Making Sense - Sam Harris - #221 — Success, Failure, & the Common Good

In this episode, I speak with Michael Sandel, an American political philosopher and author of The Tyranny of Merit: What's Become of the Common Good? about the ethics of success and failure in our society, the enduring problems with capitalism, how college has become a sorting mechanism for a new kind of caste system, and the paradoxes which come from valuing excellence all the while recognizing the role that luck plays in producing it. It s a very timely conversation as we struggle really throughout Western society to deal with the politics of humiliation and injustice and the rising levels of wealth inequality to which they are anchored. And now I bring you Michael Sandels, who is a man of many honors and talents. He teaches the quite famous course on Justice that has been televised and viewed by tens of millions of people, and he s the author of several books, the most recent of which is The Terrible of Merits: What s Become of The Common Good ? a new book about the idea of meritocracy, written by a man who argues that there is no such thing as a fair society, and that the only flaw in meritocracy is that we don t give everyone the opportunity to rise or fall based on their own merits. What could be wrong with that? point of view? Well, if we could just let everyone deserve the opportunity they don t need to be well-qualified? on the face of it is a counterintuitive idea, isn t that a good thing, because it could be a good one, right? And so if I need someone to be a surgeon, I need a good surgeon? so I need to perform a good job based on my connections, rather than on their connections, or by virtue of their birth, and so on? what could be I need I need not be a well qualified to be good at it? I don t know. - Sam Harris - making sense of the point of this point of it? - is it a good idea? - is there a point of the common good that we could be better than a good doctor? by someone who is not based on meritocracy based on virtue, not by virtue, rather by their connections or by their meritocracy? - and so I don't need to get it by virtue or by an accident? - what could I need it based on a good degree of skill or by a good social role? - or by luck, rather?

00:00:00.000 Welcome to the Making Sense Podcast.

00:00:08.320 This is Sam Harris.

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00:00:45.840 Today I'm speaking with Michael Sandel.

00:00:49.320 Michael teaches political philosophy at Harvard University, where he teaches the quite famous

00:00:54.740 course on justice that has been televised and viewed by tens of millions of people.

00:01:00.000 And he's the author of several books, the most recent of which is The Tyranny of Merit,

00:01:05.880 What's Become of the Common Good?

00:01:08.320 And that is our focus in today's episode.

00:01:11.000 We talk about the ethics of success and failure in our society, the enduring problems with capitalism,

00:01:20.420 how college has become a sorting mechanism for a new kind of caste system.

00:01:27.040 We cover what I have come to think of as the pernicious myth of the self-made man,

00:01:31.740 and we discuss the paradoxes which come from valuing excellence, all the while recognizing the role

00:01:39.860 that luck plays in producing it.

00:01:43.340 It's a very timely conversation as we struggle really throughout Western society to deal with the

00:01:50.620 the politics of humiliation and injustice and the rising levels of wealth inequality to which they are anchored.

00:02:01.080 Clearly we're going to have to get a handle on this sooner rather than later.

00:02:05.720 And now I bring you Michael Sandel.

00:02:08.140 I am here with Michael Sandel.

00:02:15.520 Michael, thanks for joining me.

00:02:17.440 Good to be with you, Sam.

00:02:19.060 So, you know, I will have properly introduced you here, but give me your short-form bio.

00:02:25.460 You're a man of many honors and talents, but how do you describe yourself in an elevator with a stranger?

00:02:31.340 I teach political philosophy.

00:02:32.880 At Harvard, and you also, if I'm not mistaken, teach what's often described as the most popular

00:02:39.800 course at Harvard, this course on justice.

00:02:43.060 Do you still teach that?

00:02:44.420 I'm teaching it this semester, adapted to include new examples of justice and ethical dilemmas

00:02:51.640 arising from the pandemic and from this moment of racial reckoning.

00:02:56.100 Nice.

00:02:57.080 Well, you have a new book, The Tyranny of Merit, What's Become of the Common Good,

00:03:01.940 which I want to focus on.

00:03:04.440 But another colorful fact about you, which I only just learned, was that in 1971, at

00:03:10.940 the age of 18, you debated Ronald Reagan when he was the governor of California.

00:03:15.560 That had to be amusing.

00:03:17.240 But I also recall that you and I once debated, I think I probably got the more seasoned Michael

00:03:22.600 Sandel, somewhere around, I think it was 2005.

00:03:26.140 Do you recall that?

00:03:27.500 We met at either Pomona or Harvey Mudd College?

00:03:32.640 Yes, I do.

00:03:34.500 So we've met once, and I remember that being quite a collegial and amicable debate on, it

00:03:42.140 surely must have been on religion at that point.

00:03:44.280 I think that's right.

