Will extreme wealth destroy democracy?

31:34Why should the institutions that are, if you like, the fortresses of the free market, the great banks need us to save them? That looks pretty unjust, doesn't it? And so they were all saved by the state, and they didn't save lots of other people is particularly important in the US. And then after the financial crisis, though it's changing a bit now, but I document this, growth collapsed. So take the UK, Britain, if GDP per head, the average income in our country had continued over the last 17 years now, since 2007, as it had in the decades before 2007, the average GDP per head will be 39 % higher than it is.

32:27So obviously, that means we're not giving people what they had hoped. We've moved into relative stagnation. We discuss whether that's because of the financial crisis or whether the financial boom hid this. But basically, either way you look at it, the economy really hasn't worked very well. And cumulatively, that means an awful lot of people have had pretty stagnant living standards. And that's been true, the evidence suggests, in much of the developed world. And while a relatively limited number of people have clearly made out like gangbusters. It's obvious. Chief executives, successful financiers, successful entrepreneurs.

33:10And I think that part of the problem is that many people feel these aren't entirely honest people doing a job, honest job. And I think, as I argue at Great Lake, there's quite a lot of truth in that. So if you add these things together, the fundamental sense that this is a decent order, which works effectively for us, and in which we all share in the gains, just as we contribute to making it work, that that isn't true, that people have become, I think, quite generally cynical, and they want something else. Once that happens, they are prey to dishonest demagogues. So let me give you two examples.

33:55They're different, but they're essentially the same sort of thing. In Britain, the proposition was essentially, you hate all this. It's a terrible world. Vote for Brexit. It will make everything different. The arguments put forward for this were all nonsense. At the very least, it would make things a little bit worse, and it could have made things, I would argue, quite a bit worse. But the point is that didn't matter. The people who voted for Brexit, a very significant proportion of them were obviously going to be made worse by it, no doubt about it. But they were voting for a change because they'd had enough of what the elite thought, because the elite, you know, the people who are proposing staying in Europe were the people who had been in charge for a long time, and they didn't seem to know what they were doing.

34:45Similarly, I think a similar process, I argue, led in the Republican Party to what was essentially a revolution, a coup, if you like, in which the Republican Party moved from an absolutely classic, genuine, multimillionaire business person like Mitt Romney, ultra-conservative, standard Republican, to Donald Trump, who's everything but. He's a chancer. I won't go into his business behavior, but it's pretty well known. Serial bankrupt and all the rest of it with a completely different agenda. And that's because that additional pro-market conservative Republicans had potentially become discredited.

35:30And similar things were happening in the Democratic Party. So politics started falling apart. And in Britain, we saw this with both with Brexit and then the experiment with Corbyn. And I don't think this process is over. So my view is a long-running process of declining performance, along with a sense of injustice and unfairness, culminating in the financial crisis and its aftermath, made worse, I think, by some of the recent developments, the cost of living crisis, which I couldn't discuss there because it happened after I really started writing this or finishing it. basically led people to think this system isn't working.

36:14And once that happens, a significant part of the population, not necessarily half, but 30%, 40%, maybe on different sides, will start saying we need to vote for somebody different, not because we trust them, but because we distrust everybody else. And that is what we are seeing. And that's why I don't think we're at the end of this story Until we create a system which people really have trust in again, including the technocrats who we do need, we are going to be operating in a very fragile political environment. So that, I'm sorry, it's a very lengthy explanation. That broadly is my story. Last time we recorded, Temein, you were having some real dramas with your accountant.

36:59So how's that been going, mate? They're sacked. So drama sorted. They're a big corporate firm. They didn't really reply to my emails very quickly, like took a week or two at times. And they charged me way too much. I mean, I've got pretty simple taxes and yeah, they were charging me thousands. They saved me some money, but yeah, I had to move on. Slow and expensive. Pretty much, yeah. This is one of the reasons that we're really happy to be partnering with TaxApp. It's a tech platform that makes self-assessment simple. Whether you're self-employed like me, a freelancer or a director like Damo, big dog.

