 Good evening everyone. I think we're going to go ahead and get started. So welcome. I'm Jonathan Diven, president of the UT Objectivism Society, and I want to welcome everyone to our debate. Any quality should we care? The UT Objectivism Society is the student organization on campus that is the main source of information about Einrann's philosophy Objectivism, and over the course of each semester we meet weekly to discuss her novels and ideas. So if you find the objectivist ideas you hear tonight intriguing, I invite you to stop by our table if you haven't already done so and sign our email list on your way out this evening. We send out information at the start of next semester about our meeting times. So first off I would like to ask everyone to please silence their cell phones or any other electronic devices that might disturb the debate this evening. I want to remind everyone that anyone found disturbing the debate tonight will be removed from the auditorium by the UT Police Department. In the event of an emergency the exits are located both to the left and right in the front, middle, and back of the auditorium. Secondly, I would like to give a special thanks to the donors who help support this event without whom it would not have been possible. I would also like to thank the Leadership Institute for their support and the paying members of the UT Objectivism Society and the volunteers that put their time and effort into promoting this event. And finally I would like to thank the Aynran Institute for sharing Dr. Yaron Burke with us and also along with Dr. James Galbraith and Dr. Yanis Varoufakis for agreeing to participate in this debate. So thank you everyone. Moderating the debate tonight is Dr. Yanis Varoufakis, a native of Athens, Greece. Dr. Varoufakis is a political economist and author of several books, including the Global Minotaur, Economic Indeterminacy, Modern Political Economics, and Rational Conflict. He is an active participant in the current debates on the global economic crisis and an expert in the Eurozone crisis. He received his PhD in economics from the University of Essex and has held professorships in economic theory and policy at various universities, including the University of Cambridge in England, the University of Sydney in Australia, and the University of Athens in Greece. Currently he is teaching at the LBJ School of Public Affairs here at the UT Austin. He is a frequent guest speaker for different news media outlets including BBC, CNN, Sky News, Russia Today, and Bloomberg TV, among others. So please join me in welcoming Dr. Varoufakis. Thank you very much Jonathan. I hope you can hear me. Yes. The trouble with inequality is that we all believe inequality of something. Even if we find it very hard to pin down exactly what that something is, even those who think that there should be no politically imposed limits or when people can earn as long as they don't earn it through fraud or violence, they believe in the equal right to exert oneself in the marketplace and not to be taxed. Meanwhile, the trouble with egalitarianism is that as Aristotle once put it, you get a Greek, you have some Aristotle in the mix, the worst form of inequality obtains when we try to make unequal things equal. And the worst form of injustice happens when you try to treat equally those who are unequal. Now, turning to our present moment in history, a consensus seems to be emerging that material inequality is on the rampage. It has been for a while now and that it is breaching all the defenses that the new deal and the post-war institutions had erected to curb it. The question is, should we care? Is increasing income and mental inequality a good, a bad, or a neutral thing? To debate this question, we have two men exceedingly well suited to tease out the complexities of this question from two very different indeed to clashing perspectives. On my right, taking the side that we should care about inequality, is Dr. James Galtbraith. Dr. Galtbraith holds the Lloyd Benson Junior Chair in Government and Business Relations and the Professorship of Government at the Lyndon Baines Johnson School of Public Affairs here at the University of Texas. He holds degrees from Harvard and Yale, including a PhD in Economics from Yale. During 1974-75, he studied as a Marshall Scholar at King's College, Cambridge, and then served in several positions on the staff of the United States Congress, including Executive Director of the Joint Economic Committee. He directs the University of Texas Inequality Project, an informal but important research group based at the LBJ School. His latest book, quite pertinently, is entitled Inequality and Instability, a study of the world economy just before the great crisis published by Oxford University Press. A couple of years ago. Galtbraith is a member of the Linsean Academy, the oldest honorary scientific society in the world, a senior scholar of the Levy Economics Institute and Chair of the Board of Economists for Peace and Security. Ladies and gentlemen, Dr. Galtbraith. On my left, taking the side that we should not care about inequality, is Dr. Yaron Brooke. Dr. Brooke is the Executive Director of the Einrand Institute. He received his PhD in Finance from our very own Macoom School of Business and I can see we have some representation here from it. I think University of Texas. He is a columnist at Forbes.com and his articles have been featured in the Wall Street Journal, USA Today, Investors Business Daily and many other publications. He is a frequent guest on national radio and television programs and is co-author of Neoconservatism, an obituary for an idea. He is also a contributing editor, sorry, author, to winning the unwinnable war, America's self-crippled response to Islamic totalitarianism. Dr. Brooke is co-author with Einrand Institute's fellow Don Watkins of the National Bestseller Free Market Revolution, how Einrand's ideas can end big government. A former finance professor, he speaks internationally on such topics as the causes of the financial crisis, the morality of capitalism, ending the growth of the state and American foreign policy. Ladies and gentlemen, Dr. Brooke. Now, let me state the rules as well as my intention to enforce them ruthlessly. Each speaker will be given 10 minutes to make their opening statements. Following this, they have five minutes in which to reply or rebut. Then another round of five minutes each for rejoiners. Immediately afterwards, we shall open the debate to the floor for a Q&A session involving you, the audience. And after the Q&A, each speaker will get three minutes to make their closing remarks. Now, please join me. No, before you join me to do this. I have an idea which I communicated with the speakers and with the organizers and they are in agreement. How about spicing up the proceedings a bit by getting you to raise your hands in favor of or against the proposition for today, for or against the question, an exercise that we shall repeat right at the end to gauge the mood swing of the audience. So, before the battle commences, let me ask all of you to raise your hands if you believe that inequality matters and that we should be worried about it. Thank you. And now, all those of you who think that inequality doesn't matter and or we shouldn't be worried about it. Thank you. Well, okay, neutrals undecided. Okay. Now, remember that, etch this image in your memory because we're going to do this at the end to see what extent of swing we have achieved tonight. Okay, Dr. James Galbraith, you have the floor for 10 minutes. Dr. Varifakis, Dr. Brook, my friends, the question before the house is inequality should we care? My brief from Mr. Diven states that the discussion can cover any form of inequality, including its ethical implications. Dr. Brook, thanks to the position that we should not care, I am to take the position that we should. Now, I am not going to claim that all forms of inequality have ethical implications or economic effects. I could say that but it would be stupid. I only need to argue that some forms and some degrees of inequality have ethical implications or economic effects. Dr. Brook is free if he wishes to disagree with me but he must take the contrary view, namely that there are none. One form of inequality greatly studied by sociologists is called categorical inequality or durable inequality, the title of the book by the very eminent Charles Tilley. These are inequalities based on traits such as race, gender, religion, educational status, citizenship. Some of these do not matter but some of them do. Let me assert for starters that when Adolf Hitler declared the Jewish peoples of Europe to be vermin fit for extermination and their property subject to expropriation, he was declaring a vile form of inequality with plain ethical implications. When Jim Crow in America declared our citizens of color to be legally inferior, unfit to dine in restaurants or use the washrooms, he was declaring a vile form of inequality with plain ethical implications. And when the Declaration of Independence in 1776 declared that we hold these truths to be self evident that all men are created equal, it was declaring a foundational ethical principle to which I hope we are still attached. Those are my ethical points. Let me however not claim victory so easily and turn to the economic issues. I could of course find many economists to argue the other side of the case from Schumpeter to von Mises to von Hayek. But let me cite the one I like best, John Maynard Keynes. In 1919 he wrote of 19th century Britain, it was precisely the inequality of the distribution of wealth which made possible those vast accumulations of fixed wealth and of capital improvements which distinguished that age from all the others. Herein lay in fact the main justification of the capitalist system. For Keynes what mattered was not inequality but behavior, how the wealth was used. On