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00:00This is a story of unimaginable wealth.
00:03Elon Musk is now a trillionaire.
00:05But the story is about more than one person's enormous fortune.
00:08It's about how markets reward capital, how our tax system treats it,
00:12and how much power can accumulate at the very top.
00:18I give SpaceX less than a 10% chance of succeeding at all, to be clear.
00:27In fact, I told people this.
00:28I said, look, we're probably going to fail, but, you know, we should give it a try.
00:31SpaceX made history last month with the biggest ever IPO.
00:37Raising $75 billion on a market value of nearly $2 trillion.
00:42More than double that of Saudi Aramco's $29 billion listing in 2019.
00:48Encouraging more of that type of innovation in the American economy,
00:51rather than less of it, seems important.
00:53But also trying to make sure that we are fiscally responsible and disciplined.
00:58SpaceX is now one of the most valuable public companies in the world,
01:02putting its founder and CEO into a category all his own, the world's first trillionaire.
01:08As Nobel Prize-winning economist Paul Krugman points out,
01:12public markets are turning ownership stakes into staggering concentrations of wealth.
01:16Until recently, we've been talking about income.
01:19And we mostly talk about the top 20% or even the top 1%.
01:25But wealth is a whole different story.
01:28And wealth is really where the action is.
01:30So it's wealth, top 1%.
01:32It totally dominates wealth.
01:34But it's the inequality within the top 1%.
01:37It's the top 10th of a percent or the top 0.001 or whatever that is.
01:42Just a handful of people.
01:43Elon Musk, obviously, is the best known.
01:46But really, if you look at the top 10 people in the United States,
01:49there's an incredible amount of wealth there.
01:51And that is relatively new.
01:53Even in the year 2000, we were already talking about the 1%.
01:56But this, you know, 10 billionaires, 10 mega billionaires, that's a new story.
02:02And at this scale, the numbers start to outrun the language we use to describe them.
02:07These numbers, like billions, hundreds of billions, trillions,
02:10you start to not even be able to realize or understand, like,
02:14what the magnitudes really mean or demand of the American economy.
02:19To fully comprehend how much a trillion dollars is,
02:23Yale law professor and co-founder of the Budget Lab,
02:26Natasha Sarin, offers a different way to measure it.
02:29A million seconds is about 11 and a half days.
02:34A billion seconds is about 32 years.
02:37A trillion seconds is 31,700 years.
02:44That is roughly back to when humans first began painting cave walls.
02:50And so a trillion dollars is just such an astounding and significant sum
02:56that it is almost hard to grasp what it means.
03:00With a trillion dollars, Elon Musk could buy every carmaker in the U.S., Europe, and Japan,
03:07like GM, BMW, and Toyota, which total around $900 billion,
03:11and still have nearly $100 billion left over.
03:16NASA's budget for 2025 was $24.6 billion,
03:21meaning Musk could fund the space agency 41 times over.
03:25And if Musk were his own country, his territory as of now would be richer than 156 other nations.
03:33He sits at number one on Bloomberg's billionaire index,
03:37followed by former Google CEO Larry Page with $314 billion,
03:43one-third of Musk's net worth.
03:45But Musk is not the only one benefiting.
03:48SpaceX's IPO has created thousands of new millionaires inside the company.
03:53And the next wave of wealth creation may already be on its way
03:57as more technology companies, especially those tied to artificial intelligence,
04:02move toward the public markets.
04:04Both Anthropic and OpenAI filed for IPOs in June,
04:08with estimated valuations already pushing that trillion-dollar mark.
04:12Big tech is driving so much of the stock market, for example, right now,
04:16and these mega-IPOs are AI-related in one shape or another.
04:19How much of it is tech?
04:21A lot of it is tech.
04:22It used to be, not that long ago, we would think,
04:24we used to say Wall Street was really driving this,
04:26although now it really is tech.
04:27The ranks of the super-rich, aside from being enormously richer than they used to be,
04:33they're also much more sort of monochromatic than they used to be.
04:37Often, with great fortune comes political influence.
04:40The Doja influence will only grow stronger.
04:42It's, I liken it to a sort of buddhism.
04:45It's like a way of life.
04:46So it is permeating throughout the government.
04:49In 2025, President Trump put Musk in charge of the Department of Government Efficiency,
04:54or DOGE, in which government agencies suffered massive financial and employee cuts.
04:59As more people cross into billionaire territory,
05:02and now possibly trillionaire territory,
05:05Krugman says the question becomes larger than net worth.
05:09It becomes a question about democracy.
05:11The Times did a report saying that 300 billionaire families accounted for something like 19% of campaign contributions in
05:202024,
05:21and that's only the explicit stuff that's counted by the Federal Elections Commission.
05:27If you count all of the invisible channels of influence,
05:29well, if you have that much wealth at the top,
05:32it does make us, in a meaningful sense, a less democratic nation.
05:37Musk's trillion-dollar milestone is historic,
05:39but it's not the first time American capitalism created a new financial class.
05:53The Rockefellers in the early 20th century were really rich.
05:57John D. Rockefeller, the founder of Standard Oil,
06:00he crossed the $1 billion mark in the 1910s,
06:04and when you adjust that for the share of the U.S. economy,
06:09he's about at a trillion dollars.
