Chris Hughes made a fortune as a co-founder of Facebook.
Now, he's arguing for a guaranteed basic income for working Americans — $500 a month to households making less than $50,000 a year — paid for by taxing the country's wealthiest.
"I think there's a responsibility to pay our share," Hughes (@chrishughes), author of "Fair Shot: Rethinking Inequality and How We Earn," tells Here & Now's Jeremy Hobson. "And I don't think that that's happening today."
- Scroll down to read an excerpt from "Fair Shot"
On the impact of being guaranteed $100,000 as a 20-year-old, because of his work with Harvard University roommate Mark Zuckerberg on Facebook
"For me, it wasn't the kind of money that would mean obviously I'd never have to worry about money again. But at the same time, it gave me a bit of a cushion, and it allowed me to think about, what did I really want to do in the years after college? Did I want to work at Facebook? Did I want to go to law school? Did I wanna write a novel? A lot of what I talk about in the book is making the case for a guaranteed income, specifically because it does enable people to think about who they wanna be, what they wanna do, what dreams of their own they want to follow and chase, and, you know, $6,000 a year is not the same as making $100,000 at a young age, but it is a meaningful amount of money that can give people an important boost to their bottom lines."
"I think if we raised rates on income above $250,000, we could pay for a guaranteed income for 90 million Americans that would lift 20 million out of poverty overnight."Chris Hughes
On one story he tells in the book about Zuckerberg and the early days of Facebook
"I talk about this conversation we had in the pouring rain — it was quite possibly the worst way to have a conversation of that kind — and I was wholly unprepared, demanded something like 10 percent [of the company] and ended up with something like 2. It made it a complete failure of negotiation, but also the most successful conversation of my life. I mean that 2 percent ended up eight years later being worth nearly half a billion dollars at the moment of Facebook's [initial public offering]. And I think that seemingly small conversations like that can have outsize consequences. And that's part of what's driving the unfairness in the economy today."
On his financial windfall being something that doesn't happen to most people
"I mean for the first few years after Facebook's public offering and success, I to be honest thought my case was really unique, that, you know, these kinds of events where a small number of people were getting very lucky were pretty rare. And over time what I've come to understand is that while my case may be extreme, it's not as uncommon as you might think.
"A very small number of people in contemporary America are getting very, very rich, while everybody else is struggling to make ends meet. We know the stats, but the top 0.1 percent — not 1 percent, but the top 0.1 percent — owns as much wealth as the bottom 90 percent combined. So I say all that because I very much believe that the most powerful way to combat income inequality is in many ways also the simplest: using cash — cold, hard money — to help people make ends meet, through a guaranteed income tied to work."
On calling for giving working Americans a guaranteed income: $500 a month to households making less than $50,000 a year
"Just for context, if you've got two adults working in a household at minimum-wage jobs, a guaranteed income of $500 a month would boost their incomes by 40 percent."
On calling for that money to come from the wealthiest taxpayers
"I think it's really important though to emphasize that, I'm not making the case for pitchforks coming for the rich or anything like that. I think we wanna live in an economy where as many people as possible are able to win. So I think if we raised rates on income above $250,000, we could pay for a guaranteed income for 90 million Americans that would lift 20 million out of poverty overnight."
On if he thinks a guaranteed income is politically possible
"I do. I think that if there's anything that's coming out of the 2016 election, whether you're a Democrat or a Republican, it's the sense that the system is rigged against working people. I mean working people have not gotten a meaningful raise in 40 years, and yet the cost of living is up by 30 percent. And in this environment, there's an opportunity — particularly at a moment when [President] Trump and congressional Republicans are not enacting policies that help working people — there's a vacuum, and there's a vacuum not just for people on the left, but for the broad center as well to think about new, bold solutions that are based in proven programs, like the earned income tax credit, to really make a difference."
Book Excerpt: 'Fair Shot'
By Chris Hughes
In May of 2013, I stood beside a podium on a wooden stage in the center of the Georgia Dome, an indoor stadium in Atlanta. I listened to the president of Georgia State University introduce me to a crowd of 20,000 students and their families attending that year’s commencement ceremony. “Chris began his career as an entrepreneur in 2004, when he co-founded Facebook with his Harvard roommates,” he said. “In 2007, he became director of online organizing for Barack Obama’s campaign.” He continued through a few more accolades, and the audience applauded thunderously. I stepped up to the podium to speak to the largest crowd I had ever faced. For a moment, I felt like a rock star.
