The Comedy Cellar: Live from the Table - The Economist Comes to the Table: Tyler Cowen

Episode Date: May 28, 2019

Tyler Cowen...

Transcript
Discussion (0)
Starting point is 00:00:00 You're listening to The Comedy Cellar, live from the table, on Show here on Sirius XM Channel 99. My name is Noam Dwarman, I'm the owner of the Comedy Cellar. We're here at the back table of the Olive Tree Cafe above the Comedy Cellar. As always, I'm here with Mr. Dan Natterman. That's me. And our producer, Periel Aschenbrun. How do you actually say it casually? Aschenbrand? Aschenbrand?nd. How do you actually say it casually? Aschenbrunnd?
Starting point is 00:00:46 Aschenbrunnd? As I said in the old country. You say casually, formally, and every way. It just seems like a name you have to say with like a Hogan's Heroes. Anyway, and we have with us one of the guests we've ever had that makes me most happy and excited. Mr. Tyler Cowen is here. Tyler Cowen holds the Holbert Harris Chair of Economics at George Mason University. And he's the author of several best-selling books.
Starting point is 00:01:14 He is a co-author of the popular economics blog Marginal Revolution, which I read. Writes a column for Bloomberg View and hosts the podcast Conversations with Tyler. I just heard the one you did with Daniel Kahneman. And his most recent book, Big Business, A Love Letter to an American Antihero, is available now. And the book before that was The Complacent Class? Correct.
Starting point is 00:01:37 Who's the antihero you're speaking of? Big Business is the antihero. So, Mr. Cowan, you once said this and it really spoke to me and I think it's a good way to jump in. As a general rule, we're too inclined to tell the good versus evil story. As a simple rule of thumb, just imagine that every time you're telling a good versus evil story, you're basically lowering your IQ by 10 points or more.
Starting point is 00:02:03 Do you recognize that? That's correct. I call that imagine the button. That there's a button you're pressing with the IQ by 10 points or more. Do you recognize that? That's correct. I call that imagine the button, that there's a button you're pressing with the good versus evil story. You will think you're smarter than you are and that the people who disagree with you are more evil than they are. Now, why is that? How did you come to that and how do I explain that to somebody?
Starting point is 00:02:19 What insight? You go to Twitter, you go to Facebook. It's all about disagreement, right? But in fact, the people on the different sides of the debate, no one group of them typically is morally worse than the others, but you get yourself worked up about the outrages of others, you overlook the shortcomings of your own point of view, and the more you double down on what you thought to begin with, the less keen is your analysis, the less penetrating are your insights. And this contributes to why we have the bubble, as they say these days. How does that... I thought of that recently in this abortion debate,
Starting point is 00:02:53 when there's such a surplus of just ugly back and forth about the issue, and very little of what I regard as the interesting discussion of what is a difficult philosophical issue. But each side considers the other side evil, no? That's correct. One side thinks the other wants to control women's bodies or hold women down, and the other side thinks there's murder at stake. So it's hard not to get worked up about the people you disagree with. Can I just briefly jump in and ask what kind of accent you have? That's an interesting...
Starting point is 00:03:26 Your voice, where did you grow up? I grew up in New Jersey, in Bergen County, but I've lived in Germany, New Zealand. It must be that mixture of Germany and New Zealand. Okay, carry on. You can say Aschenbrunnen. Aschenbrunnen. Ah, there it is!
Starting point is 00:03:39 Have you been told that you have an interesting accent? Absolutely, and I do, but it's my prosody rather than my accent, I would say. I'm not sure what prosody means. Kind of sing-song. Gotcha. Okay. So, one of the issues that we've been dealing with, I've been writing down just for the last couple of weeks,
Starting point is 00:03:55 just things that I wanted to ask you. But one of the hot topics here is congestion pricing. And I predict that you're for it because economists are, I think they don't like rationing, so they like markets to ration. And it just seems to me something you'd probably be for. I'm against it, I think, but let me hear what you think about it. This is the traffic. I'm for it. I drove in New York City as long ago as the late 1970s, and you could actually go 28 miles an hour and hit all of those traffic lights. Now the average speed in Midtown is well below 10 miles an hour.
Starting point is 00:04:35 It can just take you forever to get somewhere, and the natural way to ration a scarce resource is by price. That said, I am worried about the surveillance, which would seem to come along with electronic taking of tolls, right? So the government, one way or another, is going to know where your car was at different points of the day. I'm very uncomfortable with that, but it still seems to me Manhattan is dying due to traffic congestion,
Starting point is 00:04:59 and we ought to do it. But isn't that like the old Yogi Berra line? Nobody goes there anymore. It's too crowded. But if you have a trip... In other words, you say Manhattan is dying, but at the same time, everybody wants to be here. No, I don't think he meant dying. But think of the waste involved.
Starting point is 00:05:13 So you could spend easily an hour and a quarter in traffic, and then you have to leave super early for your meeting to make sure you're going to get there on time. You never know when you can get a taxi. Uber is difficult, right? You find the car. Where do they pick you up? They can take, you know, 20 minutes to go around the block. It's not a perfect city for Uber. By the way, I'm all on board with congestion pricing. I just disagreed with the notion that Manhattan is dying. Let me tell you why I think
Starting point is 00:05:37 I'm against it. Yes. Okay. So first of all, I was driving in Manhattan and I was looking around at the make and model of the cars in this congestion zone. And I noticed that was overwhelmingly middle-class people. And all of a sudden now, these middle-class people are going to get a pretty big hit. And, like, I make a good living. I would happily pay $11 a day to have clearer streets. But these people, many of a day to have clearer streets. But these people, many of them don't have another option.
Starting point is 00:06:12 They're working people. They may not live convenient to a station or public transportation. They may have bought a house in a town where they planned their lives, essentially, to commute in a car in all sorts of ways. So that that that bothers me. That's point one. Point two is I don't know that the only beneficiaries of people driving in the city are the people driving. Like I benefit as a business owner when my employees drive here or my customers drive here. Right. So there's all sorts of – so I don't know if it's fair actually to attack just the drivers. And finally, just philosophically, I believe in trial and error, and I feel that when it comes to government, no trial is ever rescinded because it doesn't work. So what I'm afraid is going to happen, it won't actually help congestion. But you agree it's worked in London, right?
Starting point is 00:07:03 I don't know, and I've heard that. And it's worked in London, right? I don't know. And I've heard that. And it's worked in Singapore. And I've been to both cities a lot. Now, are there differences? Well, okay. There are big differences. Let me get the last point down. I don't want to... I want to just get it all out. And then... Oh, I forgot what I was saying.
Starting point is 00:07:18 What was the last thing I was saying? The last thing you said was the government won't rescind it if it doesn't work. That's right. If it doesn't work. That's right. If it doesn't stop congestion, if people just have to drive because it will stay forever and go up, and it also is a way to avoid what would be another way to stop the congestion, which is actually make public transportation so convenient that people would rather do it. I mean, people are waiting in traffic for an hour and 20 minutes to cross town, whatever it is.
Starting point is 00:07:51 To me, it says that the alternatives provided are so poor that who would do that? But that may be harder to fix. You know how long it took the Second Avenue line to open, right? Forever. They talked about that since the 1970s. So we could wait another 50 years for another line. But how do you imagine the traffic problem being like in 10, 15 years? Say Manhattan does well.
