Economic Justice: It's Time to Change the Way We Work and Earn Money With Robert Verkaik

Alexander McCaig (00:00):

Hey, Robert, thanks for joining me today. I wanted to bring you on because you wrote a great book on why I just won't get rich. And when I first saw the title, I was like well, help me understand how I live in a world or a society here in the United States that tells me, I can do all of these specific subsets of activities that would lead to some sort of economic prosperity.

Alexander McCaig (00:38):

I always have the ability to change the class that I may be sitting in from an economic stance and find myself somewhere else. But when I read your book, it starts to shed a light on really how the economic systems are not really gamed or tuned for really my benefit. What it is, is that, people who take a certain stance of ethics and their approach on the world, depending on how those ethics are, find that they can hide outside of the limelight, or specifically tow the line, or put certain legislation in their favor that keeps their wealth in their hands for how it has been accumulated, whether it's through some sort of family aspect or some sort of legal aspect that says, "This is the definition of my wealth."

Alexander McCaig (01:28):

For many times in the book you use the example of, when the estate in England is transferred from one individual to family to the other, it's gifted, and that limits the amount of tax on that. And just in the context of it, you express bridges between what is going on in the United Kingdom is also happening elsewhere with economic disparity and opportunity, but you take a very human centric value.

Alexander McCaig (01:55):

So I was wondering, can you tell me why your focus was to go about from a journalistic standpoint this sort of avenue? Because economics is a tough mess to get into so how did you try to unpack that? What was the point for this?

Robert Verkaik (02:11):

The point was to really go out into the community and speak to people whose lives have been immeasurably transformed over for the worse, for over the last 30 years. And more specifically since the credit crunch crash 2008, 2009. That's when I think things started to go bad for lots of families and the pandemic has just simply exacerbated the kind of daily economic strife that these families have been facing. So I went out to find them, I'm also an advisor.

Robert Verkaik (02:52):

I work here for a charity, which advises people who have got nowhere else to go because they're homeless, they can't afford their next meal, or they part up so much debt that they need someone to help them. So I had a very good access to hundreds of families who were in these kind of dire strait. And what I found was that the trends that we read about in the newspapers and listen to on the news is more terrifying for real life than we really imagine.

Robert Verkaik (03:33):

So we hear a lot about a gig economy or zero-hour contracts or pandemic laying waste to an economy. But when you meet people who literally coming in to an office and asking you how they're going to get their hands on some toilet paper, because the supermarkets have been subject to these runs on bare essentials. That strikes me as an economy that probably isn't working very well.

Alexander McCaig (04:18):

It is one fact that it doesn't work well, but it's the fact that a lot of people miss the effect of these systems fragility on an individual's life. One person can say, "Well, the market crashed, but it'll bounce back." But what about the lasting effects? Not at the businesses itself, but the people that are actually integrated into those businesses, the people in the healthcare systems, the people that were selling insurance, people doing the things of that specific nature. It cripples them, and you use those stories so that it leaves a lot beyond the sense that it's not just the dollar value that's lost, but there's a sliver of the human being that's lost at the same time.

Alexander McCaig (05:06):

They don't have the opportunity in their own evolution because they can't sustain the basic needs that they do need to survive. Those bare essentials. They can't get to them. So relationships suffer, right? Personality suffer, depression sits in, and those are longer, more drastic effects on the quality of life beyond just the fall down and the bounce back of an economy. But people tow on that fragile line constantly because the amount of opportunity and the design of specific systems forced them to be in that fragile state, they don't have an anti fragile nature to them.

Alexander McCaig (05:42):

And I thought that's what was very interesting about the book itself is that, by diving into those lives, it shows that it's not just looking at the financial numbers that come out to say, "Oh, it's all well and good that unemployment it's on the down," but in truth, a lot of people aren't reporting it or they fall outside of whatever that spectrum of how the government defines the unemployment. And I think these are the things that really require more of that focus because there's a much larger human element that tends to be missed.

Robert Verkaik (06:18):

Yeah, absolutely. And I think the human stories kind of tells the bigger story, they paint the bigger picture and the more people I spoke to, the more obvious this was causing... What we found in the pandemic was that people who were at the back of the queue anyway, because since the credit crunch, the levels of productivity have badly afflicted your and our economies. These people who were working in these economies suddenly found that they were not just at the back of the queue, they couldn't find the queue anymore. They were almost negated.

Robert Verkaik (07:06):

And it was very hard to even get these people to sort of leave what accommodation they had to come and even seek help. So I think that was still going to get that. I think when furlough scheme start to unwind and the reality of just how many people are no longer able to not just find work, but to make any money at all, to put a meal on the table for their families.

Robert Verkaik (07:39):

Once the full figures of this start to be realized, I think we are going to have everything. I think politicians will start to ask the same questions that I've been asking about, has capitalism broken it contract with hard work and do we need to start reevaluating it? I don't think we need to tear it apart. I don't think we need to you get rid of it, find a new system, but we just need to recalibrate it to make it fairer so it distributes more wealth, more fairly, which is what the whole point of capitalism was.