the other hand, when Adam Smith, another imminent economist of great I think continuing reputation, wrote of inequalities occasioned by the policies of Europe, he was attacking monopolies and state charters and barriers to trade which he wrote by not leaving things at perfect liberty occasions other inequalities of much greater importance. And Smith wrote something that I think is pertinent to our own day. The exclusive privileges of corporations are the principal means Europe makes use of for this purpose. Exclusive privileges of corporations granted to them of course by the state. Can anyone of any political persuasion disagree that we should care about inequalities of this type? Can an adherent of the objectivist doctrine disagree? I'm very interested to learn if so how. Let me turn briefly to other forms of inequality that have I think important economic implications and I will make a reference to the book that Yanis Farrak Pakas mentioned, inequality and instability in which the evidence for these propositions is set forth. I have shown I think with both fact and theoretical justification that as a general rule countries which have less inequality in their structures of pay can to enjoy less unemployment. That is contrary to some textbook theory but it is consistent with the facts on the ground. If one looks at the difference between north and southern Europe it is very plain that the northern European countries which are substantially more egalitarian have enjoyed less unemployment over many years than those in the south Italy and Spain for example and this is not accidental. This is not accidental and I think we should care. A second point learned by the Scandinavians long time ago is that more equal wage structures and effective social benefits promote the growth of productivity and therefore living standards. This was one of the major ways that countries like Sweden like Sweden in particular grew rich over the second half of the 20th century. They attracted high productivity industries and put pressure on their lower productivity competitors to close or move elsewhere with the result that the productivity of the whole society rose. They knew what they were doing. There was a specific economic model in the 1950s that laid this out. Closer to home and part of an experience that we have all shared we have learned in the 1990s and once again in 2008 with catastrophic impact that when economic growth is fueled by deeply unequal incomes and the extension of credit in a deeply unbalanced way it is radically unstable. The times may feel good the symptoms may be enjoyable in fact the conditions may be very favorable but they do not last and when they end they end very dramatically and in ways from which it's very difficult to recover. Inequality in that sense leads to busts and debacles. I'm not saying it's a cause and effect relationship but rather that inequality and instability are really just two aspects of the same phenomenon and should we care about that I think we should. All that said do I have a problem with the ordinary accumulation of wealth through business and innovation and technological change? Not really. I am firmly with Schumpeter on this point. There are social benefits to having small numbers of big prizes and to having many more people think they have a shot at them than is actually the case. That is a formula that we have used very successfully in this country to promote technological change. Where does the problem come in? The problem plainly comes in with inheritance, with the next generation, with dynasty, with plutocracy, with oligarchy, the curse of the favored sons. I don't object to having Mitt Romney but five more Romneys coming down the pipe. That's to me a little bit too much. I know, I have 57 seconds left. What is the cure? The cure is an established institution in these United States. It's the estate tax which has and could still incentivize the transfer of wealth from the living. Well, for example, to this university, creating much greater equality than existed before. It's, to my mind, a great solution. It's the American way. I have one other substantive issue that I would like to bring up. I will wait and see if it's appropriate to do so in the next round. Let me just close with Adam Smith once again who wrote, wealth as Mr. Hobbes says is power. Say it again, wealth as Mr. Hobbes says is power. Thank you, I rest my case. You have the floor. Thank you all for being here. Thank you, Divin, for putting this on. So let me start with where we're going to agree with the quote from the Declaration of Independence that all men are created equal. What does that mean? What do they mean when they say all men are created equal? All men are not equal. Look around you. We're all different. We're all unequal in almost every attribute we have. Some of us have genes for being talented in math. Others are great artists. Others are just mediocre and some people are not very good at math, art. Business, whatever. We're all different. It's one of the wonders of life. It's one of the great things about being alive is how different unequal we all are. The founding fathers weren't ignoring the metaphysical fact of inequality. So what do they mean when they say all men are created equal? Well, what they mean is a political statement. All men are created equal in rights. All men are created equal before the law. The only sense in which equality has meaning. The only sense in which equality is a valid political concept. The only sense in which equality leads to anything actionable that is moral is equality of freedom, equality of rights. We all are free. And again, this is written in a context of a Europe in which this is not true, in which aristocrats and peasants are treated completely differently before the law, in which they are slaves and masters. Unfortunately, that also sustained itself in the U.S. for way too long. But the principle is that we are all born equally in terms of our freedoms, in terms of our rights. We all have a right to life, liberty and the pursuit of happiness. And what does a right to life mean? It means the right to be free of coercion. It means the right to live your life as you see fit, as you see fit, free of your neighbor sticking his hand in your pocket, free of your neighbor committing fraud or stealing from you, trying to murder you, free of coercion from your neighbor. But it doesn't matter if your neighbor gets everybody together and they vote to take your money, to steal, to control. That's still coercion. It's a free of governmental coercion as much as free of coercion from other individuals. That is the equality that has meaning. Equality of freedom from force, from freedom being caused by other people, including primarily, if you read the founding fathers, you know how much they warned us against coercion from government. Government is the most coercive entity in the history of mankind. So what does that mean in terms of the other inequalities? It means that, of course, government should not discriminate. So let's take the Jim Crow laws as an example. It means that those should have been ruled unconstitutional because they don't treat people equally before the law. They didn't treat people in terms of equality of rights. But what does that tell us about economic inequality? It tells us that coercion should be out. It tells us that the government has no role in economics because the government is power, is force, is coercion. Taxes are force. Regulations are force. Government controls are force. So government has no role in dictating our lives. Government has no role in determining what is the right level of equality or the wrong level of equality and what's good about equality or what's bad about equality. Equality is not relevant in the economic sphere. And in that sense, inequality, economic inequality, wealth inequality, inequality in the economic sphere doesn't matter. I don't know what the right level of inequality is. It's whatever the market produces if it's a market. So in a marketplace, how does inequality come to be? Well, inequality is a consequence of the division of labor. It's a consequence of trade. It's a consequence of specialization. It's a consequence of the creation of values. Do I care that Bill Gates is about, I try to calculate this, 15,000 times richer than I am? Yeah, I care. I think it's wonderful. Because it's a sign that he's created about 15,000 times more economic value than I have. And I celebrate that because I benefited from it and so did all of you. You should all be happy that Bill Gates is really, really rich because the only way to become really, really rich in a market economy is to create, it's to produce, and you all benefit from that creation and that production. So we should celebrate inequality when it is a consequence of free exchange in a free market. Wealth creation, not wealth redistribution, is what free markets are really about. So inequality in that sense is an enormous virtue. It's just an indication of the level of production, of the level of value created, of the level of value that is being traded. So why don't you be envious of the rich? Why don't you celebrate them? I know, it's funny. So what is the problem? Or is there a problem today? There is. There is a problem of inequality today. And the problem of inequality today is that we have coercion all around us, that we have government that redistributes wealth from poor to rich, from rich to poor, from middle class in both directions. We have government that doesn't leave us alone. We have government that subsidizes the rich, that sets interest rate policies that hurt savers and benefit stockholders who happen to be typically wealthy. We have the government that decides on distribution of assets of wealth. We have a government that sets a minimum wage that makes it impossible for young, unskilled teenagers to ever get a job and therefore ever rise