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38:01That code is MONEY, M-O-N-E-Y 1-0. so mr carolet i hear you are a salesman elite salesman yes one of the best they say i've got a little bit of experience in the game yeah i could say i've done a few deals uh bill a bill what what would your compliance team say about you they would say that i am always nagging them and that um essentially i just have i have beef with compliance i love the team compliance slows down all my deals because every time i get to the finish line they've got to check documents kyc GDPR and it's just a nightmare it slows the deal down by like two three weeks it's always on both sides as well as yeah sometimes it can be blocked on the other side exactly well that's where today's sponsor can help indeed Vanta helps companies of all sizes get secure and compliant fast and they stay that way they do it by automating compliance with over 35 security and privacy frameworks like SOC 2 ISO 27001 and HIPAA yeah all of them and this saves businesses so much time and money According to a recent IDC study, Vanta customers save over half a million dollars a year in costs.

39:06Not bad. And they also help you complete security questionnaires up to five times faster, which is great because everybody hates filling out forms. If you're a business that needs to prove security and compliance, visit Vanta.com forward slash making money to sign up for a completely free demo today. That's Vanta.com forward slash making money. There's a link in the description though, so you can just click that. you give the example so like this idea stuck with me because as someone who's on the internet when you take the politics out i see a rise in the this argument of andrew tate is almost an example of like the matrix them them you know inequality is a very popular discussion at the minute rightfully so you you talk about how well you quote a paper in the book where austerity caused Brexit.

39:54And it's this kind of like, the system hasn't worked for me, so I'm going to push against it and find something new. And austerity is that. It's like the economic system has been cut to the bone, basically, or the cuts are - Well, if you look at what austerity did, which I argued very passionately against it at the time, both, so this is not, sometimes I was right at the time. I would argue I'm usually right at the time, but not always, for sure. But the government we had after the crisis came to power in 2010, Cameron Osborne decided that inherited a huge fiscal deficit was clear, because the economy has shrunk so much.

40:43and they decided to blame this crisis on the fiscal policy of its predecessor, Labour, which was certainly dishonest, as I pointed out many times at the time. And they said, we must get rid of this fiscal deficit because it's too big. And if we don't, we'll end up like Greece. I think that was an answer too, but they argued this. But then they made a really crucial decision, the crucial decision, I think. Okay, they could have said we need to close the deficit over the next four or five years. That's what they ended up doing. But they could have said, okay, we'll raise taxes, that'll count for half of it.

41:23And we'll cut spending, that'll count for a half. And that's sort of safe. And when we cut spending, we'll make sure it doesn't hurt the poorest. That would have been a just way of doing it, I think. But in fact, I don't know the exact figure, but something like 80 % of the adjustment of the fiscal position was done by spending cuts. And most of that huge proportion was done through cuts in local authority spending and where the cuts were savage. And local authorities provide a lot of services that really matter for ordinary people, particularly vulnerable people. Looking after social care, care in the community, that sort of thing.

42:09And that's particularly important in those areas of the country where they already have considerable poverty, like northeast England, I think, which is where so many people ended up voting for Brexit and for Boris Johnson. So they suddenly found their lives, which were already very difficult. These are the relatively poorest parts of the country, the former mining and industrial areas. the services they were getting were really being decimated. And actually, other services, slow deterioration of the NHS, the standards of welfare provision more generally accept pensions. So these people felt something is going wrong.

42:56They didn't understand, why should they, the arithmetic of the fiscal adjustment that was being imposed. I mean, it would be unreasonable to expect most citizens to understand fully how the fiscal position of the government works. I mean, that's a specialist subject. Really relatively few people understand how this works. So they felt things, again, very badly wrong. They can't get any worse, quote, unquote, famous sort of notion. so we need to vote for change yeah brexit was the only change on offer they didn't really trust jeremy corbyn as it turned out and uh and so brexit became a vote for change unfortunately it wasn't a vote for a change that would benefit those people um as i think they've subsequently discovered.

