The Munk Debates Podcast - Be it Resolved: The Capitalist System is Broken - It's Time to Try Something Different

Episode Date: December 18, 2019

Is capitalism broken? On this episode of the Munk Debates Podcast, David Brooks and Arthur Brooks square off against Yanis Varoufakis and Katrina vanden Heuvel to debate the motion be it resolved, the capitalist system is broken. It's time to try something different.Become a Munk Donor ($50 annually) to get 72-hour advanced access to the full length editions of Friday Focus and Munk Dialogues. Go to www.munkdebates.com to sign up. Hosted on Acast. See acast.com/privacy for more information.

I think it's time for this toxic binary zero-sum madness to stop. We're not an imperial power. We're a revolutionary power. We are no longer in a world where you can plot out moves statesmen to statesmen like a chessboard. You don't know anything about my background to where I came from. It doesn't matter to you because fundamentally I'm a mean white man. We can't do this to the next generation because America will cease to exist. Welcome to the Monk Debate podcast. I'm your moderator, Rudyard Griffiths. Our mission every episode is to provide you with civil and substantive debate

on the big issues of the day, free of spin, focused on facts, and animated by smart conversation. By the end of each debate, our hope is that you'll be armed with enough information to make up your own mind about any given issue. On this episode, we debate the motion, be it resolved. The capitalist system is broken. It's time for something different. We have capitalism, unbearable inequality, unsustainable debt, brazen authoritarianism, and yes, catastrophic climate change. Don't change the fundamental genetics of what we have that truly has blessed the world.

Together, we need to protect capitalism as the best way to lift ourselves up and those around the world. Welcome to this special edition of the Monk Debates podcast. On this episode, we feature the best moment. of the Monk Debate on capitalism, which took place in Toronto, Canada earlier this month. The debate resolution, be it resolved, the capitalist system is broken. It's time for something different. Arguing for the motion is Janus Verifakis, one of the world's leading social democratic thinkers and the former finance minister of Greece. Yannis is joined on stage by Katrina Vanderhovel, publisher of the nation magazine and columnist at the Washington Post.

Their opponents are David Brooks, the internationally bestselling author and New York Times columnist, and Arthur Brooks, Harvard Professor and former head of the American Enterprise Institute. Let's join the debate in progress. Ladies and gentlemen, welcome to the Monk debate on capitalism. My name is Rudyard Griffith. It's my privilege to have the opportunity to help organize this debate series and to once again serve as your moderator. So why are we convening this debate now of all the various topics that we could have confronted this autumn? Why did we turn to capitalism?

Well, something is clearly happening in our politics and in our culture when it comes to public perceptions of free markets, capitalism, and free enterprise. More and more of our fellow citizens have come to believe, quite simply, that the capitalist system no longer works. They blame it for fueling, rising, if not rampant economic inequality and stagnating living standards. They believe, many strongly, that capitalism is poisoning the planet for profit. And they are worried, genuinely worried about how capitalism is concentrating in the hands of a few wealthy and powerful elites, increasing amounts of democratically unaccountable power. In short, I don't think it's a stretch to say that we're living through a moment where we as a society are experiencing a crisis of faith in capitalism as an engine of economic, social, and human progress. But as we'll hear

tonight, capitalism's defenders feel that blaming the capitalist system for society's problems is the moral panic of our time. So tonight we challenge the essence of these arguments by posing a simple motion. Be it resolved, the capitalist system is broken. It is time for something different. Well, it's time to get our debaters out here center stage and our debate underway.

Arguing in favor of tonight's motion, be it resolved. The capitalist system is broken, it's time for something different, is one of the world's leading socialist democratic thinkers. He's a member of the Greek Parliament. I think he's got a budget coming out tomorrow that he's going to have to comment on. He's a former finance minister of Greece during the Eurozone crisis, and he's an internationally best-selling author.

Ladies and gentlemen, please welcome to Toronto, Canada, Janus Verifakis. Well, one great debater deserves another, and Yanis is debating. partner tonight as one of America's leading progressive voices. She is the publisher of the storied Nation magazine, a Washington Post columnist, and an acclaimed author of numerous books on economics, politics, and international affairs. Ladies and gentlemen, Katrina Vanderhovel. Speaking against the motion, be it resolved, the capitalist system is broken. It's time for something different is the Harvard professor, best-selling author. And if you have haven't watched it yet, check it out. The Star of the Netflix hit documentary, The Pursuit.

Ladies and gentlemen, Arthur Brooks. Joining Arthur on the con team for this debate is the celebrated New York Times columnist author and the person I know I do that we turn to regularly on PBS stations to try to understand the big issues of our time. Ladies and gentlemen, please welcome our final presenter, David Brooks. We're going to move to opening statements, and as is debating convention, we're going to have the pro team, the team arguing for the resolution, speak first. So Janus Verifakis, have your opening words. Thank you, Roger.

