Cool story bro
Back in the real world, almost every economist recognizes that income inequality is part and parcel of market economies and capitalism. Having some income inequality is generally regarded as positive. The problem is that income inequality is rising, with numerous detrimental effects. In particular, it tilts the political system in favor of the ultra-wealthy who have massive stockpiles of cash to throw at politicians. To put it mildly, the policy goals of billionaires is vastly different than the typical American who is just struggling to get by, thus it drives the government away from policies the public actually wants. (See
Billionaires and Stealth Politics for a fuller explanation of that phenomena.)
It also means that the overwhelming number of consumers don't share in the gains, which alienates them from the political, economic and social systems. One result is a disaffected populist public that votes incompetent morons into office because they "like their style" (e.g. Berlusconi). A second is that the high levels of inequality negatively impact growth rates. When 99% of your customers can't afford your products, and when the top 1% have so much money that having more doesn't result in them spending more, then the economy suffers.
In fact, all of these issues give fuel to
exactly the kind of revolutions he objects to -- e.g. the rise of Communism in the Gilded Age, and anarchism in the 1920s and 1930s... If you don't want a socialist uprising, then you should take steps to mitigate increases in income inequality.
As to his claims?
Surprise! Income inequality did not rise between 1970 and 2019 because a handful of people (mostly white men) became 500 times more brilliant and productive than their predecessors. It's because they lobbied to change the tax code and corporate laws to their advantage. (Or, in his terms, the math of Price's Law did not change since 1970.)
To put this another way: Bill Gates is definitely more productive than the average American. Is he 1,355,263 times more productive than the average American? Obviously not, especially since he stepped down as CEO of Microsoft and became a full-time philanthropist over 10 years ago.
As to "financial services?" Most of that class are rentiers. Whatever value they do add as a class, they typically detract by creating financial instabilities in sectors, nations and global systems. We can't live without finance, but listening to some finance dude spout off with his rationalizations about how he and his buddies deserve their high pay because they're
so much more productive than the Hoi Polloi is not persuasive... unless you were already looking for a reason to ignore income inequality in the first place.
His claims don't bother to deal with the role of inheritance. The US has eroded estate taxes for decades, and this obviously exacerbates income inequality. And no, those inheritors rarely did anything to enhance their own productivity.
So, spare us the biased claims of a financier who hasn't bothered to understand the basic problems of the increases in income inequality.
BFD.
