Anthony Scaramucci thinks the coronavirus crisis could be an opportunity to close the economic gaps in our society. But first we’ll have to get politicians to stop yelling at each other on cable TV.
Scaramucci, the voluble former White House communications director and also managing partner of investment firm Skybridge, also says that the Federal Reserve’s long standing policy of keeping interest rates low inadvertently contributed to widening the divide between the rich and poor.
“I hope [the COVID-19 pandemic] will cause people to take a pause, take inventory of what's really important to them, and recognize that it's in our best interests, through market forces to close the wealth gap, and to find ways to fortify people who may be blue collar workers, or lower middle income people, give them opportunity, and to make them feel aspirational about their lives, but also their children's lives,” Scaramucci said in an interview with me.
“Maybe this pandemic will be a wake-up call for policymakers, politicians, macro-economists, the very wealthy, the Forbes 400, where they'll examine what's going on in the society and say, OK, we can do this better, Scaramucci said. “And it won't be any less yachts, or any less clothing, or fine dining for any individual. But it'll be way better for the social progress of the society.”
The income and wealth gap, which has increasingly vexed American society over the past several decades, certainly hasn’t diminished during the coronavirus crisis. In fact, the gap between the haves and have-nots has been brought into sharp relief during the pandemic, as the disease has particularly ravaged lower income Americans because they can’t work from home as readily, can’t social distance as easily and don’t have access to the best health care.
Pols need multi-decade plans to fix problems
Scaramucci, who likes to point out his working class roots and how he climbed the economic ladder, notes that that kind of mobility is harder to come by today. “Real incomes are down 20% to 25% over 30 years, for [working class] people,” he said. “We've moved those people from aspirational to desperational.”
I asked Scaramucci if we’d have to legislate change.
“Well, I certainly believe that,” he said. “I think somebody looking back on this period of time, from 2007 to where we are now would say that the monetary policy, the accident of the monetary policy, which was very healing after the crisis, probably created some of the income divide.”
“When you lowered rates like that, the people that held the assets, they got the inflation,” Scaramucci said. “You didn't get much wage growth. I think that's where the anger is.”
The solutions Scaramucci says are what he calls, “the tough things, like an infrastructure bill, a jobs training bill, a long-term plan, not a two-minute plan, but a 10- or 20-year plan to rightsize the K through 12 public education process.” That he said would have put us in a different environment today.
“What I fear right now, is because politicians have in general been more interested in excoriating each other on cable news is that they'll allow for that easy one-step solution, which is global coordinated monetary policy, printing of money, and that sort of thing. And I'm hoping that they'll think way more long term. There's things in our country that can be fixed, but they're 10, 20, or possibly even 30-year fixes.”
Scaramucci, who says he might consider running for office someday himself, acknowledges few politicians have multi-decade plans to fix problems.
“Hopefully this shock will cause people to say, you know what? We've got to find leaders and political leadership that are more focused on the long term and more focused on fortifying the entire society than the short-term gimmicks and the soundbites that are effective on cable news,” he said.
Tall order, that.
Andy Serwer is editor-in-chief of Yahoo Finance. Follow him on Twitter: @serwer.
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