Good evening, Toronto. Good evening, ladies and gentlemen. We have a great debt of gratitude to capitalism. Capitalism liberated us from prejudice, superstition, backwardness, feudalism. But at the same time we owe capitalism, unbearable inequality, unsustainable debt, brazen authoritarianism, and yes, catastrophic climate change. The problem with capitalism is that it is particularly inefficient at using the fantastic technologies and wealth that it produces. The problem with capitalism at the moment is that it is seriously undermining itself, and by undermining itself being itself's worst enemy. it is undermining humanity's capacity to share prosperity on planet Earth.

We live in a really existing capitalism, which is against free markets. It has been against free markets since the invention of electromagnetism, which gave rise to the Edisons, to the fords, to the grids, to the network companies, mega companies, the big business cartels, that were fantastic at usurping states, replacing markets and fixing prices against the interest of their own supposed ideology. It is anti-liberal. It is compelling young people today to think of themselves as brands and to try to develop themselves as brands instead of as human beings

if they are not obliged to work zero-hour contracts under wages that make the idea of personal freedom, personal space and personal development a cruel joke. Really existing capitalism today is utterly inefficient. Think of the mega banks that were necessary to fund the mega corporations. How they have created fictitious capital based on mountain ranges of debt, of unsupportable debt, which periodically goes into a spasm. Think of what has been happening since the financial collapse of 2008, where we have a world today,

where we have the highest level of savings in the history of humanity. and the lowest level of investment in the things that are essential for human dignity and for the planet. And it is profoundly anti-democratic in the sense that we have captains of industry and masters

of finance that accumulate war chests with which effectively to buy politics, to pad campaigns, and to capture regulators. The ecological destruction is an essential aspect of this techno structure. If you think about

markets were never designed to produce public goods like the environment. They were only designed to create private goods. There is no way that this corporatized, financialized capitalism that we live in can ever value the scarce resources of our nature, of our environment. They will always assign a near-zero price to it and therefore deplete it until it's gone. Ladies and gentlemen, the really existing capitalism that we live in has a lot more to do with the Chinese Communist Party than Adam Smith. It is based on this grand divide

between those who work in corporations but have no power and those who have power but do not work in the corporations that have the power. Thank you. Thank you, Janice. We're going to have more time in the rebuttals

right after the opening statements for you to add additional points. So Arthur Brooks, you're up first for the con team. Thank you. I'm on the capitalism side of this debate. because poverty is the thing I care about the most. I was raised in a politically progressive family in Seattle, Washington, which is practically Canada.

I made my living as a musician all the way through my 20s. I knew nor cared nothing about economics and held no brief whatsoever for the free enterprise system. But I had a question that I was nagged at me. I remembered when I was a young boy, the haunting images of poverty that came from the East African famine of the early 1970s. This was the first time most Canadians and Americans had ever seen

the face of true grinding poverty. The boy with flies on his face and an extended belly in the National Geographic magazine. You remember it, so do I. It haunted me, and you. I wanted to know what could be done, but the implication was that nothing could be done. The world couldn't get better. In my early 30s, I decided to find the answer

to what had happened to the poorest people in the world since I was a child. And I found something that shocked me and changed my life. I had assumed, like, two-thirds of Americans and probably most Canadians, that poverty had gotten worse since I was a child. I was wrong. According to the best data in the world compiled by the World Bank, an economist at MIT and Columbia University, since 1970, when I was a young child, four-fifths of starvation-level world poverty has been eradicated. Living on a dollar a day or less, adjusted for inflation, 80% declines the first time in human history.

That is a humanitarian achievement beyond our wildest dreams. Two billion of my brothers and sisters had been pulled out of poverty since I was a young child. What happened? I'm going to tell you what happened because I found the secret. And if we know the secret, we can do it again because we make the next two billion and the next two billion. My friends, it's in our hands.

It's five forces that did this. globalization much maligned today free trade despised on the right and the left it was property rights in the rule of law it was the culture of entrepreneurship that brought your ancestors to this great country that pulled two billion of your brothers and sisters out of poverty that my friends is the essence of how capitalism saves lives now i am no radical i will not stand up here and tell you that we need no regulations I will not tell you that we do not need reform. I will not tell you that capitalism is perfect because it isn't. But let's remember the truth here. This is not a partisan or political statement. We have a humanitarian opportunity to repeat the achievements of the past 50 years. If not if we curb capitalism, we get rid of capitalism.

No, we need to spread capitalism more widely. We need to push it into the corners of the world where it doesn't exist. Why? Because people need to throw off the tyranny of their poverty and the tyranny of the leaders that want to hold them in status regimes down so that they cannot live up to their God-given potential like you have, like your ancestors did, to people who came to Canada to give you a better life. Let me leave you with this. Tonight, we're debating whether we should turn her backs on capitalism. Like I said before, reform it. Find better ways to regulate it. Tax people more. I won't like it, but this is democracy.