43:52But that, I think, is what happens. Once people get unhappy with the status quo, and with the leaders who are seen to personify the status quo, I think people will, they won't decide not to vote for anything, or not to vote for anything particular. They will, as it were, vote for anything that looks like a viable protest. And that's, I think, what happened. Does this damage the country or the government in the long term? Do they see it from their perspective? Yes, I think a situation in which a very large proportion of the population becomes disillusioned with their own situation and disillusioned with all normal political processes that might rectify that situation, though they don't know why they can't rectify it.

44:52I don't want to get into the details of the problems that a new government will face, but they will say, we're in this situation we don't like, and it's continued, as I said, with the cost of living crisis and so forth. It's obvious that the people in charge, the two main parties don't know what they're doing about it. Now, Now, in the moment, I think they hope that labor will be able to make a difference when it comes in. But my own fear is it won't. And then they will say, well, obviously, the conventional establishment has no answers to our problem. And once they decide that, then there are two possibilities.

45:37One, they just sort of give up. and the other possibility is they will start listening to people who give them glib answers who'd say that you know it's all the fault of whoever it might be immigrants let's throw them all out of the country uh that's one way these things go you can see that happening just now in holland uh you know it's all the fault of these people the same in germany with the alternative for Deutschland. It's all the fault of the EU. That was part of that. So the problem with a situation in which people are this disillusioned is, as I've said already, they will start listening to the sort of extremists they would never have listened to in better times when they confidence in their political leadership.

46:33Democracy doesn't work if you don't trust the leaders that the democratic process throws up. And if instead of that sort of person, you get a pretty unscrupulous, rabble-rousing sort of demagogue along, successful ones, and some demagogues are very talented, then you can find, and we've seen this happen many times, you're shifting into a completely different sort of politics. And with a completely different sort of politics comes a really completely different sort of society. It's not, it doesn't, isn't the sort of tolerant, peaceful, basically trusting society, not perfect, but you're used to, it becomes violent.

47:20I asked that because we studied, I went to Manchester for my MBA, Manchester Business School. Yes, I know it well. Very good, very good school. Great school, yeah. We were talking about rentier capitalism and universal basic income and solutions for like the inequality gap. And we put into different groups in the MBA course. Our group, our solution was universal basic income, which is like giving everyone money. But the problems with that were it would be like manipulated and how would you make sure the right people got the money. So then we thought, why don't you just tax like Starbucks or the big companies and then put that money not into giving everyone like 100 pounds a week, but into the services that are lacking for the people who need them.

48:01So like health care, social services, mental care, all these things. Why would a government not rather go down that route? There are two points about that. The first is when you start taxing the big companies, you're really taxing people. You will be taxing corporate profits, which basically the property of shareholders or dividend recipients. And this would have the effect of lowering the value of the ownership of British shares or corporations here to the owners. And that includes, of course, pensioners, a lot of pensioners. And that's probably the most important group. But it also almost certainly would lead to a reduction in corporate investment.

48:54And that's quite an important source of growth, probably, arguably the most important. So you can't, and the share of profits in our economy, that's significant, is certainly not big enough to fund all the things you want to do. You would have to tax high earners, right, as well, corporate executives and so forth, and people who earn a lot of income from capital and land. You would have to end up, ultimately, you're going to tax people. So basically, this is a slightly roundabout way of saying, if you want to fund a UBI, and I do discuss this in this book, you have to raise taxes. And obviously, you would like to tax the well-off more, but you would end up by taxing at least half the population more.

49:56Otherwise, you don't get enough to make a big difference. And the point is that the sort of people who would be asked to pay more taxes, they all vote. And they have money. So they influence politicians. And they are politically mobilized. And they fund parties directly and indirectly. and they will argue very passionately that if this policy goes through, growth will slow and it will all be terrible. And so essentially, ever since the 50s, really, maybe a little later, parties haven't promised higher taxes because they think they'll lose. They think they will lose many, many voters. It's true of the Labour Party now.