00:03:45.360 I think it was about the role of religion in public life, if I remember correctly.

00:03:49.820 Yeah, yeah.

00:03:51.320 Well, nice to meet you, albeit at some distance here, on a new topic.

00:03:56.880 And it's a topic that I think we substantially agree on, although I must say there's something

00:04:02.100 so counterintuitive about a criticism of meritocracy.

00:04:08.320 It makes the topic itself surprisingly elusive.

00:04:12.300 Once you think you have the thesis in hand and you agree with it, it's almost like you wake

00:04:18.880 up and can no longer find your purchase on the felt sense of the argument anymore, because

00:04:26.880 there's just something so ingrained about this notion that the only flaw in meritocracy,

00:04:33.880 which is to say, you know, truly valuing differences in competence and excellence and rewarding people

00:04:40.780 along that continuum, is that the flaw is generally thought and felt to be that we haven't achieved

00:04:48.700 it.

00:04:49.280 We don't have a fair society with real, anything like equality of opportunity, but if only we

00:04:54.980 could give everyone the opportunity they deserve, well then what could be wrong with just letting

00:05:02.460 people rise or fall based on their own merits?

00:05:06.580 Right.

00:05:06.960 Let's start there.

00:05:07.980 How do you think about this notion of meritocracy at this point?

00:05:13.620 Well, you're right, Sam, it is a counterintuitive idea, because merit on the face of it is a good

00:05:20.220 thing, even an ideal.

00:05:23.040 What could be wrong with trying to assign people to social roles and to jobs based on their merits

00:05:30.580 rather than based on arbitrary factors or the accidents of their birth or whom they know,

00:05:37.160 connections, and so on?

00:05:39.580 And if I need a surgeon, if I need surgery, I certainly want a well-qualified surgeon to

00:05:45.880 perform it, not someone who's poorly qualified.

00:05:48.560 So on the face of it, merit seems an unqualified good.

00:05:52.780 And yet, when merit comes to be a governing philosophy, a way of determining access to

00:06:04.060 opportunities, it has a dark side.

00:06:08.420 And the book tries to bring out this paradoxical feature of merit.

00:06:14.020 But I would put it this way, if we had a perfect meritocracy, if we could one day overcome all

00:06:25.320 of the obstacles that hold people back, all of the prejudices, wouldn't that be a good

00:06:33.800 thing?

00:06:34.180 Well, it would have this feature, that the winners of the race, this fair race, would believe,

00:06:45.600 understandably, that they deserved their winnings, provided the races run fairly, and that the

00:06:54.380 losers deserved whatever place they wound up in. 0.99

00:06:57.380 And here, when we think about a society and an economy and a democracy, here's where the 0.94

00:07:06.020 flaw in the ideal arises.

00:07:09.740 First, it's a good thing to bring everyone up to the same starting point in the race.

00:07:16.340 But if we could, it would be predictable that the fastest, most gifted runners would win,

00:07:24.260 and would believe they deserved all of the benefits and the material rewards and the honors that

00:07:32.840 the society bestows upon them.

00:07:36.060 But a question, one question could be asked is, do we deserve, in the first place, the talents,

00:07:43.880 the gifts that enable us to flourish in a market society like ours?

00:07:50.200 Or is having those talents a matter of good luck?

00:07:54.080 Take, for example, make it concrete, LeBron James.

00:07:58.240 He's a great basketball player, just helped lead the Lakers to the NBA championship.

00:08:04.820 He works hard to cultivate his great athletic talents.

00:08:10.220 But does he really deserve those talents and all the benefits that flows from them?

00:08:16.260 Or is having those talents, certainly it's not his doing that he's gifted in that way.

00:08:22.400 Is that his good luck?

00:08:23.500 But more than that, Sam, it's the fact that he lives in a society that loves basketball.

00:08:32.960 That, too, is hardly his doing.

00:08:35.600 If he lived back in the Renaissance, they didn't care much for basketball then. 0.97

00:08:40.400 And they preferred fresco painters.

00:08:44.140 So that, too, is a matter of contingency and good luck.

00:08:48.240 So for these two reasons, it's a mistake for the successful to assume that their success

00:08:55.080 is the measure of their merit and that they, therefore, deserve all of the benefits that

00:09:01.760 flow from the exercise of their talents.

00:09:04.760 And here's where the dark side of it comes in, especially when we think about our current

00:09:10.240 society and our politics.

00:09:12.500 As the successful come to believe that their success is their own doing, a measure of their

00:09:18.760 merit, they tend to inhale too deeply of their own success.

00:09:23.780 They forget the luck and good fortune that helped them on their way.

00:09:27.760 And they tend to look down on those less fortunate than themselves, believing that their failure

00:09:35.340 is their fault.

