WEBVTT - Galloway on 'Post Corona: From Crisis to Opportunity' 0:00:00.120 --> 0:00:04.920 This is Bloomberg Business Week with Carol Master on Bloomberg Radio. 0:00:05.240 --> 0:00:06.880 All Right, I gotta just say and I'm gonna put 0:00:06.920 --> 0:00:08.320 it out there, and I say this every time he 0:00:08.400 --> 0:00:11.000 joins us. I could talk to him for a couple 0:00:11.000 --> 0:00:13.360 of hours. We're talking about Scott Galloway. He's author of 0:00:13.400 --> 0:00:16.960 several books, including The Four The Hidden DNA of Amazon, Apple, Facebook, 0:00:16.960 --> 0:00:21.439 and Google. He's also wrote wrote Uh, The Algebra of Happiness, 0:00:21.480 --> 0:00:23.720 The Pursuit of Success, Love and What It All Means, 0:00:23.840 --> 0:00:26.239 which is a perfect book for right now. Professor at 0:00:26.320 --> 0:00:28.880 n y use Stern School of Business, he has founded 0:00:29.280 --> 0:00:32.120 multiple tech firms. Great to have back with us and 0:00:32.159 --> 0:00:35.920 talk about his new book, Post Corona From Crisis to Opportunity. 0:00:36.000 --> 0:00:39.880 Scott Galloway, he is with us on the phone from California. Scott, 0:00:40.040 --> 0:00:41.919 So nice to have you here with us. How are you. 0:00:43.240 --> 0:00:46.200 I'm great, Carol, but I'm feeling especially good after that introduction. 0:00:46.360 --> 0:00:51.400 I could speak to Carol Master for hours in my car. Well, 0:00:51.440 --> 0:00:53.120 I'm gonna hold it to you. Hold you do it 0:00:53.120 --> 0:00:54.840 because I really I do. I feel like you get 0:00:54.920 --> 0:00:57.040 us thinking. And there's so much going on in the world, 0:00:57.200 --> 0:01:00.160 um right now, where so much has happened to us, 0:01:00.200 --> 0:01:02.520 and I do wonder about what happens on the other 0:01:02.600 --> 0:01:05.319 side of it. So first of all, tell us about 0:01:05.440 --> 0:01:08.000 kind of your world right now. I mean you've been teaching, 0:01:08.040 --> 0:01:10.360 I'm assuming, I mean tell us about how you've been 0:01:10.400 --> 0:01:15.880 kind of taking everything in in this world that is well. 0:01:16.240 --> 0:01:18.839 You don't like to say this out loud, that if 0:01:18.920 --> 0:01:23.080 you have, if you've been blessed with with health and 0:01:23.120 --> 0:01:26.160 the people you love are healthy, and you make a 0:01:26.200 --> 0:01:28.479 good living, and you have a nice home, and you're 0:01:28.480 --> 0:01:31.680 a little bit older, and maybe you know, have a 0:01:31.800 --> 0:01:35.360 fortunate to own real estate and owned stocks. The pandemic 0:01:35.440 --> 0:01:38.200 for a lot of those people has meant more time 0:01:38.240 --> 0:01:41.400 with their children, more time with Netflix. You get back 0:01:41.440 --> 0:01:43.800 five to ten hours of commuting. The era of cleaner 0:01:43.840 --> 0:01:46.360 in your stock market portfolio isn't an all time high, 0:01:46.440 --> 0:01:49.200 So you know, that's both a good and a bad thing. 0:01:49.280 --> 0:01:51.880 I would argue that COVID nineteen is more of an 0:01:51.880 --> 0:01:54.120 accelerant than it is a change engine, and some of 0:01:54.160 --> 0:01:57.040 the dysfunctional income and equality attributes of our economy have 0:01:57.160 --> 0:01:59.640 absolutely become the stoke in So I would argue a 0:01:59.640 --> 0:02:03.200 lot of the wealthiest people are living their best lives 0:02:03.280 --> 0:02:06.760 right now, and I think unfortunately it's taken a real 0:02:06.880 --> 0:02:11.600 toll on and maybe a little bit younger, not as 0:02:11.600 --> 0:02:15.760 economically well off, had jobs that were a lower income 0:02:15.880 --> 0:02:18.280 and more susceptible. So this is really a