50:55The reason Mr. Starmer and Rachel Reeves, Kim Starmer and Rachel Reeves are so cautious about their promises is they believe, even with this huge margin, apparent margin in the opinion polls, that if they said we're really going to raise taxes, they would lose an enormous number of votes. And that relates to the UPI. the point about the UBI, universal basic income, is I've concluded after some fairly careful analysis, that the least we would need to fund a general universal basic income, the absolute least, and it's a not very generous one, would be about 5 % of GDP, which what does 5 % of GDP mean?

51:42Well, one easy way of thinking about it, it's a little less than half of health spending. And it's about what we spend on education, schools. It's a lot of money, right? Now, if we do do a universal basic income, since we do have a welfare state, most of the additional benefit over and about what we give anyway to poor people, single parents and so forth, disabled, will go to people who don't get welfare benefits now. So I would benefit, which is ridiculous. Lots of people who do pretty well, who are better not as well as I do would benefit, but it wouldn't actually go to the poor, unless we really make the UBI high, which in which case it would cost much more than this.

52:29Essentially, you use that 5 % of GDP, if you could raise that amount, which is a lot of money, by the way, that's about It's 125 billion pounds, right? So I think I got that right. So it's serious money. And you'd use that money essentially to benefit people we now don't think deserve it. Now, there's an argument for that. We would lower the marginal tax rate. There would be more incentive to work. That's technical. But essentially, I think it will be a colossal waste of the very limited capacity to raise taxes. because if I could raise taxes by 5 % of GDP, this is not where I would spend it. You clearly need more money for the health service.

53:14There's no doubt about that. You need reform that would go with that. You need to reverse the welfare cap. There are obviously a lot of questions here. We need to fund education more. I mean, there are so many other things we want. Every area needs money. So the 5 % of GDP could make a real difference. So I regard the UBI as a snare and a delusion because it wouldn't help and it'd be too expensive. But the key point, that's a specific technical question about a specific measure. It's pretty obvious to make our society better in key areas because of all the problems we now have, aging and all the rest of it, we need to raise more in taxes.

54:02but most people haven't had sizable increases in real incomes for 15 years. Now, persuading people that to pay more tax, which will actually make them absolutely poorer, many of them, when they haven't enjoyed a real income standard, a living standard increase for 15 years, and they can't afford a house, that's politically dynamite. So the truth is that any government, by the way, any honest government, and certainly the income government, will have a fantastic problem in managing the politics of our situation in an aging society with huge public spending demands in an economy which is growing at best a percent or so a year.

54:49And that's why I'm very, very concerned that the relative stability of the UK at the moment might not last. Now, my view is that the government should, a new income government should take a risk and go for it. But, and I think they are also areas, I'm going to write about this soon, they can borrow more, but the, carefully done. But the dilemma, they really have been left. I'm not saying it's deliberate. I want to be clear about this. But they have been left with terrible options. And you just look through the last budget, and this is concrete. It's obvious. There are spending promises that won't be delivered.

55:35And if they're not delivered, then the budget deficit will blow up, and they have to decide what to do with it. When you say go for it, you mean borrow? There's a perfectly good argument that you can borrow to invest. I mean, it's a standard thing. And that's clearly best if you borrow to invest in assets which are clearly valuable. Well, the most obvious one and where there's an obvious shortage is housing. When we really built a lot of houses in the 50s, and we did enormous numbers, we built huge numbers of council houses. Now, the councils could, if they want, build houses to rent. They could build houses or encourage the building of houses to sell.

56:29But if they had the power to buy land at or close to its agricultural value, could hand it over to developers at market prices. That gives them huge revenue, which they can use to fund the infrastructure, the schools, and all the other things that are needed to go with houses. They would have an incentive, and so would their electors to do it because they would have better services. And they would develop new areas in places where work needs to be found. There are lots of problems about where you would do it. I don't deny it. But the housing problem, for example, is an economically and technically soluble problem if a government wants to do it.