00:09:37.300 And I think this hubris among the successful, meritocratic hubris, I call it, and the humiliation,

00:09:45.400 the demoralization among those left behind accounts for some of the resentments that have

00:09:52.440 gathered in recent decades against elites, resentments that we saw bubble up and find expression in

00:09:59.540 the populist backlash of 2016.

00:10:03.280 So there's a lot here.

00:10:04.100 So there's the kind of the ethical case, and then the political ramifications of getting

00:10:11.180 that right or wrong here.

00:10:12.300 And so you've just sketched that in brief, and your book really goes deeply into it, that

00:10:16.900 we have this sense among the successful, certainly, that they desperately want to believe that their

00:10:25.920 success is morally justified.

00:10:28.140 Right.

00:10:28.280 There's this notion of justified advantage, which just by the very logical nature of the

00:10:35.140 claim begets this notion of justified disadvantage, right?

00:10:38.940 The people who are not winners, i.e. the people who are losing to one or another degree, also

00:10:45.020 deserve their lot in life.

00:10:47.280 And this leads to a kind of, you know, resentment and populist anger that we've seen, and the

00:10:54.040 attendant politics of personality and Trumpism, and also this now pervasive and totally

00:11:01.920 destabilizing distrust of institutions and expertise.

00:11:07.800 Now we're living in a kind of shattering of our public conversation about basic facts, because

00:11:13.600 so-called elites are despised to the degree that they are in the media and in academia and

00:11:20.080 various institutions.

00:11:20.980 And I'm quite sympathetic with much of this criticism, because the elites have played their

00:11:25.820 side of this terribly.

00:11:28.060 And maybe we'll touch on some of those specifics.

00:11:30.880 But before we get into the politics of all this, let's linger on the ethical case, because

00:11:37.220 I totally agree that we should view differences in success in general as a kind of multivariate

00:11:48.700 lottery that's being run.

00:11:50.460 You know, it's not just a matter of the normal forms of good luck.

00:11:55.720 Everything can be ascribed to luck in the end.

00:11:58.500 I mean, you know, down to your genes and all that they do to determine who you are and down

00:12:03.860 to the environment and all that it does in concert with your genes to determine who you are.

00:12:08.560 I mean, no one made themselves.

00:12:10.040 No one created the society into which they were born.

00:12:14.040 Take the perfect example of someone like LeBron James.

00:12:17.180 He neither created his physical attributes that allow him to succeed as a basketball player,

00:12:22.840 nor did he create the world in which basketball would be valued or even deemed interesting.

00:12:29.760 And so he has won a kind of lottery, and yet there does still seem to be this problem in

00:12:36.760 how we deal with differences in ability that we value and will inevitably value, because

00:12:44.680 you take something like basketball.

00:12:46.240 I mean, if you value basketball, if you enjoy watching the sport, almost by definition, you

00:12:52.540 will value the far end of the continuum of the bell curve of basketball talent more than you'll

00:12:59.580 value the mean, right?

00:13:01.500 And so no one wants an NBA where everyone gets a chance to play and everyone gets a trophy at

00:13:07.680 the end of the season.

00:13:08.860 I mean, that annihilates the principles by which one would even capture your attention, you know,

00:13:15.000 as a sport.

00:13:15.600 If you could wave a magic wand and reset all of our ethical and attentional dials here, just

00:13:25.600 what would be our experience?

00:13:28.220 Take the limited case of basketball, you know, thinking about basketball, valuing basketball,

00:13:32.640 buying tickets, and rewarding the obvious merits of a player like LeBron James.

00:13:40.200 If I were recruiting a basketball, an NBA team, I would still go, Sam, for the best players.

00:13:47.740 I would.

00:13:48.160 I would want LeBron James.

00:13:50.020 I would want the best players.

00:13:52.720 So that's not really the question.

00:13:56.280 The question is what moral dessert we attribute to those who enjoy material rewards as well as

00:14:05.640 honorific rewards for excelling in this or that way.

00:14:09.700 So in the narrowly contained realm of basketball, the hiring practice wouldn't be different.

00:14:20.220 The recruiting practice wouldn't be different.

00:14:22.540 But when we look at the society as a whole, and when we look at social roles, and when we

00:14:29.820 look at who gets to govern, and who gets to have the greatest voice, and who makes the

00:14:34.880 most money, there's the tendency to assume, let's take the economy, there's a tendency

00:14:41.260 to assume that the money people make is the measure of their contribution to the common

00:14:47.300 good.

00:14:48.400 But this is a mistake, because there are all sorts of contingencies that determine who makes

00:14:55.180 a lot of money and who makes less, contingencies that are in no way related to differential contributions

00:15:03.340 to the common good.

