Tuesday, October 16, 2012

Chrystia Freeland on the Plutocrats

This is a very interesting interview:

Journalist Chrystia Freeland has spent years reporting on the people who've reached the pinnacle of the business world. For her new book, Plutocrats: The Rise of the New Global Super-Rich and the Fall of Everyone Else, she traveled the world, interviewing the multimillionaires — and billionaires — who make up the world's elite super-rich. Freeland says that many of today's richest individuals gained their fortunes not from inheritance, but from actual work.
"These super-rich are people who, as they like to say, 'did it themselves,' " Freeland tells NPR's Steve Inskeep. "And what's interesting for me, and actually I didn't expect it, I think it's a paradox of this sort of working super-rich, which is that you would think ... that having done it yourself, you might have more sympathy, be closer to the 99 percent."
But, she says, that's often not the case. "In many ways, that personal history of really feeling like, 'I did this! By myself!' actually creates more of a chasm between them and the rest of us, and, I would say, a certain degree of disdain."

Here's an interesting quote from Freeland:

Those at the very top, Freeland says, have told her that American workers are the most overpaid in the world, and that they need to be more productive if they want to have better lives.

Indeed, she relates this person telling her that if American workers want to get paid ten times the amount Chinese workers do then they should be ten times as productive!

It's actually pretty hard to get good data on labor productivity but what there is suggests that American productivity has increased a lot in the recent decades but those gains have gone not to the workers but to the firms (and their owners):

Not to mention the fact that international earnings comparisons should not be carried out as if some free-markets-fairy was setting the earnings with great justice.  Reality can be quite a bit nastier as you might remember from stories like this one.