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February 25th, 2014
09:19 PM ET

'Shark Tank' Investor Kevin O'Leary defends the 1%: "This isn't a Robin Hood society"

Is it a war on the one percent, or just leveling the playing field?

President Obama tripled down at an event Tuesday, where he announced the creation of two new manufacturing institutes aimed at creating quality jobs in the Midwest.

"While those at the top are doing better than ever, average wages have barely budged. Too many Americans are working harder than ever to keep up and it's our job to reverse those trends. We've got to build an economy that works for everyone, not just a fortunate few," Obama said.

The president wants to raise the minimum wage by 39 percent.

CNN's Erin Burnett asks Kevin O'Leary, who makes a living helping small business owners become millionaires as a judge on ABC's reality show "Shark Tank" - about his perspective when, according to one report,(OXFAM) the richest one percent of the population own 46 percent of global wealth. And in the United States the richest one percent has grown 150% since 1980.

Why not change the policy now and help the less fortunate?

"It would be a huge mistake. The reason they're the 1% is because they created businesses, products and services that were very successful, employed millions of people, paid billions in taxes," says O'Leary. "All of the wealth in America doesn't come from government at all. It comes from the backs of people like the 1% that created the businesses and hundreds of thousands of jobs."


Filed under: Business • News
soundoff (26 Responses)
  1. nostalgic for WM

    CNN has to be better than this. Erin I like you and I believe you and your staff are better than this. How can you let Mr. O'Leary set the premises of the debate and not push back on them? He said something about the "1%" paying taxes at 38% and the middle class paying on average 12%. Push back on that. We know that's not the case. We know people with wealth don't pay white shoe law firms literally hundreds (sometimes thousands) of dollars so that their effective tax rate is 38% at the end of the day. And the capital gains rate is something in the teens or 20% if you make over X amount, O'Leary's stats just don't jive. Ask where Mr. O'Leary gets those stats. Ask him to define who he's talking about when he says the middle class. You should know his arguments before he makes them and have your counters already prepated. You already know you're going to be talking about this – why are the counter arguments not prepared. i'm not saying you beat him on every point of that that is even possible, some of this stuff is about value choices, but c'mon at least challenge premises and layout counter arguments – debate him. We can handle it. We'll still show up and watch t/m. Have faith in us. And you let him conflate the "1%" with "small businesses." Ask him to tell us how he defines "small business." Ask him how many small businesses are out there and how many fall into the 1%. Just make him define something so we actually know what the debate is about. You're our leadership, you're our voice, reclaim the fourth estate. We need you. He says they are the 1% because they created businesses, products, services, etc. Push back on this. What proportion of the 1% are entrepreneurs and what proportion are rent seekers and how he thinks that effects the economy. Maybe I've watched too much of Sorkin's News Room, but I know Erin is better than this. We need better than this. And the minimum wage – Ask him if businesses have a responsibility to their workers. Ask if tax payers including him, you, and me should be subsidizing people who show up and work 40 hours a week or if businesses should pay them enough to support themselves. That is what happens now; taxpayers subsidize low wage earners because some businesses does not pay a livable wage.

    And my man who posted about the pizza shop you give a nice example but I what if we lived in a world where the median income was 15K higher (it's really about purchasing power not numbers, but bear with me) and folks could afford $15 or $20 pizzas or whatever the uptick was you talked about? That's the whole point of this debate – if we live in a society where the rules are structured in a way that the Kevin O'Leary's of the world bring home $10 million a year (I have no clue what he makes, it's just a thought experiment) and the Joe workers bring home $50,000. You will sell less $20 pizzas than if we live in a world where the rules (and a lot of it is the rules, not all but a lot) are structured in a way where the Kevin O'Leary's bring home maybe $7 or $8 million instead and the Joe workers brings home $65,000 a year. Kevin O'Leary can (scratch that WILL) only buy so many $20 pizzas whether he brings home $7 or $10 million a year.

    March 26, 2014 at 7:28 pm | Reply
  2. Jen B

    It's not all about job creation. I work two jobs equaling 65 hours a week. There are people who work more then I do at only one job. And yet we are still we are still at the poverty line or just barely over it and struggle to make ends meet. Something needs to be done so that those who break their backs for minimum wage can get ahead. I'm not asking for the high life, just an easier one. One where I could see my kids for more then just the 45 minutes we have for lunch.

    March 23, 2014 at 9:27 pm | Reply
    • Jane

      Then instead of working menial jobs upgrade your skills and get a higher paying job.

      March 24, 2014 at 10:04 pm | Reply
  3. MIke

    http://www.bls.gov/opub/ted/2013/ted_20130325.htm

    Depart of labor statistics for 2012 – Hourly workers at or below min. wage represents 4.6% of hourly workers, 50% of the 4.6% are under the age of 25 with 21% being between the ages of 16-19

    March 4, 2014 at 11:20 pm | Reply
  4. Small Business Owner

    Thank you, Kevin. I would welcome the president to talk to me about his policies so I could walk him through the financial impact of his decisions on me personally and the number of people I employ. For those of you who think it doesn't matter and that small business owners (ie – middle class folks trying to feed their families and send their kids to college)... consider a small pizza restaurant. The workers aren't especially skilled and a lot of them could easily by highschoolers working a part-time job. The pizza joint employs 15 full-time equivalents at $8 an hour. Minimum wage is raised to $10 an hour. The cost to the business owner is ~$65k. The average profit margin for a pizza restaurant is 7%. This means that the owners would have to bring in almost a MILLION dollars to offset the increase in minimum wage. At $15/pizza, that is an extra 170 pizza's a day. For a normal size restaurant, that is probably what they sell in an entire day. So, if you have never owned your own business, please stop hand waving about how easy it will be for all of us who actually do to absorb a higher minimum wage.