00:15:04.840 And when we ask about who governs us, we want, in broad terms, here's the basketball analogy,

00:15:14.040 we want to be governed by the people who are best at governing.

00:15:18.000 Or in a representative democracy, we want to be represented by those who are best at that

00:15:24.300 role.

00:15:24.960 But today, essentially, we are governed by only a segment of the population, those who have

00:15:37.200 managed to get four-year university degrees, overwhelmingly in democracies in the U.S.

00:15:43.320 and in Europe.

00:15:46.420 Parliaments and executive branches are dominated by, overwhelmingly by those who have university

00:15:52.960 degrees, even though those of us who have such degrees represent a minority of our fellow

00:16:01.820 citizens.

00:16:02.700 Most people don't have a four-year university degree.

00:16:06.580 Nearly two-thirds do not in the United States and in Europe.

00:16:11.460 So if we're talking about governing, this touches, too, on your point about expertise, Sam, and

00:16:17.280 the backlash against elites and experts, I think that we've confused, talking about merit and

00:16:27.520 governing, we've confused the virtues necessary to govern well in a democratic society with

00:16:35.580 technocratic expertise.

00:16:38.820 But that's distorting.

00:16:39.920 That's much too narrow.

00:16:42.260 So in many of the domains, once we get outside of basketball, the problem is that we have

00:16:48.060 woefully misconstrued what counts as the relevant merits.

00:16:54.180 So that's why the basketball illustration is helpful up to a point.

00:16:58.760 But when it comes to distributing economic rewards and when it comes to governing, what we tend to

00:17:05.560 regard as merit actually misses the mark by quite a long way.

00:17:12.060 Okay, so I think it's helpful to grab the ethical side of this before we talk about just descriptively

00:17:18.660 what's happening at the level of our politics and society at large.

00:17:22.120 So I hear in part of this criticism, a criticism of the notion that there's any direct causal

00:17:32.980 connection between wealth and value creation.

00:17:37.500 The cartoon version of, you know, blameless wealth that one would get in a libertarian circles,

00:17:46.100 you know, perhaps above all.

00:17:47.360 This notion that the only way someone becomes spectacularly wealthy is to create a commensurate

00:17:55.320 amount of value for the world.

00:17:57.980 I mean, that is how a free market would reward, you know, human excellence and value creation.

00:18:04.060 And the way that gets deranged, I mean, obviously, there, you know, we don't live in the cartoon.

00:18:10.100 There are ways this is not reflective of reality.

00:18:13.340 But I think there is a core truth to it, right?

00:18:15.940 Now, you might say that we value the wrong things, right?

00:18:19.120 So someone can open an Instagram account and flaunt their body, and if they're young and

00:18:25.940 beautiful, they'll have millions of people following them, or at least some of them will.

00:18:30.940 And they may be able to leverage that into vast wealth, as have the Kardashians.

00:18:39.200 It's not to say it's their only assets, but there's no question they are being rewarded

00:18:44.820 by some notion of, if not value, created for society.

00:18:50.280 It's the capturing of attention.

00:18:53.120 There is a machinery here that is working based on what people, the choices people are making,

00:18:58.900 and the resulting effects in the market.

00:19:02.200 And money is flowing in what is deemed to be the right direction.

00:19:05.640 And that's a case where we, I think we might say, okay, well, people are just valuing the

00:19:10.340 wrong things, and other people are becoming amazingly wealthy based on this distortion and

00:19:16.700 priorities.

00:19:17.420 But then when you have something, you have someone else who's become immensely wealthy

00:19:22.460 by a purely creative act that has just brought nothing but joy to the world.

00:19:28.940 I mean, someone like J.K. Rowling, she writes her books, people line up at midnight to buy

00:19:35.320 them in front of bookstores all over this world.

00:19:38.400 That was a fairly pure register of the value being created, and she became among the wealthiest

00:19:48.080 writers in history.

00:19:49.100 As a result, what are you suggesting could change about our current system with reference

00:19:54.680 to someone like J.K. Rowling?

00:19:57.000 I mean, shouldn't we reward her in precisely the way we have and esteem her in the way that

00:20:03.840 we do based on her creative output?

00:20:07.060 Well, there are two reasons that the answer might be yes, that we should reward her in the

00:20:13.840 way we do.

00:20:14.460 Though it's important that you drew this distinction just at the end of the question, Sam, between

00:20:19.080 rewarding her monetarily and rewarding her with esteem, and the answer may be different in

00:20:28.240 the two cases.

00:20:30.740 But if she is providing something that is valued and that is worthy of being valued, then she

00:20:43.300 should be rewarded, certainly with esteem, for having done that.

00:20:49.080 Now, but there are two reasons we might want to reward her.

00:20:52.660 One is to encourage her and people with creative gifts like hers to continue to exercise them

00:21:00.320 by writing books that we love to read or our children love to read.

