The above TED talk, by Richard Wilkinson, is from October 2011, and it's all about economic inequality. There's quite a lot of buzz today about another talk on economic inequality which was recorded, then quashed by TED officials. You can check out the full transcript here, from National Journal.
At first glance, this is quite a strange discrepancy. Both talks are on economic inequality, and they do differ a bit, but if anything the Wilkinson talk is more radical. The gist of his is that once a country has reached "developed" status, wealth doesn't much matter for the health of that society, broadly speaking (including things like longevity, mental illness, crime, prison population, poverty, etc). Instead equality is what matters. More equal societies are better.
The censored talk, given by venture capitalist Nick Hanauer, makes a fairly banal point that starting a successful business depends entirely on having a population of people with the ability to buy your product:
I have started or helped start, dozens of businesses and initially hired lots of people. But if no one could have afforded to buy what we had to sell, my businesses would all have failed and all those jobs would have evaporated.
That's why I can say with confidence that rich people don't create jobs, nor do businesses, large or small. What does lead to more employment is a "circle of life" like feedback loop between customers and businesses. And only consumers can set in motion this virtuous cycle of increasing demand and hiring. In this sense, an ordinary middle-class consumer is far more of a job creator than a capitalist like me.Listen to his tone, though:
Significant privileges have come to capitalists like me for being perceived as "job creators" at the center of the economic universe, and the language and metaphors we use to defend the fairness of the current social and economic arrangements is telling. For instance, it is a small step from "job creator" to "The Creator". We did not accidentally choose this language. It is only honest to admit that calling oneself a "job creator" is both an assertion about how economics works and the a claim on status and privileges.
The extraordinary differential between a 15% tax rate on capital gains, dividends, and carried interest for capitalists, and the 35% top marginal rate on work for ordinary Americans is a privilege that is hard to justify without just a touch of deification.He's not just talking about inequality, he's saying that the title of "job creator" is undeserved. He's being blunt, and rude. We're all familiar with the titanic egos of the plutocrats, and how they react to sharp criticism. Check out this email TED curator Chris Anderson sent Hanauer, fisking his talk:
"Only consumers can set in motion this virtuous cycle." ...except when a company is thinking ahead of what the market wants; exhibit A: Apple ...
"An ordinary consumer is more of a job creator than a capitalist." ...really? as an ex entrepreneur who agrees with your overall stance, I don't think that statement is literally true. There are numerous jobs that exist because of the imagination, energy and risk-taking of individual capitalists or entrepreneurs such as you...
"hiring more people is a course of last resort, done if and only if rising consumer demand requires it". ...I launched numerous magazines for each of which, at time of their launch, there was zero consumer demand...I think a lot of business managers and entrepreneurs would feel insulted by that statement as given.Emphasis mine. Setting Anderson's obviously bogus quibbles aside, it seems that the perceived slight to the status and value of the "entrepreneur" class is what doomed Hanauer's talk.
The interesting thing to me is how Wilkinson's far more radical talk inspired no controversy at all. Looking at the charts, the US is shown as the worst developed country, sometimes by an enormous margin (as in incarceration rates). And check out this section, starting at about 9:58:
The other really important point I want to make on this graph is that, if you look at the bottom, Sweden and Japan, they're very different countries in all sorts of ways. The position of women, how closely they keep to the nuclear family, are on opposite ends of the poles in terms of the rich developed world. But another really important difference is how they get their greater equality. Sweden has huge differences in earnings, and it narrows the gap through taxation, generous welfare state, generous benefits and so on. Japan is rather different though. It starts off with much smaller differences in earnings before tax. It has lower taxes. It has a smaller welfare state. And in our analysis of the American states, we find rather the same contrast. There are some states that do well through redistribution, some states that do well because they have smaller income differences before tax. So we conclude that it doesn't much matter how you get your greater equality, as long as you get there somehow.The political implications of this are enormous. Taken just to the next logical step, this means that the Republican ideas around incentives for work, and tax incentives for "job creators"--exactly the same thing Hanauer was talking about--are completely mistaken. The evidence is in, according to Wilkinson, and developed countries should forget everything else and pursue equality by any means at hand.
Now, that sounds good to me, but the point is it's rather remarkable how this kind of thing goes over fine with the rich job-creatin' TED attendees, while a more moderate but less polite version gets censored. It's almost like they're sitting in their seats, blissfully unaware of what the speaker is actually talking about, but feeling good about being part of a hip, trendy, high-status event.
UPDATE: They've since released the talk.
Dude isn't that great at giving a speech; it actually reads better in the transcript. But still, relatively moderate point from the view of mainstream American consensus--the middle class is the economic backbone of the country. In any case, good on TED for releasing it, other things equal. Anderson's view here.