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July 17, 2012 < Previous Entry | Next Entry >

Chris Hayes on "Twilight of the Elites: America After Meritocracy"–Watch Part 2

Amidst a series of recent scandals that have rocked the global banking system, journalist Chris Hayes joins us to discuss his new book, Twilight of the Elites: America After Meritocracy. The book examines how Wall Street and other major institutions, from Congress to the Catholic Church to Major League Baseball, have been crippled by corruption and incompetence. Hayes is host of the MSNBC weekend show, Up with Chris Hayes, and is editor-at-large of The Nation magazine.

Listen/Watch/Read Pt. 1 of interview with Chris Hayes

AMY GOODMAN: This is Democracy Now!, democracynow.org, The War and Peace Report. I’m Amy Goodman, and we are continuing with Chris Hayes, host of Up with Chris Hayes on MSNBC, editor-at-large at The Nation. His new book is called Twilight of the Elites: America After Meritocracy. Talk about the cover of your book.

CHRIS HAYES: It’s a—you know, the number one fan sign that you sometimes see, the big foam fingers, it’s a play on that, with the 1 percent but pointing downwards. And we went back and forth about the 1 percent and whether we wanted to use it, whether we thought people would—that it would condition people who I want the book to reach, because I would like conservatives to read it and hopefully be persuaded by parts of it, and not going to be persuaded by all of it—whether it would essentially mean that they wouldn’t touch it. And I think we ultimately felt that the 1 percent, as a framework for understanding inequality, has such potent force, partly because there’s a lot of ambiguity about what we mean when we talk about this term "elites." There’s lots of ways of defining it. And what’s remarkable and so useful about the 99-percent/1-percent framing is that it just quantifies, it just gives an answer to the question of who are the elite, what do you mean by that? And obviously a contestable one around the margins, and there are folks who are not in the 1 percent I think we would think of as elites. There’s even some people in the 1 percent we think maybe not might be elites, you know.

AMY GOODMAN: And there may be those in the 1 percent who very much have the same view as the 99 percent—

CHRIS HAYES: Of course.

AMY GOODMAN: —in fact, feel that their—

CHRIS HAYES: Yeah.

AMY GOODMAN: —own lifestyle is threatened by this massive inequality.

CHRIS HAYES: I mean, that, to me, is the point. I mean, you know, you think—you know, if the ship is sinking, it doesn’t matter how luxurious the top deck is. And, you know, we saw this—I mean, what’s amazing is that lesson seems to be completely unlearned by the financial crisis, and partly because, to their credit, Paulson and Bernanke and the Obama administration did make sure the worst catastrophe didn’t happen, which was complete submersion, right? I mean, we could have had 25 percent or 30 percent unemployment. We really could have had a Great Depression.

AMY GOODMAN: And in many communities, that is the number. It’s low.

CHRIS HAYES: Yes, but we—but it could have been much worse. I mean, it really could have been much worse. And that would have—that would have just done a lot more to discredit. But because it got really bad, but just bad enough to save the people at the top and to save some basic stability in the way America works—I mean, when you go back and read about the Great Depression, it’s really important to just think about just how intense that was. You also didn’t have the modern welfare state in a lot of respects, right? There was no unemployment insurance. There wasn’t Medicaid. I mean, these—

AMY GOODMAN: And you look at what they came up with, what came out of that.

CHRIS HAYES: Right.

AMY GOODMAN: And in writing your book, you’ve looked back at this, but how FDR, who, to say the least, was of the 1 percent—

CHRIS HAYES: Yes, absolutely.

AMY GOODMAN: —how he ended up accomplishing what he did. And you also mention the issue of movements, of course. And also, there’s Frances Perkins, who was quite remarkable as his secretary of labor.

CHRIS HAYES: Yeah, and FDR—I mean, I think FDR’s thinking on this—and it’s complicated, and Eleanor was kind of the moral conscience, in many ways, of that couple. But it was in some ways a pragmatic—look, I mean, there was a lot of folks in the FDR administration who had this—basically this same argument. You know, the system is going to completely fall in on itself and give way to something horrendous like fascism, unless we change it. A lot of the arguments for the state that’s created by the New Deal, which is this regulatory state which is far more equal and redistributive than what came before it, are arguments on these practical grounds, which is that we can’t afford to have a system as prone to crisis of this depth and think that American democracy and American capitalism will survive it, right? It was a very—it was a very pragmatic approach. Now, there were people who were, you know, real moral visionaries who also saw the imperative of justice in creating that system, but there was also this technical belief that the system was just too unstable.