Robert Verkaik (08:18):

It's why we move from an aristocracy of dependent on land and wealth in the hands of the very, very few to the systems of democratic capitalism today. That was the whole point, that's why from the 19th century into 20th century, we had successful economies, which spread wealth relatively fairly, certainly in comparison to what capitalism is doing to the spread of wealth today. That's for sure. But I do also think that-

Alexander McCaig (08:57):

So when... Go ahead.

Robert Verkaik (09:04):

Yeah sorry, I just going to say that, I do think that it's very short-termism to say that you can't extend furlough or we've got to start getting people back off benefits of welfare system. We need to claw back the furlough as quickly as possible because what we discovered in the pandemic was that an awful lot of people in society who had jobs which didn't receive much respect from the rest of the community.

Robert Verkaik (09:40):

We now realize these are the key workers. These are the valuable workers who make the economy and the community tick. And I don't know about you, but we clapped these people on the streets every Thursday night. And now the pandemic seems to be be coming manageable, or coming to an end. We've forgotten all the things we said about these key jobs, these key workers, these are the people who we do need to support because, if we reach another crisis, another pandemic perhaps, or another variant of COVID, we're going to rely upon these people again.

Robert Verkaik (10:22):

And if we find that we haven't improved their living conditions, and they aren't able to do the jobs that we were so desperate that they did during the previous pandemic, then we're going to be even more dire straits than we were the first time around, but it doesn't seem like we're learning those lessons.

Alexander McCaig (10:42):

No, I mean, Robert, you know how quickly people forget things, unless they're constantly reminded of the past or, other things in their localized history that they live in, especially on the Island of England itself, they will forget and people will go back to doing the things they have always done. And so, when you speak about this, there's an interesting aspect around the distribution of the wealth itself.

Alexander McCaig (11:16):

Now in the United States, there is a massive disparity between those who hold the wealth and those who don't, but there is a growing middle class, but it's a growing lower middle class. And there's still a huge amount of the drivers for our resources and factories and everything else that is currently happening over here within our gross domestic product. But there's always such a backlash when it talks about wealth distribution and taxes specifically here in the United States.

Alexander McCaig (11:48):

And, I'm not very keen on British culture that much for how that reaction is, but from the way you've looked at the data and other countries that have taken on universal incomes and things of the sort that you spoke about, how is it that you see taxes in the future? Is that really the only avenue for that sort of solve? Do you think that that's how it proves itself out through that sort of nature for creating more opportunity, and making sure that it decreases the fragility of the system by taxing it more?

Robert Verkaik (12:23):

I think we have to grasp the net and deal with taxation. Yeah. We need a more progressive taxation. We particularly need to find a way of fairly taxing people whose assets have grown exponentially over the last 10, 20 years since the last credit crunch. Because what happened was when we faced our last economic crisis, Western countries, Western economies, yours and ours, we injected lots of capital. The major banks injected lots of capital into the system to try and save the banks, save the economy, keep us all afloat.

Robert Verkaik (13:09):

But what's happened is that this liquidity, this money has found its way into the as sets of the already rather wealthy. So we now know that since then, the assets we're talking about, big, we're talking about houses, multiple house owning families, we're talking about, jets, super yachts, diamond investments. These are the assets that have doubled in value in the last 10 years.

Robert Verkaik (13:44):

And this means that what's happened is the very rich have simply benefited from an economic catastrophe. And it seems to me they're going to benefit, and as every indication and that they will benefit as much from the pandemic as they've benefited from the credit crunch. So the disparity between the very rich we're talking about, perhaps the 1% of most Western economies. These are the people who control perhaps half of the wealth of the country.

Robert Verkaik (14:20):

The gap is going to be so great that it's going to be unbridgeable and people will see, and as you've already rightly identified, it's the middle income earners who are the ones who simply can't keep up and the money's being extracted from the economy, invested in these huge wealth facet owned by an aristocratic class preventing swaves of the middle earning classes to do little more than keep afloat really they're tread watering in the economy while the super rich are living a life of luxury decadence.

Alexander McCaig (15:16):

So Robert, you speak with a huge voice for the working class now, how do you think the super rich, and I've spoken with a lot of extremely, extremely wealthy people, billionaires. How do you think they would feel about the fact, that they've spent a majority of their life, and they look at this a lot, sacrificing things, making specific choices to generate this wealth, and then you're saying that we need to tax them more and then distribute that back to people that maybe otherwise never took the opportunity?

Alexander McCaig (15:58):

And I do hear that point a lot. So how is it that you take the story of what's going on with the working class, the middle, the economic inequality and the human element, and how do you bridge that over into a dialogue with those who have generated massive amounts of wealth, whether now, or preserved it over time to say, "Hey, we want to take more from you and bring it back to the working class that supports your systems." How is it that you sort of tell that story to them?

Robert Verkaik (16:29):

To the super rich? Yeah, it's a really, really good point. And all I would say is this is not necessarily a socialist argument. I'm not saying we need to tax the rich to pay back the poor. I'm saying that we've got a very large middle class who are struggling perhaps in different ways to the poor.

