ED HARRISON: Hi. Ed Harrison here for Real Vision, I have the distinct pleasure of talking to Tom Steyer, who is the founder of NextGen America. Tom, welcome to Real Vision.
TOM STEYER: Ed, thank you for having me. It's a pleasure.
ED HARRISON: I had to stop myself from saying also presidential candidate, I should say, for the United States as well, because you have a storied career. That's definitely one part of it, but I want to circumscribe what we're going to be talking about in this conversation to the economic portion of it. I think NextGen America is a great way to think about this, because it's talking about young people, a bunch of different ideas and things that are important for young people, specifically for me, that I'm thinking about is equal opportunity for everyone. Justice, economic justice, because you hear this term rigged a lot, as if somehow we live in a world in the United States now where the system doesn't work for everyone. Tell me about NextGen America, and what's on your mind with regard to equal opportunity economically?
TOM STEYER: Well, I started NextGen eight years ago basically to engage and empower young voters, the biggest generation in American history. It includes at this point, millennials and Gen Z, the most diverse generation in American history, by far, the most progressive generation in America and voting at half the rate of other American citizens. I felt as if we don't have a true representative democracy unless our biggest generation is represented equally with everybody else. By the way, young people have different attitudes that I believe in and agree with, which are progressive attitudes.
One of them specifically has to do with economic justice, which you can't separate from all the other issues. I look at economic justice from a young person's standpoint as being addressing what I think people recognize in your generation as generational theft. That, in fact, the young people, the young voters, the young citizens in America are going to inherit a country that basically people have stripped and left them to do what they can with huge student debt, with a huge climate debt, with low wages and low opportunity, and with all kinds of including the huge federal debt.
When I think about economic justice, I can't separate it from racial justice. I can't separate it from the way our entire capitalist private sector system works, and I specifically in the context of NextGen, can't separate it from the way older people profit from the system at the expense of younger people.
ED HARRISON: Yeah, very well put, and there's so many issues there to tackle. The one issue that you didn't mention that I think overrides everything else right now and the reason that you and I are actually on a Zoom call is the pandemic. I'm thinking about that also from equal opportunity, economic justice perspective. Just today, I was listening to the radio, they were talking about Alabama which has the lowest percentage of people who are getting the vaccine, and this woman who's in one of the groups that is most hurt, or most vulnerable, she was saying, I can't get the vaccine, people are literally waiting in their cars overnight in order to be first in line.
That's how bad it is here in terms of getting this sorted. What are your thoughts in terms of, first and foremost, the pandemic, irrespective of economic justice as an issue, that must happen, we must deal with before we can tackle anything else?
TOM STEYER: The pandemic, exposed, and exacerbated, made worse, a lot of the injustice in American society, including on a racial basis, including on an existing income basis, and including on a generational basis, so let's just go through it. We have seen that this pandemic has actually made rich people richer. It has made the vast bulk of Americans poor. It has specifically broken down in terms of income inequality and wealth inequality.
It's exposed racial injustice, not only from the standpoint of incomes and money, but also from the standpoint of who's vulnerable, who has preexisting conditions, who is an essential worker, who is going to be exposed to proportionately to the virus. Then because of those preexisting conditions, is more likely actually to get very sick or to die. Also, from a generational standpoint, it is pointing out not just the income differences, not just the low wage opportunities, which is why Democrats are pushing for a $15 minimum wage across the country, which I entirely support, but also, there's the whole educational aspect of this.
That in fact, and it's one of the things if you think the absolute promise of America has got to be that every kid gets a fair chance to go as far as his or her talents will take them. What we've seen here is an inability to deliver education in person across America, and then falling back on virtual education, online education, where the disparities between young people who are connected, whose parents are technically proficient and able to use the internet. Some people aren't connected. Some people can't use the connection.
It shows a vast disparity of outcomes for over a year at this point, a huge impact on young people exacerbating inequality, exacerbating opportunity, the disparities and opportunity for young people. Look, when I was the co-chair of a taskforce on jobs and economic recovery in California, I was absolutely passionate and remained passionate about closing the digital divide. Give kids a chance to go to school. Let poor kids go to school equally to everyone else so they have a chance like everyone else.
If we don't allow that, we are taking away their opportunities in a very substantial way. This pandemic has exposed the underlying inequalities, but it has also made them work across to board it and it is something we have to get back on.
ED HARRISON: When you say that, private schools, many of them in the area where I am, I'm in the DC area, they're in school. The public schools are not in school. My son actually, he's not in school.
TOM STEYER: It's absolutely heartbreaking. If this doesn't get you, if kids not getting a fair chance at education, if kids not getting fed doesn't get you, I don't know what your heart is made of. Because I know from years of looking on, farm to table in schools, getting good quality food to kids who need free and reduced lunches. Then watching this digital divide and seeing kids who don't get to go to school, it's heartbreaking.