Starting point is 00:08:13 There's no recession. Won't it just be unworkable? And we need to do something now to forestall that? I don't know. You know, one of my other things, and I get this a little bit from you, is that I have an opinion on something and I hear someone else's opinion on something, but I don't know, you know, I mean, so many people get it wrong and they don't put a probability on it. Like, you know, they, they say it as if it's a hundred percent certain, but they could be 65%
Starting point is 00:08:41 certain. Like, yeah. And, and, and I don't know. It should be hovering is how I put it. So in business, in a business, yeah, I would say try this, try that. If it doesn't work, the customers don't like it, if we get too much backlash, then we can adjust. But the thing is, once the government, you know this, especially when it comes to collecting revenue, it's forever. So I feel, don't we have to be like quadruply sure? Because it is really a burden. Like in my town, I live in Ardsley in New York, when it's not very convenient to take a train. And to get here and Grand Central in the winter, it would add hours to my commute. And, you know, we bought our house right next to the entrance to
Starting point is 00:09:20 the highway. And it seems like a real gut punch to a lot of people. And I don't know, does England have suburbs? Is it all analogous to London? I don't know. There's big differences. But keep in mind, if you're saving people time, they will earn back some of the money. So the hurt of paying the toll is more visible than the extra wages or extra free time with family. That's interesting. But the latter is there. It's real. I don't know how much they'll learn back. I do think that after you've had it for a generation, it's a bigger positive than when you're living through the transition
Starting point is 00:09:54 because people made plans for another system. But if we're to think long-term, which America used to be much better at than it is now, I think I would still, if the button were here, congestion tolls for Midtown Manhattan, I would press it. You would press it. Now, you know, I should mention that I have also argued with Noam in favor of congestion pricing,
Starting point is 00:10:16 and he is not anywhere near as polite with me as he is with you. He harangues me and rants and raves that I don't care about the middle class. Well, that's my next question I was going to ask the middle class, and then I'm an imbecile. Pardon? That's exactly what I was going to say. What about, is there a progressive way to do it, where a working stiff paid less and somebody like me paid more, and still accomplish?
Starting point is 00:10:36 There is, but it's a little hard politically. So you could have rebates, and the rebates could be progressive. I'm not sure the government will ever do that because they want to keep the money. But in principle, that's not hard. And I think we'd agree if you're going to do it, that's the best way to do it. You know, I had a thought about congestion pricing I've never heard mentioned anywhere else, which could well be because it's a stupid point. But maybe it's not a stupid point. What about the ability of emergency vehicles to move freely through the city
Starting point is 00:11:07 if there's less traffic? It will save lives, absolutely. So that's an upside. There you go, and I've never read that anywhere. That is an upside. Oh, there's going to be upsides. I've never read that point made in the discussion of congestion pricing.
Starting point is 00:11:22 Therefore, is it fair to say that I am very insightful? You are very insightful. Oh, wow. Tyler Cowen. When your book comes out, you're very insightful, Tyler Cowen. All right, you wrote a column that got a lot of traction when Trump talked about shithole countries.
Starting point is 00:11:39 And you essentially made the argument, I don't want to get it wrong, that actually the countries, the non-shithole countries, the most affluent countries don't send their best and brightest. And actually we benefit by getting the best and brightest from the countries that are doing the worst. For the most part, and the harder it is to get here, the more likely you get the best. So to migrate to America from Africa is relatively difficult. So you're more likely to get a high level of ambition
Starting point is 00:12:05 and eventually educational achievement. And indeed, African migrants to the U.S. have college degrees at a rate higher than native-born whites. Yeah, Nigerians are very high earners, right? Correct. And in many places, not just here. And you think that's the reason?
Starting point is 00:12:20 Yes. There's a large country you're selecting for the elite for the most ambitious, and that's positive selection. But neighboring countries, you get that less. You do better, on average, getting people from distant countries. So where are you on immigration? I would like to increase the amount of legal immigration by at least a factor of two, but it's not going to happen anytime soon. And what would your parameters be about who gets to come in and who does not get to come in? The current system of family-based connections is maybe not ideal,
Starting point is 00:12:53 but I worry if we try to redesign it, we'll screw it up. So just to take the current quotas and multiply them all by two, I would be happy with. I think there's some advantages to the family-based system that aren't so obvious. If you come with your family, you're less likely to hang out with your fellow country people and more likely to assimilate. So I think it's a little underrated. The idea that you just want the software engineers from Sweden, not exactly my take. Nothing against the software engineers from Sweden. But there's a lot to be said for bringing over family units as well okay so explain to me then
Starting point is 00:13:27 uh... like i i have a i have a kitchen i pay our guys in the kitchen xx amount dollars a lot more on uh... mostly muslim-based mostly if uh... you're from our country uh... if if there were many more uh... uh... obviously low-wage low-skilled immigrants who came in. Right. Wouldn't that have a negative effect on their wages in my kitchen? There's a number of papers estimating the negative wage effect of having more low-skilled
Starting point is 00:13:56 immigrants. And it does seem it hurts Americans without a high school degree by about 1% or 2%. I don't dismiss that. It decreases their income by 1% or 2%? Correct. That's not so much. That's not so much. So the immigrants who come here, they're also demanding products,
Starting point is 00:14:11 and they earn more money, and they want to hire carpenters or cooks or the people who work in your house. So the negative wage effect, I think, is pretty small. Is that 1% or 2% in the aggregate? That doesn't mean that some people take a big hit. Of course, some take a bigger hit and some take no hit at all, many gain. But that's for people without a high school degree. For people with a college or high school degree, there's no wage loss at all.
Starting point is 00:14:36 And there's probably a wage gain, especially for women. If it's easier to hire people to watch your kids or clean your house, it's easier to have a second career. But is that aggregate way of looking at things? I mean, this is in some, in my mind, somehow related to even to Trump's victory that, yeah, they average everybody together. Some people did better. Some people did worse. And they say, oh, it's just a 5% or 2% effect. And that kind of masks that, yeah, but for like 30% of the population, it was a life-changing negative effect that we probably wouldn't have done so easily if we had really seen what they were going through.
Starting point is 00:15:15 I worry about that, but if you think of the communities where that's been relevant, parts of West Virginia, parts of the Midwest, those are not the places full of immigrants, right? They're starving for immigrants. I would even consider the idea of city-based visas. Tell people from other countries, look, you can come here from Nigeria, but you've got to go live in, you know, fill in the blank, maybe the Midwest for five years. I would experiment with that notion. Because those places do not have too many immigrants. You walk around, you see white faces.
Starting point is 00:15:46 Maybe some Latinos now. Even Krugman had said at one time, maybe it changes thinking. I mean, years ago I read something where he wrote that he thought that low-skilled immigration was a negative for low-wage earners. I think it is a slight negative.
Starting point is 00:16:01 He seemed to think it was more than a slight negative. I guess there's new science all the time. Are you a Chicago school economist, by the way? I don't think in terms of schools. I've been influenced by Chicago school. What is a Chicago school, by the way? Milton Friedman. Oh, okay.
Starting point is 00:16:16 He's good. Are you worried? What would you do to encourage what I see to be the fraying social fabric of America and the tribalism and the emphasis that everybody, and I worry about this. For instance, I've said on this show, I don't see how a country that's not ready to let Harvard be more than 20% Asian is ready to start taking millions more Asians. Like something's got to give. Either we're going to allow them to be Americans once they get here and treat everybody the same, or we're just increasing resentment by increasing their numbers, but keeping them down in terms of their achievement. So what do you think about all that?
Starting point is 00:16:58 I call it the externality of diversity. I don't think it's politically feasible right now to have more immigration. So in part, I agree with that. But keep in mind, there are other countries, Canada, Australia, which are not so different from the United States, that do now, currently, much more than my proposed doubling. So I don't think we have the attitudes in place to sustain what I would like to see. But I don't feel it's utopian.
Starting point is 00:17:24 And I think we could have a more open America, which in the past has had at times higher levels of immigration. And at least 80% of Americans would benefit from that. Not everyone. There would be distribution effects. There would be political effects, which are complicated. And that makes me uneasy. You always worry, well, if we let in group X, they'll vote for the other party, right? And that's partly why we're stuck. Yeah, I've always felt that the Democrats and business owners want the immigrants because Democrats see the votes and the business see the labor, and the rest don't.
Starting point is 00:18:03 But in the end, I've always felt we're going to have to let more immigrants in because these rich people are not going to start taking care of their own gardens and their own childcare and all this stuff. I mean, they talk a good game, but then they need the labor, right? Somebody's got to give. What about the Japanese? They don't seem too keen on allowing immigrants. Are they doomed then?
