive change. and that's been true. that was true in the progressive era, evan. it was true with regard to civil rights and voting rights. it was true in the 1930s with
regard to the new deal. it's been true every time you get a critical number of people who say this can't go on. >> evan: enough, enough. so you have to wait for the outrage, the kind of collective outrage to hit a certain point. and at that point then -- >> robert: that's the only way -- >> evan: -- the doors break open. >> robert: -- things change. >> evan: is it possible to fix the system from within? or do you have to fix it from without? i'm mindful of the fact that you've been in three presidential administrations. you were secretary of labor under bill clinton. you ran for governor of massachusetts once. but you now live outside that universe. although apparently lawrence lessig has floated your name for vice president, or it's been floated on his website, at least. the likelihood of you being back in elected office or public life or what have you is probably not high at this point, right? >> robert: i hope not. [laughter]. >> robert: no, let me clarify that. >> evan: so i'm wondering if you're better off outside the system rather than in. >> robert: i would certainly, i mean if a new president asked me to do something, i certainly would -- >> evan: you'd listen. >> robert: well, i would do it because it's a duty. you would do it too. >> evan: sure. but the point is can you fix the system without being part of the system? >> robert: i think the only way you can fix the system is from
outside the system. because, you know, i've been there. i have seen again and again presidents -- i was secretary of labor. you can't actually effect change if you don't have a large number of people mobilized and organized and energized to push change behind you. >> evan: yeah. >> robert: otherwise the vested interests are overwhelming. >> evan: was bill clinton, for whom you worked and with whom you attended school back in the day at yale, was he a change agent in the end? >> robert: i think he wanted to be a change agent. but even those who want to be change agents are, again, they are confronted with the reality of organized interest groups that make it very difficult for them to do anything. i don't remember the following anecdote, but in 1936, so i'm told, franklin d. roosevelt was running for re-election and somebody came up to him and said, mr. president, if you're re-elected -- i want to vote for you but i'm going to only vote for you if you promise me to do this and this and this and this and this. and he looked at her and he
said, "ma'am, i want to do everything you just listed, but if i'm re-elected, you must make me". >> evan: yeah. >> robert: now what did he mean by "you must make me"? what he meant was, even in the 1930s, even when we were in the midst of a great depression, he knew he could not do very much unless the public was behind him. >> evan: so i'm going to ask you the same question and you may have the same answer about president obama. has president obama been the change agent you assumed he would be? you endorsed him in '08 -- well, actually and despite the fact that you had gone to law school with hillary clinton as well and you worked in that administration, you endorsed then-senator obama. has he lived up to his billing as a change agent? >> robert: no, i don't think so. i think he accomplished a lot. i think the affordable care act really will go down in history as a very important advance. a lot of people disagree with me on that. i think it is important. i think that he did rescue the economy from the abyss. i think we were heading into another great depression. but, no, he was not enough of a change agent for two reasons, i think. number one because he didn't use
the kind of movement that he had created to get into office to help him get things done. >> evan: yep. >> robert: he essentially cut off that movement. and secondly, because he, i think, fundamentally dislikes politics. now it's odd to say about a president -- >> evan: right. but he's seemed to be -- he'd found a distaste in politics from the very beginning, right? hasn't he? >> robert: i think so. i think so. and that was attractive to many of us. but you can't be a change agent if you don't love politics to the extent that you embrace -- >> evan: really engage the system. >> robert: you really threaten and cajole and do everything that lyndon johnson -- >> evan: so that whole argument about not having a drink with john boehner or mitch mcconnell being an obstacle to succeeding at his agenda may be true. he doesn't want to schmooze with people. he didn't want to actually work the political levers. >> robert: well, you have to work the political levers but at the same time you have got to be courageous and not let compromise really get in the way of what you want to fundamentally accomplish. >> evan: hasn't the kind of let