57:17And there's no question that houses are valuable assets. So as long as both sides of the balance sheet, the debt and the assets are increased together, that's less obviously true in most other assets, but I think it will be true for schools too. Better educated population is an economic value. There are things government should be prepared to borrow for, but I don't think they should be borrowing for current consumption. And there, if you really want to raise that, we have to start thinking about the possibilities of better tax systems. I think there are areas where we could raise taxes, property taxes in particular.

58:05Council tax. Council tax. Well, council tax is multiply anomalous. First of all, it's a terrible tax. In a sense, it should be a land tax. Second, and crucially, it hasn't been recalculated since, is it? 91. 91. And third, it's mammothly regressive. So for me, in my house, the tax rate is just nothing. But for many people who have somewhat less smaller houses, the tax rate is much more heavy relation to property and to incomes. So I've argued for 25 years for a better system of land taxes and a better system of land taxes would raise more money and it would also be a way of funding local authority and state infrastructure investment.

58:58And we've known since David Ricardo, it's 200 years plus, that land taxes are the least distorting of taxes. Again, though I think it's politically much more difficult, emissions taxes are efficient as it is now. Our inheritance tax doesn't apply to any truly rich person. It only applies to basically to middle and upper middle classes with a house. That's ridiculous. And a much more equitable system of property tax, wealth taxes could be designed. I think the best way to do it is on bequests, automatically on bequests and transfers at death. And everybody would have a free limit. And then over some amount, maybe 100 ,000, 200 ,000, that would be a standard tax of 30 % or 40%.

59:50And it would be much more equitable. And it would mean that the Dukes of Westminster would pay a proper tax when they transfer the property to the next generation. And as far as I can see now, they don't pay anything. No, they don't. And it seems to me absolutely incredible that we have an – the only wealth tax system we have, just think about it, is one in which the only people that don't pay it are the richest. Yeah. Obviously, very poor people don't either. All I'm saying is there are lots of things you can do, in my view, which are imaginative, but they will all create problems because they will involve governments doing things again.

1:00:28And we've got used to the idea that governments shouldn't do anything. But the truth is, I think it's now obvious that it's always difficult. I understand that. We haven't done very well out of that. And I'm a bit unhappy that Labour hasn't been prepared to make a somewhat more positive case for the possibility after this period of relative failure of getting something out of states that do more. I can go through many, but I think we can be much more imaginative to make our society better within reasonable constraints as long as we could persuade people that a more just and effective way of doing things could work.

1:01:12You say in your book, it's like reform, not revolution. So you think these little tweaks? Well, they're not that in the valley of the land of a thing. If you ask Keir Starmer, he would say that is not a little tweak. That's life risking. No. One of the frightening things is that because of the loss of trust and the squeezing of the population, people aren't prepared to accept any change because they fear that it won't work. They vote for change but don't accept it. They vote for the idea of change, but not for anything that might actually plausibly make a difference. They're totemic. Leaving Brexit wasn't a thought through, leaving the EU wasn't a thought through program of reform.

1:01:59It was a twitch, a sort of a sense, well, I hate all this. Let's change something. It's a protest. Now, that's not a good way to do this. started. Now, on the big point, I do think, I quote Karl Popper, who was the great

1:02:21Austrian philosopher of science and history in the middle of the 20th century. Yeah, we've had a lot of experiments with true revolutions. And it was fair to say none of them has gone well. I mean, in the sense that immense amounts of death and carnage, and you can't rebuild a society from scratch. In fact, the strange thing is that if you start trying to rebuild a society from scratch, you're most likely to end up where you began. My favorite example is Russia, where they started off with a Tsarist regime in which the Tsar basically owned and controlled everything and his cronies around him. Then he went through the Soviet Union, the Soviet Revolution, the Stalinist period, which about 20 million people were killed, it's unimaginable.

1:03:10And at the end of it all, it collapses. And what are we left with? One man controlling absolutely everything. His cronies were the new aristocracy, enjoy all the wealth. He has total control over his society. What's changed? So I think you set the basic, for reason, basic idea of a market economy and democratic politics. But within that, you start thinking about making it more just, more effective, having taxes, our tax system is a total mess, which design better to promote entrepreneurship, which tax things like land, like inheritance, which I think will be good for the society and support things that are essential for its future and its stability.