00:21:07.080 That's a reason.

00:21:08.860 That reason has to do with providing an incentive to her and others like her to continue doing 0.89

00:21:15.180 what they're doing, because we like the stories that she writes.

00:21:21.600 But it's important to notice that that reason, the incentive reason, has nothing necessarily

00:21:28.520 to do with whether or not she morally deserves all the money she makes writing Harry Potter stories. 0.99

00:21:38.800 That's a further question.

00:21:41.300 And so the second question is, should we reward her in the sense that not only does she get

00:21:49.960 a lot of money for selling a lot of Harry Potter books, but we also consider that she morally

00:21:57.960 deserves the money that she makes thanks to the market success of the books. 0.81

00:22:04.720 And that's the further question.

00:22:06.960 That's a harder case to make.

00:22:10.920 Now, this is why your mention of esteem matters.

00:22:15.560 We might decide that she deserves esteem for having written beautiful and compelling Harry

00:22:23.880 Potter stories.

00:22:25.080 And yet it could very well be a further question whether she should make ten times more than

00:22:32.600 other writers or people in other professions, or a hundred times more, or a thousand times

00:22:40.020 more, or ten thousand times more.

00:22:43.060 It's hard to claim that as a matter of moral desert, she deserves to make X times more, where 1.00

00:22:51.540 X is in proportion to her actual earnings relative to other people, whereas I think it's easier

00:22:59.220 to say she's certainly worthy of admiration for the creativity she brought to bear writing

00:23:06.160 these stories.

00:23:08.020 If I could just add, I think you put it very well when you said part of the objection is

00:23:14.260 that we value the wrong things.

00:23:17.380 Part of the objection to assuming that the money people make is the measure of their contribution

00:23:23.720 to the common good.

00:23:26.040 It's important to keep hold of this question because it's a question that the free market

00:23:33.260 libertarians you mentioned beg.

00:23:35.780 They ignore.

00:23:37.420 But here's a simple, concrete example to test it.

00:23:40.860 I don't know, Sam, if you were a fan of Breaking Bad, Walter White.

00:23:47.100 Walter White started out as a high school chemistry teacher, and he didn't make much money.

00:23:53.840 He had to work, when he wasn't teaching, at a second job at a car wash.

00:23:59.500 And then, as we know, he broke bad and became a meth dealer.

00:24:03.360 He used his talents as a chemist to make perfect methamphetamine and made millions and millions

00:24:11.140 selling this methamphetamine because there was a great market demand for it.

00:24:16.560 So here would be the test for the pure idealistic free market libertarian.

00:24:23.060 Assuming there were a competitive market in high school chemistry teachers and in meth cooks,

00:24:30.620 and Walter White made thousands of times more cooking and selling meth than teaching high school chemistry,

00:24:39.180 would we conclude from that that his contribution as a meth dealer was thousands of times greater,

00:24:49.340 more important than his contributions as a high school chemistry teacher?

00:24:55.700 Probably not.

00:24:56.780 It would be pretty hard to make that claim.

00:24:59.600 So part of what I'm suggesting is that really to understand the question of merit

00:25:05.460 when we're talking about the economy and economic rewards,

00:25:08.720 we have to address the question about whether we are valuing the right kinds of things

00:25:16.300 in the design of markets and in the allocation of rewards.

00:25:22.500 There's so many things that distort this notion of value,

00:25:26.760 a notion that there's a linear relationship between the value being created by someone's efforts

00:25:33.100 and their monetary rewards or their rewards with respect to esteem.

00:25:39.740 I mean, you just take the case of, you know, someone who's saving your life.

00:25:43.980 You're having a heart attack, you know, the paramedic shows up and saves your life.

00:25:48.980 Well, in that moment, this is the most valuable job on earth for you, right?

00:25:54.580 But that doesn't suggest that we could have a society that paid paramedics $20 million a year

00:26:02.060 for working their trade, right?

00:26:04.140 Because it's more of a trade than, you know, finding the outlier in the NBA can be thought of as a trade

00:26:11.280 or, you know, the outlier with respect to writing novels.

00:26:15.240 I don't see how we get away from this seemingly crazy, outsized reward structure for the people

00:26:25.180 who are on the far tail of the continuum for things we value, you know, rightly or wrongly.

00:26:32.440 There is this larger criticism we could explore around, you know, a society that is just captivated

00:26:40.260 by the wrong things, and that's a much longer conversation that will outlive both of us.

00:26:46.720 How do we want the things we should want in the end?