K shape 0:02:18.280 --> 0:02:20.480 recovery on a lot of levels. I've talked with Peter 0:02:20.520 --> 0:02:23.560 atwater Over at William and Mary I totally. I think 0:02:23.639 --> 0:02:25.680 that is how we describe our time. You know in 0:02:25.720 --> 0:02:27.960 your book, Scott, you're right, and forgive me. I hate 0:02:28.040 --> 0:02:31.000 quoting someone's book back to someone the person who wrote it, 0:02:31.280 --> 0:02:33.400 but it's stuck with me. Whether the US is headed 0:02:33.440 --> 0:02:36.880 for a Hunger Games future or something brighter depends on 0:02:36.960 --> 0:02:39.920 which path we choose post Corona. I do feel like 0:02:39.919 --> 0:02:44.920 we're at this interesting time where whether it's the health pandemic, 0:02:45.040 --> 0:02:48.640 whether it's racial inequalities and justices, there's so many things 0:02:48.639 --> 0:02:51.560 that are wrong right now, and I do wonder do 0:02:51.680 --> 0:02:54.320 we learn from it? Can we be smarter and do 0:02:54.400 --> 0:02:56.240 we come out better on the other side? And I 0:02:56.280 --> 0:02:58.320 wonder what do we need to do to come out 0:02:58.360 --> 0:03:02.880 better on the other side? Well, yeah, you know word 0:03:02.919 --> 0:03:06.239 and I hope so, sister. The Chinese term for crisis 0:03:06.320 --> 0:03:11.440 is interpreted as the intersection between opportunity and risk, and 0:03:11.880 --> 0:03:15.200 there's two paths here, and I would argue it needs 0:03:15.240 --> 0:03:18.280 to you know, loosely speaking, the path to a brighter 0:03:18.320 --> 0:03:22.960 future involves, in my view, of re embracing capitalism. But capitalism, 0:03:23.000 --> 0:03:27.000 if you will, is full body contacts certain Darwinian harshness 0:03:27.040 --> 0:03:29.920 for corporations that duke get out, and that competition and 0:03:29.960 --> 0:03:33.480 that violence creates such incredible spoils that we can be 0:03:33.600 --> 0:03:37.440 generous with people. We can afford to pay for social 0:03:37.480 --> 0:03:42.520 security that takes seniors, poverties poverty among seniors from eleven. 0:03:42.880 --> 0:03:45.480 We're gonna pay for medicare. I would argue that this 0:03:45.640 --> 0:03:49.240 crisis illuminates a very unhealthy feature, and that is we've 0:03:49.240 --> 0:03:53.480 decided that companies deserve more generosity and people are less 0:03:53.480 --> 0:03:55.880 protected in some I think the opportunity here is to 0:03:55.880 --> 0:03:59.680 realize we need to protect people and not companies. And 0:03:59.720 --> 0:04:01.760 then the other word I would use as camaraderie. We 0:04:01.800 --> 0:04:04.640 need to rejoin hands with our brothers and sisters in 0:04:04.680 --> 0:04:07.720 Europe and recognize the value the North American Treaty, the 0:04:07.800 --> 0:04:11.480 Paris Accords, the World Health Organization, and just generally have 0:04:11.520 --> 0:04:13.520 more empathy for one another and try and see each 0:04:13.520 --> 0:04:15.920 other as Americans before we see each other as Republicans 0:04:15.960 --> 0:04:19.680 or democrats. Most crises have done that. I worry this crisis. 0:04:19.720 --> 0:04:22.240 It's not obvious that this crisis is bringing us together. 0:04:22.360 --> 0:04:26.200 So re embrace the capitalism and camaraderie are the call 0:04:26.240 --> 0:04:29.080 signs to move to opportunity as opposed to the risk. 0:04:29.279 --> 0:04:32.240 I like this idea of reembrace capitalism because it's just interesting. 