You’ve been flooding Nick’s voicemail for months, and the time is finally here! Comedian Trae Crowder joins Nick to answer your questions in this freewheeling Ask Me Anything session. What does John Hickenlooper think about Nick’s net worth? How can we help people see that a $15 minimum wage is good for everyone? We answer these questions and more!
Trae Crowder is a comedian and co-author of ‘The Liberal Redneck Manifesto: Draggin’ Dixie Outta the Dark’. Trae has earned national attention for his “Liberal Redneck” series of viral videos. He has been performing his particular brand of Southern-friend intellectual comedy in the Southeast for the past six years, and is now on the WellRED Comedy Tour with fellow comedians and writing partners Drew Morgan and Corey Ryan Forrester.
Francis: Hi, my name is Francis and I’m calling from Texas. I’m just curious how do we get the presidential candidates to pay attention and to understand the importance of your message?
Brian: Hi, this is Brian calling from Chicago. My question is about the minimum wage.
Howdren: Hi, Nick, my name’s [Howden 00:00:17] and I’m calling from London. How is it that as individuals we can out change the system? Make it more equitable and fair for those around us? Thanks and once again, love you guys. All the best.
Speaker 4: From the offices of Civic Ventures in downtown Seattle, this is Pitchfork Economics with Nick Hanauer. One American capitalist take on how we got into this mess and how we can get out.
Nick Hanauer: So, today on Pitchfork Economics, I am joined by my friend Trae Crowder, the comedian. And super excited to do an ‘Ask Me Anything’ episode. Trae is visiting from Los Angeles, where he lives, after having grown up in Tennessee.
Trae Crowder: Yeah, yeah, I was going to say you can tell by my accent I’m from Los Angeles.
Nick Hanauer: Exactly. This very strong Los Angeles accent.
Trae Crowder: Yep, mm-hmm (affirmative). The south of California.
Nick Hanauer: So we have been asking for a long time for our listeners to submit questions. We got a ton of them. We’re going to get through as many as we can. Trae and I are going to do our level best to intelligently, or at least amusingly, answer your questions.
Hey, there. This is Nick Hanauer. You’ve reached the magic voicemail box where you can leave me a question for my ‘Ask Me Anything’ episode. All you have to do is state your name, where you’re calling from and your question as clearly as possible. So thanks!
Donnie May: Greetings, I am Donnie May from Ontario, California. How do you reconcile your views as a capitalist with policies many people would call socialist? Thanks for all you do. Hope to hear from you on the radio. Bye bye.
Nick Hanauer: So, Donnie May from Ontario, California.
Trae Crowder: It’s weird because kind of just asked you a version of that question like ten minutes ago, before we got on here.
Nick Hanauer: Yeah and … I mean, briefly … Trae and I were chitchatting about economics and he wondered how we thought about socialism. And the problem is the definition of the word, isn’t it?
Trae Crowder: Yeah, socialism is a particularly … like in places where I’m from, like rural America, socialism is a dirty word.
Nick Hanauer: Right.
Trae Crowder: People … a lot of people don’t even really know exactly what it even means really or doesn’t mean. Everyone has their own idea of what it means and a lot of people hate that.
Nick Hanauer: Yeah. And here’s the thing: I think a lot of people hate socialism for a very good reason because the dictionary definition of socialism is the state ownership of the means of production. In other words, no private enterprise or private industry. And that’s an economic system that has been tried in a bunch of places and it has been a total catastrophe because … despite the facts that our existing economic system are imperfect and screwing a lot of people over, markets work a shit ton better than-
Trae Crowder: Governments.
Nick Hanauer: Yeah.
Trae Crowder: You don’t say.
Nick Hanauer: Not markets. And so … but what a lot of people mean when they talk about socialism today, I think, is really reforming our economic system, our capitalist system, into a system where the market works for people, not just for money. And that’s a thing that we can very easily do in many ways. That’s the purpose of the Pitchfork Economics.
Trae Crowder: To give more money to more people. Right.