Starting point is 00:18:28 Or how are they dealing with the very same problem that the Europeans and here in America are dealing with in terms of the labor force? They've greatly accelerated the rate at which they take in immigrants. So they are starting a new experiment. We'll see how they respond to that. But look, under the prevailing status quo, Japan was set to have its population be cut in half over the course of the next century. Now, maybe Japan can survive that, but do you want that to be true for the United States? You know, the global policeman, the world's greatest power, richest country, important source of liberty. You want us to dwindle and become a tiny country when there's all the space in Nevada, in South Dakota, almost everywhere?
Starting point is 00:19:06 It doesn't make sense to me. What about having more kids, having incentives to have more kids? I'm all for that. A lot of those incentives don't work. I would gladly experiment more. The biggest reason to have more kids seems to be religion. We're becoming a more secular country. Maybe we should worry about that. But you can't force religion on people, right?
Starting point is 00:19:26 Well, it has certainly been done historically. But not in the U.S. I would be willing to experiment with some kind of implicit bounty for children, but free public education already serves that purpose in the tax code. There are incentives. Singapore's incentives haven't worked at all. The French incentives
Starting point is 00:19:42 have worked a bit. It's a tough nut to crack. Okay. Just moving along on my list. Well, certainly. Go ahead. incentives haven't worked at all the french incentives have worked a bit it's a tough nut to crack okay either that the moving along on my on my list and you could do well as certainly go ahead when is it fair to credit or blame a president for the economy is that what is because
Starting point is 00:19:58 well i mean you understand the question but i say but just my thought is always that like if i have a new policy in my restaurant, it can take two years before I actually can tell you whether that policy was smart or wasn't smart. And I figure in a country as big as the United States, it can take much longer. And then at the same time, I think a president could make a right decision, but then the price of oil went up or the price of oil went down or made a bad decision. You know, that something counteracting made the decision look good or made the decision look bad. And we have no way of knowing whether the result was because of that decision. So how do you make sense of all that? Completely agree.
Starting point is 00:20:39 The impact of presidents on the economy is greatly, greatly overrated. You know, by both sides, Republicans want to claim credit for it when they feel they can, and Democrats also. I do think Trump has had one positive effect on the economy, simply not having some of the current Democratic attitudes toward business and doing his own thing, which may be totally weird and even disagreeable, but it distracts him. And the fact that Trump is not Elizabeth Warren, I think has helped our economy somewhat, but that is a speculative assessment on my part, not a fact. Well, I can tell you as a business owner, and I didn't support Trump,
Starting point is 00:21:16 but when he won, I was like, well, at least they're not going to be coming after us for a while. Like there was this feeling like everything we do, they're just trying to find a way to monetize it. And also, I'll tell you this, you might find it interesting just as an anecdote. We lived almost three years not being able to get a clear answer about Obamacare. And we were hovering around this 50 employee thing in more than one business. And the way it was that we have one business, which was doing very badly around the corner and one business was doing well, but they, they combine them when they count up how many employees you have. So it looked like if I got over 50 employees, it might cost me
Starting point is 00:22:00 a hundred thousand dollars minimum, the $2,000 penalty. But it wasn't clear and I hired experts. So everything was kind of in a holding pattern. They put this big potential cost on the 51st employee that had to tamp down the economy. And then just so you know what happened when we finally, then we were over 50 employees and we had to offer it to everybody. Nobody wanted it. Because it was $6,000 with a deductible. And so the cost ended up being zero. And I spent three years trying to find a way to avoid this reckoning. And that could have been economic growth around here. I do worry that Trump himself sometimes goes after business people. So Jeff Bezos, he'll tweet against Jeff Bezos. If you're an American manufacturer, you open up a plant abroad, you may incur the wrath of Trump. To me tweet against Jeff Bezos. If you're an American manufacturer, you open up a
Starting point is 00:22:45 plant abroad, you may incur the wrath of Trump. To me, that's not right. We should not single out individual business people for purely legal decisions, even if you would prefer quite different laws or procedures. And in that way, Trump, to me, has been a big negative for business. But it doesn't affect you. Has he tweeted against you? Not yet. His son got in a fight here one time years ago. Anyway, protectionism. Yes. All His son got in a fight here one time years ago. Anyway, protectionism. Yes. All economists say it's a bad idea, correct?
Starting point is 00:23:10 Can you give us a quick nutshell for the listeners why it's a bad idea? Trade across nations is good for the same reasons that trade across the 50 American states is good. You get more specialization. You have larger markets. It does redistribute income, but it does create more jobs than it takes away. Gives you lower prices. That said, like with the congestion pricing, the transitions can be tough. We've had a tough transition with the rise of China. Right now, we're pushing back. But economists of both parties do overwhelmingly
Starting point is 00:23:42 agree America should have something very close to free trade. Now, there are national security issues. It's different. Not economics. Some of them matter. Right. So let's say that China had slave labor. Which they do somewhat in their prisons.
Starting point is 00:23:57 We do too a bit in our prisons. Well, my point is that, so let's say they use slave labor and they could build cars much more cheaply than we could ever. They have no labor costs. And that those cars basically put our auto industry out of business, but we get the cheap cars. We're better off. We're still better off.
Starting point is 00:24:18 That's like Japan in the 1980s. And yes, we're still better off. Even if we lose our auto industry. Keep in mind, China right now is not very good at building cars. And they don't seem to be close to being very good at building cars. It's just a hypothetical to test the limits of that. It's counterintuitive to me. Well, there's also the issue of national pride in auto industry is something that Americans are proud of.
Starting point is 00:24:39 That countries want to have certain industries so they get to say, look, look at what we do. The number one exporter of automobiles from America is Daimler-Benz. The number one producer is Toyota. So it was because we were open to foreign involvement that we saved our auto industry at all. You go to places like Tennessee, there are plenty of good automobile jobs. They're from Japanese companies. So if we had just been protectionist, we would today have crummy American car companies, crummy expensive cars, not these good jobs in Tennessee.
Starting point is 00:25:11 Transition is tough. Got to worry about that. Adjust, help out where you can. But still, mostly it seems to be better to have the open market. All right, I have to take all you smart people's word for it. It does sound somehow, right?
Starting point is 00:25:25 It does seem like when they're not playing fair, if they're using forced labor. Well, there's a moral issue, too, I suppose, is do we want to drive cars or use phones that are made by slave laborers? Is there a moral issue that's involved? Depends how good the phone is. That is a moral issue. I wasn't even getting into the moral.
Starting point is 00:25:46 Well, but the phones are not what are made by slave laborers, right? Well, except they have nets for people jumping out the windows, so it's close, right? Those are better jobs than working in the Chinese countryside, right? Sad as that may be. Is that true? They have nets?
Starting point is 00:26:02 Yeah, yeah. Next question. Are we over-regulated as an economy? Is there a reliable way to measure the downside of regulations? There is not a reliable way to measure the downside. It does seem to me we are over-regulated in most sectors, that it's harder to start a business, that more of the attention of bosses and CEOs
Starting point is 00:26:21 is distracted by matters of law and litigation, and regulations are so deep and thick and complex, you don't even know when you're complying with the law. And that to me suggests we've gone too far in most cases. But that said, areas like pollution, I think we should have tough anti-pollution regulations, more so for carbon emissions. So it's case by case, you know, look at the evidence. But i would on that deregulate i agree with you know my you know my father started uh... he started this place on money that he
Starting point is 00:26:52 scrape together driving a taxi in new york so in in the sixties you could drive a taxi in your district to the mail but a restaurant in greenwich village and greenwich village was greenwich village even then you know i remember it so as it would nobody could do that today it's it seems so And Greenwich Village was Greenwich Village even then. I remember it. And I said, well, nobody could do that today. It seems so unfathomable that somebody could.