00:26:50.320 How do we live lives, you know, all together that we won't regret, that in hindsight will

00:26:56.980 seem sane, and how do we avoid, you know, just colossal wastages of time and opportunity

00:27:03.480 collectively, but in a world where people can freely spend their time, attention, and money

00:27:12.460 on things they want, and in a system that maximally incentivizes a creative and, you know,

00:27:22.540 hopefully ethical response to those wants, right?

00:27:26.800 I mean, if we want to be able to give everyone at all times what they want, what they really

00:27:32.880 want as quickly and as efficiently as possible, something like capitalism seems like the best

00:27:40.680 answer we've ever arrived at, and something like global technocratic capitalism is where

00:27:47.980 we've landed, and again, we can point out flaws in this.

00:27:51.100 I mean, there are, you know, obviously negative externalities to various business practices

00:27:55.400 that, you know, free markets don't account for, and we want some kind of regulation, you know,

00:27:59.580 environmental and otherwise, but it's hard to see that, you know, if you are going to be writing

00:28:04.660 novels that are so creative that people want to open theme parks in order to explore the

00:28:12.140 consequences of your ideas, right, and people by the tens of thousands show up at those theme parks

00:28:17.820 every year to buy the merchandise that is derivative of your ideas, other than just deciding that

00:28:26.020 someone like J.K. Rowling needs to pay more in taxes, that we should have something like a wealth

00:28:31.800 tax or a tax that's so progressive that, you know, very, very wealthy people pay the preponderance

00:28:38.580 of their wealth back into the system. If we just had our tax codes straightened out, wouldn't that be

00:28:43.760 a sufficient remedy for this particular lottery problem?

00:28:47.200 Well, that certainly would be one way of responding to it, by considering a revamping of the tax

00:28:55.120 system. A wealth tax would be one possible way of dealing with this, but I would also say,

00:29:02.240 if we're thinking now practically and moving into the world in which we live, I think we should have

00:29:07.780 a public debate about whether it's fair or desirable to tax earnings from labor, the work people do,

00:29:16.620 in the real economy at a higher rate than earnings from interest dividends and capital gains.

00:29:24.860 Why should we tax workers at a higher rate than investors from the standpoint of merit or desert

00:29:32.460 and contribution to the common good? A more dramatic example of this, Sam, would be, I think we should

00:29:39.240 have a debate about whether to trade off all or part of the payroll tax, which, after all, is a tax on

00:29:48.380 labor paid partly by the worker and partly by the company, and make up that lost revenue through a

00:29:55.220 financial transactions tax, or at least one on speculative financial activity unrelated to

00:30:03.360 improving the real economy or high-speed trading. The actual way in which enormous income and wealth

00:30:13.080 is generated, the characteristic way is not the J.K. Rowling way, or even the LeBron James way. It's to do with,

00:30:25.820 for looking at broader trends over recent decades, the financialization of the economy. We see this in

00:30:34.020 the U.S. and Britain, which is the tendency of a greater share of economic activity, of GDP and

00:30:42.420 especially of corporate profits accounted for by financial activity rather than providing goods and

00:30:50.220 services that people use. Now, there'd be nothing wrong with this or with the outsized rewards that

00:30:57.280 people in the financial industry reap if that increased financial activity corresponded to

00:31:05.100 a productive contribution to the real economy. But increasingly, the financial activity that has

00:31:14.340 exploded in recent decades, especially with financial deregulation in recent decades,

00:31:20.220 contributes little, if anything, to the real economy. The social purpose of finance is to allocate

00:31:28.020 capital to productive activities, new businesses, enterprises, factories, homes, schools, hospitals,

00:31:35.700 roads, and so on, in the real economy. But most financial activity in advanced financial systems,

00:31:44.660 such as the U.S. and the U.K., is not of that productive kind. It's been estimated by those who

00:31:52.460 know more about it than I do, that only about 15% of financial activity consists in investment in new

00:32:01.880 productive assets for the economy. 85% consists of simply bidding up the price or betting on the future

00:32:11.460 prices of already existing assets or increasingly synthetically created derivatives and other fancy

00:32:20.340 financial instruments that have precious little to do with making the economy more productive.

00:32:27.060 So in some ways, the standard defense of a laissez-faire free market distribution of income and wealth,

00:32:36.040 drawing on J.K. Rowling or on LeBron James, misses what's actually going on for the most part with the

00:32:43.760 growing inequality in our economy. And so in debating the tax system, I think we should confront that

00:32:52.920 directly. Hence, I would suggest, in addition to a wealth tax, a financial transactions tax, to offset,

00:33:01.460 to enable us to reduce taxes on work in the ordinary sense. Now, if I could just add one more thing about

00:33:09.920 this, Sam. This isn't only for the sake of redistributing income from the wealthy to those

00:33:16.460 who need it more, though that would be one advantage. It's also to prompt a broader public debate

00:33:23.880 about the earlier topic we were discussing, which is whether the purpose of an economy

00:33:31.520 is to help shape the way we value different contributions to the economy and the society,

00:33:41.800 or whether the point of the economy is simply to accept whatever valuations seem to be implicit in the

00:33:48.360 existing system. And I'm hoping by these and other proposals to prompt a broader public debate onto

00:33:56.700 the terrain that you said, rightly, is contestable and we could be debating about for a very long time.