It's fine. But to turn our backs on capitalism per se is to turn our backs on the people around the world whom we've never met and we'll never see. But we have the privilege of lifting up with our system, with the gift to the world that is our values of freedom and competition. To reject that is to pull the ladder up behind us. It's not right. It is our privilege to live in a time

and to live in an economic system that despite its flaws has lifted up so many if we let it, if we share it, if we spread it widely, then we can. We will lift up the next two billion people together. Thank you. Thank you, Arthur.

So, Katrina, the hall is yours. So, good evening. Don't you often find the debate over economic systems is stuck in cartoon caricatures? it's as if we're only offered two choices, robber barren capitalism or freedom-zapping state socialism.

In this debate, I hope we can get beyond these cartoon characterizations. We've lived in mixed economies since the Second World War with mistakes, yet also many clues as to how to best organize our lives. As a result, there are many flavors of capitalism, some more palatable than others. Now, there is a Canadian-style capitalism, with stronger protections and rules to protect the common good, public investments to reduce poverty and encourage social mobility and innovation.

There's the flavor of Nordic capitalism, of Western European capitalism, with a robust social safety net, what I call a decency floor. Now, hailing from the United States, I care about transforming, rewiring, reimagining our extractive capitalism to create different outcomes, Because as I see it, there are three major ways U.S. capitalism is broken. It is fueling extreme inequality. It is consuming democracy, and it is destroying nature.

So my appeal to you Canadians is, as I witness what is happening with declining social mobility, what even the Brooks brothers rightly acknowledge as a serious problem in the United States, my appeal to you, Canadians, is protect what you have. The American dream has moved to Canada, where there is now twice the level of social mobility than the United States. I believe my country would be far better off if we had fewer billionaires and many more thousandaires. Most families don't have $500 in the bank.

They can't even pay their health care deductibles. I don't begrudge people who have done well and are. all set. But please know most Americans are a long way from being set. To be clear, the next system I'm talking about isn't tweaking capitalism with a few more regulations and safety nets or adding a few green technologies. It is a deep, systemic, structural redesign of basic institutions and functions from ownership, banking, finance, resources, so that the economy serves the common good and protects the earth. Now, we may not call the next system capitalism or even capitalism 3.0, but we probably won't call it socialism either. So what are the next

system's characteristics? There will be individual freedoms, private enterprises, vibrant small businesses, protected from monopoly power. It will include different ownership systems, both broader individual wealth ownership, worker ownership of businesses. And there will be flourishing new business models. It will require plans. It will require plans. alongside markets will mean rewriting the rules of a rigged system. It will demand limits on wasteful consumption, especially among the world's richest 10%. Thank you, Katrina. Okay, our final opening statement, David Brooks. Thank you. Now, I was a socialist in college. I read magazines like the nation. If you go to YouTube and search David Brooks, Milton Friedman, you'll see a 21-year-old

socialist David Brooks debating Milton Friedman on TV. I had these big 1980s glasses that look like they're on loan from the Mount Palomar Lunar Observatory. And even today, I get the appeal of socialism and alternatives to capitalism. Why do we have to live with such inequality and poverty? Why can't we put people over profits? Socialism is the most compelling secular religion of all time. My socialist sympathies did not survive long when I became a journalist. I quickly noticed the government officials I were covering were not capable of

planning the society they hope to create. It wasn't because they were stupid or bad. Society is just complicated. I came to realize that capitalism is really good at doing something socialism is really bad at, creating a learning process to help people figure stuff out. If you want to run a rental car company, capitalism has a whole bevy of market and price signals that tells you what kind of cars people want to rent. How many cars to order? Where do you locations, it has a competitive profit-driven process to motivate you to learn and innovate every day. That's the biggest single difference. Socialist-planned economies interfere with price and other market signals in a million ways. They suppress the profit motives that drives people

to learn and improve. The state cannot predict people's desires. Capitalism creates a relentless learning system. Socialism doesn't. Over the past century, planned economies have produced enormous amounts of poverty and scarcity. A system that begins in high idealism ends in corruption, dishonesty, oppression. Capitalism, like all human systems, has problems. We need worker reforms. We need worker co-ops to build skills and represent labor at the negotiating table. We need wage subsidies so people are not swept away by the creative destruction of the free market. We need the carbon tax to use capitalism mechanisms to fight global warming. The big mistake those of us on the conservative side made was to equate all government action

as part of one thing. But government action comes in two varieties. They're supporting government action which helps people become better capitalists. And then there's regulation which gets in the gears of capitalism and screws things up. In Scandinavia, they do a lot of supporting capitalism. And they have completely free economies, extremely free economies. They can only afford the supporting capitalism. because they have free capitalist economies.