up and become wealthier. We have a government that holds back the poor, supports some rich, hurts other rich, does all kinds of stuff to the middle class and who knows what impact that has. In other words, we have today a distribution of wealth that is not determined, unfortunately, completely by the free market. We have a distribution of wealth that is a mixture, a mixture of freedom. Many of these rich people like Bill Gates and like the guys at Google like J.K. Wallins. You know how much J.K. Wallins is worth? You know the author of Harry Potter? I mean, she made over a billion dollars from that. She's a billionaire. How cool is that? She wrote a bunch of books that kids read in an era where kids don't even read. And then she licensed and made fun movies and created games and she made a billion dollars. Good for her, right? So there's some the way you can see the value, but then there's all the other stuff that clouds the picture. So if inequality bothers you, that kind of inequality, and I don't think that's the kind of inequality that is really the problem. With my opponent. If that's inequality that really bothers you, the solution is let's get rid of all that. Let's get rid of the cronyism. Let's get rid of the taxation. Let's get rid of redistribution of wealth. Let's get rid of welfare where we institutionalize people into poverty and again incentivize them not to work and not to succeed and not to rise up. Let's get rid of the Federal Reserve, which is, you know, manipulating our wealth distribution in all kinds of perverse ways and is much more at fault, in my view, for the financial crisis than is the distribution of wealth. Oh, by the way, let's just take up that a second. I mean, it's kind of funny because what are the causes of the other financial crisis, in my view, is the attempt by government to reduce inequality by providing cheap housing and cheap mortgages and heavily subsidizing mortgages to lower income individuals. So yes, let's get rid of government intervention in economy. Let's return or achieve a new height of freedom, of capitalism, of free markets, in which coercion is eliminated from the marketplace and where, therefore, inequality is what it is because it is a reflection of value created. That's the world I would like to see and the world I think we should be striving towards. Thank you all. Well, the first round has been concluded and it's very exciting it was. And now we're going to move into an even more exciting round of rebuttals. Each speaker will have five minutes to offer a rejoinder and then another five minutes. So there will be two five-minute sections, segments per speaker beginning with Dr. Galbraith. Well, let me begin by thanking Dr. Brook for conceding the points that I made in my opening remarks, which I think established that there are important elements of inequality about which we should care, which is the proposition of the debate. He made reference to the Declaration of Independence, which was written in the time of Jean-Jacques Rousseau, whose discourse on the origin of inequality makes the distinction between the natural inequalities about which we do not caval and the social inequalities to which we properly object. He spoke of the importance that people should be born equally and that phrase created equal in the Declaration of Independence. But of course, as I said in my opening remarks, there is an important respect in which people who are born equally are not born equal. And that is the distinction between those who are born with the proverbial silver spoon in their mouths and those who are not. It's a straightforward distinction. And that strikes me when it becomes extreme, you can't avoid it to a certain degree, but when it becomes extreme so that power is entirely concentrated in the hands of those who have the most, that that is a problem about which we should care. Dr. Brook made an equalification which exists nowhere in the terms of this debate, which said if it's a market then we shouldn't care about the inequality. Now you can accept that proposition or you can reject it, but it is not a qualification that we agreed to for the start of this debate. And Adam Smith's citation that I gave with great approval was specifically to major forms of inequality which are brought about by state action. Now on the point of fact, Dr. Brook remarked that Bill Gates is a multi-billionaire thanks to the market. Well I beg to differ, Bill Gates is a multi-millionaire thanks in part to the market and thanks in great deal to the protection of the patent laws, which are a monopoly granted by the state for the software that would run on the IBM personal computer platform. It's plainly a state action that has created that degree of inequality, but it's also plainly a state action which has reduced that inequality by inducing Bill and Melissa Gates to make an enormous gift of the major part of their fortune to a foundation, which is now engaged in great works including the construction of buildings within a hundred yards of right where we stand now. And I'm entirely in favor of that. I know why in part what I did it, I mean certainly they had good motives, but also they faced an enormous tax liability if bad things happen too soon. And that was Teddy Roosevelt's idea in advancing the estate and gift tax to begin with. On the question of J.K. Rowling I'll ask you to be careful. J.K. is not really her name, it's her pseudonym. And when she went into mystery writing, as I'm sure you know, she adopted the name of Robert Galbraith. If you take the J.K. on the one hand and the Galbraith on the other, I invite you to contemplate what you have, and I can tell you that's not accidental. She is definitely on our side on this question. My family is extremely pleased with that particular homage to my father. I want again to raise, I have a very, just a minute left to raise one other area, which seems to be very important because societies need to care about whether they survive. And on this subject I did some research some years ago with several of my student collaborators and we came to a very interesting conclusion which was published in a referee journal, which is that when it comes to the ultimate test of social survival, which is war, if you pair up countries which are more equal with those that are less equal and look at the outcome of the war at the end, you find that in the vast majority of cases, in fact it's very difficult to find a counter example that the more egalitarian society prevails. Why is that? Because equality is a military virtue, soldiers fight for each other and they can withstand a great deal more punishment if they're doing that than if they are slaves fighting for a master. When I come back I'll make a few extra observations on that ground but it seems to me to be an important, important further point. Thank you. Your five minutes are beginning now. Thank you. So the issue of property rights. One of the rights that have acquired in order for life to be successful, for life to prosper, is the right to property. It is not a right granted by government. It is a right protected by government. The only purpose of having a government, and I'm not an anarchist, I believe we need a government, but the only purpose of that government is to protect our rights, including our property rights. Patents are just property rights. Property rights over a particular form of property. So yes, the state has a role there, but it isn't something that it's granting, all it is is protecting. And without that foundational protection of property rights, markets don't exist. The foundation for markets is the idea of property rights, the idea that you have a right to use your money and your property as you see fit. Of course, Dr. Gilbert would like us to ignore property rights, particularly of very rich people, particularly as they approach death. So it's not their money anymore because they're about to die. And we get to decide what to do with it. Again, we get to curse them into taking their money and distributing how we see fit, which is, I think, bizarre to claim the money that Bill Gates created, that Bill Gates made. Why shouldn't he get to decide what to do with it? He has chosen to give it away to charity. I happen to think not the most productive choice he could have made. He clearly benefited mankind by orders of magnitude many, many times over by creating Microsoft that he will ever achieve through philanthropy, ever achieve through philanthropy. That mankind today lives at the high level, the high standard of living. We're not starving in America not because of philanthropy, not because of charity, not because of community service, but because of business, because of profit, because of entrepreneurship, because of the creation of values, because people out there working hard to make money. If Bill Gates had continued his career for another 30 years making money, he would have made the world a better place by orders of magnitude better than giving it away to charity and building buildings and sending it off to Africa as far away. So nobody can accuse him of being self-interested, God forbid. So he sends it off, he doesn't even put it into Seattle, which is close to him, because then he'd be accused of being self-interested as being... So inheritance taxes are just another form of government trying to determine what's right and what's wrong, how you should use your money, how much money is good for you, how much money you should own when you die, how much is good for your kids to stay inherent. Why not leave that to individuals to make decisions about? It's not government's right, it's not government's place. Government has no role in dictating any of those kind of decisions. So on top of that, the idea that we today are dominated by an elite that has inherited their money, it's just plain wrong. If you look at the Fortune 500 list, very few of the names there, and all