00:34:04.280 What does it mean to value the right kinds of things? What does it mean to encourage certain

00:34:11.020 contributions to the common good and to discourage others? I think that should be a part

00:34:17.060 of our public debate. And one way of making it a part of our public debate is to raise questions,

00:34:24.060 for example, about the role of speculative finance by comparison with the productive contribution of

00:34:31.160 people who produce truly valuable goods and services. Yeah, well, that's obviously a very

00:34:38.620 important distinction. I mean, there's so many areas of the economy where if we could be fully

00:34:43.580 transparent as to the contributions being made by that economic activity, we would want to rethink,

00:34:51.940 you know, what we're incentivizing and how we're rewarding people because there's so much

00:34:56.320 rent-seeking behavior and there's just so much administrative bloat in, you know, the whole sectors

00:35:04.100 of our economy are suffocating under this apparatus we put in place. And we take the medical system and

00:35:10.660 just how much time doctors have to spend dealing with insurance companies. We spend more on medicine

00:35:17.960 than any society on earth and we do not get the return on our investment. So yeah, there's a lot

00:35:25.240 to straighten out there. But even the pure case is hard to think about and puts us up against certain

00:35:33.000 moral paradoxes. So for instance, just imagine a society where we had decided, okay, we've gotten

00:35:40.940 past this notion of mere equal opportunity because we know that even if we could open the doors

00:35:49.540 perfectly and give every child starting right now an equal opportunity to get into Harvard, say,

00:35:56.680 well, there'll still be massive differences in their ability to avail themselves of those opportunities

00:36:03.760 because of all of these other disadvantages. But the paradox here is that the thing that's under our

00:36:10.520 control, the environment, if we perfectly tuned to that, if we gave everyone from utero onward all of the

00:36:19.180 same environmental benefits, right? This is magic, right? We obviously can't do this. But even if we

00:36:26.940 could, where that would land us is in this dystopian, counterfactual world where now what we'll have to

00:36:36.440 spectate on are the massive differences in genetic endowment, right? I mean, if you perfectly secure the

00:36:44.440 environment against disadvantage, well then all you will see is a kind of tyranny of genetic differences

00:36:52.060 and we'll be in some kind of Gattaca-like dystopia. And that would be if with the best of intentions

00:36:58.400 we could create perfectly equitable and enriched environments for everybody. You can take that case

00:37:05.580 and do with what you will with it. It almost seems like a kind of mirage here to figure out how to

00:37:11.640 actually solve this problem given a perfect ability to do so. Well, I think what the mirage-like feel of

00:37:23.600 this thought experiment brings out is that even a perfect meritocracy would not be a just society

00:37:34.020 because the winners would still be determined by factors that were not their own doing. And yet,

00:37:43.900 to make matters worse, the closer we came to providing truly equal opportunity, the greater the tendency

00:37:54.320 for the successful to believe that their success was their own doing, the greater the tendency

00:38:01.600 to forget or to overlook or deny the luck and good fortune that helped them on their way, and the greater

00:38:12.100 the tendency to look down on those who are flourishing less and to say their failure must be their fault.

00:38:22.200 So what goes along with the meritocratic picture is a sense of human agency so thoroughgoing

00:38:32.000 that we tend to attribute moral responsibility for one's fate, for where one lands in life. Notwithstanding

00:38:42.280 the persistent contingencies that you've just described and that we've been discussing,

00:38:48.120 the attitudes towards success and failure, toward winning and losing, as we approach more closely

00:38:57.560 perfect equality of opportunity, those attitudes towards success and failure would become all

00:39:05.000 the sharper, all the more pronounced. And what I'm suggesting is, from an ethical point of view,

00:39:12.160 and you've rightly invited us to distinguish the ethical from the political dimensions of this,

00:39:18.120 ethically, the hubris leads those on top to forget not only the luck and good fortune,

00:39:26.280 but also their sense of indebtedness, as well as looking down on those less fortunate than

00:39:34.160 themselves. So that's the ethical problem. That's the dark side of meritocracy, morally speaking.