That moment was brief. In 2012, I bought The New Republic, a nearly 100-year-old print magazine, with the intent of stewarding the historic institution and finding a new business model for print media in a digital age. After a string of starry successes, this time my failure was deep, clear, and fast. I overinvested early, set unrealistic goals, and found that I lacked the patience to manage such a difficult transition. By the next year, all of the digital savvy and esteem I had earned was worth nothing to detractors who called me a phony in the pages of The Washington Post and Vanity Fair.
That was a turning point for me. It confirmed my suspicion that the superficial praise that I had received for years had more to do with what people wanted me to be, rather than who I was. People believed me to be a genius because “Co-Founder of Facebook” followed my name. Fast Company once put me on its cover with the headline “The Kid Who Made Obama President,” as if I were single-handedly responsible. As soon as the house of cards collapsed, people zeroed in on the power of chance in my story and discounted everything else. I went overnight from a wunderkind to the hapless, lucky roommate of Mark Zuckerberg.
The truth is somewhere in between. For the early part of my life, my story played like a movie reel for the American Dream. I grew up in a middle-class family in a small town in North Carolina. I studied hard, got financial aid to go to a fancy prep school, and then went to Harvard. My roommates and I started Facebook our sophomore year, and my early success there and at the Obama campaign garnered me acclaim and notoriety. Eventually, Facebook’s IPO made me a lot of money. I worked my way up, and I took every chance offered to me. I also got very lucky.
That luck wasn’t just because I was Mark Zuckerberg’s roommate—much larger forces were at work. A collection of economic and political decisions over the past four decades has given rise to unprecedented wealth for a small number of fortunate people, collectively called the one percent. America has created and supported powerful economic forces—specifically globalization, rapid technological development, and the growth of finance—that have made the rise of Larry Page, Jeff Bezos, and other new billionaires possible. The companies we built went from dorm room ideas to assets worth hundreds of billions of dollars because America provided the companies with a fertile environment for explosive growth. Google, Amazon, and Facebook may be extreme examples, but the massive wealth they create for a select few isn’t as rare as you might think.
Inequality has now reached levels not seen since 1929, the year the Great Depression began, and stands to get even worse. The same forces that have given rise to massive companies and concentrated wealth have made it more difficult for working people to benefit from the economic opportunity they expect and deserve. By the numbers, Americans are working just as hard as ever but are still struggling to get by. Most Americans cannot find $400 in the case of an emergency like a car accident or a hospitalization, yet I was able to make half a billion dollars for three years of work. Something is profoundly wrong with our economy and in our country, and we have to fix it.
I believe we live at the beginning of a tumultuous era, similar to the turn of the last century, when railroad and shipping tycoons amassed historic fortunes. We need to be as open to creative, new ideas as the most forward-thinking leaders of the Progressive Era were then. They created an income tax, enacted direct elections for senators, banned corporate contributions to political campaigns, enfranchised women, and laid the groundwork for labor protections like the minimum wage and old-age pensions. We need to be equally bold today.
And we should ground our solutions in what works. I have come to believe that, dollar for dollar, the most effective intervention in the fight for economic justice is the simplest: cash, put in the hands of the people who need it most. The guaranteed income is as radical an idea as it is simple. An income floor of $500 per month for every working adult whose family makes less than $50,000 would improve the lives of 90 million Americans and lift 20 million people out of poverty overnight. Wage laborers and informal workers alike—parents with young kids, adults taking care of aging parents, and students—would earn the benefit. It should be paid for by the one percent.
I hope this book starts a broader conversation about why we need a guaranteed income in the United States and how it might work. We can be the generation that ends poverty in America and provides financial stability and economic opportunity to the middle class.
This book traces my journey from a little town in North Carolina to Harvard, through Facebook’s blockbuster rise, and to my life afterward. It tells the story of how I grappled with the responsibility of such early “success,” and how I came to embrace a guaranteed income. That journey began with poking around blog posts and online forums. It took me to Kenya and back three times and to communities in Ohio, Michigan, North Carolina, California, and Alaska, all in the pursuit of figuring out what works and what doesn’t in our economy today.
We have to start having honest conversations about fairness and economic opportunity—even if they are awkward or painful—if we are ever going to fix our country’s problems. I hope this book can be a starting point for a frank discussion about the fraying connection between work and wealth, and specifically, how a guaranteed income can restore stability and opportunity to the lives of working Americans.
The American Dream, the idea that we can all do a bit better than the generation that came before us, is an optimistic idea that we should cultivate and reinforce. It has long been more myth than reality, but it is up to all of us, particularly those of us who are benefiting most from the status quo, to work to build a country where everyone has a fair shot to pursue their dreams.
Excerpted from FAIR SHOT: Rethinking Inequality and How We Earn by Chris Hughes, published by St. Martin’s Press. Copyright © 2018 by Chris Hughes.
This segment aired on February 20, 2018.
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