recognizable names say yes, you can cite the list, and suddenly very few of them inherited wealth. A vast majority of entrepreneurs who built it, who created it, whether it's the founders of Google or the founders of Amazon or the Bill Gates, we still live in society still because we're hampering it by government controls, by regulations, by taxation. We still live in a country where vast wealths can be created, where entrepreneurial initiative, where entrepreneurial energy is still rewarded, where value creation is still rewarded, and that is the predominance of the wealthy. If you look at how many of the 0.1% of entrepreneurs who made it, it is an overwhelming majority. So this idea that we've got these families that are out there conspiring to rob us of everything, it's just science fiction, it's just not true. There are some families like that. If they don't watch it, that is if the second generation isn't wealth creating, they tend to lose their money pretty quickly. Thank you. Dr. Gobrayth, you have another five minutes. Well, one brief observation on that, which is that I don't believe that the Fortune 500 is the right place to look. The wealthiest 500. The wealthiest 500, the Forbes 400 or whatever it is, is the right place to look for the idle scions of the great entrepreneurs. The right place to look is the United States Senate. What could be more obvious than that? And the question then is, do you think you should care about the fact that the United States Senate is dominated by the idle scions of the last generation of the wealthy? I have a problem with it. I have a deep problem with it. I think we should care. But look, let me go back to the point that I was making, that we can ask Mr. Brook to try to refute, which is about this question which I think is of great interest as to what happens in the existential struggle between societies as the balance of equality and inequality shifts. I'll just read a few bits from the paper. World War II presents a plethora of comparisons. The USSR against Germany, the United States against Japan, the United States against Germany, and Italy, Great Britain against Germany. In all of these, the plausible case is that the more egalitarian country prevailed. The Korean War provides an interesting case. The two countries engaged were both very egalitarian. The newly established People's Republic of China and the United States. The result of the war was a stalemate. In the 1950s, in Vietnam and Algeria, egalitarian movements chased the French away in spite of the fact that they were far poorer and less well equipped. One can go on through an enormous number of cases which we have done and our conclusion is what is striking is not how easy it is to make a plausible argument for the thesis that equality conveys a strong military advantage but how hard it is to identify opposing cases. And so we went back in history and I can't resist quoting this because in honor of our Athenian moderator, we have Herodotus on record as saying it is not only in respect of one thing but of everything that equality and free speech are clearly a good, take the case of Athens, which under the rule of princes proved to be no better in war than any of her neighbors, but once rid of those princes was far the first of all. Or one can talk about the sack of Rome by Alaric. In AD 410, Procopius of Caesarea gives an account of just exactly how it happened. Among the youths in the army whose beards had not yet grown but who had just come of age, Alaric chose out 300 whom he knew to be of good birth and possessed of valor beyond their years and told them secretly he was about to make a present of them to certain of the patricians in Rome pretending that they were slaves. And he instructed them that as soon as they got inside the houses of those men they should display much gentleness and moderation and serve them eagerly in whatever tasks should be laid upon them by their owners and be further directed that not long afterwards on an appointed day at midday when all those who were to be their masters would most likely be already asleep after the meal, should all come to the gate called Solarian and with a sudden rush kill the guards who would have no previous knowledge of the plot and open the gates as quickly as possible. Thus fell the great Roman Empire in AD 410, the sack by the Goths. It's plain that there is a deeper question here. This is that when you allow inequality to go too far, it's not just that you're creating moral questions or ethical questions or economic implications. You are really cutting at the viability of the society as a whole, its capacity to govern itself, its capacity to defend itself. And you are opening it up to a vulnerability, a vulnerable challenge military or otherwise by other societies which take a different view. Thank you very much. And now Dr. Brook is going to complete the second round with his final five-minute section. Okay, clock's set. So I, you know, I don't know where to start with those historical examples because there's so many variables there, but it looks like again we're conflating different forms of inequality. It is true that throughout human history people who are free defeat people who are slaves. Countries that respect the individual's freedom do better than countries that do not. The USSR won World War II to the extent that it won it because America helped it because the freest, most successful country in human history, the country that is least tried particularly in the 19th century, least tried to repress economic inequality was the one that helped out the USSR. The USSR would have been thoroughly defeated if not for the United States helping out, helping the USSR in its battle against the Germans. So yes, equality before the law, equality of rights, freedom of the individual is vital, absolutely. That's what makes a society moral, it's what makes society right. But this is the problem, that any attempt to reduce inequality, any attempt to reduce inequality of outcome, of any form of outcome, requires the violation of those individual freedoms, requires that we take from some and give from others, therefore making them unequal before the law, unequal in rights. How do you make me and Michael Jordan equal in basketball? You haven't seen me play, but let me tell you, the only way to make us equal in basketball is to break Michael Jordan's legs. But that's probably not enough, because I'm so bad you'd have to break his arms too. My point is this, any attempt to bring about equality or more equality or less inequality of outcome, necessitates, necessitates the breaking of people's legs. Taxation is breaking people's legs, you're stealing time from them. What's more valuable in life? I take my legs, I'd rather have more time. The government today steals 50% of my time. I work, my blood, sweat and tears, my life, 50% of it goes to the government. That's worse than breaking Michael Jordan's legs. So any attempt to control, to regulate, to manipulate, to redistribute in the name of equality and the name of reducing inequality necessitates the violation of the one sense in which equality is crucial, is important, is fundamental to our lives. And that is the sense in which we are free, the sense in which we have a right to pursue our lives. We have a right to the pursuit of happiness. So that is the fundamental ethical question. Let's say you care about inequality. What right do you have to impose your vision of what an equal society should be on me? That's the ethical question. I say you have no right. I say you don't have a right to my money, to my stuff, to my goods, to my life, to my time, to my legs. You don't have a right to that. And in freedom, if we leave each other alone, if we are allowed, then whatever the inequality is, it is. And if you are unhappy by the fact that some people are poor, that some people are not doing well, then you, like Bill Gates, can write a big check and hand it to them. Nobody will prohibit you from doing that. The question is, do you have a right because somebody died rich to take his money and give it to them or just to take it from me because you feel like it? Because I happen to be part of the 5%, 10%, 1%, 0.1% or whatever you decide are the bad guys. So those are the key ethical questions. Do you have a right to your life? Or does the group, the society, get to decide your life for you? 30 seconds. And Mayan says, your life's yours. I don't get to decide your life and you shouldn't get to decide for me. Your money's yours. I don't get to decide how you spend it. You shouldn't decide for me. As long as we're not violating other people's rights, as long as we're not making money through fraud or through coercion or through stealing, you have no business intervening. You, whether as an individual or just because you get into a group and vote on it, doesn't make it right. Thank you. So we are now at the gates of the Q&A. Not of Rome. At the moment when you will get to ask your questions. If you have a question, please line up. There will be two microphones. I only see one at the moment. There must be one line on that side. You have to line up. Get up and line up. There will be two microphones, one on that aisle, one there. Let me state very bluntly the rules of the game. We shall only be taking questions. We shall not be entertaining statements, position papers or speeches. So please confine your question to just one or two sentences. You may direct your question to one of the speakers or to both speakers. And then once your question has been asked, the speakers will have two minutes each to answer your question. Now we seem to be having two queues. Perhaps we can start. You had questions. I can ask questions too, but let me just give the floor to the audience in a spirit of liberalism. Small and liberalism. So let's start from you, sir. Okay. Is this on? So if we imagine a society in which the government exists