The answer is found in fixing our economy, making a wider capitalist economy, a fairer capitalist economy, not something else. Thank you. You're listening to the Monk Debates podcast. Be it resolved. The capitalist system is broken. It's time for something different.

I'm your moderator, Rudyard Griffiths. We're now going to give our teams the opportunity to rebut what they've heard from the opening statements before we move into our moderated middle of the debate. So Janice Verifakis, you started first. So let's put a couple of minutes on the clock for you and provide the audience with your rebuttal of Arthur and David. Capitalism doesn't just have problems.

Capitalism is broken. There is no doubt that we would not have civilization if we didn't have capitalists. But that's not the issue. The issue is whether capital can continue to evolve as it is of its own accord. It cannot for two reasons. Firstly, already,

The financial crisis of 2008 has proven to us that the financial system is broken, and the manner in which states have tried to pump up the liquidity from central banks is making a bad thing worse. It's like giving cortisone to a cancer patient. It does not help except by simply perking up the patient. The second reason is that we have a remarkable disconnect between the capacity of our technologies to produce wealth and the capacity of our technology. societies to absorb the products of the machines.

Very soon, with robotization, society is not going to be able to consume to purchase the goods that it produces. This is why capitalism is well and truly broken. Let's agree that capitalism has been a force of good for good. Let's agree we need more markets. Let's agree that we need more freedom. Let's agree that we need more democracy and more liberty. But the only way to do this is by beginning to increase.

imagine a transition that we will affect through planning a different way of running our corporations. Imagine just for a moment, and then we can discuss a bit more. Imagine for a moment corporations in which every worker in them, every employee has one share, want one vote. Imagine a situation where we all have an account with our central bank. Imagine a situation where every baby that is born, every newborn gets a trust fund. Imagine a situation where we have more democracy by having fewer elections and more lotteries by which to select our authorities. Okay, Arthur, you're up next. I agree with so much of what our interlocutors have said today.

Janus's main objection to capitalism is it turns out to be fundamentally undemocratic, and he's given many examples. The trouble is that's not capitalism. That's a failure of capitalism. That's not competition. We have examples where people shut competition down. All of the predations that people give of capitalism are largely the equivalent of the Boston Red Sox blowing up the Yankees bus on the way to the game. That's not competition, that's shutting competition down.

So I agree we need true competition. But that doesn't mean that planning is the solution. On the contrary, I think his argument at the end is the strongest. We need more markets push to more people, more at the margins of society. society. We need more ownership. We need more people in capital markets, including the poor. That's where our minds should go. How can we get not less capitalism? How can we get more capitalism? Now, Katrina's excellent argument points out the trouble that we have with billionaires, that the inequality is so bothersome, it's so troublesome, and it's not just aesthetic. It seems

that our society has become increasingly unfair, but I will point out one incredibly important fact, at least to me, which is that inequality worldwide has been in decline for 35 straight years. That doesn't mean that we don't have a problem with inequality in our own societies today. But what is the answer to that? Once again, it's not billionaires per se. It's the unfair ways that some people have acquired and maintained their fortunes, which is inevitably that they have not played by the rules, have not been exposed to competition, and in point of fact, have not played by capitalism's core tenets in the first place. You mentioned the rules, people who play by the rules, who work by the rules, but the rules

have been bought by the very richest, and we need to derrig the rules so that there's a fair level playing field. There's a mountain of interdisciplinary research about how extreme inequalities of income, wealth and opportunity undermine everything we care about, and that is at the root of a capitalism that is no longer working. There are different models, as I said, call it what you will, inclusive capitalism, capitalism with a conscience, regenerative economy, capitalism 3.0. But if you care about democracy, if you care about public and personal health, social cohesion, economic stability, mental health, even sports and culture,

the vast inequalities of income of power are damaging our society and economy. As you may know around the world and particularly in America at this moment, communities are being ravaged by deindustrialization, by factories leaving, by opioid epidemics, which a public health system is incapable of caring for. That is a byproduct, a collateral damage of a capitalism, a capitalist system, which values profits over people. And I think we need to pay attention to that.

Yeah, there's been a decline in extreme poverty, thanks to global efforts. But much more could have been done. So there are two sides to this debate for them to hold the day. The first is that capitalism is so rotten we need to burn it down. And the second is they have to have something else, some alternative. They've got to win both those things. Walk around Toronto.