1:04:02That's a very modest reformism, but it's just we've got used to the idea that we can't do anything. We've just sort of given up on the idea that we can change anything. And that is a recipe. I really do think that once you're in a society where you can't contemplate reasonably well thought out change at all, it ossifies and in the end it will blow up. Do you see any countries now that you think are doing well, that we should aspire to be like or copy? That's a very interesting question. I think one has to learn from different countries in different ways. And it's quite difficult to learn. And some of what I'm talking about might be quite difficult to do.

1:04:50Obviously, I do think we need a form of economic policy that promotes and supports innovation. And the US has done pretty well at that. And it's partly about government support and partly providing environmental finance that promotes innovation, venture capital and so forth. A lot of their financial system doesn't do that, but some does. and we should be asking ourselves what they did. You can look at the example of DARPA, the research agency connected with the Defense Department, and we've created something that is aiming to do that. But I think the first thing we have to do is look at the places where real innovation is going on and asking, can we learn from that?

1:05:40My view is that probably best done here by building on the one strength we do relative to most other countries, which is relatively good universities. So if we can build up and support the creation of more new companies,

1:05:59science parks and all the rest of it around our universities, make it easier for people to set up new business by making development easier, that links to the housing and landing, I think we can probably do a lot there. I think that one of the things we have to do is raise the national savings rate. It's a long-term program. We have the lowest savings rate as a country of any larger developed country. And the obvious way to do that is to raise pension contributions. The pension contributions are now being made by people in work through our defined contribution system, the new is far too low to provide decent pensions to people when they retire.

1:06:44I mean, just about half. You need about 15%. You need about, and we're doing about eight. Yes. So we need to slowly raise it to 15, maybe a percentage point a year, as a suggestion. That would be an adjustment. It would be much easier if we have growth. If we have much higher savings, and if these divine contribution schemes are pulled into bigger schemes, you've got really large sources of capital, which can be used to build up wealth, both here and abroad, and give people much greater security. The atomization makes this worse. The Dutch do that pretty well. They have a very, very big DC scheme.

1:07:21And effectively, though, in a different way, so do the Singaporeans. So that I think we can learn about building up savings, investing them properly and giving people greater security at old age while building up the domestic capital pool. We are a huge net debtor. And we're a huge net debtor largely because our domestic savings simply aren't large enough. And that creates a vicious circle because our savings aren't large enough. Our investment isn't large enough. We're poorer. Our incomes don't rise. And that's a vicious circle. So that's another area we can learn in those areas. I think I now do think that we need to think what is the best way of organizing our health service.

1:08:05It seems to me clear now that we're really finding it difficult to make this system operate. And I'm beginning to think that the idea of running it all essentially from the center doesn't work. It's too politicized. We have lots of countries, neighbors, which have fully effective natural health services with universal coverage, but they don't rest on such a centralized system of providers. They're more decentralized. I now begin to think this will, Labour will never do this, that we have to start looking at the possibility of making those reforms. I think social care and the health service need to be fully integrated.

1:08:48I don't see how else can be done. That's done, as I understand it, much more effectively in the Scandinavian countries. We can look at that. I don't think anyone is really doing a job, a superb job on the green transition. But I do respect the Chinese for the scale of investment they're looking at. So I think if I were in charge of all this, we would define what are our big challenges? Savings, housing, innovation and development. Then there's the huge regional problems. almost everybody does better than we do that. So we look at everybody. And I've been writing a bit about this. My friend, Paul Collier, professor at Oxford has done, has done some very good work on that.

1:09:37We should be looking at what regional policy works. And once we decide one of the really big priorities, we then go and say, go out and say, well, who's doing this best? And I think we, We can't turn ourselves into Singapore. Obviously not. We can't turn ourselves into the United States. We can't turn ourselves into Scandinavia. But we can try and learn from the best examples in each case instead of always focusing on our own experience and the assumption that whatever we've done, we have to live with. We have to open ourselves to the possibility of reform instead of being, as I think we have become, just so conservative.