only to protect property rights, but it happens that markets concentrate wealth upward in the society and the government protects the rights of those who gain more and more wealth over the course of time. And it turns out that over the course of time say 90% of people in the society work for 10% of people in the society who own the entirety of the means of production. Everything like that. Sorry to use a Marxist term on you. At what point are those 90% of society no longer bound to be subject to a government that in no way represents their rights, in no way represents their interests and only represents the interests of people who own the means of production and own wealth because property has become the only part of society that you're interested in protecting. So at what point are those 90% of people justified? So are you directing this question to a particular speaker? I'd like to hear from both. So let's begin with Dr. Galbraith. Two minutes. I think it's an excellent question. I think there are many rights in society that government exists to protect and many conditions that it exists to enforce including the very fabric of modern economic activity which depends on public regulation of safety, of working conditions, of the environment, of the wholesomeness of goods without which the markets would collapse. So there is a broad base of public functions and when the government moves to the kind of position you describe, which happens periodically in history, then it is appropriate for the government to be replaced. And that is a way in which society expresses that it does care about the inequalities that have been created and is prepared to act to reduce them. And we've seen this in the United States and in every other country on repeated occasions. Dr. Brook. So that's science fiction. It has never happened in human history in spite of... And yet you advocate it. It's never happened. Yet you advocate it. No, it's never happened and 90% of the wealth gets consecrated in the hand of a few. That just doesn't happen. It's not the way capitalism works, it's not the way markets work and indeed it's never happened. It's never approached that, it's never come close to that. And yes, there are other rights. There's only one right in a sense and that is the right for you to live free of coercion. That right doesn't disappear if you're poor and it doesn't disappear if you're rich. That right is equal and that right implies a right to property, whatever property it is, a right to speech, a right to be free, a right to act on your own behalf, a right to act in the pursuit of your own values. It excludes other people's ability to take stuff from you. So I'm advocating for free market. I'm not advocating for any particular distribution of wealth. But markets do not work in a way that concentrates 90% or 80% or whatever large number you want to choose in the hands of a few. And it's never indeed, even in places and times where we've approached free markets. American in the 19th century, Hong Kong today or during the 20th century, you do not get those kind of distributions of wealth. And I completely disagree that the fabric of markets depends on regulation. You need regulations of what are destroying markets or what are reducing the ability of markets to function efficiently and productively. Thank you. The gentleman, if you could state your name before you ask your question. My name is Trevor. I've enjoyed this discussion. This has been mostly theoretical but putting it down on our level of maybe the average UT student, the most visible examples of inequality is basically brands that have basically the same utility value. You know, this guy's car, this person's shirt. Is there any way we should do things to correct this? I mean, I read a statistic recently that 92% of women in Japan over 25 have bought a purse that's worth over $1,000 US. Should we do stuff to correct this sort of inequality to make us all look and feel more equal? Thank you. Are you addressing this to a particular speaker or to both? Both. No. Brevity is virtue. No. I mean, if it bothers you, then you're free to try to educate them that this is not good use of their money, but that should be a voluntary decision. Next question. Yes. Jim Bryce. I live here in Austin. This is a question I directed both of our speakers. Excellent debate so far because I think I've heard both speak of the issue of inequality and the value having to do with the inequality and the gathering of wealth based on the productivity which is contributed to society by the effort of that person making a great deal of wealth. And we heard an example of Bill Gates, which is an excellent example. All of us are in one way or another using those products, whether we use Apple some of the time or not. We're still involved in that. But my question goes to situations in which great deals of money are made and I think what we've seen in the last decade through something other than what appears at least to those who are perhaps naive such as myself less than productive overall. I'm talking about the manipulation of financial market instruments, the money system, and the acceleration of information actually getting now a millisecond ahead of one trade forward leading in the market so one can take through arbitrage an advantage. Those don't appear to provide the same social productivity that creates wealth throughout the society, rather only for the pockets of a very, very few cane-y folks who also have particular advantages and regulations and taxation they might have discussed with various government officials. Dr. Brook. So I think you have to separate two issues here. One is the productive value of finance, which in my view is enormous. You do not get production, you do not get industry, you do not get the creation of a labor without capital and without bankers and without financial markets and financial institutions that fund it, that regulate it in a sense of deciding who gets the capital and who doesn't, allocating it, making those decisions efficiently. So productive free financial markets are the most essential feature of a capitalist economy and without it we would not have the wealth that we have today. Now it is absolutely true that the financial system in the United States is massively regulated and controlled and to a large extent those regulations were initiated by the industries themselves. I'm not just saying it's not somewhat their fault, but they're massively regulated and we don't have a free market in finance which is the great tragedy of our lives. I was just mentioning a book that just came out recently called Fragile by Design. We have designed our financial markets. Our politicians have designed our financial markets to be fragile. They have designed them badly and they've created perverse incentives within them. But the actual activity, take high-speed trading, high-frequency trading, I mean it's incredibly valuable. It makes the markets more efficient, faster, prices are more reflective of information, quicker allocation of capital gets done better. Now it's regulation that makes it possible for them to make so much money off of this and that regulation should be abandoned. So I believe in free financial markets just like free markets generally. Thank you very much. Dr. Galbraith. Professor Bryce, I'm afraid you're of my generation where we believe that a millisecond is a short unit of time. In fact in this business there are three orders of magnitude beyond that in the high-frequency business. What happened, first of all, on the question of relationship between financing and equality you're completely right. The major driver of increasing income inequality in the U.S. shown in tax records is the financial sector, was the financial sector up through the backhoe in 2008. And that's very clear of the data. What happened in the financial sector was a sequence of deregulation in the 1990s under the Democrats, desupervision in the 2000s under the Republicans in which the investigators into financial fraud were systematically withdrawn from the beat and the industry was given very clear signals that loan underwriting would not be supervised or enforced. Fraud became utterly rampant. Major company AmeriQuest was known for giving its loan officers crystal meth amphetamine to improve their aggressiveness in marketing loans to people who could not pay them. I asked a prosecutor once whether he thought that reflected an honest business practice and he said he was skeptical. In the current administration we've seen the third stage which is decriminalization in which massively fraudulent financial operations including the laundering of hundreds of millions of dollars of Mexican drug money was not sufficient to bring the Department of Justice down on the back of the perpetrator, a bank called HSBC. So we have a situation in which we have the plain results of a deregulated financial system which is nobody has confidence in it. And everybody stays in cash and insured deposits to the extent possible and the economy remains in the doldrums. That's the consequence of the policies that we've been pursuing for the last 20 years. To the next question, the gentleman on my left. Hello my name is Jonathan Guzmán and there seems to be a fundamental disagreement as to what constitutes a human right on both sides. So I'd like to ask both speakers to define the term human right to the best of their abilities as well as provide an explanation as to why you would define it in that way. Dr. Brook. So in my view, individual rights which is the term I prefer, individual rights arise from the requirements of human life. Human beings need to be able to do one specific activity well in order to thrive in order to be successful and that is to use their mind to reason. The enemy of reason once you get into a social context, once you get a group of people together is other people's coercion. It's other