And I think, increasingly, you’re seeing a vocabulary articulated around the current system that harkens back to that same analysis. Joseph Stiglitz’s book, and Jamie Galbraith has book about instability and inequality, and the arguments I make in my book—they’re all centered around the fact that—take all the moral arguments about how unjust the system is and put them to the side for a moment—although, obviously, I believe in them, and they’re important to me—and just look at whether this is a sustainable system. Just look at whether we are headed towards a set of unending crises and catastrophes that will get worse, that will actually create a level of pain unlike we’ve seen since the actual Great Depression.

AMY GOODMAN: What about the steroids scandal? Because you deal with that, as well.

CHRIS HAYES: Yeah.

AMY GOODMAN: And, you know, the Tour de France is happening now, which makes you think of Lance Armstrong, and then you’ve got Barry Bonds. Talk about how that fits into this story.

CHRIS HAYES: The steroids scandal, I think, is a great case study for thinking about some broader dynamics in our institutions and organizations. Ultimately, it’s pretty low stakes. It doesn’t matter that much whether baseball players cheat or not, particularly not as much as whether, say, bankers cheat. But some of the dynamics that happen in baseball, I think, are applicable to Enron and Wall Street.

The basic idea behind what happened in steroids and explaining the steroids scandal is that, you know, Major League Baseball really is, in many ways, a genuine meritocracy in this sense. If you’re an aging slugger who can’t hit the fastball, it doesn’t matter how much people—how beloved you are, you don’t get much playing time. And if you’re a 19-year-old Dominican kid who can’t speak English, no one’s ever heard of, but you can throw a fastball for 90 miles an hour for strikes, you get playing time. There are huge rewards for performance—$10 million a year contracts—and harsh penalties for failure—sent down to the minor league. And everyone operates in this competitive environment.

And what Major League Baseball shows us is that it’s much harder than it looks to design a system with huge rewards for performance that isn’t also a system with huge rewards for cheating. What happened in Major League Baseball is that if you have one of these competitive institutions, if you have this ceaseless process of sorting and competition and big rewards for being on top and punishments for being on the bottom, if you introduce cheating into that system, it will spread immediately. It will destroy the old norms very quickly, because everybody has that incentive. Everybody has the monetary reason to try to get the advantage. And in some ways, you end up with this ironic situation in which, because it’s competitive, no one even is better off in real terms. If you and I are facing each other on a baseball diamond, and I’m a pitcher using steroids, and you’re a batter using steroids, we’re just having the same interaction we would be having if we both weren’t using steroids, right? But instead, because of this competitive drive, we’re now both cheating, we’re now both doing this wrong thing. And that happens on Wall Street. I mean, it’s happened on the tour. The tour is a perfect example. As far as we can tell, almost everyone on the tour has been doping, it appears.

AMY GOODMAN: You mean the bicycle Tour de France.

CHRIS HAYES: Yeah, the Tour de France. You know, if there was a way to just enforce it so that no one doped, everyone would just be having the same interaction they’re having if they’re all doping. In Wall Street and in baseball and in Enron, what we see happen is when the dam bursts on the norms that hold an institution together, because of this competitive pressure, because of the massive size of the payments available at top, what floods through is this culture of deceit and fraud and almost a kind of knowing, winking, open-joke—inside-joke, open-secret culture. And you see it with testimony before Carl Levin, Senate Permanent Subcommittee on Investigations, in which a employee of Moody’s was talking about being pressured by an investment banker to rate a security AAA, even though he had misgivings, and he was asking for more due diligence. And the banker said to him, "Who cares? Let’s get the deal and get done. And if not, IBGYBG," which means "I’ll be gone, you’ll be gone." "I’ll be gone, you’ll be gone" is the moral core of looting. That is the justification for looting. And if you have institutions that are set up in this highly competitive way, with these big rewards on the top, you’re going to get cheating.