your freak flag fly second term obama, i'm not running again with his executive order every couple of days deal, hasn't that been kind of courageous? i mean, as we look back on this period, aren't we going to think, well, for a lot of people the obama they voted for has been the obama of the second half of the second term. >> robert: yes, i think that's right. i think obama will go down as one of the great presidents of the united states, historically. >> evan: yeah. >> robert: but i think he could have used -- for example, i think he could have used the crisis he inherited, the banking crisis, the economic crisis to do more fundamentally structural changes and to craft fundamental changes in the economy than he actually did. >> evan: would he have had the support in congress to do that? >> robert: i think so. i mean, look at tarp. remember tarp? >> evan: yeah. >> robert: i mean, what a great acronym. >> evan: right. >> robert: you know, a tarp is something that conceals what's really underneath. >> evan: well, the positive view is that a tarp protects things from the outside elements. >> robert: well, that's another way of doing it. >> evan: i may be more half full than you. [laughter]. >> robert: no, you're not more. i'm very half full. >> evan: you're the half fullest
guy i know. >> robert: but tarp really was designed not only to bail out the banks but also to bail out distressed homeowners. but it never got to distressed homeowners. i think he should have fought harder -- >> evan: right. >> robert: -- to make sure that it did. >> evan: all right. so we talked about clinton and obama, will the next president, the one elected in 2016, whose identity is not yet known to us, can that person be a sufficient change agent? >> robert: it depends on the public. >> evan: yeah. >> robert: i mean, again -- >> evan: more than on the candidate or the winner of the election? >> robert: well the candidate is obviously important, but the question is whether the candidate creates enough of a public movement behind him or her so that it's possible to effect change. and effect not just any change, but effect change that widens the circle of prosperity and makes our democracy more effective. >> evan: now of course i'm tempted to ask you who that candidate should be, but i know that as the chairman of common cause, which is a non-partisan organization, you're obligated not to personally endorse a candidate, right? >> robert: i can't endorse. >> evan: you cannot. but you can give us your gaming out of the campaign, can't you? can you talk to us about what you think is going on?
>> robert: i can talk to you about what i think is happening, of course. >> evan: tell us what's going on, first on the democratic side, and then we'll spend the last couple of minutes dining out on donald trump. [laughter]. >> robert: well, on the democratic side i think the great problem and challenge that hillary clinton has, who i've known for many, many years. >> evan: right. >> robert: is to not be the establishment candidate. because this is an anti-establishment election, more than ever before in recent memory. >> evan: right. >> robert: and the insurgent candidate is bernie sanders. i was going to say barney frank. he's not. [laughter]. >> robert: bernie sanders. >> evan: he'd probably be fine to be that person, but that's okay. >> robert: and there's a difference. and i think that bernie is creating a movement and he's creating a movement to take back the economy and take back democracy. it will be interesting to see in the weeks and months ahead to the extent that that movement gets translated into actual political organization. that's the great challenge. >> evan: the theory is that the non-white base voters of the democratic party primary are going to carry secretary clinton over the line that senator
sanders has not done a good job getting those voters to support him to this point. >> robert: well the question's turnout. >> evan: right. >> robert: it used to be, when i first got involved in government politics in the '60s and early '70s, the issue was popularity, you know who was leading in the polls. that's not the issue anymore. the issue is who can get people actually to the polls. >> evan: motivation. >> robert: motivation, enthusiasm. and that is, right now, hillary clinton's big challenge and is bernie sanders -- again, if he can turn his, the enthusiasm into an actual political -- >> evan: yeah. it's an opportunity. >> robert: -- organization. it's an opportunity. >> evan: biden going to get in or not? i know that by the time people see this, the decision will be made, so if you're wrong, we'll just edit it out, how about that? [laughter]. >> robert: well i thought until last week that joe biden would get in. he was giving every signal he would. but during the last week he has said a couple of things, particularly he's questioning whether his family and he are emotionally ready. to me that's a signal that he is having a little bit of doubt about whether to get in. >> evan: yeah. on the republican side are you
