Photo: AP

Hedge fund billionaire Ray Dalio is getting a modest amount of attention (including a 60 Minutes profile) for proclaiming that capitalism is broken and desperately needs to be fixed lest we have a revolution. No shit! Let’s evaluate the solution set of the enlightened rich man.

Dalio, who founded the extremely successful hedge fund Bridgewater, is worth more than $18 billion. We are not here to engage in the very easy thing, which is “Wanna solve inequality motherfucker... give away your money!” (Though he should give away his money.) We are here to scrutinize Dalio’s recently published, very long essay “Why and How Capitalism Needs to Be Reformed,” because we have similar interests. It must be said, however, that the reason Dalio is getting so much attention for making these points in the first place is that he has $18 billion, which gives the whole thing a mildly interesting fish-out-of-water aspect, and also allows him to hire an infinite number of PR people. (This is the same reason his book was a bestseller.)

In fact, there is little remarkable about Dalio’s diagnosis of our economic and social problems, except that they come from an extremely rich man. He identifies a well known litany of indicators of our broken system: Stagnant real wages; the near-total capture of economic growth by the upper class; lack of economic mobility; and underfunded and underperforming public education, which drives mass incarceration and reinforces poverty. Add to this the Fed’s post-crisis money-printing program, which inflated the price of all financial assets and made the rich richer, and here we are. This analysis may raise eyebrows among dickhead CNBC hosts, but no honest economist who has studied the past 40 years of American history would deny it.

From this, Dalio draws the obvious conclusion that we may be headed for serious domestic strife of the haves vs. have-nots, which could be triggered by the next recession. Here is his diagnosis:

I believe that, as a principle, if there is a very big gap in the economic conditions of people who share a budget and there is an economic downturn, there is a high risk of bad conflict. Disparity in wealth, especially when accompanied by disparity in values, leads to increasing conflict and, in the government, that manifests itself in the form of populism of the left and populism of the right and often in revolutions of one sort or another. For that reason, I am worried what the next economic downturn will be like, especially as central banks have limited ability to reverse it and we have so much political polarity and populism.

The problem is that capitalists typically don’t know how to divide the pie well and socialists typically don’t know how to grow it well. While one might hope that when such economic polarity and poor conditions exist, leaders would pull together to reform the system to both divide the economic pie and make it grow better (which is certainly doable and the best path), they typically become progressively more extreme and fight more than cooperate.

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This is written at grade school level, and his assertion that “socialists” can’t achieve economic growth rests pretty fucking heavily on whether you define socialism as full government ownership of industry or as, you know, having a robust social safety net and fairer wealth distribution, which is what many people mean by it in modern political discourse. But as digestible little aphorisms written by billionaires go, it’s not so bad. (A more standard billionaire aphorism would be “Summon an army of Pinkertons to crack the skulls of the ungrateful striking workers.”)

So for the diagnosis of the problem, we can give Dalio a solid B. He loses points because he possesses a dilettante’s desire to attract supporters from “both sides,” and therefore is unwilling to name the absolutely predatory, self-serving, greedy motives behind Reaganism that set our inequality crisis spiraling out of control. Nor does he deal with race and its weaponization. Nevertheless, he at least gets the basics of what is not economically working in American capitalism more or less right. Compared to his set of peers worth at least $18 billion, this qualifies him as extremely forward-thinking.

But then. Then. Then, we get to his prescriptions for how to fix this mess. Capitalism is broken, he says; it “is now producing a self-reinforcing feedback loop that widens the income/wealth/opportunity gap to the point that capitalism and the American Dream are in jeopardy,” he says; we must urgently reform American capitalism itself, lest our nation descend into bloody revolution, he says. But after laying out a problem that runs so deep with stakes so high for millions of suffering humans, Dalio can only summon five bullet points to achieve the gargantuan reset that is necessary. One is to coordinate monetary and fiscal policy, which is technocratic fix that is difficult to achieve with our current system of government; one is to raise taxes on the rich, a position he riddles with caveats about maintaining economic productivity and steering money into public-private partnerships. These are the bottom, lesser two suggestions that Ray Dalio has to fix our broken system. And these are his three top, most important suggestions:

1. Leadership from the top.

Okay you Howard Schultzy motherfucker. What is the actual big idea?

2. Bipartisan and skilled shapers of policy working together to redesign the system so it works better. I believe that we will do this in a bipartisan and skilled way or we will hurt each other. So I believe the leadership should create a bipartisan commission to bring together skilled people from different communities to come up with a plan to reengineer the system to simultaneously divide and increase the economic pie better.

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A bipartisan commission to set our nation’s economic policies. Huh.

THAT’S CALLED CONGRESS MOTHERFUCKER. THEY GOT US TO THIS FUCKED UP POINT IN THE FIRST PLACE.

3. Clear metrics that can be used to judge success and hold the people in charge accountable for achieving it.

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That would be... statistics measuring economic equality. These already exist.

Like most well-meaning billionaires, Ray Dalio is perceptive enough to notice that something is wrong here, but he lacks the courage to name the real solution to the problem: to systematically tear down and reverse the very rules that allowed him to become who he is.

Good luck in the revolution, Ray!