Ezra Klein: How have we gotten to a point where we can have high corporate profits,
and businesses can be doing so well, but the workers don't necessarily share in that prosperity?
Barack Obama: Well this has been at least a 3-decade long trend. Now there are a whole
bunch of reasons for that. Some of that has to do with technology and entire sectors being
eliminated. Travel agents, bank tellers, a lot of middle management. A lot of it has
to do with globalization. The rest of the world is catching up. Post-World War II, we
had just some enormous structural advantages because our competitors had been devastated
by war, and we had also made investments that put us ahead of the curve, whether in education
or infrastructure. Those advantages went away at the same time as workers increasingly had
less leverage because of changes in labor laws. You combine all that stuff, and it's
put workers in a tougher position. So some people who just control enormous amounts of
wealth -- we don't resent their success. On the other hand, just as a practical matter, you're going
to have problems making sure that we're investing enough in the common good to be able to move
forward.
Ezra Klein: Does this put us in a place long term where redistribution becomes, in a sense,
a positive good in and of itself?
Barak Obama: That's always been the case. I don't think that's entirely new. I mean,
the fact of the matter is is that relative to our post-war history, taxes now are not
particularly high or particularly progressive compared to what they were, say in the late
50s or the 60s. There's always been this notion that for a country to thrive, there are some
things, as Lincoln said, that we do better together than we can do for ourselves, whether
that's building roads, or setting up, you know, effective power grids, or making sure
that we've got high-quality public education and that teachers are paid enough. The market
will not cover those things and we've got to do them together. Basic research falls
in that category. So that's always been true. I think that part of what's changed is that
a lot of that burden for making sure that the pie was broadly shared took place before
government even got involved. If you had stronger unions, then you had higher wages. If you
had a corporate culture that felt a sense of place and commitment, so that the CEO,
they felt a real affinity for the community to reinvest in that community and to be seen
as a good corporate citizen. Today what you have is quarterly earning reports. You have
compensation levels for CEOs that are tied directly to those quarterly earnings. You've
got international capital that is demanding short-term profits, and so what happens is
that a lot of distributional questions that used to be handled in the marketplace through
decent wages or health care or defined benefit pension plans -- those things are all eliminated
and the average employee, the average worker doesn't feel any benefit.