people imposing their will on you by force. Individual rights is a concept that arose in the social context to protect that individual's use of his mind, farm coercion. If you have a gun placed in the back of your head, thinking is irrelevant. If I tell you 2 plus 3 equals 5 or I shoot you, you can't program, you can't build a bridge, you can't do anything. So we need in a social context, we need the idea that you are free, you are free of coercion and that's what rights are. Rights are the recognition that man's survival requires that he be free to act based on his own judgment. That's what a right is. So you cannot have a right to somebody else's stuff. So you can't have a right to health care because that means the doctor then becomes your slave. He has to give it to you whether you can pay for it or not. You cannot have a right to food because that means whoever produces the food has to give it to you. They're your slave. You can only have a right to act in order to pursue those things as long as you're not violating other people's rights. You only have a right to act on behalf of your life. Thank you. The gentleman. Yes. Oh, sorry. That is my error. Dr. Galbraith, I left you out. It's a very deep question. I do not accept that human rights are entirely defined in individual terms or that any society is free from what my distinguished colleague calls coercion. I believe that we in the modern world we operate in a web of mutual obligations and that a progressive society society that is making progress toward a higher level of achievement extends from time to time new protections to its members. And so I believe that Social Security, unemployment insurance, Medicare, Medicaid, and even the rather clumsy Affordable Care Act, I could be argued out of that one, but were at least efforts to provide a higher level of freedom to a greater number of people. And that strikes me if you are sick and poor to be a very valuable thing, something which from that perspective you are not going to despise. Thank you for having me. My name is Michael Sines. This is directed primarily to Dr. Galbraith, but I would appreciate both points. I'm a big fan of Jefferson as well. And one of the famous things he says is he talks about some people who think that the individual is not fit to rule himself. Do you think the individual, I'm assuming he means, you know, economically as well, right? Do you think that the individual is fit to rule himself or have we found angels in the form of kings to govern us? I guess my answer to that is I believe nothing is absolute in that respect. Yes, we are fit to rule ourselves jointly. We set up institutions that help legitimize the decisions that we make as a society. And then when they are made, we have an obligation to respect them unless they are manifestly unjust, in which case we have an obligation to resist them. So we have moral choice even after rules are made, but by and large the society works because most people stop at the red lights most of the time. Dr. Rook. So I believe people are fit to manage their own affairs and that any attempt to kind of get together and decide what our face should be involves by definition forcing a minority in order to accommodate a majority. Somebody once described as two wolves and a sheep deciding what's for dinner. My name is Glenn Washburn and I wanted to ask, so wealth inequality appears to have a particularly influencing factor in the justice system. Those who have more money can afford better lawyers to have a better defense or, you know, better the other side. Is this kind of inequality an actual problem and if so is there anything that we should do about it? And I'd like both to respond. It is certainly a problem. And that problem was addressed 50 years ago at the outset of the war on poverty by creating legal assistance, rural legal assistance in particular. Was something my brother was involved in to assist the farm workers of California, for example. So it is exceptionally important that we have a system which counterbalances to some degree the advantage that the wealthy have. If your public defender cannot stay awake in the courtroom, your chances of prevailing are very much impaired. That is why those programs have been the targets of the wealthy since their creation and have been paired back to the point which they are, they still have very valiant people working in them, but they are not nearly as effective as they could be. Will we ever finally level the playing field? No, frankly, we'll never entirely level the playing field, but we could do a better job than we do now. Dr. Brook. Yeah, I mean, I agree that it can be a problem, that it is often is a problem, and that it's the responsibility of the justice system as the place that is there to grant equality of rights to resolve the problem as much as they can, to the extent that they can. Thank you. Sir. Yes, my question is directed to Mr. Brook based on your introduction, your introductory statements or your first turn. In regards to some of the situations that you mentioned, a couple of the people you brought up is successful, people who had been successful in the market, and who, you know, you identified that as a positive thing and said this is something to be happy about. Well, in reference to that, I mean, there's the names you mentioned, and there's, you know, a lot of us in here come up with names who are, you know, some of them are cultural heroes and, you know, so that's happening. That thing that you said, you know, that there is this thing is going on and people are able to prosper some people at least, and we have these success stories. And the other things they've gone on to do, you mentioned what Bill Gates was doing with his time, but we also know people who are investing in technology and other social causes. So it's going on a little bit. It's going on a lot. How much more? I mean, and it's not rhetorical. My question is mainly to you, Mr. Galbraith as well. So I think I get the question. Yeah, so there is wealth creation out there. There are people who are becoming rich. They're just not enough of them. And the fact is that even those people who are becoming rich, their rights are being violated left and right by taxation and regulation and restriction. But let's shift it a little bit. Let's change the concern to the poor. I'm very concerned about ambitious poor people in America. I think our policies that are so-called there in order to reduce inequality are hampering the ability of young people to achieve, to be successful, to rise up, to make money. I think the welfare state is, the whole world poverty is a disaster for poor people, for poor people ambitious, for poor people who want to work, for poor people who want to have a successful life. I think you institutionalize them into poverty through all these mechanisms that we talked about how wonderful Social Security, Medicare and so on are. There are mechanisms by which they'll institute you guys into poverty. Basically, Medicare and Social Security are massive taxes on young people so that old people can have, not have to save and have a retirement and have healthcare. But if you look at unfunded liabilities, your taxes are going to have to go up fourfold in order to fund it. You're the sacrificial lambs of future generations. So the problem today is there's not enough entrepreneurship, there's not enough wealth creation, there's not enough social mobility. And the causes for that are all the programs being instituted in order to reduce inequality. Dr. Colbert. You know Social Security raises a lot of children in this country. About one-third of the benefits paid under Social Security are paid out to dependents and survivors. About a third. People whose parents and means of support disappeared. It's an insurance scheme. It raises a lot of children in this country. It's not just a transfer from the young to the old. And I believe, you know, I'm a little bit, I've become in my old age a supply sider. I believe in incentives. I believe if you pay people to stay alive, they live longer than if you don't pay them to stay alive. We have a great many old people in this country who simply would never be there. Had Social Security not been enacted in 1935 when the life expectancy was much lower than it is today. We have a great many old people in this country who would not be there if they did not have Medicare picking up the bills for healthcare. And the population of the country understands this very well. Those are people, by the way, who in order to be eligible for Social Security have worked. They have paid in. They've paid in to Medicare. They have bought it. They own it. It is simply an asset, a part of their wealth, which the government manages and does so in a very efficient way on a nonprofit basis. I don't see anything that impairs individual freedom there and a great many things that extend it. And I would comfortably put that proposition to the test of the approval of people who are on Social Security, who are parents who are on Social Security, or who expect to need Social Security later on in their own lives. Thank you very much. At this point I am going to make use of the highly unequal privilege bestowed upon by the organizers to utilize my moderator's prerogative and ask a question to each of the speakers. After that we have a constraint of ending the Q&A in about 10 minutes from now. So I am going to take two more questions from each side and apologies for the rest of you who have lined up. So my first question goes to, well, who knows, Polklad. So, Dr. Brook, you mentioned, you raised a very evocative picture of a person, of an individual, at gunpoint and you said quite aptly that when you are facing a gun in your head, you don't think very clearly and you lose a large portion of your capacity to act freely. Be that as it may and of course no one would disagree with that. Might one not also say that