Nick Hanauer: Right. And that’s … again, there are a lot of people who would claim that socialism. I respectfully disagree. I think that the word is a very poor choice for reforming a market system into a better system. But anyway, I think that in many ways, what we’re talking about here is what people are thinking about when they talk … think about socialism. Just an economic system that benefits everybody, not the few.
Trae Crowder: Right.
Mark: Hi, this is Mark from Portland, Oregon. And my question is this: I think there’s a strong business argument for shifting healthcare costs from businesses, who pay for those healthcare costs through their employee benefits, paying those benefits, and shifting that cost and putting it onto the government tab. Seems like it would save a lot of money for business if they didn’t have to pay those healthcare costs anymore. It would make them more competitive. Why don’t I see that argument being made? Why are businesses so interested in continuing to pay for healthcare costs? Thank you.
Trae Crowder: Mark, it feels to me like a lot of the opposition to the government paying for healthcare is because … well, that’s socialism and socialism is a dirty word to these people. They don’t want … “My taxpayer dollars shouldn’t be going to pay for somebody else’s scraped knee or whatever.” But to me … my number one thing with this has always been we’re not going to allow people to literally die. And if we’re not, then we’re going to fix people up. Somebody’s gotta pay for it no matter what. So we let people die in the street or the government can just start paying to cover them and costs will go down overall eventually anyway. But I’m mostly talking out of my butt.
Nick Hanauer: But you’re … you know, Trae, I think you’re basically on the right track. The truth is that one of the reasons you’re not hearing about moving the healthcare system to a single payer system, which is what most of the rest of the world does, in one way, shape or form, is the insurance in the hospital lobby who desperately don’t want that to happen.
Trae Crowder: Yeah.
Nick Hanauer: The insurance industry has about … I think it’s up to about three trillion reasons per year to not let that happen. And … but, indeed, if we shifted the burden of healthcare costs from private employers to a public system, where everybody just basically pays into the system and gets their healthcare via that system. Among other things, you could cut out virtually all of the 15% [VIG 00:06:55] private insurance companies take on every healthcare transaction. Which on almost three trillion dollars is 450 billion dollars. And there’s a lot of good reason to do it but I think at the end of the day … when I think about healthcare reform, I think of a giant dartboard with all the systems of all of our competing nations on it. Canada, Australia, New Zealand, Japan, Germany, Switzerland. And I think the way to solve the healthcare problem is just take a dart and chuck it and wherever it landed on one of those squares, that system would be better than ours. And we should just do that.
Trae Crowder: Yeah, but none of those countries are the greatest country on Earth, Nick.
Nick Hanauer: That’s true. That’s true.
Trae Crowder: They should be throwing darts at us right now.
Nick Hanauer: I stand corrected. Also, Mark, just speaking directly to your question about why business people don’t advocate for this obviously very sensible thing, I cannot answer that. I think part of it is … I think Trae is definitely right on about the fear of socialism-
Trae Crowder: There’s a stigma attached to it-
Nick Hanauer: That somehow it will all be worse-
Trae Crowder: I also think that on an individual level, a lot of people that are opposed to it, they think whether they own a business or whatever, that even if they stopped having to cover their own employees and it went to a single payer system, “Well, now they’ll just take more of my money to pay for everybody now. So I’d rather pay for the people who work for me and do things for me than to have to pay for everybody. All the lazy people that won’t even get a job.” I think that’s the mentality that a lot of them have, which I completely disagree with, but I think that’s how it works in a lot of people’s minds.
Nick Hanauer: Yeah, and in fact, we are paying for people that we don’t employ because the healthcare costs-
Trae Crowder: They get spread out-
Nick Hanauer: They get spread out anyway.
Trae Crowder: That’s what I was trying to say earlier about if you’re not just going to let poor people die-
Nick Hanauer: Then you are paying for it.
Trae Crowder: Right. No matter what.
Nick Hanauer: Yeah, yeah. In your insurance premiums.
Trae Crowder: Yes.