Starting point is 00:27:16 The barriers to entry today are so enormous. And somehow, to me, this goes to why social mobility is not what it used to be. And economic mobility, exactly. It's just harder to get ahead. There's more credentialism, more barriers. You have to know more about legal issues. Just wanting to work hard and run a good business is not enough. Big barrier. Also, when I was a kid, there were a lot of mom and pop stores where the people behind the counter had thick accents and spoke broken English. And there's no, exactly what you just said about all the technical knowledge you need these days. There's no way they could do that. about all the technical knowledge you need these days,
Starting point is 00:27:46 there's no way they could do that. You know, so that, again, we want to have immigrants, and it just makes it impossible, very, very hard. But there are a lot of, you know, every bodega and every, you know, corner deli is these are people from India or Korea. Yeah, maybe you're right. I don't know. Maybe I'm, maybe, I think a restaurant may be more challenging. Other businesses may be're right. I don't know. Maybe I'm, maybe, I think a restaurant may be more challenging. Other businesses
Starting point is 00:28:06 may be more challenging. I don't know. I would say, like, if Thomas Edison wanted to start today, there's just no way he could open that, was it Menlo Park?
Starting point is 00:28:14 Yeah, Menlo Park. Yeah, there'd be so many regulations and rules. I'm not even sure that Bill Gates could legally build his computers in his garage today.
Starting point is 00:28:20 A lot of our worst regulations are on infrastructure, like building more subway lines in New York City. Not on businesses per se, but the levels of approval you need from different parts of different governments with no clear lines of accountability, like who's responsible for getting this done? Who has the authority to make a real decision?
Starting point is 00:28:37 That's part of the mess. It's not only regulations on small business. It seems so many things we do take longer. The Empire State Building went up very quickly. Thirteen months. Thirteen months, and it was safe, relatively speaking, for its time. We can't do that anymore. It took ten years to build, eleven years to build the Freedom Tower. Yes, so
Starting point is 00:28:55 all of that we need to change, but I don't see it happening. We're too cautious, we're too risk-averse, we're too complacent, as I called it in one of my books. I think that your accent sounds Canadian. Has anybody ever mistaken you? You do say like a boot-noot. So let's talk about the new book on big business.
Starting point is 00:29:18 We had a guy on another podcast here. You weren't on. Anand Gurdaharadas. I can't pronounce his name. Gurdaharadas. I can't pronounce his name. Gurdaharadas. He's this Indian guy with a shock of gray hair. Anand is his first name. Anand, yeah. Yes. He's very anti-business.
Starting point is 00:29:34 Well, very. And he walked out on me because he was complaining about Amazon and the people peeing in bottles in Amazon and all that, which of course, I'm not for that. And I tried to make the point to him that in my experience, yes, in big business you may hear a story about that,
Starting point is 00:29:52 but the real abuses go on in the Korean deli, or they don't have to be Korean, in the bodegas, where they have a Mexican guy working illegally, you know, 20 hours a day, not getting... And it's off everybody's radar, and there's no PR problem. There's nothing. And big business is as clean as it gets. And he walked out, he walked out. That's amazing. The people who work from Amazon typically came from worse jobs or they would not
Starting point is 00:30:17 have accepted the job from Amazon. So there is a problem that we ought to do more to create better opportunities for all those people. That's a genuine concern. But to blame that on Amazon, which is giving them at least some marginal improvement, it's that we need more Amazons to bid up their wages more, improve working conditions. That's how you get better pay, is by having more people chasing your labor. I think you are Chicago schooled. On that issue, yes. Are you Chicago schooled?
Starting point is 00:30:42 Well, I may well be. I may well be. Can I ask my question? Yeah, go ahead. This is a microeconomics question. I don't know how your microeconomic skills are. You might be a little rusty. We'll find out.
Starting point is 00:30:57 We have here at the Comedy Cellar a scarce resource. We have X number of seats for our shows and X number of shows. And we cannot easily increase the number of seats because it's hard to... Size limitations. Size of the room cannot be easily increased. And we have, we turn away many, many people. They come to our website. Well, I say, no, I'm not an owner.
Starting point is 00:31:25 They come to the website. They can't make a reservation a week or two in advance. I don't know how far in advance they need to make a reservation. It's a seller's market, as they say in your field. There's people waiting outside in the rain to get in, and they can put their name on a waiting list. So what we have here is a disconnect between supply and demand. Should we, therefore, raise the cover charge? If you have the image of being an exclusive business that everyone wants to get into,
Starting point is 00:31:53 and it's hard to get into, a bit like buying your very favorite Andy Warhol painting, that is good for long-run publicity. So I don't know your exact price, revenue, cost, structure, but I would just say don't underrate that fact. It's the best form of advertising you can have in Manhattan to have excess demand for your product. I've been saying that. I'm a lone voice saying that. I like the fact that we're not high price.
Starting point is 00:32:18 I think that longevity matters to me more than anything, anything. I have to stay in business forever. And I don't want to kill the goose. But there is a downside for the customers insofar as they can't... Like, for example, I tell friends of mine, because the schedule comes out a week before
Starting point is 00:32:37 the show. Well, the thing to do would be to open another club. Look, you're a word-of-mouth business to some extent. So if you make it a little hard to get here, you're selecting for the most dedicated customers. They will talk you up the most. You will get the more favorable word of mouth. If you only ration by price, you get older people, well-off people, but they post less on their Facebook pages. They're less social, period. And your long run reputation is lower. Well, I will ask you a question maybe
Starting point is 00:33:04 because I didn't think of you as a business analyst, but you think along the lines that I think on that. One problem I am having is a corporate culture problem, which is that we're very, very busy now, and it's easy for the staff to start viewing the customers as a bottomless pit. There's just a never-ending wave of people. And at the same time, I have three young children, and I try to spend less time at work than I used to.
Starting point is 00:33:34 And I've noticed a disturbing change in what used to be second nature to everybody who worked in my organization, which was no matter what, the answer was yes to a customer. If somebody asked for a drink with a particular type of liquor and we didn't carry it, someone would run to the liquor store and get it just so we could serve that customer. Do you have any advice about keeping good corporate culture? I don't know what you do, but do you give prizes for good customer service? No, we don't. Try that. Experiment with it. Gold stars. May or may not customer service? No, we don't. Try that. Experiment
Starting point is 00:34:05 with it. Gold stars. May or may not work. But no, a real prize. It's worth something. Free tickets to hand out to friends and maybe a little bit of money. I was hoping for a solution that wouldn't cost me any money, but no, I'm kidding. No, maybe that's a good idea. It's hard to measure good customer service, but simply that you make examples of people will send a message. I'm not saying you'll always give the award to the right person,
Starting point is 00:34:28 but have some kind of ongoing periodic contest. Every two months, someone gets something, and then make sure it's publicized with the others. I'm not sure that will work, but if you're looking for experiments, why not? I mean, McDonald's has Employee of the Month or whatever, and I say that with respect to McDonald's, as I presume they know what they're doing, and they stick to these things. I mean, they's has Employee of the Month or whatever, and I say that with respect to McDonald's as I presume they know what they're doing, and they stick to these things.
Starting point is 00:34:48 I mean, they've analyzed everything. But also ask your workers, like if there were some kind of prize for those of you who did the best, what kind of prize would you value? And just see what they say. Don't set up the prize with no feedback. That's a good idea. And they might say something that's actually quite cheap to you. It could be like first, was it second prize, dinner with Noam.