someone, a parent who has difficulty putting food on the table and has a hungry child is open to abuse within the marketplace. Desperate people perhaps would accept desperate terms that instead of manifesting themselves as examples of contractual freedom represent nothing more than enslavement through contract. No, I think that somebody who is desperate is seeking out a situation that makes him less desperate. So whatever transaction, whatever contractual relationship they come into with somebody else, they are seeking to better themselves. Whether you as a side, as a bystander think, oh, that wage is way too low, they are viewing it as an improvement in their life otherwise they wouldn't take the deal. Now are they at an inferior bargaining position? Sure. We're all in various bargaining positions all the time. But the point is this, there's a lot of suffering in the world. A lot of people in dire straits have starving kids. I mean luckily in America not that many, but there are people and under capitalism I believe there would be a lot fewer. But does the fact that you're starving give you a right to pull a gun and take my stuff? That is the fundamental question. Does the fact that you need something, that you desire something give you a right to somebody else's ability? So we talked about this idea of a progressive society, we expand the things that we give people. But who's expense? It's at somebody's expense, it's always at somebody's expense. So if my neighbor's sick, and I'll end with this because I know what time constraints, my neighbor's sick and needs a procedure, his child is sick, whatever. And he doesn't have the money to have it and there's no, he has two options. He can come to me and ask for the money or he can pull out a gun and take my money. Those are the only two options, charity or force. The fact that he goes to the neighbors and gets all the neighbors to vote to take my money doesn't make it any less force and any less of theft. So it's charity or force, those are the options placed. I am unequivocally always against force. I want people to interact with one another on a voluntary basis, recognizing completely that we don't have equal bargaining power, that there's going to be asymmetries of information and asymmetries of opportunities. Thank you. And now a question, and now a question to my esteemed colleague, Dr. Galbraith. Dr. Galbraith, given that an increasing portion, an ever increasing portion of income and wealth is becoming immune to taxation through creative accounting and the utilization of various means and methods. Are you not being forced to rely too much on inheritance tax in your pursuit of programs for lessening inequality? And isn't that slightly problematic from an ethical and philosophical point of view in the sense that it is a little bit like condoning gross income inequalities amongst those who actually earned during their lifetime. Those vast sums. And stepping only at the moment of their death and preventing them from passing this on to their sons and daughters. I don't have an ethical problem with stepping in at that moment. I think if you have an ethical issue here, it should recognize the value of the accomplishment and give an incentive for people to pursue those big prizes and great gains. But I don't see how the children have the same ethical right to the fruit of that. I don't think we live or should live in a society which is primarily dynastic. That strikes me as being a fundamental problem of inequality. We should have a society which so far as possible, people from whatever station at the starting point have an equal shot at the big prizes. That strikes me as a very basic principle. We're never going to achieve it perfectly. The inheritance tax has been for a century a very useful way, not present in Europe by the way, that the United States does this. This is a very American institution and we all, every one of us here in this room, is an enormous beneficiary of it because the institutions to which money comes are public institutions from either public or private from which we all benefit. Now on the question of taxation, yes we need other instruments as well. I'm not against the income tax. That's been around quite well established since 1917. I think that the principle of taxing land value is a good principle, principle of taxing rent. You don't want to tax wages, you don't want to tax capital, but taxing rent taxes a form of property rights and causes people to make economically effective use of their real property. That is a very, it strikes me very sensible approach and has been for a century. Of course, big property opposes it dramatically. So you have to fund government and you do have to fund it. I would suggest that it is sensible to tax those pieces which are least active economically and leave those pieces which are most active somewhat alone. Thank you. Because of time constraints, I propose that we take four questions, two from each side, one after the other, and then our speakers get an opportunity for a Blitzkrieg answer to all four of them before we move to the final round, which will be the round of the closing statements by the two sides. So if you can please ask your question, make it very succinct. Okay, so my name is Gary and this question is for Dr. Brooks. And so you said that Bill Gates creates economic value, but how can people who are at or below the poverty line seek to create economic value when they don't have the quality of freedom, when they are imprisoned by history, when the black African Americans who live in the U.S. have been imprisoned by the history of the past, they were enslaved and Jim Crow laws and they don't have the opportunity in the present because they were coerced in the past. How do you explain that? Okay, thank you. Next one. My name is Peter Ferreira and my question takes one second to answer. In the interest of time I'm going to put it very simply and plainly, hopefully people will understand the deeper implications it entails. It's a question for Dr. Brook. We started this debate about one hour and a half ago and Professor Galbert was given ten minutes to put his points across. You were given ten minutes to put your points across. Would have you been concerned if you had been given five minutes? Maybe two minutes? What about zero minutes? Do you care? Thank you. Next, my name is Michael. I'm going to talk about another type of inequality and equality and equality of conditions to you, Mr. Brooks. In your ideal society, if you're born with a pre-existing condition or a condition that requires some healthcare services, if the services are provided and the parents can't pay for those kids' stuff, are those kids doomed from the start? Thank you. And one last question from a gentleman. Hello, my name is Bruce Spink, mostly interested in the theoretical division between the public and the private spheres that has been at kind of the heart of this conversation. It seems like Dr. Brook takes a very hard line in saying that they're very different. The only exception to that was when we were talking about the justice system and he said that if an economic situation impinges on the public sphere, in this case the courts, that the government has a right to mitigate that. And I'm wondering, given that the statistical impact of the average voter, the median voter in the United States, is almost nothing compared to the real policy effect of those that are either affluent or a member of an interest group, is that the same kind of effect on government by an economic situation as we discussed concerning the Justice Department? All to me. Thank you. Dr. Brook, clearly the person to answer first. Okay, let's see if I get these right. So how can poor people create value when they've got history, bad circumstances, whatever? I think the question is insulting to those poor people. If they are free today, they have the capacity to create value, they have the ability to go out there. If what we need to do politically is to make sure that the government is not a factor in discriminating, that the government is not a means to prohibit their advancement. But there is no reason. And you see this all the time. You see poor people succeed all the time. And it's an insult to them to say because they're ancestors of slaves, they can't do well today. I mean, that's ridiculous. Every individual can do well today. Well, today is not free. In a free society, every individual can do well, no matter where they come from. I just hired a woman who was a chief operating officer of Shell International. She came from a horrific background, a poor background, foster care, and she rose to be a senior person, one of the mightiest businesses in the world. You hear stories like that all the time. So it's insulting to say people can't because of their circumstances. Yes, they can if they're not prohibited from doing it, which is what I think we do today. Minimum wage laws, welfare and so on are ways in which we institutionalize people into poverty and prevent them from rising. Would I be upset if I only got five minutes versus ten minutes? Well, it depends. I get five minutes versus everybody else's ten minutes all the time. Watch television sometime. I get like one spot a month and everybody else gets everything else. You know, Bill O'Reilly has a whole show. Damn it, that's not fair. So it depends on the contract. It depends on the relationship. You know, we agreed to equal time, you know, maybe on a different circumstance as it wouldn't have been equal time. We could have come up with some other agreement. Maybe there was, could have been some side payments to compensate. Who knows what kind of structure we could come up with. But I'm, look, I'm in the minority all the time, I can guarantee you. I agree with Professor Galbraith in a sense that nobody agrees with me, right? So if you put this to vote in American people, I lose. So I have less