Francis: Hi, my name is Francis and I’m calling from Texas. I recently ran into presidential candidate Hickenlooper in Montgomery, Alabama, when he was there visiting the Museum for Peace and Social Justice. And, of course, I took the opportunity to mention Pitchfork Economics to him because I really feel like that would be a winning message for anybody who’s running for office, and he said, “Oh yeah, I know Nick.” And then he said you are an interesting guy and you had gone far left. And he also, when I suggested that you were a billionaire, disputed that, and said he didn’t think you were a billionaire. So, my question is: how do we get the message out that neo-liberal economic policies continue to hurt all of the middle class and the working core?
I think if a Democratic candidate would embrace the messages that you so clearly explain, they would have a much better opportunity at defeating the incumbent president. So, I’m just curious, how do we get the presidential candidates to pay attention and to understand the importance of your message? Thanks so much. I enjoy your show. I look forward to every single episode and tell everyone I know about it. Have a great day. Keep up the good work.
Nick Hanauer: Francis from Texas.
Trae Crowder: I think she’s really onto something. Something that’s annoyed me for a while, just in general, when it comes to the Democratic Party or the left in this country, is that the left, for a long time, was the party of poor people, the party of working people, the labor party, and they’re just … kind of not anymore. And I thought there’s a major opportunity there for the left to gain some ground back in places like West Virginia or Oklahoma, with the teachers’ strikes and that type of thing. And I think people would be receptive to these types of economic arguments if the left gave enough of a … can I say ‘shit’? You can say anything you want. Gave enough of a shit to talk about them to begin with. I think it’s a huge hole in their strategy so far, as far as I can tell, because I agree completely. They should be starting to deconstruct all of this stuff to the people who need to hear it the most. But as far as how they should best go about that, why don’t you tell me and Francis?
Nick Hanauer: Well, first of all, Francis, I really am so appreciative of you representing me to John Hickenlooper, who I know and like. I think it’s hilarious that he thought I was too far left. But I’m not surprised by that because the Democratic party that John is sort of a big part of has been notoriously wrong on economic issues for a generation. Make no mistake, if you’re a middle class person, you’ve gotten screwed over the last 40 years, but you got your screwing from Democrats and Republicans alike because they have been … the best the Democratic Party has been able to muster is some form of trickle down light.
And, Trae, you should talk a little bit about where you’re from and the marvelous job the Clintons did for you.
Trae Crowder: The briefest Cliff notes version of it is I’m from a really small town in Tennessee. The beating heart of that town’s economy for decades was this big clothing factory that, right after NAFTA passed, packed up and moved to Mexico. Which, I know, that kind of became like a false narrative. Like, “Mexico took all the jobs” or whatever, but in the case of Celina, Tennessee, where I’m from, that’s literally exactly what actually happened. And the town has never recovered from it. To crime and opioid abuse and all that just skyrocketed. Things are terrible there now and have been. Over 13% unemployment for like 20 plus years now. It’s just been utterly devastated. And most people there blame Bill Clinton, but then, just the Clintons, for that to this day.
So, Hillary was … they were never going to go with Hillary after everything. Even when the alternative was what it was, they were never going to go with Hillary because they blame the Clintons for what happened … neo-liberalism for what happened to their home. And I get why, I mean why-
Nick Hanauer: Makes perfect sense.
Trae Crowder: Why wouldn’t they feel that way?
Nick Hanauer: Absolutely and I think John Hickenlooper is part of sort of that old tradition of Democrats who believed largely that tax cuts for rich people created growth and raising wages killed jobs. We should just give slightly smaller tax cuts to rich people and we should hold wages down just a little bit less than the Republicans as the distinguishing factor. And this podcast is devoted to trying to talk, at least some Democrats and hopefully a few Republicans, out of those idiotic ideas and into the notion that the most pro-business thing we can do is build a thriving middle class.
And indeed, if the Clintons had approached NAFTA in a better way, we would … your town, where you grew up with and the country would be in a far better spot.
Trae Crowder: Well, very quickly, one other thing. It’s a very rural, southern community but Clay County, where Celina’s in, in every electoral map for years and years and years up until that happened, was a blue county within Tennessee. And then that happened and it’s been deep red ever since, basically.
Nick Hanauer: Yeah. And I want to address the billionaire thing. So I’m not a billionaire. I’m worth less than one billion dollars but many hundreds of-
Trae Crowder: I’m sorry. I apologize.