Do you think we should burn this down? All that's been achieved here? Walk around Canada. I know there's poor parts in the rural. We have that too. We have strengths and we have weaknesses. But we're some of the most successful societies on Earth. Burning that down strikes me as a mistake.

the single greatest problem with inequality, with despair, the single greatest solution is education, human capital, social support, and decent lives. America is growing. The poorest wagers in America are rising twice as fast as everybody else's because we're finally increasing the high school graduation rate. In this country, we reduced poverty to be 20% recently. part because of a child tax credit. There are ways to fix this thing by pouring into early childhood education,

nurse family partnerships, better job training, better community colleges. That is the way you grow. The fact is, we haven't said anything new here. They haven't said much that's new here. We've had this debate for 150 years about planning versus the market. We've run this experiment. The market won for all its flaws. The key debate right now in the world is not capitalism versus socialism,

it's fair for democratic capitalism like here in Canada, and authoritarian capitalism, as in China. The argument is how do we make our capitalism more democratic because there really is no alternative. We already ran this experiment. Thank you. You're listening to the Monk Debate podcast. Be it resolved, the capitalist system is broken.

It's time for something different. To listen to more debates on everything from climate change, to religion, to geopolitics, to the future of human progress, visit our website, monkdebates.com. I'm your moderator, Rudier-Griffis. Now, back to our episode. So, Janice, you're up first.

Nobody wants to tear anything down. When we moved from feudalism to capitalism, we did not tear down the great cathedrals. We just moved on to a new phase of our evolution, a more advanced phase of our evolution, which was capitalism. Where we are now, we are at a serious junction. we are destroying the planet at rates that the generation that are today in their teens are going

to hold us responsible for. The market is not going to respond to this emergency. We have a situation where, as I said before, I'll say this once more, we are soon going to have robots that are capable of replacing most of you, and their robots are not going to be purchasing the stuff that they produce. Let's agree that we need to do. start imagining and planning for the new corporate law, for the new financial system. It is not going to emerge out of nowhere. Even capitalism was not something that emerged spontaneously.

Some good people thought about it. So, for instance, you know, the joint stock company, somebody thought of it, introduced it, fought with Adam Smith, who was against it, and prevailed. You said we don't have any ideas? Yes, we do. Imagine a market society, a liberal, democratic market society without a stock exchange where employees of Google, of Apple, of Ford, of every company have one share, one vote. Imagine a situation where we have no private banks because there will be no need for them if the central bank can provide you with bank accounts, digital bank accounts. Imagine a situation where we revisit in and allow me as a Greek very quickly to say in ancient

Athens, the Democrats were against elections and the aristocrats were in favor of them because they could buy them. Let's have more jury system. Let's have more sortition and lotteries. Thank you. These are all wonderful ideas from Janice, and it is in point of fact the truth that he's had a lot of ideas.

And I'm very respectful of that, given the fact that he is one of the most successful finance ministers in the last 50 years. He's a terrific public servant. The problem is, how do you pay for these things, my friends? How do you pay for these things? We talk about public investments constantly. All these public investments,

are very expensive. Money is not sitting in the middle of nothing. You don't, you know, billionaires don't put their money in the bank and it sits in the mattress. On the contrary, it's put to private use such that private businesses can thrive. Capitalism makes it possible for a wealthy society to fund the welfare state, to pay for these things that we're talking about. In point of fact, you can be as politically progressive as you want. You can come up with all of the ideas that you think are appropriate, to lift people,

up. Many big schemes. Some will work, some won't. Some will work some places, not others. But they have to be paid for. It doesn't come for magic. What pays for every welfare program? Capitalism does. Capitalism, in my view, the Democratic Free Enterprise System, you know what his greatest accomplishment is? It's the welfare state. We're actually able to help pull people out of poverty that we've never seen and we'd never meet in our own society. I know it's surprising coming from a proponent of capitalism, but that's my view. If you love your fellow men and women, and you want to try new programs that will pull them up out of poverty, that will give them new opportunities, you better find the capital someplace. That's going to come from private

businesses. That's going to come from private individuals who have the capital to pay the tax. Capitalism will give the thanks. So no one's talking about burning it down, as my colleague, Giannis said, we're trying to build it out and build it out for millions of people who are living lives of precariousness who aren't benefiting from the, quote, capitalist system, the extractive capitalist system. I'm interested in what Arthur said about who can afford it, what can be afforded in a capitalist system. You know, the question of affordability is almost always asked when it comes to social programs that benefit those who have the least. Think about the $6.4 trillion we've spent since 2001 on endless wars that have brought us almost no security. No one asks about the corporate bloat

at the Pentagon. No one asks about the tax cuts unprecedented at a time of war which gave money to millionaires who didn't need it. No one asks about the tax cuts we just saw, the wasteful tax cuts and how they weren't used to invest in our country but for stock buybacks. So I think we need to reassess, rethink, reimagine capitalism and move beyond what I said earlier, the cartoon characterizations. We're not talking about socialist planning. We're talking about a different kind of capitalism that will enhance the power, the possibilities. Education is a good tool, but you need an infrastructure built around education and communities, housing, any poverty programs. So everyone wants a different kind of capitalism. Somebody wrote a famous book,