0:04:32.320 --> 0:04:34.680 I have conversations with my nieces who are younger, and 0:04:34.720 --> 0:04:37.160 they're like, capitalism is terrible and Carol, and I'm like, well, no, 0:04:37.279 --> 0:04:39.520 it's not. It can be very good. But I do 0:04:39.600 --> 0:04:42.359 wonder how it got to be such a bad thing. Where, 0:04:43.040 --> 0:04:47.440 if anything, you created these incredibly wealthy companies, right, um, 0:04:47.520 --> 0:04:51.080 that sold a lot of stuff, but not everybody got 0:04:51.120 --> 0:04:55.640 to participate in that wealth creation. Well, I would argue 0:04:55.720 --> 0:04:59.080 that your what your nieces are saying, it's not capitalism 0:04:59.080 --> 0:05:02.200 when you have uh, you know, full by contact capitalism 0:05:02.200 --> 0:05:04.040 on the way up, and you privotize the games and 0:05:04.160 --> 0:05:07.120 in the airline industries and example, here's your free cash 0:05:07.160 --> 0:05:11.240 flow to buy back shares. As the senior executives, compensation 0:05:11.320 --> 0:05:13.480 is based on the value of shares and then on 0:05:13.520 --> 0:05:15.320 the way down, you say we're in this together and 0:05:15.320 --> 0:05:17.600 you ask her a bailout. Capitalism on the way up 0:05:17.640 --> 0:05:21.040 and socialism on the way down is coronism. And so 0:05:21.279 --> 0:05:23.640 I think, I think their right to be skeptical of 0:05:23.680 --> 0:05:28.679 capitalism where an older, middle class, mostly white, mostly college 0:05:28.760 --> 0:05:32.640 educated cohort is capturing gains and when they hit a 0:05:32.680 --> 0:05:34.880 tough time, they want to borrow money and time against 0:05:34.920 --> 0:05:38.440 future generations and out of control deficits and claim that 0:05:38.480 --> 0:05:40.680 we're all in this together on the downside. So I 0:05:40.720 --> 0:05:43.080 don't think what we're seeing as capitalism. Capitalism is not 0:05:43.120 --> 0:05:46.440 an organic state. It has to rest on a base 0:05:46.520 --> 0:05:50.120 of empathy and i'll use the R word redistribution of income. 0:05:50.680 --> 0:05:53.920 And we seem to have found incredible empathy and generosity 0:05:54.000 --> 0:05:58.040 for these companies that we idolize and turn into people 0:05:58.160 --> 0:06:01.200 and then seem to be very harsh with people. That's 0:06:01.200 --> 0:06:04.839 not capitalism, that's crony ism. That's the hunger game. So 0:06:04.839 --> 0:06:07.240 what I would argue is they were not witnessing capitalism 0:06:07.240 --> 0:06:10.120 and it's best. Okay, So how do we We've got 0:06:10.120 --> 0:06:11.960 about fifty seconds and then I gotta do some news 0:06:12.000 --> 0:06:13.520 and we'll come back. I told you. I could talk 0:06:13.560 --> 0:06:16.160 to you for hours. Um. So how do we how 0:06:16.160 --> 0:06:18.160 do we get away from this CRONIUSM. I mean, man, 0:06:18.240 --> 0:06:20.320 you look at Congress and that's what it's all about. 0:06:21.080 --> 0:06:23.520 Um and elsewhere? How do we remove it? And just 0:06:23.520 --> 0:06:27.839 got about forty seconds. Uh So on a corporate level, 0:06:27.880 --> 0:06:30.720 I think the fastest thing we could do to reoxygenate 0:06:30.760 --> 0:06:33.080 the economy which to be fund the FTC and the 0:06:33.160 --> 0:06:35.520 d o J and go through every industry, whether it's 0:06:35.600 --> 0:06:38.800 big tech, big agg big pharma, and break them up 0:06:38.839 --> 0:06:41.080 and oxygen eight the economy and give small and medium 0:06:41.080 --> 0:06:43.960 sized companies the same fighting chance. They've always had to 0:06:44.040 --> 0:06:46.560 create two thirds of the jobs, and we've let big 0:06:46.560 --> 0:06:50.000 companies overrun government and overrun small and medium sized companies. 