Nick Hanauer: It’s okay.
Trae Crowder: No.
Nick Hanauer: No-
Trae Crowder: Lost that third comma. That’s got to be tough.
Nick Hanauer: I have said this … so it’s on my Twitter. I put it everywhere. But of course it’s academic. Anyway-
Trae Crowder: Right. Almost, there’s like three people on Earth are like, “Did you hear about Nick? That’s rough. He’s in bad shape now.”
Nick Hanauer: Francis, I just want to say that I try to be as explicit as possible, as often as possible, that I’m actually worth less than one billion dollars. Many hundreds of millions but not a billion. And so, I draw that distinction often and John … maybe he knew. But anyway. Trae, I still roll pretty good, don’t I?
Trae Crowder: As far as I can tell, yeah. Yeah, Nick’s doing fine, Francis.
Nick Hanauer: So, here’s the thing, in general, we need to … I think what you did with Hickenlooper is how we get presidential candidates to take these issues more seriously. We have to be in their face and communicate that the only basis upon which we will vote for them is if they are devoted to meeting the scale of the economic challenge most people face at that scale. In other words, it’s not good enough for him to be advocating for raising the minimum wage from 7.25 to 9.00 dollars an hour. That is not going to materially help anybody in this country. We need to move it from 7.25 to 15 or 20 dollars an hour. So we all collectively need to be in the face of these public officials, to try to drag them, frankly back to the center, which is economic policies that benefit everybody.
Trae Crowder: I think, and I, again, talking out of my ass, but I feel like, and I hope, that in a like post-Bernie, post-AOC type of … They better start caring about it or they’re not going to have a shot in hell, in my opinion. If they’re not appropriately on message as far as taxing the rich and all of that, they’re not-
Nick Hanauer: They don’t have a chance.
Trae Crowder: They’re not going to get very far. So I don’t … It ain’t up to me. They need to figure out how to go about it or they’re going to be in deep shit if they don’t, in my opinion.
Brian: Hi, this is Brian calling from Chicago. My question is about the minimum wage. I’m a big supporter of a 15 dollar minimum wage but I get push back from those … say, nurses, EMT’s, that are currently making 15 dollars an hour. How do I communicate and how do I articulate that a federally mandated 15 dollar minimum wage is good for everyone? Because they deserve a raise, too. Thanks.
Trae Crowder: Okay, Brian. This is one of those things that pisses me off more than anything when it comes to economic problems. Because he’s 100% right. I know a lot of these people, too. You start talking about raising the minimum wage and you start hearing people … he said EMT’s, perfect example, that are like, “Why should a teenager flipping burgers get paid 15 dollars an hour when that’s what I get paid for saving lives? Does that sound fair to you?” It’s like … that’s not what any of us were saying, man. We’re not saying that the burger flipper deserves to make as much as money as you do for saving people’s lives. We are saying that you both are getting fucked-
Nick Hanauer: Right. Exactly.
Trae Crowder: And deserve to be paid more and treated better. Both of you should be getting more. Just because you’re getting fucked over doesn’t mean that kid should be getting fucked over, too. You know what I mean? I don’t understand. Everybody has this … and maybe it’s like a human nature thing.
Nick Hanauer: It is.
Trae Crowder: People want to make it about their situation compared to someone else when we’re trying to fix things for everybody.
Nick Hanauer: Yeah, but Brian, I think you raise a super good question because it does … and this policy does antagonize people. I’ve had exactly the same questions. But the reason that that EMT is only making 15 dollars an hour is because the floor is so low. What happened over 40 years is they kicked the foundation out from under the house and everybody wonders why the floor’s collapsing. Well, if the foundation is solid and high and rising, well, everything above it will do well, too. And so the quicker we can raise the minimum wage to 15 or 20 dollars an hour, the quicker that EMT’s wage will go from 15 to 30 dollars an hour, or 40 dollars an hour. As the dynamics of the labor market adjust to it. Everybody in the country has a stake in raising the floor as high as we can because people who are in the middle now will be compressed upwards in the same way that they are.