time. It makes sense to me. Kids health care. Again, I think you have two choices fundamentally. You rely on charity or you pull out a gun. Those are the only two choices. That's it. And if, if I believe that pulling out a gun is wrong and for the charity doesn't materialize, bad stuff happens. And it's sad, but that's the reality of it. Now I happen to believe that in free societies, people are incredibly charitable. And then in free societies, kids won't be dying. But the reality is those are the only two options. You either rely on charity or you rely on force. I believe on a principle way that force, coercion is wrong and should never exist in a free society. And the final question was, I think I understand it. So isn't it the existence today of pressure groups that give advantages to certain parts of the population? Isn't that unfair just like in the justice system? And therefore shouldn't we do something about that? Shouldn't we correct for that? And my answer is yes, we should. And the way to do it is to get government out of economics. I think government should have no economic policy because it should have no role in economics. I think we should add to our constitution a separation of state from economics. So that the state has no role in economic policy. And if the state has no role in economic policy, there aren't any pressure groups to try to get stuff from the state because the state ain't giving anybody anything. Today, the reason we have all these pressure groups is the state is involved in every economic decision out there. The financial markets are the most regulated markets in America, even after so-called deregulation. So surprise, surprise. The different gangs of pressure groups line up to try to get whatever resources they can out of government that is trying to... So you saw the Orgie around Dodd-Frank, which was about all these groups trying to get these regulators to give them something at the expense of somebody else. I'm afraid we're running out of time for this segment. So that's it. So with no further ado, let us proceed to the closing statements beginning with Dr. Galbraith. What's Dr. Brooks? He just spoke. All right. Let's begin with Dr. Galbraith. I will take up the cudgel. It's okay for me to end it, right? Well, it's been a very interesting evening. Again, the question before the House is inequality should we care? I think the first point to realize is that on some fundamental principles, Dr. Brooks concedes that we should care. He agrees with the fundamental principle of legal equality. He objects, as I do, to categorical inequalities based on race or gender or religion. That's fine. We agreed on that. When it comes to inequalities based upon a starting point of vastly unequal property, he's prepared to take whatever has been dealt out by the history of feudal land titles and robber baronism. And I'm not. I think that we as a community have not only the right but the ability and the obligation to moderate those inequalities. So I think in that respect, we should care. And that's a tradition in the United States and in every other developed country to do exactly that. Not to extremes, but to a reasonable degree. The question of social protection, Dr. Brooks is categorically opposed. I believe that social protections, insurance, health care, retirement are part of this process of extending basic rights to a whole population which does not have landed property. It's basically the same thing. It's wealth. It's wealth granted by legal title just as land property is. Just as financial property is. But it's wealth that can be granted to people who don't have either of those two things. Very good system. I made a number of further points. I argued that in practice societies which are moderately more equal have done better. They have less unemployment. They have higher productivity. They're more efficient. I made an argument that they also survive contests with other societies, particularly military contests more effectively. There has been no rebuttal to any of those propositions. They haven't even been taken up. I think we can accept that they stand as accepted or at least as unrefuted. And finally, I should close by bringing back to life one of the great economists ever to teach at the University of Texas, Dr. Robert Montgomery, the mentor of Lyndon Baines Johnson, who was called once before the Texas legislature in a very critical spirit and asked by a hostile legislature professor, do you believe in private property? Oh yes, he said. I do. I believe in private property. I believe in it so strongly that I think everybody in Texas should have some. That's my position too. Thank you very much. So I'm still looking for the feudal land barrens somewhere out there. So let me just say that I do not concede the point that moderately more equal societies perform better. I don't think that the evidence supports that. Greece today is more moderately equal than we are, is more equally in. Yep. Genu ratio is lower. And yet it doesn't perform. The United States performance economically over the last several decades has outperformed every other western country. We are the envy of the world and yet inequality it's true is greater in the United States than anywhere else. I always find my challenge my Swedish friends to lower the barriers between Sweden and the United States for immigration and see which direction people go. I have no doubt which direction that would be. We agree or seemingly agree I think really that political equality equality before the law equality of rights is something we both agree on. But I think my point is that if you take that seriously if you believe in equality of rights if you believe in equality before the law then you cannot advocate for government doing anything to address even if it's your concern. Even if it's your concern about inequality that as soon as government addresses the concerns of inequality it is violating the idea of equality before the law to tax some people at a rate of 50% and other people at 0% is not equality of rights. Some people are discriminated against the people paying 50% to regulate is not equality before the law. It's to treat some people differently than others in a significant important sense in respect to their freedoms. So my argument about my indifference to income inequality is really my argument for my passion for equality before the law for equality of rights for equality of freedom. I believe in individual freedom. I believe in the right of every individual to pursue their values free of coercion and to make of their life whatever it happens to be. They might choose to be a professor or teacher like myself and Dr. Galbraith and condemn themselves to a life of lower middle classhood. Or they might choose with a finance degree to go work in Wall Street and make a lot of money. In my view have less fun. But it's their choice, their choice. And we need to create a political system that allows them to express that choice and doesn't constrain them. Thank you. Before I exploit again my moderator's prerogative to offer some concluding thoughts, this is a time to have another unscientific poll amongst our audience members. Let me ask you if all those of you who still think or for the first time think that inequality matters and we should be worried about it, please raise your hands. Thank you. Now, do we still have undecided ones? We have the agnostics. Well, it has been a great privilege to be moderating this stimulating debate which reminds me and I think it reminds all of us that, a lot more is at stake here than income distributions, wealth distributions, genicon coefficients and technical matters. What is at stake here, I think we all agree, is the dignity and poignancy of the human condition. Freedom is also at stake. Freedom from poverty, poverty, poverty, poverty, poverty, poverty, poverty, poverty, poverty, poverty. Freedom is also at stake. Freedom from state interference but also equal freedom to live, dream and develop without fear of others and prejudice for others. But it is also, I believe, about a word that hasn't been used much in this debate, democracy. An idea that according to Aristotle again, there you are, it arose when humans started thinking that we are equal in some respect and then ended up concluding that if that is so, we must be absolutely equal when it comes to deciding matters of government and state. Perhaps you will indulge me a few personal thoughts with which to end. I grew up in a military dictatorship so I can see one and I can recognize one from afar. Dictatorships have one distinctive characteristic, uncomplicated politics, vile but quite uncomplicated politics. There is very little mystery about what goes on. Take Russia today or indeed the Ukraine. Powerful people use money to get power and use power to make money. Society is ruled by oligarchs whose agents, political agents, politicians, go through the motions of creating markets seemingly, holding elections, even transferring power as between Mr Putin and Mr Bedveev, backwards and forwards. But the people on the ground know better. Russians and Ukrainians as well as other people living in despotic regimes understand fully well that an unequal command of wealth undermines equality of freedom, not of income. The optimist amongst you may feel that the West and the United States in particular is not subject to this problem because we are different here. Thankfully, it is true. We are different here. But Western societies are not immune to the corrosive effects of oligarchy. It would be folly to think that American societies except from oligarchy, from oligarchy's detrimental impact on the citizen's substantive freedom and our democracies. On this note from the chair, thank you once more Dr. Brook, Dr. Galbraith, the objective society that organized tonight's event and of course to all of you for being here and making this possible. Thank you.