0:06:50.120 --> 0:06:52.600 I think, cross individuals, I think we can need a 0:06:52.640 --> 0:06:55.040 greater sense of empathy and camaraderie for each other, whether 0:06:55.040 --> 0:06:57.120 it's national service where we all serve in the same 0:06:57.200 --> 0:06:59.080 uniform right out of high school. I think gap here 0:06:59.120 --> 0:07:03.120 should become the norm, not the exception, and find common 0:07:03.160 --> 0:07:05.440 cause so we see each other as Americans, as opposed 0:07:05.480 --> 0:07:09.440 to Democrats and Republicans. So, Scott, what I do wonder 0:07:09.560 --> 0:07:11.120 is and one of the things you write about is 0:07:11.240 --> 0:07:14.600 kind of how we have you know, broken this contract, 0:07:14.640 --> 0:07:17.760 this agreement, that these promises that if you worked hard, 0:07:17.920 --> 0:07:20.640 you had talent, you know, anybody could do better and 0:07:21.000 --> 0:07:24.360 and and do well in our society. You know, my 0:07:24.440 --> 0:07:28.080 dad was first generation and he raised seven kids and 0:07:28.200 --> 0:07:30.880 it's pretty remarkable what he was able to do with, 0:07:30.960 --> 0:07:34.160 you know, parents that came over from Europe. So I 0:07:34.200 --> 0:07:39.960 do wonder what's happened? Can we get back that contract? Yeah? 0:07:39.960 --> 0:07:42.160 So I think so. I think you zero in on 0:07:42.560 --> 0:07:46.760 what is the ground zero of some of the anger 0:07:47.240 --> 0:07:51.120 or whether it's protests, whether it's a disaffection or lack 0:07:51.160 --> 0:07:53.200 of confidence in capitalism. And that is, for the first 0:07:53.200 --> 0:07:55.680 time in our nation's history, at thirty year old man 0:07:55.800 --> 0:07:57.960 or woman isn't doing as well. It's his or her 0:07:57.960 --> 0:08:01.440 parents were at the age of thirty. And the question is, well, 0:08:01.440 --> 0:08:04.600 why is that? And the good news is is that 0:08:04.720 --> 0:08:07.840 there's no excuse for it because the prosperity we have 0:08:07.920 --> 0:08:11.040 recognized over the last thirty years, whether it's GDP, slow 0:08:11.120 --> 0:08:15.320 but steady growth, market games, you know, the prosperity that 0:08:15.440 --> 0:08:17.840 is there. The problem is we haven't made much progress, 0:08:18.000 --> 0:08:20.000 and that I would argue that our tax structure, our 0:08:20.120 --> 0:08:23.520 education system that's drunk on luxury. It seems like what 0:08:23.560 --> 0:08:27.320 we have said with our priorities, our tax policy, only 0:08:27.400 --> 0:08:30.320 letting in fewer and fewer kids to elite schools, turning 0:08:30.360 --> 0:08:32.520 into a cast system instead of the upput lubricant of 0:08:32.559 --> 0:08:35.280 the middle class. Of fields that we're saying to America 0:08:35.360 --> 0:08:38.000 that our priority is to take the top one percent 0:08:38.240 --> 0:08:41.480 and turn them into billionaires, as opposed to taking the 0:08:41.520 --> 0:08:45.080 bottom and giving them a shot at being in the 0:08:45.120 --> 0:08:48.199 one percent. So we have to, I think, return to 0:08:48.240 --> 0:08:50.079 the notion that we have to fall back in love 0:08:50.120 --> 0:08:54.080 with the unremarkables. If you're born wealthy, if you're incredibly remarkable, 0:08:54.360 --> 0:08:56.520 there's never been a better time to be American. But 0:08:56.640 --> 0:08:59.320 America used to be a place where the unremarkables could 0:08:59.320 --> 0:09:02.319 have remarkable futures. I think it's about education. I think 0:09:02.320 --> 0:09:05.400 it's about tax policy where the top point one percent 0:09:05.440 --> 0:09:08.480 don't pay the lowest tax rate. It's about universities like 0:09:08.640 --> 0:09:11.280 mine falling back in love with unremarkable kids and not 0:09:11.360 --> 0:09:16.200 bragging that we're rejecting our applicants and then forcing middle 0:09:16.240 --> 0:09:19.440 class households to go into debt. We've affected a a 0:09:19.480 --> 0:09:22.320 reallocation or transition a cap at one point six trillion 0:09:22.320 --> 0:09:26.320 dollars in middle class homes the universities. That is morally criminal. 