And the reason this is so important right now, in this moment, is we are in the midst of a national experiment, in which we are quite explicitly transitioning the model of teachers and education from a bureaucratic model to a meritocratic one. That is the goal: accountability and punishment for failure, constant testing of metrics, competition for bonuses through merit pay. The prediction made by the analysis in the chapter of the book that looks at steroids is that we should not be surprised if this new model produces endemic cheating. And in fact, lo and behold, what are we seeing? That’s what we’re seeing in the cheating scandal that’s happened in Atlanta. We’ve seen it out of the numbers in Washington, D.C. This is going to be something that we’re going to see more and more of as we transition this model.

AMY GOODMAN: We’re talking to Chris Hayes, Nation editor-at-large, has his own TV show over at MSNBC on the weekend, Saturday and Sunday, 8:00 to 10:00, every Saturday and Sunday morning. His new book, his first book, is called Twilight of the Elites. Chris, a little of you? You grew up here. You grew up in the Bronx?

CHRIS HAYES: I grew up in the Bronx. My father was a—he was a Jesuit seminarian who became a community organizer. My mom was a public school teacher in the Bronx. We grew up in the Northwest Bronx.

AMY GOODMAN: And who did your father organize?

CHRIS HAYES: He did a lot of tenant organizing, particularly in a period—he worked with an organization that still exists, was one of the earliest—essentially the co-founders of the Northwest Bronx Community and Clergy Coalition, still exists in the Northwest Bronx. It was at a period of time in which, you know, the Bronx was burning, literally. I mean, arson and, you know, tremendous struggles in terms of poverty that were the setting, the Bronx. And it was organizing in an area that was essentially on the border of the South—between the South Bronx and the North Bronx, in a neighborhood that was struggling with all the issues that had come to the Bronx at that time, and doing a lot of tenant organizing. He’s later gone on to do organizing in banking, around healthcare and hospitals in Brooklyn and New—he now for the Department of Health for New York City doing community-based health in East Harlem. So, that was the world that I grew up in. It was kind of an amazing world in the Bronx, because it was—my parents’ circle of friends were folks who were all, one way or another, involved in social justice work, a lot of folks who had come through Fordham and had a kind of Catholic—left, Catholic, social justice tradition that they were putting into practice. That was the—that was the milieu that I grew up in in the Bronx.

AMY GOODMAN: And you really begin your book there, and you begin with your own education. Talk about where you went to school and why it sort of forms a model for how you look at the elite and meritocracy.

CHRIS HAYES: Yeah, I had the remarkable fortune to go to Hunter College High School, which is a public magnet school here in New York City that is on 94th and Madison. And it’s a very interesting place. It’s open to students from all five boroughs, public, free school. You take a test in sixth grade, as an 11-year-old. If you’ve scored high enough on your fifth grade test, then you qualify to take the test. Then you take the Hunter test, and if you score high enough on that, then you can get into the school. And it’s, you know, competitive. There’s not that many kids that are able to get in, compared to the desire. And it’s a remarkable place. I had an amazing education. And in some ways, at a certain level, right, this is the model of meritocracy at its most austere, which is level playing field, one test.

And the virtue of that—I’ll get into the vices of it—the virtue is that it’s a relatively difficult system to game. So, if Mayor Bloomberg’s granddaughter doesn’t get a high enough score, she’s not going to get in. There’s—he can’t donate a new wing to the science library, like you could at a major university. There is no legacy admissions or a scheme team that you could work out a special means of getting a preferred member of your family into. And, in fact, I talked to the president of the school, who said, "You would not believe the phone calls I get." And I said, "I can believe them. We’re in New York City. There’s millionaires and billionaires who want to give this scarce resource of a great education to their kids." So, in that way, it resists some of the corruption that we see in some of our other institutions.

But at the same time, what we’ve seen in the school is it’s always vastly underrepresented, black and Latino students, because of the distribution of poverty in the city, the distribution of educational quality in the city. So, kids who are coming at sixth grade, 11 years old, it isn’t a level playing field. They’ve had vastly different experiences of those first 11 years in terms of their education and resources. And then, on top of that, we’ve seen in the last 15 years, since I was there, the growth of a test prep industry for the school, for this one test.

AMY GOODMAN: For the fifth graders, leading into the sixth grade.

CHRIS HAYES: For the sixth grade—yeah, yes, exactly.