06:11So right now, basically 120 years after the first billionaire,
06:17we have the first trillionaire sort of hitting basically that same mark in terms of the U.S. economy.
06:23Bloomberg reporter Ben Steverman has covered Elon Musk's rise
06:27and has seen some similarities between the first billionaire and the first trillionaire,
06:31but also some key differences.
06:34The Rockefellers did not want to be known as billionaires.
06:37They already felt like they had a target on their back.
06:39They were in control of this monopoly that was incredibly controversial.
06:42A case against them went all the way to the Supreme Court, and they lost.
06:46So they did not want to be known as billionaires.
06:49That sounds different from now.
06:50I'm not sure that Elon Musk is that upset about being called a trillionaire.
06:54It wasn't just John D. Rockefeller.
06:55There was a Gilded Age, and there were Carnegies,
06:57and there were other people who had a lot of money.
07:00Was it a different sort of societal reaction?
07:02Yeah, I think there was the Gilded Age in the late 19th century and early 20th century,
07:07but the Progressive Era was coming in,
07:09and that level of wealth just became incredibly controversial.
07:12That level of power in society became very controversial.
07:17It was in the time of the Rockefellers, Carnegies, and Vanderbilts
07:21that the 16th Amendment was ratified,
07:23giving Congress the power to tax incomes from whatever source derived,
07:27laying the foundation for our modern income tax system.
07:31But today's large fortunes are not built mainly from income.
07:35They are built through ownership stakes, stock appreciation, and capital gains.
07:40There was no conception of a trillionaire then.
07:42Yeah.
07:43Was this system set up for trillionaires?
07:45You can kind of trace its roots back to concerns about inequality in the first Gilded Age.
07:52You know, concerns that there was wealth that was being concentrated
07:56in these American oligarchs that we didn't actually have a good handle on how to tax
08:04because of the restrictions with respect to the ability to tax income
08:08and issues dealing with apportionment that dated back to the Civil War.
08:12But it was exactly in response to the needs of the FISC to finance itself
08:19and concerns about inequality and its rapid growth in society.
08:23And so in some sense, you're kind of seeing the same movie play again,
08:29except it turns out that the income tax doesn't seem exceptionally well situated
08:34to be able to tackle the nature of inequality in this country
08:38because the income tax is a tool that's leaving out of its tax base
08:43something like 40 percent of the wealth of those at the very top.
08:46And so a bit I have wondered whether one way to understand the sort of ideas
08:53that are being put forth with respect to things like wealth taxation
08:56or mark-to-market taxation of capital gains,
09:00whether this is the new income tax movement in some sense in this country.
09:05The tax system, though, actually has a disincentive to freeing up capital, does it not?
09:09Because if you're only going to have to pay on returns,
09:12and when you realize, when you sell the asset or otherwise transfer the asset,
09:15then you just tend to sit on the asset, and it's not freedom.
09:18If you look at the way the system is structured,
09:21it is structured such that there is a huge incentive for Elon Musk
09:26to transfer his ownership stake in Tesla and SpaceX and X to his heirs
09:33rather than to transfer it potentially during his lifetime.
09:37Taxes on wealth or on capital income are a real way to curb this.
09:45You have corporations paying almost no tax with no tax,
09:48passing their profits on to one way or another to people who own stock
09:54who then pay little or no tax.
09:57So we really have exacerbated this inequality.
09:59It's because so much wealth is generated by appreciated capital rather than high incomes,
10:06the California is now considering the Billionaire Tax Act,
10:09which would impose a one-time levy on residents worth over $1 billion.
10:15But unlike during the first Gilded Age,
10:18Americans in recent years have had a more nuanced view
10:21of the ultra-wealthy getting even richer.
10:23You don't see a lot of anger, actually, in the polling at billionaires until fairly recently.
10:30So that indicates to me that the average American actually kind of wants to be rich themselves.
10:36I think it becomes a problem for a lot of Americans
10:40when there's a sense that the system's rigged
10:43or that the people at the top are somehow manipulating things to make their lives harder.
10:50How much of this is, forgive me, envy?
10:52I suppose we all had a minimum income, everybody in the country, that was sufficient.
10:56Would we feel better about inequality?
10:59We would feel better about inequality if we had the basics, we're sure.
11:03If everybody had health care, if everybody had a roof over their heads,
11:07if everybody had sufficient nutrition, which, by the way, we don't.
11:10The thing to say about that is that doing that is quite expensive.
11:14I think that there's something fundamentally skewed, demoralizing, corrupting
11:21about really extreme inequality.
11:24I think a society in which, essentially a society in which there's trillionaires
11:28is not going to be a good society even if everybody has the basics.
11:32But, you know, if we could take a step towards making sure that everybody had the basics,
11:37then that would deprogress.
11:42Capitalism rewards winners, those who innovate and create successful businesses
11:46and help grow the economy overall.
11:49But as those rewards soar beyond our wildest imagination,
11:53the question becomes whether there can be too much of a good thing.
11:56No billionaires!
11:58No trillionaires!
11:59Whether the system can provide those lavish rewards
12:02without leaving the vast majority of us behind.
12:05And ultimately, whether the growing gap could put democracy itself at risk.
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