two cheers for capitalism. You can't give it three cheers because it's based on creative destruction and people get hurt. And you've got to have government to help give a floor to people. But capitalism is a thing. That's what the subject of this debate about. What is capitalism? It's about the price mechanism. It's about decentralized decision making. It's about stock markets. It's out of investments, profit and loss. If you don't have the stock markets, if you don't have have the price signals, you can't make decisions. You're just not that smart. None of us are that smart. And that's why capitalism has failed every time. You can have a share-wideshare share ownership. I'm for that. I have shares in my company, the New York Times doing phenomenally

because of Donald Trump. One of our journalists, he calls us the failing New York Times, the journalist tweeted, look, we even fail at failing. But it turns out most people, even if they have a share, they can't make a decision collectively as a corporation because they don't have the signals. When you have some sort of planning, it winds up in government. And I just am not that impressed with my political system right now. I don't trust Donald Trump enough to give him control over the economy. Over the last few decades, the U.S. has seen our economy double, and our energy share goes same. We're at a 67-year low of carbon emissions.

It's not enough. We need to do the coal tax. but it's not because we set out to reduce energy and carbon emissions. It's just because capitalism loves efficiency. And we got a good byproduct out of a system that was looking after its own self-interest. This occurs again and again and again. Don't rely on the good intentions of extremely powerful people. Create a mechanism around them.

You're listening to the Monk Debates podcast. Be it resolved. The capitalist system is broken. It's time for something. different. I'm your moderator, Rudyard Griffiths. Arthur, let me start with you, because I think one of the key issues that is emerged in this debate is your optimism about the potential for capitalism to reform itself. What I'm hearing from Janus and Katrina is real skepticism that that is a possibility.

In a sense, the status quo that they see now many features of which you are also in opposition to, why do you think that there's the potential for a positive reform? So I think the biggest difference between how I see it and how Yanis sees it is that he is more pessimistic about the possibility of capitalism becoming more democratic, particularly under current circumstances. Why am I more optimistic? It's not because capitalism reforms itself. It doesn't. My car doesn't fix itself. Capitalism is a machine. Capitalism is socialism is a machine. Any is a structure that's not inherently moral or immoral. People are moral. You know, we have hearts. We have brains. Morals have to come before markets. And what I'm optimistic about is our ability as a society with ingenuity is to actually figure out what's going wrong

to create social movements that will make it so. I mean, this is exactly what Katrina and Janice are talking about, is social movements that will bring the people together to get what they want. Do you want to come back on that point? There is no capitalism. What we have is socialism for the very, very few. and rabbit conditions for an increasing proportion of the population. This is what we have.

The Heves are enjoying the greatest degree of socialism in the history of humanity. They have a federal reserve in the United States, your central bank here, totally securing their profits during the good time and making sure that you pay for their losses during the bad times. They have a situation where whenever technology produces profits, corporations use those profits in order to expand not so much investment into that which humanity and the planet needs, but in greater concentrated, more concentrated power for themselves. We have a situation where short-termism, CEOs that are terrified by two or three financial

companies that control through pension funds, the share value that determines their bonuses, they will downsize the company immediately, independently of whether this is good for the company or not, if they think that this is going to have a short-term beneficial effect on their bonuses and on the share market. That is destroying the moral sentiments of Adam Smith. As you said, morals have to come before markets. Today, because we don't have markets, we have this techno-structure

with abusive concentrated power, it is destroying the market. It is destroying the morality on which markets can only flourish according to Adam Smith. This is why we're moving in exactly the opposite way what you were saying. This is why I need to reconsider the corporation, reconsider the financial market. And remember, in 1944 it happened. Franklin Roosevelt, convened in New Hampshire, the Breton Woods Conference, and completely redesigned capitalism into something completely different from what existed before the Second World War. We need something similar to such an extent that we are no

longer going to have socialism for the few and rabbit misanthropy for the many. Let's bring David in here. Powerful evocative argument. So, David, why are you optimistic about reform? Because, again, Janus is painting a picture here of powerful vested interests who really have no interest in the kind of, I think, what characterized fairy tale capitalism that you're propounded. Yeah.

Well, first, I do think you're exaggerating the difficulties in the situation. We are in a time of pretty much full employment in this country. We earn a time of rising wages, rising wages for the bottom. As Arthur mentioned, we've just pulled 800 billion people, I mean, million people out of poverty. I mean, there are real things here. Secondly, I've seen capitalism reform. I've seen the New Deal, which is a capitalist reform.

The Bretton Wood system, the IMF and all that, what could be more capitalist? You go to the Scandinavia if we want to make the Social Democratic case for it. I'm not sure it could work in a big, diverse country like you have, like we have, but it works. And they have a high social support. They also have no wealth tax. They have no inheritance tax.