So, anyway, that’s the basic story but I’m deeply sympathetic to the push back you’re getting because I’ve gotten it myself.
Trae Crowder: Yeah.
William Smith: Okay, this is William Smith. I’m calling from Decatur, Georgia, right outside of Atlanta. When we talk about the health of the economy, are we talking about the wealth and prosperity of the rich or are we speaking of the economy as a separate entity in and of itself? And an even greater question would be because of the fact that it really doesn’t matter whether it’s the former or the latter, the largest participants in the economy, namely the poor, are never even considered in that calculation. So the greater question is how do we include the poor into a discussion about the health of the economy? And I think that by doing that and making that the way that we report on the overall health of the economy, can change the dynamic of how the poor are considered in our society. Thank you.
Trae Crowder: Well, William, I think it depends on who’s talking about the economy but without a doubt, a whole lot of people when they talk about the economy, definitely are talking about the wealth and prosperity of rich people. I mean like the stock market. We talk about what the stock market’s doing. Like in my hometown’s like, “Did you see? The stock market’s really surging.” It’s like, “Oh, great, I still got to help my Memaw get her pills” or whatever. Or the opposite. Like the stock market crashes and it’s like, “Okay, whatever.” I literally have no idea what that means. It means nothing to me. But it’s still used as this metric on a national scale so I mean … there’s no denying or arguing with the fact that a lot of times, when people talk about the economy, that is what they really mean. The wealthy and how they’re doing.
Nick Hanauer: I couldn’t agree more. And, William, you’re really on to a very important thing, which is how we characterize whether things are going better or worse. And if you think about all of the basic statistics we use to measure the economy, sort of in everyday life, like the … where the stock market is or whether GDP is growing. These things are completely disconnected from the lives of the typical family. I can’t remember what the statistics are but something like 80% of the stocks in the country are owned by the top 10% of Americans. The bottom 60% of Americans effectively own zero. And GDP has gone up every year, for all intents and purposes, for 40 years. I think GDP is up an outstanding 112% over the last 20 years. But the median income is only up 18%. That’s the big problem. It’s completely crazy that the median wage, the amount of money that the typical family makes, is not a thing that we really measure. This is the measure of the health of the economy is how’s the typical family doing year to year and relative to before.
To say nothing of poor people, who should be measured in the same way, and in fact, I mean it is hopeful that there is a movement afoot to measure how different segments of the society are doing simultaneously so we can see how the richest are doing, how the poorest are doing, how middle class people are doing, in a more concrete way. And I think that will lead to better policies because it will be more obvious to everybody that a few people are winning and everybody else is losing.
Trae Crowder: Right. Yeah, I was going to say I don’t know the metrics or whatever, but I can tell you right now how the poor people are doing. Not good. Not good. More at 11.
Howdren: Hi Nick. My name’s [Howdren 00:24:05] and I’m calling from London. I found out about your podcast through the Young Turks and I absolutely love it. I was wondering: as much as all of the massive impact can be done through the political process and that has to be done through the political process, I was wondering on an individual level, what about options to really show that we’re not supporting or we’re doing our best to support a more progressive economics? Where do you stand on, whether it be charity or maximizing personal wealth, how is it that, as individuals, we can help change the system and make it more equitable and fair for those around us? Thanks and, once again, love you guys. All the best.
Nick Hanauer: So, [Howdren 00:24:47], thank you for the question. It’s awesome, by the way, to have somebody calling in all the way from merry old England. That’s cool. I have a very strong view on this. As a philanthropist, which is kind of what I am now, there’s all sorts of ways to make change in the world and one of them is to give money away, which tends to be ameliorative, kind of … how’d you put it early-
Trae Crowder: Treating the symptoms and not the cause.
Nick Hanauer: Not the causes. Or getting at the structural problems, which always is at the intersection of policy and politics. And the thing is, that that involves a particular kind of work plan but it also involves creating conflict that lots of people don’t like to have. And the thing about deep, social problems is that they’re always a product of a particular arrangement which benefits the hell out of somebody. Right?
Trae Crowder: Right.
