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The Lie

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Trump/CNBC have adopted a narrative that this is about protecting the most vulnerable. No, it’s about buttressing the most wealthy. Pandemics typically result in higher wages over the next several decades as we recognize that essential workers (the gal/guy delivering your Greek yogurt and placing your Indian food in the backseat of your car) should be paid more. A good thing.

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Letting firms fail, and share prices fall to their market level, also provides younger generations with the same opportunities we, Gen X and boomers, were given: a chance to buy Amazon at 50x (vs. 100x) earnings and Brooklyn real estate at $300 (vs. $1,000) per sq. ft. Just as we pretend our service men and women are heroes, and then treat them like chumps, CNBC advertisers and Peter Navarro want to pretend they give a sht about younger generations so they can protect the wealth of old people and management/advertisers. Enough already.

Earlier this week, I was on MSNBC with an early Uber employee, who reminded us, “We’re all in this together.” What bullsht. My guess is this executive registered $10-100 million in equity crafting software that figured out an elegant way to pay their 3.9 million “driver partners” less than minimum wage, ensure Uber isn’t obligated to provide them with health insurance, and avoid paying payroll taxes to adequately fund the CDC. But Dara Khosrowshahi and his several-hundred-strong comms department wrote a compelling letter to the government urging them to help his driver partners.

Dara, pay your “partners” before picking up the pen again.

Walking the Walk — PPP

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We recently founded Prof G, a firm attempting to disrupt graduate business education. We offer online business/strategy sprints that aim to provide 30-50% of my classes at NYU Stern for 7% of the price. We are eligible for some of the $350 billion federal PPP program. With a modest amount of paperwork, in 7 days or less, we’d receive a loan for approximately $250,000. If we don’t lay off any employees, most of the loan would likely be forgiven. This is meaningful cabbage for us.

We are not going to apply for the program.

Our backers are wealthy, and if we can’t make this work — pandemic or not — then we don’t deserve to be in business. Yeah, our demise wouldn’t be our fault, nor is most success. Like steroids for the body, the moral hazard of government assistance only leaves the economy less healthy in the long run.

Just as death is a key part of life, so is the demise and reinvention of firms that can’t endure tropes. Covid-19 is no more historic than an 11-year bull market. With dangerous disregard for future generations we’ve decided that hundreds of thousands of people dying is meaningful, but the NASDAQ going down would be worse. The rescue package is $2.2 trillion. The annual CDC budget — $6.6 billion.

We. Have. Lost. The. Script.

To be clear, socialism may be a better way to go, as evidenced by the study showing 4 of the 5 happiest nations are socialist democracies. However, unless we’re going to provide universal healthcare and universal pre-K, let’s not embrace The Hunger Games for the working class on the way up, and the Hallmark Channel for the shareholder class on the way down. The current administration, the wealthy, and the media have embraced policies that bless the caching of power and wealth, creating a nation of brittle companies and government agencies.

The terrible thing about crises is they always happen. The wonderful thing is they always end. As we fight to bring this crisis to an end, let’s re-embrace capitalism and foster a future generation of leaders and firms that are soldiers, not hoarders. Yes, America is a terrible place to be stupid. It will be a worse place if we replace capitalism with cronyism.

Life is so rich,

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P.S. What happens when universities send tuition bills for $68,000 to host a bunch of marginal Zoom classes? Catch episode 4 of the Prof G Show on Apple, Spotify, or wherever you listen to podcasts.