The New York Times Magazine's cover story this week is about Edward Conard, a wealthy private equity titan and former business partner of Mitt Romney's, who has written a book arguing that income inequality is actually good for the middle and lower classes, because the promise of great wealth spurs more investing and risk-taking which eventually benefits all of society.
We must note up front that the magazine has claim-jumped easy blog jokes by giving the piece a blinged-out photo illustration and the headline, "The Purpose of Spectacular Wealth, According to a Spectacularly Wealthy Guy." So we'll just take a short peek at the substance.
If you'd like to bask in your rage against Edward Conard's robotic and heartless outlook on wealth, society, and love, please read the entire story. Conard is not a nut, though; he has a coherent economic and political philosophy. Here it is presented in its clearest form:
A central problem with the U.S. economy, he told me, is finding a way to get more people to look for solutions despite these terrible odds of success. Conard's solution is simple. Society benefits if the successful risk takers get a lot of money. For proof, he looks to the market. At a nearby table we saw three young people with plaid shirts and floppy hair. For all we know, they may have been plotting the next generation's Twitter, but Conard felt sure they were merely lounging on the sidelines. "What are they doing, sitting here, having a coffee at 2:30?" he asked. "I'm sure those guys are college-educated." Conard, who occasionally flashed a mean streak during our talks, started calling the group "art-history majors," his derisive term for pretty much anyone who was lucky enough to be born with the talent and opportunity to join the risk-taking, innovation-hunting mechanism but who chose instead a less competitive life...
"It's not like the current payoff is motivating everybody to take risks," he said. "We need twice as many people. When I look around, I see a world of unrealized opportunities for improvements, an abundance of talented people able to take the risks necessary to make improvements but a shortage of people and investors willing to take those risks. That doesn't indicate to me that risk takers, as a whole, are overpaid. Quite the opposite." The wealth concentrated at the top should be twice as large, he said. That way, the art-history majors would feel compelled to try to join them.
No. The art-history majors—and the janitors—would just feel more compelled to try to kill them.