AMY GOODMAN: So you start at the fifth grade—

CHRIS HAYES: Yes.

AMY GOODMAN: —so in fourth grade, you’re preparing for that fifth grade test?

CHRIS HAYES: That’s right. I mean, well, that’s what we—we’ve seen this testing model is now increasingly what our educational model is around. And—

AMY GOODMAN: Little nine- and 10-year-olds carrying their little attaché cases.

CHRIS HAYES: Yes, exactly. And so, we’ve seen a test prep industry grow up in which, you know, for thousands of dollars, you can send your child to a cram school over the course of winter break every day, for instance, to prep for the test. There are tutors in Manhattan who charge $90 or $100 an hour for kids to prep for it. And from the reporting I’ve done, there’s no figures kept by the school on this, but the—

AMY GOODMAN: Do they have examples of the test?

CHRIS HAYES: So, they’ve—actually, one of the ways that they have tried—the school, the first step it’s taken to try to counteract this is actually publicly release the test, which never—it hadn’t been doing before. So, this test prep was based on reports of, you know, kids remembering what questions were asked and sort of reverse-engineered. And so to try to once again level the playing field, they’ve said, "OK, we’re going to make it open and public and accessible to everyone. Everyone can see prior tests and do their own test prep."

But, of course, you know, this is exactly the problem. This is exactly the problem, which is that if you try to preserve this austere vision of equality of opportunity, and you don’t worry about the context of inequality in which it is embedded—a city like New York City, which is a vastly unequal place—the inequality of outcomes, the inequality of resources, the actual amount of inequality is going to subvert and corrupt whatever kind of mechanism you come up with in which you’re trying to preserve equality of opportunity. You can’t detach those two from each other. And this is exactly the challenge that my alma mater, which I have obvious and tremendous affection for, is wrestling with right now.

AMY GOODMAN: And has it become increasingly less diverse?

CHRIS HAYES: Yeah. Well, it’s become less black and Latino. It is 3 percent African American, 1 percent Latino, in recent statistics cited in the New York Times, reported through the school. But this is in a city that’s majority black and Latino. And it’s just—it’s unacceptable, in the final analysis, to have a public institution in New York City, a city that’s majority black and Latino, have those sorts of numbers. I just think it’s unacceptable.

AMY GOODMAN: We’re talking to Chris Hayes, Twilight of the Elites: America After Meritocracy. Hey, Chris, what has happened? I saw yesterday that "MS" is coming off of "NBC" on the website?

CHRIS HAYES: Yeah, this is actually extremely exciting news for us at MSNBC, because the history of MSNBC was this joint venture, 50-50 between NBC and Microsoft, and in 2005 NBC bought out Microsoft’s share of the cable network, so it was entirely an NBC property. But until two nights ago, MSNBC.com was a joint property. It was 50-50, which meant we didn’t really have control over our own web presence, at a certain level, because, you know, when you go to MSNBC.com, there’s a whole editorial staff in Washington state that was overseeing what that content was. And my sense of this—I don’t have any special knowledge of this—my sense is that Microsoft, you know, didn’t want the brand of their website to be the brand, increasingly, that MSNBC is going in.

AMY GOODMAN: I mean, I think they were quite explicit. When I was watching the news yesterday, there were some quotes about the increasingly less diverse points of view that are presented, we don’t want to associate with?

CHRIS HAYES: Right. I mean, they don’t—you know, Microsoft wants to be a down-the-middle purveyor of content and not be associated with this lean-forward, you know, increasingly progressive brand. But for us, it’s wonderful, because we can now look towards—we now own our own online presence, which the irony of this, of course—

AMY GOODMAN: But the "MS" stays in "MSNBC"?

CHRIS HAYES: Well, yes. So, right now, it’s NBCNews.com, and that’s going to be that for six months. And then, starting January, it’s going to be MSNBC.com, and we’re going to have a whole new website. We’re going to—it’s, you know, MSNBC.com—

AMY GOODMAN: So "MS" stays, the Microsoft part?

CHRIS HAYES: Yes. Yeah, it will stay as the name. We still—we’ve just now bought out all of it. So, MSNBC, the network, MSNBC.com are all now squarely housed within MSNBC, and we can begin to do online the kind of web presence that reflects what we are doing increasingly on air.