Nick Hanauer: I mean, there’s a reason that there’s a bunch of poor people and a few rich people and core among the reasons is that the rich people really like the current arrangement and are going to resist the hell out of changing it. And so, if you want to really make a difference … course, there’s all sorts of nice, charitable ways to help people. But if you want to make a difference in scale, you’re going to have to change the system. And if you’re going to change the system, you are gonna be in the politics business. Which is what our team at Civic Ventures do, basically. It’s a team of political professionals that run campaigns and build narratives and shape policy because that’s the way to do it at scale.
Trae Crowder: At scale, for sure. And I could be wrong but I’ve felt like the collar was … like what can he do … like a day to day person who agrees with you on all of this. What can they actually do differently to sort of help in whatever way that they can? And even if that’s what he meant, that’s what I’d like to know.
Nick Hanauer: Yeah. I mean, I think that that’s fair. I think you do have to be involved in politics. You have to-
Trae Crowder: Which I think is a good thing to tell people anyway. Be involved. Get involved. I think that can only lead to better things.
Nick Hanauer: That’s right. There’s a reason that your political leaders have enacted policies which have benefited people other than you. And that is because they did not hear from you. You were not involved. You did not scream outside their door and say, “No way. Hell no.” Folks weren’t in the streets protesting and complaining about a set of economic policies that benefited the rich and disadvantaged the many. And if you want to change it, you have to personally get involved. There’s no alternative. Now, I’m personally blessed to have the resources to stand up my own political apparatus. That’s how I decided to get involved and so I have this wonderful team of people who know how to run campaigns and build narratives and beat the shit out of politicians if we don’t agree with them.
But everybody can do it in their own way, at their own scale. And I wish that there was a handy way not to do that and get the effect that you want but I just, sadly, I think that that’s just what you got to do. In every way you can.
Trae Crowder: Well, I mean, that’s kind of your whole deal with the pitchforks, right? Is that … that’s what eventually is going to happen-
Nick Hanauer: Right.
Trae Crowder: It’s what’s going to have to happen, is regular people coming together and saying they’re over it. They’re not going to put up with this anymore.
Nick Hanauer: Right.
Leslie: Hi, Pitchfork. This is Leslie from Detroit. And I was wondering how modern monetary theory would explain the 2008 economic crash? Okay. Thank you.
Trae Crowder: That’s way above my pay grade, Leslie, for sure. Nick, I don’t know how you feel about it.
Nick Hanauer: So …
Trae Crowder: I saw a pretty good movie I think was about that. A couple of them. Big short margin call. I don’t know how accurate they are but I recommend those anyway. That’s my time. You go ahead.
Nick Hanauer: So, in a sense, we solved the 2008 crash with modern monetary policy by just creating a bunch of money and lending it, unfortunately, to the financial system to prop it up. By unfortunate I mean we could have taken that huge pile of money that we invented, that the government printed into existence, and instead of bailing out the banks, bailing out the consumers who had been defrauded by the banks. And we would be much better off as a country and, ideally, a whole bunch of banks would be bankrupt and we would have new banks.
But I do think that-
Trae Crowder: Yeah, it’s kind of like, “The banks are all in trouble. They’re all dying. What are we gonna do? I don’t know. Somebody call the banks.”
Nick Hanauer: Yeah, exactly, exactly.
Trae Crowder: Let’s ask the banks, see what they think we should do.
Nick Hanauer: Yeah that was really stupid. To make a bunch of bankers richer. But why did we do that? Neo-liberalism, right? Because the prevailing neoclassical economic thinking was that that was the only option available to us and that the richer the rich got, the better off everyone will be. But sadly, we didn’t have the courage at the time to make the investments that we made in our country bigger. We could have doubled the size of the investments we made in the country at the time of the crisis and if we had, we would have emerged from the crisis quicker and everybody would be better off.