This is the absolute essence of any society. Are you going to give young people an equal chance? Are you going to give them a real chance? You're exactly right. Kids get in private school are going to school, kids in public school aren't going to school. Richer kids are connected. Those kids who are connected also have parents and home facilities that let them get some semblance of an education. Other kids don't.
ED HARRISON: A lot of this sounds good, and we're going to get to the solution, because I know you have a lot. The one question that always comes to mind-- because I did my research on you, I looked you up and your background, you're not exactly what people would consider the guy who would be thinking about poor people, you have a storied background, the private schools, the hedge fund, and the billionaire status. The thing that sticks out for me when I read your CV is the Brooklyn House of Detention. Your mother doing education there. Can you talk to me about what brought you into this need for economic justice? Why are you so passionate about it?
TOM STEYER: It's really funny, Ed, because you're right. My mom was somebody who got a graduate in Education, ran volunteer programs, teaching kids in the public schools of New York, how to read, how to learn English, if English was a second language, remedial math, and brought those same programs to the Brooklyn House of Detention to the prisoners there. She was someone who-- look, I grew up right in the middle of the civil rights movement.
She was completely passionate about justice, completely passionate about opposing injustice, voted for Shirley Chisholm for President, and when people would ask her about it said, it's not some cute thing I'm doing. I'm voting for by far the best person running for president. By the way, if you go back and look, my mom was right. If you go back and look, every one of those moves that she made that people in New York would give her a hard time about, she was passionate about, she was fighting for and she was right.
I look at this, it's funny. Yeah, my mom was passionate about this. My dad was a prosecutor at the Nuremberg Trials prosecuting the murderers of the Nazi regime. The funny thing is one of the stories is my grandparents who I thought of is quite conservative and not particularly nice people, during World War II, my uncle, their son, my mother's brother was fighting in the Pacific as a naval officer on a PT boat and on a submarine. At the same time, there was the Japanese internment in California and my grandparents took in a young Japanese-American girl into their house to live with them and go to school so she wouldn't be interned.
For some reason, people in our family, including my brother, Jim, who is passionate about this, whose life work is underserved, underprivileged children, giving them a chance. We all know that the promise of America and the meaning of life is to stand up for the vulnerable. That in fact, that is a huge part of the meaning for everybody. Certainly, for me, what is the point of being on the planet if you're not doing that? Isn't that how your own life, however privileged you may be, if you're not doing that, are you really having a meaningful life? Are you really proud of what you're doing?
Isn't that what gives you-- that's what gives me the pleasure of seeing fighting back on behalf of exposed vulnerable people against people who I consider to be mean and selfish. Boom. That's what motivates me. I'm looking for that. That's why I didn't like Trump. That's why I ran a need to impeach campaign for two years. I don't like mean people who hurt vulnerable people, especially kids, especially Americans. That's really what this is all about to me, is I don't like that. It's a gut thing. I'm very motivated to push back on that.
ED HARRISON: Well, I appreciate your sharing the personal side, because I think that's really important to understand why we are and where we are, and one of the reasons that I'm interested in talking to you, just from a personal level is that after the Great Financial Crisis, which was another one of these events where the system was exposed in a very negative way, I went to a conference, and they were talking about bank reform.
One of the conference meetings was on this bank, a woman who was very well spoken was talking about it. Her name was Kat Taylor, and she was talking about Beneficial State Bank. There you go, that is your wife talking about a bank that you founded with her. Talk to me about that bank in the context of this system both economic justice and also the financial system that hasn't really worked for everyone.
TOM STEYER: Look, Ed, we all know that the financial system has been dramatically biased during both all of our lifetimes, specifically with redlining of African-American communities, but in general, it supports itself, it supports the status quo, it supports the people who are the already haves. We looked at that, and as we both-- Kat Taylor has a law degree and a business degree and I'd started a business. We felt like what do we have to contribute? The answer was to try and bring some justice, economic justice and environmental sustainability, which I don't separate, to the finance world.
We started a bank that was aimed at those two values, along with financial sustainability, and specifically supports businesses owned and run by women and people of color. The people who've been shut out, who can't get bank loans. We said, we can prove to you that they deserve bank loans, and that there's a business in helping them out, not in gouging them, but in supporting them. Our whole idea here was, we knew we'd never be the biggest bank. We started with $0. We're up to I think, $1.2 billion. We did a ton of PPP loans last year, but the point was both to substantively make a difference, but also to show that what the big banks were doing was wrong, that they were absolutely unfair.