0:09:26.520 --> 0:09:28.920 So yeah, I think we have to get back to 0:09:29.000 --> 0:09:31.360 this notion that America needs to fall back in love 0:09:31.920 --> 0:09:35.120 with its unremarkables. The remarkables have killed it. Good for them, 0:09:35.160 --> 0:09:39.920 It's time to focus again on the other I am 0:09:39.920 --> 0:09:43.800 wondering on this Thanksgiving Eve. You know, is there hope 0:09:43.800 --> 0:09:46.400 out there? You know, do you see anything out there 0:09:46.440 --> 0:09:49.960 that does give you some hope that you know, we're 0:09:49.960 --> 0:09:52.040 not going to just keep talking about the problems, but 0:09:52.120 --> 0:09:55.679 we're actually going to have some form of action and 0:09:55.760 --> 0:09:58.920 make a change so that we do embrace the unremarkables 0:09:58.960 --> 0:10:01.640 and that we kind of, you know, raise up those 0:10:01.679 --> 0:10:03.720 that have really been forgotten. I mean, I think about 0:10:03.720 --> 0:10:06.880 the political scene. To me, it makes sense why people 0:10:06.880 --> 0:10:08.960 were angry because there's been a lot of people left 0:10:08.960 --> 0:10:13.160 behind and forgotten. So do you have hope that we 0:10:13.240 --> 0:10:16.800 can that we will fix this and do better? Well, 0:10:17.120 --> 0:10:19.640 as you've probably discovered, Carl, I'm I'm a glass half 0:10:19.640 --> 0:10:23.319 empty kind of guy, but I think there's I think 0:10:23.320 --> 0:10:28.760 there's enormous silver linings and healthcare. The people that have contracted, endured, 0:10:28.800 --> 0:10:32.280 and developed Antibiason the novel coronavirus will have never stepped 0:10:32.360 --> 0:10:34.880 in foot in a doctor's office a much less the hospital. 0:10:34.920 --> 0:10:37.199 We might be able to offer healthcare remotely that brings 0:10:37.240 --> 0:10:40.480 down costs and takes our healthcare system off its heels 0:10:40.520 --> 0:10:43.320 and onto its toes and starts offering great primary care 0:10:43.360 --> 0:10:45.960 at a lower costs. We might, in my industry, be 0:10:46.040 --> 0:10:49.560 able to take advantage of remote remote learning and double 0:10:49.679 --> 0:10:53.520 our admittistrates, double to supply, and take education back to 0:10:53.520 --> 0:10:56.440 where it needs to be with much greater admittistrates and 0:10:56.559 --> 0:10:59.480 much lower costs. We might decide to leave a mission behind. 0:10:59.520 --> 0:11:01.800 We might decide to take that time we spend community 0:11:01.800 --> 0:11:04.280 and spend more time with our families are making money. 0:11:04.440 --> 0:11:07.000 There are absolutely nothing wrong with America that can't be 0:11:07.080 --> 0:11:09.920 picked with what's right with it. And this is not 0:11:09.960 --> 0:11:11.320 the world we live in. This is the world we 0:11:11.400 --> 0:11:13.400 make of it. We're at a critical juncture here and 0:11:13.440 --> 0:11:16.000 it's up to us. Okay, having said that, I'd be 0:11:16.040 --> 0:11:18.440 remiss if I don't at least tap into all of 0:11:18.480 --> 0:11:20.360 the great writings that you've done about kind of our 0:11:20.400 --> 0:11:22.640 text base and those you know companies that we talk 0:11:22.679 --> 0:11:25.800 about ad nauseam, whether it's ads you know, Tesla, whether 0:11:25.800 --> 0:11:29.679 it's Amazon, whether it's Twitter, whether it's Google. Um. What's 0:11:29.720 --> 0:11:31.920 the role that they need to play in all