Starting point is 00:35:07 First prize, dinner without Noam. Exactly. I am skeptical of prizes because I think that at some point it just, they become overwhelmed by the inertia of the situation. Just when the culture turns away, I don't know if free show tickets will be enough to get someone who just is not properly motivated in the right way to do the right thing. But it certainly can't hurt. And I'm kidding about it. I don't mind taking the risk and trying it. Trump versus Sanders. Yes. If either president could
Starting point is 00:35:52 press a button and impose their vision on America, and let me say the caveat, not violating of the Bill of Rights and the Constitution, their legal vision of America, but they could cut through all the red tape and create the legislation that they want, which America would be better off economically? They would both be disasters. So spin that out. Sanders is easier for me to figure out
Starting point is 00:36:22 because he has a pretty clear track record of saying what he wants. So you would have, I think, nationalization of a lot of key industries, much higher taxes, complete government control of health care, and we would be a truly socialist country, not like an open-market-oriented Nordic social welfare state, but some kind of actual socialism. It would be a disaster. Trump, I'm genuinely unsure what it would mean. So I get that there would be higher tariffs,
Starting point is 00:36:50 which, as we've discussed, would be bad. Can I stop you there for one second? I never know whether Trump really wants the tariffs or he's just looking for leverage to make an eventual deal. I suspect sometimes that that's just his M.O., is just to look for leverage, bluff, say I'm going to put the tariffs on, and hope that in the end he won't have to have the tariffs. Or that might be too kind to him. That's true for constrained Trump, as we know him.
Starting point is 00:37:15 But unconstrained Trump, I think there's a pretty good chance he loves tariffs, he put Peter Navarro in the White House. He does love tariffs. He talked about tariffs since the 1980s pretty consistently. So like I said, I'm not sure, but I think tariffs would be higher. And then the rest, I don't know. Like, does he really believe in all that infrastructure?
Starting point is 00:37:34 Is there even a fact of the matter? So the Trump... He loves to build things. He does love that. I guess. So I know Sanders would be a disaster. Trump, I would never root for. I don't know.
Starting point is 00:37:47 Can we move to New Zealand or something? Because that may be, I mean, it doesn't look as likely as it did a couple months ago, but that could be the choice. And I'm really torn. I don't see how I could vote for Sanders. And on top of that, I worry about the bad actors in the world who are already not as worried about American reactions to things as they used to be. Looking at Bernie Sanders and saying, you know, we have open road.
Starting point is 00:38:12 We can do whatever we want. America's not, you know, America's not sending any gunboats over here. Not with Bernie Sanders as president. And that's dangerous, I think. But I would be very surprised if he won. Democrats right now seem obsessed with electability. If Biden does not explode, he has a big lead in the polls. Perfect name recognition, a lot of support with African-Americans.
Starting point is 00:38:33 There's Obama nostalgia amongst Democrats. People think maybe Sanders can't beat Trump so easily. So unless something weird happens, and there's so many itty bitty little candidates pecking away at Sanders supporters offering them, oh, Elizabeth Warren is more radical on this or, you know, Mayor Pete on that or so I think Sanders has a very steep climb to even get the nomination. I don't see that in the cards. I would be happy with Biden. I'm afraid on a debate stage that both Mayor Pete and Elizabeth Warren can really score some points against him
Starting point is 00:39:06 because he's not he's not that nimble even when he was younger intellectually and now he's he does seem to have slowed down to me and Mayor Pete you know he's campaigned many times for the nomination and never got it until now right so something must be wrong with him uh if Obama and Hillary and other people more or less endorse him, though, I still think that will drag it across the finish line. There's too many other candidates for any one of them to emerge. If you had any one of them against Biden, they might beat him. But it's not the case. What's how many, like 17, 18? More, 22. More, 22 now, yeah. Did the tax cuts help? I think they will help with time.
Starting point is 00:39:45 I don't think they've helped very much yet. So our corporate tax rate had been 35%. World average for wealthy countries is around 23%. Ours was much too high. We lowered it. That was good. Typically, businesses make plans over a long-run basis. I'm not sure there's been much stimulus from it so far.
Starting point is 00:40:04 But it was more or less the right thing. 21% is probably actually a little-run basis. I'm not sure there's been much stimulus from it so far, but it was more or less the right thing. 21% is probably actually a little bit too low, but it was in the right direction. There are people, I think, that say that the corporations shouldn't be taxed at all. The corporations aren't human beings. They're legal fictions, and that if they're not taxed,
Starting point is 00:40:21 that money will go ultimately to stockholders and to employees that will pay the tax, will pay those taxes, but the corporation itself shouldn't not taxed, that money will go ultimately to stockholders and to employees that will pay the tax, will pay those taxes, but the corporation itself shouldn't be taxed. But you're not of that mind, I gather. I used to think that. That's the Chicago view. But I've actually changed my mind. I think what would happen is so many workers, myself included, would incorporate to avoid tax. And what is really labor income and what is capital income,
Starting point is 00:40:45 the law would have to monitor so obsessively that I don't think that's workable. But in a first best ideal where the law could monitor everything at zero cost, maybe that would be a better system. But I think we'd end up with too much tax evasion, labor income being reclassified in a way that violates the spirit of the law but not the letter. Can I tell you my back of the matchbook calculations to why I supported the tax cut? Which is going to be totally ridiculous for an economics genius. I said the following.
Starting point is 00:41:14 First of all, it's kind of the opposite of my congestion pricing thing. They're lowering taxes. So getting up to raise it, if it turns out to be too low low is not going to be that challenging. Correct. They'll do that, number one. Number two, it seemed to me that if now that we have this new tax plan, if we were to propose going back to the old plan, the Democrats would be screaming bloody murder about the middle class tax increase.
Starting point is 00:41:41 Like whichever tax plan they started from, they would oppose the other one. And so I thought it was just very, very political. And so I said, you know, and yeah, I read articles where like only 20% of economists thought it would work out well. I say, well, 20% is not such a bad bet for something that doesn't seem to have any tremendous downside to it. So give it a shot. They've been wrong so many times in the past. Why not? And that's bias from economists.
Starting point is 00:42:11 If you polled economists five years earlier and outlined the same plan but did not connect it with the name of Donald Trump, you would get 80% saying this is probably good. Now it's like Trump's tax plan and 80% say it's bad. But that's what's going on there. Not a completely honest and open assessment of the policy on its own merits. It's not. It's not. Let's not fool ourselves. And do you agree that lowering taxes as a trial and error measure is not such a bad idea?
Starting point is 00:42:35 Because nobody really knows. There's more good than bad in that tax bill, in my opinion. More good than bad. By the way, you said something about bias. If I were to have one required course in high schools, it would be a course in cognitive biases. Have you read John Hite's book, The Righteous Mind? By the way, he's a big fan of yours. And I sent him that quote about stories and good and evil. And he wrote back how, and he listened to the TED Talk after that, how much he loved that quote. So he's a big fan of yours. But yeah, that
Starting point is 00:43:05 book kind of changed my life in terms of, I mean, I was aware of it, but really realizing how everybody is biased, how I'm biased, and how difficult it is to see past it. But once you really are aware of that stuff, I think
Starting point is 00:43:22 you do end up making smarter, forming smarter opinions. I agree. My worry, though, is we don't have the teachers to staff such a class. That if you had a class on cognitive bias, the teachers would use it to push their own cognitive biases on the students. So it's saying like, oh, let's have every high school student take Econ 101. It's a great idea, but we don't have the forces who can teach it. So, the problem is deeper than it looks, I think. I just feel like it should be kind of a common
Starting point is 00:43:50 knowledge, like the idea of confirmation bias, and there's a bunch of other ones, obviously. It should be more common knowledge among at least educated people. Everyone should know it. It should be one of the five or six things everyone knows, like compound interest. Yeah, compound interest is another thing. I don't know it. It should be one of the five or six things everyone knows. Compound interest.
Starting point is 00:44:07 Compound interest is another thing. I don't understand it. Everybody should understand it. Do you think the average person, even in knowing what cognitive bias is, will be able to overcome their own cognitive bias? No, they'll just see it more in the people they disagree with. So you need really good teachers who live it in an honest way. And that's hard to
Starting point is 00:44:23 find, even at PhD level. Go to Harvard, go wherever you want. that's hard to find, even at PhD level. Go to Harvard, go wherever you want. It's hard to find. That's the whole problem, right? You know, the cognitive bias, they cut so much to the core of our psychology that the problem is so deep. Our cherished beliefs, our sense of self, you know, to overhaul that. It's a lot harder than a course.