Trae Crowder: Well, briefly, I actually was kind of directly involved and impacted by all that because I was getting out of college, right around the time of the crash. Hugely good time to be graduating college. That really worked out well for me. But the only reason I found a job is because I found a job that was funded by the American Recovery and Reinvestment Act. And it not only gave me and a bunch of other college graduates jobs but the job I had was administering all these grants that went to American cities and towns, specifically for like renewable energy projects. So that put a lot of money into … making the city hall more efficient or putting in all new street lights that are more energy efficient. Whatever. Any number of things that were genuine, actual improvements that are still there today that were long-term improvements and actually did good for things. It makes me kind of biased about it except for the thing is, like you said, the amount of that that we did, which was effective, was dwarfed in comparison to the amount of that money that we printed that was just given to the banks or whatever.
They did a little bit of that-
Nick Hanauer: But we could’ve done something else or much-
Trae Crowder: But not nearly enough. They could have just done all of that type of thing.
Nick Hanauer: So how old were you when you did that?
Trae Crowder: Twenty-three.
Nick Hanauer: So you flew around the country giving away the government’s money?
Trae Crowder: Yeah, actually my-
Nick Hanauer: You must have cut a very impressive figure.
Trae Crowder: Yeah. My … Yeah. You’re so right. My area was the Pacific Northwest, coincidentally. So I got Bellevue, or Bellingham or Tacoma, wherever. And yeah, I’d walk in the door and they’d have a whole team of city engineers and city managers and stuff sitting there. And then this twenty-three year old walks in and is like, “Hey, I’m from the DOA.” You know? And the looks on their faces, man. Just like, “Oh my God. Okay. This is what the government’s sending us right now.” But it all worked out for them, I hope. I don’t know. I had no reason to say that, actually. But I think it worked out. I hope it did. But, yeah, you’re right. People were vastly disappointed when I showed up, Nick. Yeah. Happens in my comedy shows a lot, too, now that you mention it. Anyway.
Nick Hanauer: Awesome.
Speaker 11: Hi. I’ve been curious. I’ve asked a lot of people this question and no one has ever been able to give me an answer. When the stock market goes up and generates value or generates wealth, where does that wealth and that value come from and, if the stock market drops 10%, where does that 10% value go to? It’s never made sense to me how the stock market can grow seemingly out of nowhere. So if you could answer that, I would be eternally grateful. Thank you.
Trae Crowder: Well I can tell you this, dear caller, that you can take comfort in knowing that you’re not at all alone in having these questions. Like what we were saying earlier, to most people, they feel exactly like the caller did. It’s all just … like words and numbers that don’t mean anything to most people. So I think most people would like to know the answer to this question.
Nick Hanauer: Yeah. So here’s the … it’s a super interesting question. It’s a very complex question about what the economy is. And what’s super interesting is probably not a very satisfying answer is that the economy is just a bunch of ideas.
Trae Crowder: Right.
Nick Hanauer: The economy is imaginary. Money is-
Trae Crowder: Yeah, it’s just numbers and-
Nick Hanauer: It’s just a shared fantasy. When I hand you a dollar bill, that dollar bill is worth a dollar because we, in our minds, have agreed that it is worth a dollar.
Trae Crowder: You’re taking me back to college bong session talks right now. “Ain’t none of it’s real, man.”
Nick Hanauer: Exactly.
Trae Crowder: “It’s all just a lie, dude.”
Nick Hanauer: It’s all a lie.
Trae Crowder: “It’s only real because we say it’s real, you know?”
Nick Hanauer: I think they’re basically-
Trae Crowder: But you’re right, though.
Nick Hanauer: Basically you were right in the bong session. It is all a lie. The economy is what social scientists call an imagined order or an inner subjective reality. What is an inner subjective reality? It’s a set of subjective ideas that we agree about.
Trae Crowder: Yeah.
Nick Hanauer: So the legal system is another great example of just an imaginary system.
Trae Crowder: I mean, time is kind of that way-
Nick Hanauer: Absolutely.
Trae Crowder: With the days of the weeks and months and all that. It’s all just stuff that we just made it up and we’re all like, “Yeah, that works. We’ll go with that.”
Nick Hanauer: Yeah. I mean-
Trae Crowder: And now July’s a thing.
Nick Hanauer: Obviously, one thing that is real with respect to time is day and night, right?
Trae Crowder: Right. It progresses.
Nick Hanauer: Yes, it does.
Trae Crowder: Space-time exists-
Nick Hanauer: It does.