of 0:11:31.960 --> 0:11:35.760 this in your view, I think they're playing that role. 0:11:35.800 --> 0:11:37.760 I think their profits thinking. I don't think they look 0:11:37.840 --> 0:11:39.720 left or right. I think they look down and focus 0:11:39.760 --> 0:11:41.840 on how to increase their earnings. I think the role 0:11:41.920 --> 0:11:45.320 is for government to provide the same level of scrutiny, 0:11:45.320 --> 0:11:49.080 whether it's antitrust or regulation, that we've provided against other 0:11:49.120 --> 0:11:51.480 companies and other industries, and that at some point the 0:11:51.520 --> 0:11:54.439 company becomes so powerful that the best way to oxygenate 0:11:54.480 --> 0:11:56.520 that sector is to do what we did with a 0:11:56.600 --> 0:11:58.760 T and T or the aluminum companies, of the old companies, 0:11:58.840 --> 0:12:00.720 going to break them off and then with and ten years, 0:12:00.800 --> 0:12:02.400 as we've seen with a T and T or the 0:12:02.400 --> 0:12:06.320 spin of PayPal, those companies are worth exponentially more So. 0:12:06.360 --> 0:12:09.280 I think it's regulators that have to step in and say, 0:12:09.280 --> 0:12:12.559 all right, congratulations. Any trust is in a punishment, it's 0:12:12.559 --> 0:12:15.559 a reward that you have become. You are so good, 0:12:15.920 --> 0:12:19.239 you are now performing a fantaside on small companies prematurely 0:12:19.280 --> 0:12:21.679 euthanizing big companies which tend to be better employers of 0:12:21.720 --> 0:12:24.319 their taxpayers. We're going to break you up, and we're 0:12:24.320 --> 0:12:26.720 gonna unleas incredible innovation. And if you want to see 0:12:26.720 --> 0:12:29.560 the markets go to new highs, break these companies up. 0:12:29.600 --> 0:12:31.280 We need to go through big tech, big form a 0:12:31.320 --> 0:12:35.760 big act and oxygenate the marketplace with any trust. Well, 0:12:35.800 --> 0:12:37.520 I have to say, you always leave us with lots 0:12:37.520 --> 0:12:40.480 of things to think about. And you know your book, 0:12:40.880 --> 0:12:42.720 you know, Ends with America isn't what it is but 0:12:42.760 --> 0:12:44.439 what we make of it. I mean, we as individuals 0:12:44.480 --> 0:12:46.960 also have a role right in all of this. Just quickly, 0:12:49.880 --> 0:12:52.760 you know, be the be the man or the woman 0:12:52.800 --> 0:12:55.480 your kids think you are. U. This is an extraordinary 0:12:55.520 --> 0:12:57.760 time to reach out to people. People remember how you 0:12:57.800 --> 0:13:00.680 behave in a crisis. People will remember how you behave 0:13:00.760 --> 0:13:02.920 in this crisis. Make sure the people in your circle 0:13:03.440 --> 0:13:05.439 are healthy and happy. And then if you have, if 0:13:05.440 --> 0:13:07.520 you're blessed, reach out to people who will never know 0:13:07.600 --> 0:13:10.560 your name. This is that's Americans are the most generous 0:13:10.559 --> 0:13:13.040 people in the world. Let's let's live up to that. Yeah, 0:13:13.120 --> 0:13:15.440 the sense of community has never been as important. He's 0:13:15.480 --> 0:13:18.320 got Thank you so much. Have a safe um and 0:13:18.400 --> 0:13:22.319 good holiday, Happy Thanksgiving and our thanks to Scott Galloway. 0:13:22.400 --> 0:13:24.200 He does always leave us with so much to think about, 0:13:24.200 --> 0:13:26.640 certainly for me, Professor at n y eu Stern School 0:13:26.679 --> 0:13:29.719 of Business. His new book post Corona From Crisis to Opportunity. 0:13:29.800 --> 0:13:32.079 Check it out, check out to the Algebra of Happiness. 0:13:32.559 --> 0:13:34.360 Whenever I'm a little lost to I go back and 0:13:34.440 --> 0:13:35.000 check it out.