Starting point is 00:44:44 I find that anybody who's anti-Israel is suffering from a terrible cognitive bias. Anyway, it's a joke. Well, but it's... I don't know that it is a joke, as far as you're concerned. The MRIs, I looked this up before,
Starting point is 00:44:58 MRI technology was invented in the 70s. I believe that's correct. The iPhone was invented about 10 years ago, and it's almost free. I imagine the technology in an iPhone far exceeds the technology in an MRI. Why does an MRI still cost $30,000 or whatever it is? You're paying for a lot of the fixed cost of the hospital or medical center where they have them. So it's not a very competitive setup. There's not real price transparency. There's a great degree of third party payment. There's all kinds of government intervention and regulation. In short, it's a mess. What would you do to fix the health care? That's a huge question. I think in principle,
Starting point is 00:45:36 the best system is what Singapore has, but I don't know how we could ever do it here, getting back to transition. In Singapore, there is single payer for catastrophic expenses above a certain level. But below that, you're forced to save a certain amount of your money and then spend your own money out of your own fund for the cheaper stuff. And there's enforced price competition and price transparency for the hospitals. Now, I don't know how we get from here to there, but that's my ideal system. Isn't that what I said, Dan? I don't know if you said that.
Starting point is 00:46:05 I did. I said it should be, my thing is there should be catastrophic insurance because nobody should be ruined by getting sick. Right. On the other hand,
Starting point is 00:46:16 people carry $10,000, $20,000 credit card debt all the time. And I feel like if you have to pay for something, and if the people selling it have to pay for something and if the people selling it have to compete for you to buy it from them, you're going to see prices fall through the floor on many things.
Starting point is 00:46:33 What's the downside of that system? I mean, even Reagan kind of proposed that system years and years and years ago. Does Bill Gates and people like that, they don't even have health insurance, do they? Of course he does. Well, why would he have health insurance? I got like Bill Gates. I suspect Bill Gates has an agreement with the concierge service where he pays a fixed fee
Starting point is 00:46:52 and gets the best health care in the world. And that's a kind of insurance. So I'm just guessing. I don't have direct personal knowledge of Bill Gates's arrangement, but a lot of wealthy people... But there's no need for him to have classic insurance. No, he's not buying a policy from Blue Cross. That would be silly. So my next theory, so far I'm scoring high with Tyler Cowen. How are we doing compared to James Altucher? He and I started off talking about chess,
Starting point is 00:47:22 and comedy never came up, nor did food. I'm waiting to get to food. Oh, okay, we'll get to food. Well, what does he have to do with food? A lot, as it turns out. This is my next theory. Okay. Already, computers could do a better job than doctors diagnosing us for the most part.
Starting point is 00:47:43 That's a maybe. It depends on the sickness. There's, as you know, a project at IBM Watson, which has actually not done well, has not found a market. People use Google themselves. That's a kind of artificial intelligence, right? With highly varying results. It depends how smart the Googler is.
Starting point is 00:48:01 But in a way... But you talk about cognitive bias. I mean, I don't want to be having a heart attack. So when I'm Googling... On the other hand, I might be a hypochondriac, and you know what I'm saying? So... I think fear wins out when people Google. So they end up worrying too much, when maybe sometimes they should just live with their problem. But the number one doctor today already is AI, and that's AI through Google plus the human using Google. So let's try to improve that process as one way to improve our healthcare system
Starting point is 00:48:29 and rather just be like Google random things like do I have the flu? Teach people how to Google, steering them to more reputable sites, educational sites, sites run by hospitals rather than just a raw, pure Google. But of course, anybody who's Googled knows is
Starting point is 00:48:46 it always will say at the end, it'll say, see your doctor. So no matter what, it'll say, yeah, but see your doctor. A lot of times it should say, don't see your doctor. So this is what I think. My son, he's going to be two this week, shortly after he was born, he had what looked like a pimple. But it was growing bigger and bigger. And my wife, she started Googling like crazy, looking to match pictures. And she diagnosed that this was not a pimple.
Starting point is 00:49:17 There's a name for it. It's a childhood thing. It's actually a blood vessel which pops up and whatever it is. And she Googled and she found the doctor who specializes in this. And she went to that doctor. And his first thing he said was, how did you know to come to me right away? Usually people go see three doctors before they get to me. And meaning to me that even doctors who deal with dermatological issues,
Starting point is 00:49:43 they only remember, you know, X number of things that it can be. But a computer would never forget that. If you put that symptom into a computer, it would spit out a chart of the probabilities from most likely this all the way down to a 1% chance of this. And then you could tick off each one.
Starting point is 00:50:03 But right now, we have to depend on the doctor's memory. And I guess years ago, doctors were the smartest people. And that was the only choice we had was to put the doctor's memory was our best bet to keep us healthy. But every high school should have a class how to be a better Googler, which would include health care. I mean, the smartest doctor can't hold a candle to a computer database of that diagnosis that analyzes symptoms. But you have to use it right. You married a that diagnoses, that analyzes symptoms. But you have to use it right. You married a great Googler, right? Congratulations. She's a great Googler. I'm sure. Alright, you want to talk
Starting point is 00:50:31 about food? Yeah. I didn't know that food was an issue. I don't know if it's an issue. I wrote a book on food. An economist gets lunch. I wanted to talk about the replication crisis in science. I'm game. What can you tell us about that? We can only do food or replication
Starting point is 00:50:47 because we only have... Let's end with food because let's go... We'll make it Tyler's choice. Most research papers you read, you can't trust them, especially in social psychology. But more generally, don't trust everything you read, even if it's often from credible sources. And that's tough to deal with. Like, how do I figure out?
Starting point is 00:51:03 What do I know? what to do next? But approach the world with a grain of skepticism. Be hovering. That's right. So that's why I hear that congestion pricing works in London. I'm like, okay, I just don't know. And then how do you know that the studies that you've read which say that low-skilled immigration is beneficial to the country, how much skepticism do you have of those?
Starting point is 00:51:30 Well, some, but keep in mind the very best-known studies are by George Borjas, and he's an opponent of more low-skilled immigration. So even his study is not that negative. That's not a kind of proof, but it makes me feel a little better. Yeah, it's more credible when my kid admits to breaking the window than when he dies breaking the window. As a non-scientist person, a citizen, and I see that every study, as best as I can tell, says that global warming is real and it's man-made and it's serious. Agree all across the board. Okay, so as a citizen, what is my...
Starting point is 00:52:05 How should I respond to that crushing weight of evidence? Should I just take it on faith? Find the people you know who are the best synthesis of available bodies of knowledge, ask them, chat with them, at the end of it all, eat less meat, and try to support some political causes that will have some impact on this. But obviously, because... I mean, obviously the expert opinions, they could be wrong, but they're the best opinions we have.
Starting point is 00:52:33 That's right. And they're reflected in market prices. What would you do for global warming? Nuclear? I would absolutely do nuclear. I would, in general, have higher subsidies for other alternatives. You can't fly a plane using nuclear, right? I would have a carbon tax.
Starting point is 00:52:48 But, you know, say triple the amount of money going to funding at a basic science level. Do nuclear and work a lot with other countries because they're the main problem at this point, not the U.S. Not the U.S. The increase in carbon is coming abroad. We cannot control them. We have to give them technologies
Starting point is 00:53:04 cheap enough. And a topic have to give them technologies cheap enough. And a topic like, will nuclear energy get cheap enough for Africa to use? No one is talking about. It's one of the most important questions in our world. I think maybe it can be, but of course, we've got to show that. We can be of help there. Yeah. And I always thought it was ridiculous to think that China or India, which maybe this is chauvinistic of me, but I regard them as corrupt countries, that they would ever actually live through any real economic pain on behalf of the environment. They would cheat and they'll do whatever they need to do. Exactly. They fudge already all their numbers.