1:10:19Paul Johnson, who sat in last chair, said, politicians need to be brave and so do we, was the quote he said. And I think it's like you say, no one can move. Do you think that people have, my generation, again, coming back to the quote of, I hope the next generation does a better job than mine. Do you think people like me and your grandchildren should be optimistic? And do you think that the change can happen? Well, look, I have two answers to this. The first is being optimistic about the possibility of change is a moral obligation. Despair is sort of a sin. There's this famous quote from Gramsci, which everybody knows, pessimism of the intellect, optimism of the will.

1:11:06So you might believe that things can't be solved, but you have to try. That's what it means to be alive. Otherwise, you're not alive. You just accept everything. It's too depressing for words. But I also think that's that sort of a general orientation. Look at the reality. we live in an unimaginably better world in obvious ways than people did 100 years ago. I'll leave aside the fact that they were in between two world wars in this country. That's pretty obvious. Life expectancy has been utterly transformed, utterly transformed. Unfortunately, there are some people in this country who are beginning to die younger, But we know that's soluble.

1:11:59It's a result of some bad, very obvious bad policies. But in many countries, life expectancy is now getting over 80. We can get to that. Worldwide, even more so. There are clearly going to be huge advances in medical science. There are also huge advances in technology, and a few of them are good, though some of them worry me. We didn't discuss that at all. We didn't discuss new media. we have democracies we have freedom i mean you have to be in a totalitarian state and i have to know the difference you know if you know that you can't talk freely at all i think you find that pretty difficult and because you can talk freely you can discuss with politicians and persuade them um uh we have unimaginable opportunities in for in the form of entertainment of any kind, travel, ability to experience the world, experience different people.

1:13:01When you imagine what life was like for people stuck in a village somewhere in this country 150 years ago, and in India, 30 or 40, or even now, and they've all had such vast improvements in wealth and income. The last 70 years have seen the biggest falls in extreme poverty, the biggest rises in life expectancy, the biggest increases in opportunity for people across the world. And I started off in development economics 50 years ago. There's ever been. So while we have made some pretty serious messes and we could do better, I think it's very important to recognize this is a much and imaginably much better place to be than it would have been 100, let alone 200 years ago.

1:13:53And the same is true in the world. It's very, very far from perfect. But the slavery that existed doesn't exist anymore. still huge problems of exploitation and so forth. So yes, I think it is right to be optimistic because we have unimaginable, for our predecessors, economic resources. We have unimaginable improvements in technology of all kinds. We have the possibility of freedom and of action as individuals and collectively. We just have to use them. Just ask ChatGPT what the answer is. We all are through that bit of AI. But no, thank you so much. I think I'm better than Chuck. You're more modest as well.

1:14:40But anyway, that's my answer. You have to do better. And there's one additional point, which is perhaps very important. Because things went so well here for so long, and because we had no huge crises, and because we came out of the war and we thought we won, and then the Cold War, By the 90s, people of my generation and a bit younger became very, very complacent. And the complacency was a natural response of what seemed a natural progression of success. Well, maybe it's an advantage not to be complacent. And whatever your generation is, as far as I can see in your generation, you, I think, are between my children and my grandchildren.

1:15:27children. You're not a complacent generation. And probably that's a good recipe for progress, as long as not being complacent doesn't mean you give up. That is, if you say the public sphere, nothing to do with me, and everybody says that, things will not improve. If you want a bullet point summary of this episode, you can sign up to our newsletter using the link in the description. And don't forget to subscribe to the podcast and leave us a review. It really makes a difference and lets us know that we're doing a good job. I'm Damo. I'm T. This episode was recorded by Jack Hobbs. Music is by Felix Taylor.

1:16:08It was produced and edited by Ruth Edwards. Johnny Hunter is in charge of marketing and it's all brought together by Will Stollerman.