Why Capitalism is the BEST System | Kevin O'Leary

Last week, Kevin, I discussed an Oxfam report that contained a startling statistic: that the world's richest 85 people hold precisely the same wealth as the three and a half billion poorest people. Now, if you saw the show, you won't be surprised to hear we got a rather large response. If you didn't, you'll understand why I got so much attention in just a moment.

Let's start with part of our conversation from last week. The combined wealth— that's according to Oxfam— of the world's 85 richest people is equal to the three and a half billion poorest people. It's fantastic! And this is a great thing because it inspires everybody, gets the motivation to look up to the 1%, and say, "I want to become one of those people. I'm going to fight hard to get up to the top." This is fantastic news, and of course, I applaud it! What can be wrong with this, really?

Yes, really! Somebody living on I celebrate every day in Africa is getting up in the morning and saying, "I'm going to be Bill Gates." That's the motivation! Everybody's me, I guess, chair motivation. I just need to pull up my sock. Money? I don't have sock.

Okay, well, let's start with the obvious because even for you, that came off sounding a little bit rude. You do not think it's fantastic that people are poor. That's not what you meant to say at all, no. I don't think poverty is fantastic. I don't think income disparity is fantastic. What I think is how successful capitalism has been over the last 100 years— reducing poverty and reducing income disparity.

In the last 30 years, the number of people living on this globe in extreme poverty has been reduced from 42 percent down to 17 percent. Amanda, I want you to thank capitalism for that because that's how it happened.

Yeah, I mean, I knew where you were going even as we were having the conversation. You were focused on the wealthy and why that's a good thing. It's a mistake that people make, and I would say people on a certain part of the spectrum who feel as though somehow focusing anywhere else is somehow anti-capitalist, anti-welfare.

Isn't it to say the disparity is growing? So the fact that there are wealthy people— the Oxfam report actually makes a point that they're concerned. There's something systemic about this. It's not that wealth is bad; it's not a zero-sum game, but that the disparity grows larger because the wealthy are controlling the systems, and that is the problem that we may need to address.

You know, I'm very concerned when Oxfam focuses on one country like the United States. I think this is global. Probably, this was a Global Studies method, so it's global. But here's the concern I have: If you want to incentivize people to create wealth and start businesses and take capital risk, you can't start telling them that you're going to somehow overtax them, like in France at now 78%, or redistribute their wealth after they've had success of actually putting it together.

My point is that wealthy people provide taxes at different tax rates all around the globe, and we've seen tremendous success as a result of this system. Most countries have adopted a capitalistic society, and we've seen from 1900 to today, illiteracy— which is the best metric to measure— drop from 70 percent down to 20. This is capitalism.

Fake it again, Amanda. Saluted? Nobody races it! Is vented capitalism is good. You know, far from the truth that I would say, 'Cause anything wrong with capitalism? It has its flaws, but when it has worked for mankind, and there's, of course, this period where incomes actually went up— the middle class grew in America thanks to the New Deal, thanks to capitalism used wisely, nobly, with good policy.

When it works is when policy drives it. It doesn't drive itself; it's not a driverless car. You actually need some thought around it. And you might be interested to know that places like China— in the Oxfam report they talked about— China, Pakistan, Nigeria— fast-growing economies where wealth is booming, the middle class is growing.

The very thing you're talking about— the disparity is growing there too. So it isn't just a rising tide lifting all boats; it's lifting some at the top more, and the argument they're making is it's because of systemic issues— because the uber-rich, they don't pay taxes, first of all. You know that as well as I do. And second of all, they control the political process, and that's where corruption comes in. That's where you start to undermine democracy, and that's bad for you as well as anybody else.

The overachievers will not fare well, as they never have throughout history, when they start to undermine the systems that got them there in the first place. I can't agree with that at all. I'm not gonna try. Anuba rich, because the capitalist society will always statistically have a 1%. That's always going to be the case.

But here's the real blame that I focus on. When you think about what really matters— and there's a very famous 1900 quote. It goes something like this: You feed a man a fish, and you take care of him for a day. Teach him how to fish, you take care of him for his life. And I think this is about education.

I blame governments around the world because I'm agnostic. I've said too many times, and you agree with me, that 1/3 of tax dollars that come out of wealthy people's pockets are wasted by governments. Imagine if that third went towards education!

I wanted— we would compress the number of people that are in poverty dramatic. Everybody make it small! Education is important. Even the wealthiest countries in the world, like this one, the United States, aren't getting that piece right.

I do want to address the redistribution thing as you go right there. Every time, as though somehow there's this evil plan to take more money from the wealthy. And the truth of the matter is, Kevin, that the vast majority— when we talk about the 1% paying a disproportionate amount of tax— the 1% means doctors, lawyers, the upper middle class, the uber-rich, the people on this list who may have got billions— some of them pay no tax because of their taking all of their investment income.

They have ways to get around the taxation system; you know that as well as I do. The same way corporations get around the tax system. That's the kind of problem that we're talking about— the systemic problem that keeps capital flowing in a tiny pool among the rich instead of down to workers in the form of higher wages.

Or remember the new business? You are completely discounting the tremendous value— socially and economically— they provide by creating the companies that made them rich— millions of jobs. It's all around the world.

Know what this issue is? An oligarch in Russia? He is in West value; he is the Duke of Westminster. These are not people who create wealth! Of course they're creating wealth; they're investing their money. In fact, they are investing their money because they want to make more money.

Businesses— this isn't madness. I want you to embrace capitalism for all the great things it's done in the last hundred years, and you can't deny the fact the world's a better place! Thank you, capitalism! Thank you! Thank you! Thank heart! Where's my satchel?

Um, Evan, every fringe member of the Tea Party— the fact that I see inequity, that I can read this Oxfam report and say there's something wrong— and that we as thoughtful human beings in democratic nations can actually work to improve the system doesn't make me anti-capitalist, anti-market, anti-rich, anti-anything. It just means we can do better than we're doing, and to deny that actually just puts you offside permanently.

You know what I hope happens, Amanda? Your son becomes a great capitalist, starts a business, the ice skating, rich! And I hope it takes care of giving him a jerk that takes care of you in your old age. Maybe he'll help you out a little bit because he understands the big picture.

I thought you were going to take care of me in my old age! Not anymore! You rapidly— it seems like it's the least you can do! You've learned so much from me, admit it!

Now, all right, we got to go, Kevin. Have a great night. Take care!