Capitalism must be reformed because it’s creating such an income gap between the rich and everyone else that threatens to spark conflict, hedge fund titan Ray Dalio wrote in an essay posted April 4 on LinkedIn.
The billionaire founder of the world’s biggest hedge fund argued that “the American dream is lost” and that income inequality, rising health costs, and a lack of education funding pose existential risks for the U.S.
“I think that most capitalists don’t know how to divide the economic pie well and most socialists don’t know how to grow it well,” Dalio wrote, “yet we are now at a juncture in which either a) people of different ideological inclinations will work together to skillfully re-engineer the system so that the pie is both divided and grown well or b) we will have great conflict and some form of revolution that will hurt most everyone and will shrink the pie.”
“I believe that all good things taken to an extreme can be self-destructive and that everything must evolve or die,” he added. “This is now true for capitalism.”
Despite his criticism of the current state of U.S. capitalism and the fact that the nation’s top 0.1% takes in over 188x the income of the bottom 90% ; in an interview on CNBC’s “Squawk Box” Dalio said the system doesn’t need to be destroyed, just reformed.
He noted however, the question remains whether there is “equal opportunity for the American dream.” He says thanks to things like proper care and a proper public school education system he did have that chance, but too many others do not.
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I believe this too. America has proven with things like Social Security that the best society lies somewhere between the two systems. There are too many “charities” at present pretending to help people and too many government programs trying to help people and neither one getting the job done. Corporations are taking the same road of reward for the top individuals leaving not enough for the middle and bottom employees. Nowhere do you see loyalty for a company these days, but then companies are not loyal to their employees either. There used to be better examples in the past that maybe we need to go back to. Anyway you look at it the economy and employment need to be better so people can depend upon where they work and they can depend upon a government that is there to help by doing a job as if they were a company trying to make money. Most Americans do not want to depend on the government. They want their worth to show up with the company they work for. That cannot be accomplished if the government thinks it can give us a just enough existence. It cannot be done with overpaid top individuals in corporations with the same mindset.