Starting point is 00:53:39 If we had an agreement with them, they would fudge those numbers. It's not per se an answer. I was kind of in favor of Trump pulling out of the Paris Accord because I felt like when we were in it, it gave us the false sense of, okay, now we've done it, and we can feel good about ourselves. And really, I think all we signed
Starting point is 00:53:56 was a way for those countries we just spoke about to hopefully, in their mind, keep America in some kind of straitjacket only to increase their advantage and cheat and use fossil fuels as much as they can. So I feel like now that we're pulled out, it's keeping the issue on the front burner where it needs to be. We're in agreement on many things.
Starting point is 00:54:15 Oh, I have an economic question. How much would it benefit the world economy if we all spoke the same language? Oh, that's a good one. And is it only cultural pride that gets in the way of that? There's been a study of people in India who are English speakers, and it tries to adjust for their other demographic characteristics. And it finds that the return to them learning English is actually pretty high. I can't remember the exact numbers, but it was considerably higher than I might have expected. So that's only India. It's only one country,
Starting point is 00:54:45 but the returns to having a common language I really do think are pretty high. There'd be a lot more export-based businesses. Migration would be easier. Maybe we'd even understand each other better. You can still have your other language at home, but that would be wonderful, I think, if everyone spoke English, Esperanto, Spanish, whatever.
Starting point is 00:55:03 English would be the obvious choice because it's the number one second language. Right. And it's the superior language. Universal basic income. Four against it. I used to be sympathetic. Now I'm strongly against it.
Starting point is 00:55:18 Based on? It's sending a wrong message to people. Like, people want to work. They want to have jobs that are rewarding and create social validation. And the message of, oh, you stay at home, we'll pay you, what will that do
Starting point is 00:55:28 to the quality of migrants we attract? What will it do to social norms? I think it's the wrong approach. I mean, no parent would want that for their kids. Exactly.
Starting point is 00:55:36 But then, are we going to run out of jobs? No, we'll never run out of jobs. There's always more work to be done. More people can become comedians. We can have thicker competition in your space. There'll be a transition effect on
Starting point is 00:55:48 your wage, but nonetheless there's always scarcity. Well, you'd be shocked at the number of comedians that already are in the space, as they call it. Yeah, I think I can get robots to tell jokes pretty well. I have a question. I got two more rapid fire. Wait, I have one question. Am I correct in assuming that you are
Starting point is 00:56:03 a phenomenal chess player? When I was 15, I was champion of the state of New Jersey for all age groups. But I haven't played since then. Wow. So my skills have deteriorated and I'm a feeble chess player. And do you think that other than something like meditation, that teaching young children to play chess is probably, in addition to reading perhaps,
Starting point is 00:56:24 one of the best things that you can do for their intellectual development. I don't know. There are some research papers that seem to show teaching kids chess doesn't do much for them. Really? I suspect it elevates, you know, a small minority. That's so interesting. Maybe there's a way to target it. But just like teach everyone chess, to me it's not a priority.
Starting point is 00:56:42 Look, I have three kids, and it seems so clear to me that their intelligence is stubbornly baked in. I mean, it's just remarkable how one kid is better than the other kid at this, and the other kid is better than the other kid at that.
Starting point is 00:56:57 And, I mean, I... Like, my daughter's having trouble with arithmetic. I mean, it's just... But you said it's okay because she's really pretty. I mean, I might be able to improve her arithmetic, but I don't think I'm going to improve her IQ.
Starting point is 00:57:08 I don't know if Noam heard Perry Ellison's witty retort. You said that she's having problems with arithmetic, but you said it's okay because she's really pretty. She's very pretty. Okay. Is it CEO pay? Is this a real problem? Not a real problem.
Starting point is 00:57:21 We have the best CEOs in the world. I could have told you that. There's global markets, bigger companies. Of course, they earn more. False issue. Because it's a global market now. So if you make a penny on every customer in a global market, you're going to become fantastically rich, no?
Starting point is 00:57:35 The intellectual class is upset because they're not paid as much. It's a kind of local envy. Very low on my list of worries. What about this whole notion of income inequality? Everybody rants and raves about what this guy's making and what that guy's making. And, you know, to me, as long as everybody's making enough, that's more important than some other guy that's making $80 trillion a year. Is there a real downside to income inequality if everybody has enough,
Starting point is 00:58:00 but a small group of people have monstrous amounts of money? Is that a problem? but a small group of people have monstrous amounts of money. Is that a problem? Or does everybody have enough and there's no problem? I would say our problem is declining income mobility, not the wealthy per se. Wealthy start companies which on average bid up wages, right? Right.
Starting point is 00:58:21 So I don't focus on inequality. We have seen a stagnation of opportunity or retrogression in this country. That is significant. It's not that everyone has enough. Maybe they do compared to Nigeria, but we can do better than that. What was the French economist? Picardy? Thomas Piketty. He had an incorrect model, it seems. He had an incorrect model.
Starting point is 00:58:39 There's a small group of people with outrageous wealth. The argument's been made that they can have outsized control politically, that they might have too much power. Well, you look at Jeff Bezos, you look at Bill Gates, two of the wealthiest people. First, they're not in charge, right? They didn't want what we have now.
Starting point is 00:58:58 But a lot of what they push for or would push for, I think, is pretty good, actually. So to me, again, that's not the biggest concern. I'm more worried about what the average voter might want, not what Bill Gates is pushing for. He's super educated, super smart, brilliant, pretty open-minded. And has everything he needs. I'd love to have him as president, but it's not going to happen.
Starting point is 00:59:17 That's not our problem. But you think a lot of it is just plain jealousy and resentment, a lot of this talk of income inequality as a problem. Mostly for media and intellectuals. The average American out there does not hate bill gates nor should they is the wage gap between men and women real well real is a tricky word there is such a wage gap but it can be accounted almost completely by demographics it meaning
Starting point is 00:59:41 that for instance if men have more work experience or less likely to take a break because of pregnancy or have taken different majors in college or many many other factors if you put all of those into the statistics the wage gap comes very close to vanishing okay side for a positive lesbian wage premium for black men and women black women earn more than black men so there's all kinds of ways in which
Starting point is 01:00:03 like that gender wage gap is not real. Okay. So why does so many smart people, New York Times columnists, also, why is, is what you're saying not accepted already? Why do they, why do they cling to what seems to be an anti, anti-empirical claim? I hesitate, I hesitate to accuse others of bias, but that is how it looks to me. That people see women have restricted opportunities in a way which is unjust and we should remedy, that's completely correct. But then the notion that you're going to take every possible piece of evidence that comes your way and misinterpret it, that's where I think they go wrong. But the core view that we could do much more to improve women's opportunities, I'm fully on board with that.
Starting point is 01:00:49 Two things. Number one, Tyler's going to Israel next week. Are you Jewish? No, but my wife is. But I'm giving some talks there. It'll be my third visit there. Which I thought would be of interest to you and our listeners. I love it.
Starting point is 01:01:06 He's like a very, very serious foodie. And an accomplished one as well, which I discovered just recently. What is a foodie? Because aren't we all foodies? Who doesn't like a good piece of food?
Starting point is 01:01:22 No. Bobby Sands. I write an online blog, which is a dining guide for the Washington, D.C. area. It is, in my humble opinion, the best resource of its kind for food where I live. But it's not fancy dining. It's mostly ethnic food, cheaper meals. Very often, price and food quality are negatively correlated, not positively correlated. Go to Queens, go to the best parts of Brooklyn, get out of Manhattan around here, and probably you already agree with me.
Starting point is 01:01:48 Yeah, yeah. Well, I would like to know your opinion of the food right here at the Comedy Center. I don't know if you've had any of the food. I've never had any of the food here. Well, you know, I think for the money it's pretty good. What do you serve? Well, I don't serve anything because I'm not the owner
Starting point is 01:02:01 and I'm not a waiter. We have a varied menu, some Middle Eastern stuff. We have very good steak. I don't know if you eat steak if you want to have dinner or something but now I'm scared to have you eat here. It was the first thing I wrote down because I want to ask you
Starting point is 01:02:19 and I didn't ask it at first because if you didn't want to answer it, I didn't want to start the interview that way. Do you think human nature is malleable? You know, I think that so many issues we're coming to are being driven by human nature, including the immigration issue and the rejection and the tribalism within all of us. On the other hand, you see the powerful effect of culture, for instance, in the way gay acceptance has happened so quickly and so profoundly. And then in a different way,
Starting point is 01:02:55 who would have thought that you could raise people to send their children off as suicide bombers or to stone their own children to death for rape? So, you know, these primary, what you would think would be these primary impulses are overcomable with culture, even to do things like kill your own children, right? So do you think about those things? All the time. The current Swedes, Norwegians were once violent Vikings.