They have extremely low corporate taxes. They have school choice. They don't have minimum wage laws in most of those countries. They have a very free economy. And you walk into Denmark, you're going to tell me that's a failed state. I see the possibility for change, and frankly, I see a greater possibility for change on that side of the world than I do see in a political system which is rigidifying, stultifying, and stagnating.

All so, David. I think Roger wants to jump in on that point. Yeah. There is a non-trivial irony, as Janice points out, that David and I are talking about regulated economies. As, you know, some programs in social democratic economies are things that people like here up in Canada, even in the United States, all over the Scandinavian countries. Virtually every modern economy is effectively some kind of social democracy at this point. And so there is some irony of the fact that we want to preserve capitalism. that can give people democratically what they want.

There's also some irony in the fact that what Janice wants is more competition. He sounds a lot like Milton Friedman. Milton Friedman hated crony capitalism. Milton Freeman was completely against billionaires who had ill-gotten wealth. He was completely against the idea of privileges that come from a system that's effectively engendering landed gentry in countries like Canada and the United States that were built on principles of freedom without royalty. This is really important.

I mean, the irony is that you want more competition, and I'm willing to live with more government programs. I don't think that we're... I mean, and together we'll live in perfect harmony. I think that there's a possibility that there actually are solutions to these things. The real question is whether capitalism can be saved. That's the issue that we're taking on today. But I wanted to ask David something, because I was reading a profile of you in the Jesuit magazine, America. My father is a great admirer of yours, so we found this profile.

That's my demographic, right there. You said I'm more aware of how capitalism unbalanced just rationalizes selfishness, and it also justifies a sort of amoralism. It turns off the moral lens, made me see the ways that capitalism has on balance created a very shallow view of life. So I wonder, I mean, in terms of morality, and I believe you need both moral renewal and ethical renewal,

but you also need systemic change, that sense of capitalism is something almost amoral. I think has really been a part of a younger generation's view and led them to very different things than led you to. But I wonder how you square your admiration for Dorothy Day, for these comments, with capitalism as constructed. That's a good question. So capitalism is morally complicated to me. I think it does arouse energy, and I think it does arouse optimism and hope. But I also think it drives a consumerist, materialist mentality.

I think it also creates a hyper-individualistic privatism, my world, who cares about the common good. I do think capitalist countries suffer from that. And so if you want to say capitalism should be your worldview and your philosophy and your moral creed, I say you're going to be a selfish bastard. So you better to be a good person. You better have a separate creed, a value system and a moral system that comes from a separate place, probably outside capitalism,

and often pushing against capitalism. Catholic social teaching, which I think a lot of us on the stage are really admires of, is that kind of creed, which pushes against capitalism. In Scandinavian here, there's an egalitarian creed

that pushes against capitalism. And that's the way to be in the economy and be a whole person. So when I look at communities, I look at people who are capitalists, but also deeply involved in the loving care of their community and the surrendering grace. So subsidiarity and solidarity. Capitalism, it can be, if regulated right, a very decentralized thing. You're listening to the Monk Debate podcast. Be it resolved, the capitalist system is broken. It's time for something different.

Arguing for the motion is Janus Verifakis, the former finance minister of Greece, and could Katrina Vanderhovel, publisher of The Nation magazine. Their opponents are David Brooks, the internationally bestselling author and New York Times Calmist, and Arthur Brooks, the former head of the American Enterprise Institute. I'm your moderator, Rudyard Griffith. And let's go to closing statements now. I'm a journalist, and a lot of this debate has had a bit of an ethereal feel. Like we're imagining a system of blockchain and Bitcoin, getting rid of a tax system,

and shifting over to something so radically different, what could go wrong? It sounds like there are complexities that we can't even fathom. I'm a moderate. I like gradual change. The one kind of radical change I like and the prism through which I see capitalism is immigration. I was at a Latino church last Sunday

with these kids, hundreds of them, under 30, second generation, had come to America as so many come here, and they said, look how far we've come in one generation. They were filled with joy and hope and what they were worshipping. It was a lot better than capitalism. But you could see their life stories in there, in the progress of a generation. And when I saw them, I saw my own Jewish history,

the butcher and the seamstress in my family, and the ocean of opportunity that hit them. And they're hitting people in this country. And it's caused by the growing pie that capitalism creates. It has a lot of disadvantages, but people migrate to capitalist economies and free capitalist economies. They vote with their feet to this city, which has been transformed since I was born here, and to my country which has been transformed. We're becoming mass multicultural democracies, and that's a tough thing to go through.