Robert Verkaik (16:57):

Certainly, those suffering from extreme poverty, but the middle classes are still trying to earn a living in very challenging times and, they need their iPhones. They want to be able to treat their families to a weekly visit to the restaurant, they want to go to the cinema. They perhaps want a holiday couple of times a year. These are the things that are no longer given this contract between the worker and capitalism is not being honored.

Robert Verkaik (17:34):

So all I would say is that where with a progressive tax system, like the one I would advocate where you are asking those who own, whose assets have risen exponentially in value over the last 10 years to give back a little bit more so that we can, recalibrate the economy and give people a better stake in their output. And I think it's interesting, you aren't you say what is their response? They will claim they worked very hard for the wealth that they've secured and they deserve to keep it.

Robert Verkaik (18:15):

And they shouldn't be penalized for their good fortune, or perhaps they've described it as their business acumen, talent even. But in America and Britain, there's been a couple of groups who representing the very wealthy, who've written to their respective governments, actually asking to be taxed more because they themselves believe this is the situation. Because they want to live in a society which is cohesive in which democracy works.

Robert Verkaik (18:57):

And when people can see that the value of their toil is being recognized in terms of being able to sort of advance them up a career level. They know that once that dream is no longer exists, once the contract between captain hard work is broken-

Alexander McCaig (19:17):

Robert, to close this up. I'd like your final thoughts on this matter, is that when we look at the future of the middle class, how do you see your view of the progressive tax and other aspects of the economic system and political system that are changing, that will make things less fragile and more resistant for those individuals that actually support these economies, which is that growing middle class of human beings.

Robert Verkaik (19:52):

Yeah, I think we need to take a holistic approach now. So it's interesting, you say that today, Alexander, because we obviously today is the day we've got the United nations report on climate change. So I think we need to, anything we do in terms of reconfiguring an economic system that pays more out to more people, we need to take into account the impact that's going to have on the climate. That's why I find the new green deal so attractive.

Robert Verkaik (20:21):

And this is something that has its origins in am in America. So I think it's a great idea because we need to build economies with jobs that are sustainable to the environment, to the climate. So we need to find new economies, new industries that create and help to sustain new energies, new sources of fuel, houses which have proper sustainable heating. We need to build these kind of houses.

Robert Verkaik (21:03):

So I think we can create many, many thousands. That's millions of jobs in these new industries, which will pay fairly and also help to build back the economy. And I think once the rest of the world recognizes that, and we're all on the same page, then work won't necessarily be all about the end product. And perhaps, GDP, the gross domestic product of each country will have a climate element to it, an environment element to it whereby it's not just what you produce, it's what you produce in the least harmful way to the climate, to the environment.

Robert Verkaik (21:55):

So in that way, we will be bringing in many more jobs to help lots of people who are perhaps losing their jobs through the changing nature of work and artificial intelligence has meant that there's an awful lot of people working in say the insurance, in law, in these kind of professional services who won't necessarily have as many jobs, certainly not as many well paid jobs as they were used to in the past.

Robert Verkaik (22:32):

So we need to embrace the challenges of the world economy in the context of the climate emergency we are now facing. And if we can do that, I mean, it's just a massive trick to pull off. If we can do that, we will have something worth lasting, worth keeping and worth passing on our children and their children's children. I think that's the way to go. And if it means also bringing in things like a national basic income, whereby you are paying people not to work and experiments in Canada, Scotland, Kenya, and Finland have all shown that these communities where people are being paid not to work, actually don't have the kind of negative impacts that most politicians instinctively feel they have.

Robert Verkaik (23:31):

It turns out that these are thriving economies where people choose to spend their basic income building up their own businesses, but building up or making a contribution to society in a way that they want to make a contribution to society. But because they're doing it for themselves, they are much more productive. And in that way we will solve the low productivity puzzle as well.

Alexander McCaig (23:57):

Yeah. And I think taking that approach, there's just a lot to be said when we put a focus on the human being and then how that human being all also interacts with the environment of the planet we live on. And those should be the defining factors for how we then look at economics and policy outside of it. But taking that human forward human-centric approach versus the thing that really will bring us to a much better brighter future that continues to give that opportunity and support to who really do need that support itself.

Alexander McCaig (24:29):

So Robert, I thank you so much for coming on and speaking about this, thank you for your career of journalism and bringing the story and the voices of those who are sometimes kicked to the wayside or unheard or never get their limelight when it's due. And I really appreciate you sharing that, that truth on that situation and teeing up some options for our future that just may be a better one for all.

Robert Verkaik (24:59):

Thanks, Alexander. It's been a pleasure talking to you too. And if you got any problems regarding the recording or you want me to go over something or whatever, just let us know and happy to jump back in.

Alexander McCaig (25:14):

No, that's awesome. And, I'm definitely going to want to bring you back and I'd love to ask you more because there's just so many other nuances to what you're speaking about that I think we should carry on with, following those ideas down to their absolute end to say, "Is this something that we really should take a more serious approach to?" And I think having that voice of those individuals and making them a part of that decision making is going to make a drastic difference in our future. So, thank you again for doing that Robert.

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