JUST Capital’s co-founder Paul Tudor Jones on doing the right thing.
Q1 hedge fund letters, conference, scoops etc,
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Paul Tudor Jones - JUST Capital: Do The Right Thing
Transcript
When you think about it we have an elective process where we go choose our elected officials to govern for us well the government is a 4 trillion dollar piece of a 16 trillion dollar economy. The real real I guess power is in the private sector and yet the public has very little impact. When I say little impact certainly consumer behavior is very important that determines which companies survive and which ones don't. And no question they're investing is and where they work. But I don't know if they have a collective voice. And I think what we've done is provide an opportunity to aggregate the entire public and give them a voice and give information to companies about how they can become more just. I think the reason why just capital so important right now if you think about how we got to where we are now as a society and I would characterize where we are is in a highly unstable place. We have the highest wealth disparity in over 130 years. How do we get there. Well one way we got there was back in 1970 Milton Friedman famously said that the social responsibility of a company is to make a profit and at that point in time when he said that taxes were about 70 percent just down from 90. Income inequality was probably a fifth of what it is today and the lowest point in this century. So when he said what he did I can actually somewhat sympathize with it.
Fast forward to the day where profit margins have gone from 6 1/2 percent to 11 and a half percent and where labor's share of corporate revenue has dropped 30 or 40 percent and income inequality is five times what it was then. So this is really important because if we're going to actually change the way that society addresses particularly income issues we're going to do it through the private sector. That is what drives everything is three times the size of the public sector. I assume at some point there's going to be an app and I'm going to go to it now and put it in sneakers and it's going to say these are just sneaker manufacturers. No doubt you'll be able to go put in the name of any company and find out immediately probably where it ranks against companies its own sector as well as companies vertically through throughout the business change. Our job is to be nothing but great journalist in gathering information and then delivering that information to the public. They are completely unbiased. We also stopped into talk to Arianna Huffington about the power of the purse. Arianna is an author syndicated columnist and businesswoman. She was the co-founder and editor in chief of The Huffington Post and is currently the CEO of Thrive global digital public has never had more power and that's why Das Kapital is so important because it does the research to inform the general public about the decisions that companies are making around how they take care of employees and the provenance of products the supply chain and how they take care of all the different stakeholders not just the shareholders and the consumers the employees the planet the community and bringing all that together requires a lot of research and making that research available means that consumers can make better more informed decisions.
So I studied economics at Cambridge three thousand years ago and I still remember reading the book that Adam Smith rode before his famous Wealth of Nations and that was the Theory of Moral Sentiments. And it was really about the need for capitalism to have a moral foundation. When we forget that we really lose that trust in capitalist institutions. And that's why this happened now especially at a time when the accelerated rate of technology has had very unequally distributed benefits and has affected the middle class in a way that we are all very conscious of. I mean we all talk a lot about that growing inequalities that need funding to save capitalism. But there is a real gulf between our understanding of the decisions we're making. I totally agree with.