pulling for anybody in particular? or is there a candidate, to ask the question in reverse, who you think would be a formidable, maybe the most formidable candidate in the fall? >> robert: almost impossible to say. the trump phenomenon is interesting to me because, again, here's an anti-establishment candidate -- >> evan: right. >> robert -- who is also a billionaire. who says whatever comes into his mind. >> evan: right. >> robert: and offends a lot of people, but nonetheless -- >> evan: but fan krugman has written nice things about him. i mean, he's got weird fans on aspects of his program. >> robert: well let me make it clear, i'm not a fan. >> evan: you're not a fan. [laughter]. >> robert: no. i think that the problem, the fundamental problem is that when so many people are economically stressed, when their incomes have not gone up, when they're working harder than ever, they're worried their kids are not going to do better, they can be attracted either to an authoritarian character who says, i'll do it. don't worry, i can make any deal. you know, just trust me. the kind of, you know, erich fromm "escape from freedom". or they can be attracted to a
reformer, a fundamental reformer who says we are out to strengthen democracy and that's what we are doing and what we must do. >> evan: in your mind, trump is in the first camp. >> robert: i would say he's squarely in the strong man camp. and historically that kind of authoritarianism is very dangerous for democracy. it's dangerous for the public in general. >> evan: so you think the bubble bursts? >> robert: which bubble? >> evan: the trump bubble. because obviously right now he's at, like, three times the next candidate in the polls in all the states that are -- >> robert: i don't know whether the trump bubble is going to burst. i mean, i can tell you that historically in this country and around the world -- >> evan: right. >> robert: it's not just the united states. when you have a middle class under great stress and they are worried -- >> evan: yep. >> robert: they will either go in an authoritarian direction or in a democratic -- fundamentally democratic reform direction. in this country we have normally gone, again progressive era the 1930s, to some extent the 1960s, we've gone in a reform direction. >> evan: yeah. >> robert: but there's no guarantee. >> evan: who among the 17 do you
look at and think, you know, that person actually may be steering a more establishment normal general election course and might be the toughest candidate for the democrats to beat in a poll? >> robert: well, i think that both jeb bush, but also john kasich. people don't really appreciate -- kasich is a very abled politiciany. >> evan: he's kind of a hip guy, too, right? kind of a concert t-shirt guy. >> robert: i don't know how hip he is, but i enjoyed working with him. when he was -- when he headed the house budget committee back in the day, i worked a lot with him. very different values than i have. >> evan: right. don't agree on policy. >> robert: but he was a decent guy. i could deal with him. >> evan: you could deal with him. and, you know, he said some things already in this campaign that have caused some people to go, hmm. you know, he's a little bit more moderate than you typically see in a republican primary. >> robert: yeah, watch him. watch john kasich. >> evan: and he's actually doing pretty well right now, at least in new hampshire, as we sit here, so we'll see what happens. what are you going to do next? so this book is going to be a big success, of course. what do you do next? you said if the next president asked you to come in you might consider doing that. but is there anymore mountains
to climb for you? things -- you seem to have accomplished so much in the time -- >> robert: oh, i don't know. you know, i have two sons. one of whom is an academic. >> evan: yeah. >> robert: and the other is in show biz. >> evan: who made the right choice? [laughter]. >> robert: and i don't know who made the right choice. but the show biz son keeps saying to me, you know, dad, i admire you for writing all your books. but if you want to reach millennials you got to do more films, more videos. you've got to actually -- our generation is not that much of a reading generation. we respond to visual cues. and i took his advice. we did do a movie -- i and a couple of other people. and i've done a bunch of videos. i may do more of those. i'm not sure. >> evan: yeah. >> robert: it's hard to know. >> evan: well, he may be a good guide for you in terms of reaching the next generation. we'll see. mr. secretary, thank you so much. good luck with the book. very nice to have you. >> robert: good to have you. [applause]. >> evan: we'd love to have you jin us in the studio.
visit our website at klru.org/overheard to find invitations to interviews, q&as with our audience and guests, and an archive of past episodes. >> robert: i would go to occupy encampments at their invitation. and i remember in particularly there was one that was in oakland, california. they asked me to speak. i got there to speak and they said, you can't speak. i said, why can't i speak? they said because the anarchists won't let you. [laughter]. >> robert: i said if they're anarchists, how can they stop me? >> funding for "overheard" with evan smith is provided in part by mfi foundation, improving the quality of life within our community. also by hillco partners, a texas government affairs consultancy. and by the alice kleberg reynolds foundation.ññ?ñ?oñ