But it's a beautiful problem to have because people around the world in plan systems love our system. and they find a fair field and a fair chance. I wish I could play the Canada card. But let me try. Picking up on what David said, if you wanted to come to a country to realize what was once called or is called the American Dream, I say again you'd come to Canada,

where social mobility is at a level, double that of the United States. I think that's very important. I believe we can do better. What does that mean? We can rewire and reimagine an economy of shared prosperity that works for everyone, not just the very wealthy. I understand that many are understandably wary of change, but I think we're at an inflection point

that capitalism, as we've known it, predatory extractive, has turned off many, it's not working for many. And that is going to lead to real change. I think we're going to see real reform, or we're going to see real social discord, the center isn't going to hold. As we live in the world as it is, we should also try to imagine the world as we want to live in, and one in which millions live with dignity, decency, happiness, environmental well-being, opportunity, and again, social mobility, and enjoy a new social contract.

These are times for greatness, not for greed, a time for idealism, not ideology, and a time not just for compassionate words, but compassionate action. Thank you. There was a recently passed Roman Catholic Cardinal in the city of Chicago named Francis George. Francis George once was giving a speech to his richest donors on the North Shore of Chicago about funding poverty programs on the South Side. And here's what he said, to raise money. He said, the poor need you to pull them out of poverty.

And you need the poor to pull you out of hell. I'm never going to use that fundraising pitch. but ask yourself do you need the poor do we need the poor our society does need the poor not to stay poor but to do things that we need to be among us there are 3,000 life stories in this room there are 3,000 family histories in this room you know what do they have in common very little scratching out potatoes in Ireland running from a pogrom in my country many people were brought to this our nation involuntarily but let me tell you what we all have in common in Canada and the United States. We descend from ambitious riffraff and we're proud of it.

Why did your riffraff ancestors come here? Because they were needed. That is the essence of dignity. That's how you become worthy of respect to be needed. What makes you needed? I guarantee you that your grandfather coming to this country was not on his way saying, I can't wait to get to Canada where there's a better system of forced income redistribution. He said, finally, I'll be free. Finally, I'll be able to work and be rewarded for my work. We need programs to help the poor. We need reform. We need to pay attention to predation. Don't get me wrong. It's absolutely true. We all know that. But fundamentally, the DNA of this system of this great country in mine is democratic free enterprise. It's the system that people still want to come to. Why do people struggle to come to Canada?

Why do people struggle to get to the United States? It's because here this opportunity, I want more of it, I want to fix the system, I want to make it fairer, I want to make it better. But don't change the fundamental genetics of what we have that truly has blessed the world. Together, we can change it, But together, we need to protect capitalism as the best way to lift ourselves up and those around the world. Thank you. Yannis Verifakis, you get the last word tonight. Three minutes on the clock. Thank you.

When I was six, the secret police broke down our front door and abducted my father. I'm not a great friend of the state, but I am equally not a great friend of any privateer with excessive power over other citizens. The one thing I learned during my political life, which is fairly recent since 2015, is when a bill comes to Parliament, somewhere in it, you will find, if you follow the money, some vested interest that has created circumstances for the corrupt enrichment of some oligarch. If you follow the money, you will find the essence of corrupt power of oligarchy embedded in the deal. of what passes as a really existing capitalism. My concern can be summed up in one objective, democracy.

The only guarantee we have, the only weapon we have against concentrated power, is a combination of civil liberties, liberty at the personal level, with democracy. And allow me to finish off by reminding you of Aristotle's definition of democracy. It is a system of government in which the poor govern. poor govern, because by definition, the poor are in the majority. What we are experiencing today is an oligarchy, a financialized oligarchy that is pushing us towards an ecological catastrophe. We must not tear anything down.

We must take every piece of technology that capitalism created. Every liberty that was brought to us by capitalism, and we should cherish it. But we need to make one evolutionary step beyond. on capitalism. We need to democratize economic life, democratize the way corporations are run, democratize finance in order to save democracy, in order to save liberalism,

in order to save those ideals that those who had invested in capitalism initially 200, 300 years ago, looked upon as hope for the world. Thank you. Well, thank you, debaters, for a hard-fought debate. civil. It was substantive. We covered a lot of

key issues. Well done. I want to thank everyone, the Aurea Foundation, the Monk family. We're going to do this all again in the spring. Thank you. Enjoy the rest of your evening. That wraps up today's debate.

I want to thank all of our participants, David Brooks, Arthur Brooks, Katrina van der Hovel, and Janus Verifakis for a terrific debate. The Monk Debates podcast is a place for civil and substantive debate on the big issues of the day. To listen to more debates on everything from climate change to religion, to geopolitics, to the future of human progress, visit our website, monkdebates.com. You can also find show notes on today's debate, along with a full transcript.

Thank you for helping bring back the art of public debate one conversation at a time. I'm your moderator, Rudyard Griffiths. The Monk Debates are produced by Antica and supported by the Monk Foundation. Rudyard Griffiths and Ricky Gerwitz are the producers. The executive producer of Antica is Stuart Cox. Be sure to download and subscribe wherever you get your podcasts. And if you like us, feel free to give us a five-star rating. Thanks again for listening.