I remember when I was running for president, one of the people who was supporting me was a probably fortyish African-American entrepreneur who had worked at the Bank of America. He said to me, I left the Bank of America to start a business and I'm very good at finance. This is my profession. I understand what it takes to get a loan. I'm good. I know where this is going. He's like, I couldn't believe it. I couldn't get a loan. I know what it takes to get loans. I'm meeting, I'm checking every box. They're going like, thank you for your application, no.
It was clear, and I heard those stories all the time of people who were mistreated, differentially treated, and our attitude was like that's why communities can't advance. They don't get support to build their own businesses from the financial system that other people do get. The gap just continues to grow.
ED HARRISON: As you say that, I was thinking about the rural communities, and not necessarily banking, but also the economic environment there. There's this divide between the rural and the urban. What can the government do in order to foster an environment that works in both places, at the same time, using community banks like the one that you're talking about?
TOM STEYER: Well it's funny, Ed, because the bank, we specifically said from day one, we want to serve every underserved community in California, rural and urban. It's like, we want it to be in the lots and we want it to be in the Central Valley. We know there's extreme poverty and injustice in both places. It wasn't like, we wanted to say, oh, we just get this one part, we wanted to be in every underserved community to try and lift them up. When you look at rural communities, Kat and I, but Kat really is working, we've also been working in what's called Regenerative Ag, a new model of agriculture that is much more sustainable, that it's actually rebuilding the soils, sequestering carbon and providing better, healthier food.
That is when I look at rural America, I look at huge opportunity but also at a place which traditionally has been very unjust economically, think about the farmworkers in California. Think about industrial agriculture versus family farms, and where they're missing huge opportunities in my mind, the government is to support those farmers as they provide a different service than just doing industrial agriculture. We're in a huge climate crisis, a lot of this solution is going to turn out to be in farms, in agriculture and in sequestering carbon there, that basically you pay farmers to take the carbon out of the air and stick it into the ground, which they know how to do and which they can do, which will be a service to all of us.
I think what we can see is that our economic system is efficient, in some ways, it's highly unjust, it is running into a wall, and we really need to have a new version of it that's much more just where the incomes are much more equal, and where in fact, they all grow together. Because the idea that a society can work when a thin slice on top is doing really, really well and everyone else's suffering cannot work. It can't work politically. It doesn't work economically.
ED HARRISON: Yeah. There's so many different issues that are touching there. I could go to climate change, I could go to financial regulation or deregulation as it was before, anti-trust. Let me see if I can boil down-- because there are so many issues that are related to that. I think the one issue that speaks to me the most about what you're saying about the system has to do with bigness, anti-trust, big tech, big companies in general. In terms of things that can make a difference, where can we go in terms of dealing with the whole concept of anti-trust as a solution to bigness, and the rich getting richer?
TOM STEYER: Look, I think there's no question at this point that we all recognize that there's been a massive concentration of economic power in fewer and fewer entities. That's statistically obvious, but think about the anecdotes, think about how many people Facebook reaches, how many people Google reaches, all of these huge concentrations of power. I think that even those companies recognize that they're at a place where in some way, they're monopolist. I always say to people, if you think about a monopoly, where Ed has no choice but to use this service, then their job is to give you the worst service at the highest price.
Everything you learned in Econ 101 is the job of a businessowner is to provide the best service at the lowest price so that he or she can outcompete all the competitors. With a monopoly, there are no competitors. Therefore, the most money you make is providing the worst service because better service cost more at the highest price, because you know what, Ed, has to use it no matter what. We can jack the price as far as we want, because he doesn't actually have a choice. It's a perverse incentive.
When you look at a monopoly, it becomes clear that there are only two solutions. You can break it up, or you can regulate it. Now, if you think about a utility, an electric utility, they regulate it, because you need electricity. There's not going to be two providers, it's too expensive to build every bit of system twice, there's going to be one provider, and therefore the government sets prices, because otherwise, the electricity company would run rampant and charge whatever they want it. You either have to have regulation, or you have to break it up.
You say, look, we're going to have 10 Citibanks now. Citibank is too big. They're monopolizing. They're not treating the market fairly. They're gouging. Therefore, we're going to take Citibank and create 10 Citibanks and let them compete against each other and get back to Econ 101. I think that if you look at these concentrations of power and economic might in the United States right now, some of them fall into one of those, some of them falling together. Some of them are natural monopolies.
A lot of these online things are like marketplaces. If you think about an original marketplace, like Ed and Tom are now living in 1700s in a dusty town someplace in the world. We want to go to the marketplace, there's one marketplace. The reason is the sellers go to the marketplace because that's where the buyers go, and the buyers go to the marketplace because that's where the sellers are, and Ed and Tom can decide to go off into the corner and go