The best way to reduce inequality is for the government to borrow $1 trillion to improve infrastructure and create middle-class jobs, billionaire Jeff Greene said.
Speaking Monday on a panel on inequality at the Milken Institute Global Conference, Greene said the combination of globalization and advances in technology will make inequality in the U.S. even worse in the coming years.
“The global equalization of wages and the exponential growth in technology has created a job-killing machine that’s only going to get worse,” he said.
Greene, who became a billionaire by betting against the housing market during the financial crisis and later ran as a Democratic Senate candidate in Florida, said raising taxes on the wealthy and investing in education and training would help reduce inequality. But he said a bolder solution would be for the government to take advantage of low borrowing costs and add $1 trillion in debt to fund construction of roads, bridges, underground pipe systems and schools.
“If we added an extra trillion to national debt, we could rebuild these underground pipes and schools and hospitals and give hope to people,” he said. “That would get the country through this difficult period. And it would help make the U.S. more competitive again.”
He admitted that the borrowing might make some politicians balk. But he said, “Sure $1 trillion is a lot, but it’s not a lot relative to the total debt” of around $18 trillion.
Greene also advocated an increase in the minimum wage. He said the current federal minimum wage of $7.25 an hour is cruel.
“If you think about $7.25 an hour, that’s $290 a week,” he said. “It’s inhumane to have that kind of wage.”
He said that as the owner of several real-estate projects and hotels he has recently raised the wages of many of his employees and seen their lives improved without damaging the financial viability of the investments.
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But Greene said that Americans who hope to get back to the American middle class’ heady days of the 1950s and 1960s may be deluding themselves.
“Let’s not forget we created that ideal middle class by destroying all of our industrial competitors during World War II,” he said. “The world has changed. I think you’re chasing a mirage if you think that system that created that perfect economy is going to come back again.”