Starting point is 01:03:21 That has changed completely. So it depends in part on time horizon. But over long periods of time, change is the norm. Radical change is the norm. And occasionally in the short run, as with gay marriage, you can get change. But in the short run, I'm often pessimistic. Humans are not inherently better people than they were a thousand years ago when we were hacking each other up.
Starting point is 01:03:45 We're better people. I wouldn't say we're inherently better. We've had better training, better upbringings, more comfort, learned better norms. I think resources are less scarce. That too.
Starting point is 01:03:54 And so we don't have to fight each other for everything. But also our social norms have changed in a positive way and cultures had a positive effect. And I worry that, not to sound corny, but that when we stopped
Starting point is 01:04:08 self-actualizing ourselves as like a colorblind nation as a nation where it doesn't matter where you're from that we're destined to never get out of that pit when we are focusing so much and telling
Starting point is 01:04:24 people that no, you should be focusing on, we really need to know that they're Asian before we can decide whether they can get into Harvard or not. And this is righteous, and this is what good people ought to be doing. I don't see how you ever break out of that cycle. And the social norms are much more powerful than any legislation. But when change comes, it often comes suddenly, and it is often not predicted in advance, like with the French Revolution, the Iranian Revolution. And we've seen so much progress in human affairs. Things that seemed impossible so, so often have happened.
Starting point is 01:04:53 So I think we ought to be optimists. We have no other chance, and we ought to do our best to work for those changes, most of all by trying to be paragons for virtue and tolerance ourselves. Sounds good to me. All right, anything else? Going once? Well, I predict the Iranian revolution. Is diversity our strength?
Starting point is 01:05:11 Everyone wants to use the word diversity in their own way. I would say unpack the concept, disaggregate, be empirical. No society can be completely diverse, but no society should be completely monogamous either. United States has done pretty well. We're actually mostly still on the right track. Hard to believe at times. But I think 50 years from now, we will still be the best, greatest country in the world.
Starting point is 01:05:36 I agree with you. You know, people often talk about the decline at the end of the American century, and yet we're still the nation of Google and Apple. And population growth. And GPS. That was us. The internet. I mean, that was probably 80% us. 70%
Starting point is 01:05:56 was a big percentage. Waze was actually Israel. That's kind of us. Yeah, but the point is, we're still kicking ass. I agree. Jews are 0.2, but the point is we're still kicking ass. I agree. Jews are 0.2% of the world and 20% of the Nobel Prizes. Great.
Starting point is 01:06:12 If I ask a typical liberal president, I'm pretty liberal in some ways, I'll say, okay, is that a result of a superior culture or a superior genetics, which I think are the only two options. They will change the subject. Neither answer is acceptable within their worldview. You cannot say the culture is superior. You certainly can't say the genetics are better. Do you dare answer the question? I believe in the power of culture. I mean, look at German scientists, late 19th, early 20th century. They're incredible. They're amazing. But German science for hundreds, thousands of years earlier was nothing. Jews have not been intellectually dominant in every period of human history, far from it.
Starting point is 01:06:56 Really? So I really do believe in the power of culture. Yeah, I do too. All right. Well, do you feel that Tyler is smarter than our dear friend Coleman Hughes? Do you know Coleman Hughes? I follow his writings on Twitter and in Quillette. I've never met him. I want to meet him.
Starting point is 01:07:13 Well, I can arrange that because he and I are very good friends. As a matter of fact, you can see on the Internet this video of, actually, I was just playing percussion, but Coleman plays trombone as well, and we all sat in with John Mayer two Fridays ago here in the Olive Tree. Oh, wonderful. Noam has decided that the comedians are not sufficiently intellectually knowledgeable to provide him with the conversation he craves. So what he's done is he's imported these intellectuals to come hang out with him. So basically he befriended Coleman Hughes. He read something that Coleman wrote on Quillette or Kia, whatever it is.
Starting point is 01:07:46 Yeah, Quillette, yeah. And reached out and said, we need you here because these comics are idiots. So you've got to come here and talk to us. But it turned out we have an enormous amount in common, Coleman and I. I don't know if he's that funny, but Noam can get funny. He gets his funny fix, but then he has to get his intellectual fix. And he can't necessarily get it from the same place. I already told Tyler that Noam is more excited to have him here than probably any comedian we could possibly get.
Starting point is 01:08:13 How well does sense of humor predict IQ? Now, that's an interesting question. That is an interesting question. The answer is I'm not sure, but there's a correlation, I would imagine. What do you think? I would think it's like, you know, 0.4, but it's just a guess. That's a low correlation. No, that's pretty high.
Starting point is 01:08:36 0.4, that's okay, yeah, okay. Higher than a lot of others. 40%. It's a higher correlation than IQ and earnings. Well, but also some people are funny because they're clever. Some people are funny because they're just funny. They talk funny. No, but also, some people are funny because they're clever. Some people are funny because they're just funny. They talk funny. No,
Starting point is 01:08:49 but that's different. Just so people understand, so if the median IQ is 100, I don't know if it is. That's what it is by definition. So there's a point for correlation.
Starting point is 01:08:56 What would the median IQ of comedians be? Good comedians. Funny comedians aren't so good. There's not enough information in that to answer the question. There isn't?
Starting point is 01:09:04 Yeah. But it would be... We'll have you back to really unpack that. Yes. I think they are smarter. But they're not extremely smarter. What they are is much less rigid and open in their thinking. So they're high openness on five-factor personality theory.
Starting point is 01:09:21 Yeah. There's one thing... But also observant. Like higher neuroticism? Yes. But also very observant. I think you's one thing... But also observant. Like higher neuroticism? Yes. But also very observant. I think you have to be really keenly observant. And as I said, some people just have a funny way of saying things and of putting things.
Starting point is 01:09:34 Yeah, and the rhythm. The comedy is like almost a musical rhythm. But you have to be aware. That some people have inherently. The timing. We talk about joke timing. And I don't know if that's... That's more like music than it is, I think, intellect.
Starting point is 01:09:46 Dan, but I do think you'll agree with this. But if you want to take the subset of comedians who can be funny on the written page, then I think you would see a... Not physical, not charisma, but just the ability to write something that you read and laugh. I think that would be a more higher correlation. Like me. That's like me.
Starting point is 01:10:04 All right, I think we're pushing it. Mr correlation. Like me. That's very tough to me. All right. I think we're pushing it. Mr. Cowan, I will facilitate the meeting with you in Coleman. Awesome. I would love to do that. You live in D.C.? Is that correct? Northern Virginia.
Starting point is 01:10:14 Close. It's been a pleasure to have you on our show. I hope that you didn't think we were a bunch of dunderheads. This was awesome. Let's do it again sometime. I think it was good. I think we jumped topics a little bit more. I think we should have focused on three or four topics.
Starting point is 01:10:26 That's the way he does it. You have to listen to his podcast. Rather than jumping around. That's his thing. But that's my opinion. I could be wrong. Anyway, we haven't given out the email, I think, in a while. Comments.
Starting point is 01:10:38 Podcast at ComedyCellar.com, please. And our Instagram. You can follow us now on Instagram At live I don't know Live from the table Thank you At live from the table Thank you
Starting point is 01:10:50 At live from the table They're very And they're right Promote promote promote And I just I just love to Have the conversations He just wants to talk to you
Starting point is 01:10:56 Alright so thank you very much My pleasure Thank you

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