The Good Guy Hedge Fund Manager — Who Wants a Youth Movement
Stanley Druckenmiller Wants To Stop “Generational Theft.” After all, the one thing Occupy and Wall Street have in common is futures.
Stan Druckenmiller looks across the table at Charlie Rose, bemused. Rose’s questions are doing that long-tail staccato thing they do when the host is visibly tired: the questions can’t stop themselves, they sputter on like a Grateful Dead jam. Each time Druckenmiller begins to answer Rose claws the desk and tosses another stray word—and then another—onto the end of his question. Even the camera doesn’t know where to point. It’s all very strange, since Druckenmiller—one of the most financially astute and successful men in the world—has come to this chair bearing potential solutions to the most vexing issue of our time: how to secure a viable financial future for US citizens—all of them. It’s just the sort of thing Rose should want to hear about, but he just keeps asking whether Druckemiller’s old boss George Soros agrees and whether his ideas have a “chance in hell” of getting traction in Washington. Druckenmiller, a man accustomed to autonomy, has presumably disdained this kind of meandering during his storied career. He slowly goes from bemused to resigned; you can see it in his intelligent eyes. This is what it’s going to be like, he realizes, trying to talk to the old guard about reform. That’s why Druckenmiller, a man so rich he has changed his title from Hedge Fund Guru to simply philanthropist, is taking his show on the road—directly to college kids. Young people whipped this country into rethinking gay marriage in record time, he says. And they’ve even moved the needle on climate change, an assertion he sneaks in edgewise against Rose’s inquisitive noise. Young people can do this, too—create a movement.
But what exactly will disruption-minded students at Bowdoin and Chapel Hill, Berkeley and Stanford espouse? Since Rose didn’t much get to it, here’s Stan Druckenmiller’s solution. Entitlement reform. That sounds cold (and old), but when you start calling the current entitlement structure “generational theft” it gets hotter. And youth likes it hot. For starters, Druckenmiller doesn’t think he should be getting $3,500 a month in Social Security—not least because he’s worth $3 billion. Taxes on capital gains and dividends, the bread and butter of the 1%? Raise those rates to regular income tax levels. Higher taxes then? That’s the advice from this iconoclastic Wall Street wizard? Not entirely, no. He’d put the corporate tax rate at ZERO, in a bid to—among other salutary effects—eliminate the corruption and bad deals that gum up the economy. (Hey, many big corporations pay zero anyway, gaming a gameable system.) But Druckenmiller’s main point is that while a social contract that creates and sustains Social Security, Medicare and their like is necessary and important, it hasn’t been intelligently administered (much like the pension plans of many big companies). And because of mismanagement what happens is that some junior at Rutgers is financing Druckenmiller’s Social Security check and that’s a raw deal, he says. (The student would agree, no doubt.) Maybe even the Occupy movement could get behind this—adopt a cause, instead of a complaint. Hard times make for strange bedfellows. It’s clear anyway that Druckenmiller is having no problem getting the attention of lots of mad, smart college kids on the bad end of the deal—even if he can’t get Charlie Rose to listen. Come to think of it, maybe that’s the real sign he’s onto something.
—Joseph Mackin
A version of this article originally appeared on 2paragraphs.com