00:39:41.380 It's the hubris. The more we appreciate, the more we would be alive to the role of accident,

00:39:48.120 and luck and luck and fortune, the more open we would be toward a certain humility, toward success,

00:39:56.280 toward winning. And this openness to humility can open us also to a greater sense of responsibility

00:40:05.880 for those less fortunate than us, those who struggle, those who may be left behind through no fault of

00:40:13.900 their own. So that's the ethical side of it. But politically, even though we haven't realized the

00:40:21.720 perfect meritocracy that you've just described, and that we've been imagining, it has so, this ideal,

00:40:29.900 this picture has so dominated public discourse, that it has shaped the response to the deepening

00:40:36.300 inequality of the last four decades. And I think it's no accident that meritocratic modes of public

00:40:45.060 discourse and moral argument have strengthened their hold at the very same time that inequalities of

00:40:54.880 income and wealth have deepened with the kind of market-driven globalization we've had in recent

00:41:00.460 decades. And this has fueled the anger, the resentment of those who have lost out. It's one thing

00:41:10.700 to feel that you've lost out because the system is unfair, the system is rigged. That's a worry about

00:41:19.180 fairness. But humiliation is a deeper kind of demoralization, because it's a system where the

00:41:27.600 attitudes towards success and failure lead those who struggle to believe, well, maybe I don't work

00:41:35.300 hard enough. Maybe I'm not talented enough to land where they landed. That's deeply demoralizing,

00:41:42.860 and maybe that's why they're looking down on me. One of the most potent sources, Sam, I think of the

00:41:49.360 populist backlash that we've seen most dramatically in 2016, is the sense among many working people

00:41:59.820 that elites look down on them. And this has a specific meaning in the context of American politics,

00:42:06.700 because for four decades, the meritocratic promise was, yes, there may be deepening inequality,

00:42:13.340 but you can rise. Everyone can rise through individual effort and training, provided you go

00:42:22.660 to college. Then you too can compete and win in the global economy. What you earn will depend on what

00:42:30.500 you learn. So the response, and this includes Democrats and Republicans, the response to the deepening

00:42:38.980 inequality was to offer individual upward mobility through higher education, which on the face of it

00:42:47.500 seems inspiring. I'm all for improving access to, widening access to higher education. But as a remedy

00:42:55.300 for the inequality that we've seen, it's a pale, inadequate solution. And it contains what seems an

00:43:03.160 inspiring message. You too can rise if only you go to college, contains an insult, an implicit insult.

00:43:11.520 And the insult is this. If you don't have a university degree, and you're struggling in the new economy,

00:43:18.760 your failure must be your fault. And this politically is folly, when we recall that most, most people don't

00:43:27.320 have a four-year college degree. So instead of focusing on arming people for meritocratic

00:43:33.980 competition, I think we should be focusing more on affirming the dignity of work and having a public

00:43:41.600 debate about what it would mean truly to enable everyone to flourish, whether they're in blue-collar

00:43:48.200 jobs or whether they're well-credentialed people in professional jobs.

00:43:54.200 Yeah, so let's focus on the problem of college, because this is, in some measure, the whole

00:44:01.860 problem in microcosm, but it's also the longest lever that has separated the fates of winners and

00:44:10.420 losers in our society. I mean, college, you know, on your account, other people have hit this topic.

00:44:17.400 Daniel Markovitz was on the podcast a couple months ago. I mean, college has become a kind of

00:44:23.000 sorting mechanism for a new caste system in our society. And again, as you point out, this is not

00:44:30.800 just a problem with, you know, one party or the other, and this comes from everywhere, that this is

00:44:36.780 the way you will successfully compete in this increasingly global state of economic nature.

00:44:44.400 And it's not only something that is offered more or less to everyone, and everyone who will claim

00:44:51.940 the opportunity can sort of get it in hand, but there's something, you know, generally fair about

00:45:00.320 how all of this shakes down. Because of course, the elites, right, the best of the best in any field

00:45:07.260 will wind up and should wind up at the best universities, because how else would the best

00:45:12.660 universities select their student body? And if they, you know, if this gets gamed occasionally and

00:45:19.480 occasionally perversely with people buying their way in, there's a probrium attached to that. But

00:45:25.300 in the general case, it's hard to even optimize that because these schools are fantastically expensive

00:45:34.980 to run. And if, you know, if you're not going to give alumni any, any advantage, well, then why would

00:45:41.580 they be donating year after year to, you know, to Harvard's endowment, right? So it's, there's

00:45:47.140 something that, while it's not ideal, many people look at this and think, well, how else could it be?

00:45:52.600 So I ask you, you know, in our closing chapter here, what is the problem with college and how should

00:45:58.620 we fix it?

00:45:59.320 The main problem with college is that we, and by we, I mean the society as a whole,

00:46:05.580 not just the higher education community, we have made colleges and universities

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00:46:39.700 I'll see you next time.

Making Sense - Sam Harris - October 22, 2020

#221 — Success, Failure, & the Common Good

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