AMY GOODMAN: In writing this book, since it’s your first, talk about what you learned, what most surprised you, as you both wrote the book and then traveled around the country.

CHRIS HAYES: I learned—I was really struck by how often people talked about their experience of what I call in the book "the failed decade" as a kind of betrayal, this—the sense of betrayal, and the way that it extended from people who are very poor, and have been very poor for a while, to people that actually have a lot of money, and the way it extended from people who are on the far right of the ideological spectrum to the far left, that the people they thought were looking out for them or should be doing the right thing weren’t looking out for them and weren’t doing the right thing, that—this phrase that kept coming up over and over again—the game is rigged, that the social contract has been torn up, that the—that something is skewed or queered or that there is this sense that behind closed doors people with power are manipulating the rules to benefit themselves. That’s a story, increasingly—that’s a framework and a story that you hear from folks all over the place, I mean, from Detroit to New Orleans to, you know, Greenwich, Connecticut. I mean, folks have—

AMY GOODMAN: And you write a lot about Katrina.

CHRIS HAYES: Yeah, and—

AMY GOODMAN: You write about what happened.

CHRIS HAYES: And the sense of betrayal, particularly there, it’s particularly directed at the Army Corps of Engineers, I think rightly directed at the Army Corps of Engineers. The sense of betrayal there is profound. I mean, there is a line—there is a line that actually didn’t make it into the final version of someone who lived along, I think, the 17th Street Canal, where the levees failed for no reason having to do with the storm. I mean, the levees were certified to hold back the category of storm that hit. The water didn’t overtop the levees. They just basically fell in line mashed potatoes, as one engineer told me. And he said, you know, "We really" — he talking about the Army Corps of Engineers, and he points to a flag in the yard of his neighbor that’s the Army Corps of Engineers insignia, which looks like a little fort, and it’s a circle with a bar through it, you know, like the "no smoking" sign. He says, "You know, we really do rank them up there with child molesters." I thought, "Whew!" You know? And—but he—you know, he almost lost his entire house, had to rebuild the whole thing more or less from scratch because of the failure there. So this sense of betrayal in the wake of these failures was really affecting to me.

The other thing I learned is just that writing a book is incredibly difficult and incredibly rewarding, just as a process. I found the process of writing it, forcing yourself to think through things at the length and depth that a book requires, was a really challenging but rewarding experience, particularly, I think—and I think about this now in the context of just my daughter, who’s seven-and-a-half months old, and thinking about her—the world that she’s growing up in—is how rare a commodity the ability to pay attention to something for a duration of time is and how much modern life destroys that ability. And this is true of me. I mean, I’m—you know, the iPhone and Twitter and all these—this kind of addiction to different stimuli. And the thing that is almost meditative about writing a book, that’s gratifying, is that you are just forced to reconstruct the ability that you probably once had—you had to have to, you know, get through algebra, for instance—which is, you know, you would sit there when you were a kid. You’d do your homework for 45 minutes or an hour. And that’s, you know, a 10-year-old or 11-year-old or 12-year-old who doesn’t have the same capacity, and you were able to do it then, but I—god, I can’t remember the last time I sat and did a task uninterrupted for 45 minutes and an hour. And I think just going through that exercise is just extremely useful and important. And I think that—I think more and more about how we, just generally in the modern world, can come up with ways to reconstruct that broadly.

AMY GOODMAN: So, Chris Hayes, with three new babies, his new TV show, Up with Chris Hayes, his new book, Twilight of the Elites: America After Meritocracy, and probably most importantly, his baby Riley?

CHRIS HAYES: Ryan, yeah, yeah, yeah.

AMY GOODMAN: Ryan. What is it?

CHRIS HAYES: Ryan.

AMY GOODMAN: Ryan.

CHRIS HAYES: R-Y-A-N, yeah. Yes, definitely—

AMY GOODMAN: How did you choose that name?

CHRIS HAYES: Definitely most important. We—you know, long process of brainstorming and winnowing down, yeah.

AMY GOODMAN: Well, congratulations.

CHRIS HAYES: It’s really wonderful.

AMY GOODMAN: Chris Hayes, thank you so much for being with us. Twilight of the Elites: America After Meritocracy.

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