Trae Crowder: But our whole system surrounding time, the way we talk about it and all that, we just made up.
Nick Hanauer: Exactly. And so in the same way that we just made up the idea that the minimum wage should be seven dollars and twenty-five cents in an hour. When the stock market goes up, that is just the product of our collective greed and fear and imagination. And, indeed, you can monetize that increased wealth. Let’s say if you own a stock for ten dollars and the world all of a sudden decides it’s worth 100 dollars and you sell that stock and you buy a car with the money you made. You know, indeed, you converted that increased imaginary wealth into actual wealth. And, again, if it goes from 100 to 10, then you lost that money. But the thing about the human economy is that it is in our imaginations. In our shared imaginations. And the reason that’s so important is … to understand is that means we can change it. Right? That means we can collectively decide that the minimum wage should not be seven dollars and twenty-five cents. It should be 15.
And we should also decide that it is reasonable for wealthy people to not spend 20% of their earnings on taxes but 40 or 50 or 60%. That that arrangement, that social arrangement, is preferable. So, I hope that answered your question in a moderately reasonable way.
So, Trae, what did you think about answering all these crazy questions?
Trae Crowder: Well I really wouldn’t know because I don’t think I answered very many of them. But I think you did a great job of answering them and I’m just glad to have been here for it. No, I had a good time and I learned a lot and I could talk about this kind of stuff all day. Because growing up how I did … that’s how we got sort of hooked up in the first place is because just by nature of my life experience. I’ve always felt like this stuff is really the key to everything, you know?
Nick Hanauer: Yes.
Trae Crowder: So, yeah. I’m just glad to be here.
Nick Hanauer: Yeah and when we’re listening to these questions and talking about the answers, as you think about it and I’m droning on in my technical way about what’s going on, do my answers surprise you or does it feel like they contravene common sense or?
Trae Crowder: No, not at all. Not for me. Personally, I think it’s just … they have the opposite effect on me, normally. You’ll say a thing that I didn’t know the particulars of but in my mind, I hear it and I’m like, “That totally checks out. Of course that’s true, what he just-“. Because it makes sense to me. It’s the opposite of contravening of it.
Nick Hanauer: Interesting.
Trae Crowder: But obviously, not everybody feels that way.
Nick Hanauer: We definitely … we get hate mail, too.
Trae Crowder: Oh, I bet. I know a little bit about hate mail.
Nick Hanauer: But anyway, thank you so much for taking the time out of your comedy career to come and talk to us and be part of Pitchfork Economics. Super fun to have you. And thank you to all of our listeners from all over the world, which is super cool. Sending a … flipping amazing questions. We got, by the way, hundreds of them, and obviously, we cannot answer hundreds of them. We would be here for like 10 days. But we did the best we could to answer as many as we could and we would love more. And if you have a hankering, please call our number and leave a voicemail. (731)-388-9334. For all you international listeners, I don’t even … what is the country code? Oh, one? I think that’s it.
Trae Crowder: Yeah. What else would it be, Nick?
Nick Hanauer: That’s true.
Trae Crowder: Other than one?
Nick Hanauer: Other than one. We’re number one.
Trae Crowder: That’s right.
Nick Hanauer: We’re number one. So, anyway, in the next episode, Trae and I are going to answer even more tricky economics questions. Thanks again, for everybody, and thank you Trae.
Trae Crowder: Thank you.
Nick Hanauer: And we’ll see you on down the road.
Speaker 4: Pitchfork Economics is produced by Civic Ventures. The magic happens in Seattle in partnership with Larj Media and the Young Turks Network. Find us on Twitter and Facebook at Civic Action. Follow our writing on Medium at Civic Skunk Works and peak behind the podcast scenes on Instagram at Pitchfork Economics. And one more, you should definitely follow Nick on Twitter at NickHanauer. As always, a big thank you to our guests and thanks to you for listening from our team at Civic Ventures. Nick Hanauer, Zack Silk, Jessyn Farrell, Jasmin Weaver, Stephanie Ervin, David Goldstein, Paul Constant, Stephen Paolini, and Annie Fadely. See you next week.