    March 4, 2014 at 5:58 pm | Reply
  5. Jeff

    I'm not sure anyone in the video made that claim, but lets address it anyway.

    Just because Arkansas has a LOWER minimum wage than say, California, that doesn't mean it is at the magic number that would fuel job creation.

    Your claim also implies that minimum wage would need to be a sufficient condition to fuel job creation, but in reality it could just be a necessary condition, or neither.

    March 4, 2014 at 1:14 pm | Reply
  6. arshagarbon

    It might not be a Robin Hood society, but it's about to be!

    March 4, 2014 at 12:16 pm | Reply
  7. Mr.TelephoneMan

    This guy followed the Romney plan perfectly. Don't have enough money for college or to start a business? Just borrow it from your parents! He borrowed 10K from his Mom to start his first company, got rich from there. Granted, a mix of hard work, lucky and smart decisions him rich. The fact is that most people don't have parents that can fund their start up idea. To be born so privileged (white, male, parents with disposable income) yet not acknowledge that others don't have the same opportunity, its disgusting to watch. Classic example of being born on third base and thinking you hit a triple.

    March 4, 2014 at 10:51 am | Reply
  8. Gary

    Erin Come on, please.. you were way to easy on Mr. Wonderful
    you had the chance to challenge him more on these same old
    republican excuses and Reaganomics. Why did you let this guy
    go so unchallenged on his politics?

    We don't care if they can create jobs

    Job creators sent our jobs out of the country
    1. Bush tax cuts made them rich and they still want to pay even less taxes. Where does it end?
    2. Yes of course they want more deregulation. It equals more money for
    them. But as you sad less rules mean more cheating and disasters.
    3- They sent our jobs out of the country which resulted in less jobs
    and less collected taxes.
    4- They think they should own the policies because they own the companies
    and wealth.

    You should have challenged him on:
    -They pay 38% – WRONG they generally pay less % than us, way less than 38%,
    or in some cases they companies pay nothing or close to it.
    His numbers are wrong and you know that!

    Less regualtion and taxation, you should have called him on this!
    They pay less taxes and they have gotten nothing but less regulation
    every year for the past 30 years!

    Their time is up, Reaganomics (trickle down) which is another way of saying
    if you give us all the money, less taxes and less rules, you will make more
    money. Well this has not worked in 30 years! Times up!
    Reaganomics are a ponzi scheme. Just keep giving us all the power and money
    and it will come back to make you rich.

    20 million small businesses will not fix america they
    generally pay low wages republicans are just courting them to get republican votes.

    March 3, 2014 at 11:36 pm | Reply
  9. Chris

    OK so the so called "job creators" are richer than ever. So where are the jobs?

    March 3, 2014 at 2:08 pm | Reply
  10. Jim

    I own a small but growing manufacturing business (employ 7 people) and this guy is absolutely right!

    March 1, 2014 at 8:32 am | Reply
  11. Craig in Indiana

    @ Joey at Purdue Univ, most states have the same minimum wage, so your argument loses validity there. There is no evidence that higher minimum wages helps job creation, but simple logic might show you that it hurts job creation. Requiring higher minimum wages requires one of two reactions; either higher prices to consumers or fewer jobs available because each job now takes a larger piece of the "salary" pie. So unless you are willing to pay more for that college education at Purdue, pay more for the computer you use, or pay more for that pizza you are ordering for late-night study sessions, you must be willing to have fewer workers earning that higher minimum wage. And if you have to bring up the third possibility, that being lower profits for business owners, remember that your future retirement plan will be invested in publicly-traded companies, that now will have lower profits, thus lowering the value of your retirement package. Remember this; the minimum wage was not and is not meant as a forever wage. Almost every place of employment offers opportunities well beyond the entry-level jobs that usually make up the minimum wage employment opportunities. The problem is that some people don't want to invest in the time it takes to climb the ladder of success. They'd rather complain about not getting management pay for entry-level work.

    February 28, 2014 at 5:14 pm | Reply
  12. Dustin Jackson

    If Bill Gates had no workers, how much money could he make annually? Not as much as what he is making now. Thus, he is being paid more than what he is worth and he is doing it by taking from his own supporters. They willingly give him the money but it does not make it right or justified. People should be allowed to be paid for what they do and others should not be paid for work they did not. Bill Gates is only an example I am using to represent the all corporate heads who believe they are deserving because they believe the workers need them but they need the workers equally to produce mass revenue so the workers should be paid equally.

    February 28, 2014 at 11:20 am | Reply
  13. Tired of Billionaire Babies

    How many of you are getting tired of these billionaire cry babies taking to the media with their non-stop BS. Trickle down economics didn't work. It was a disaster. Get over it. Quit taking to the airwaves with your crack-pipe economic theories that magically make you richer, make the rest of us poorer, and then tell us it's free enterprise. It's a rigged system and everyone knows it.

    February 27, 2014 at 1:41 pm | Reply
  14. Cortney in Tampa

    Kevin does a great job here trying to explain to an unreceptive, left winger an alternate philosophy of viewing economics– one I might add that anyone who took economics in college gets. I can't figure out the hypocrosy of the left wingers thinking O has it figured out with economic policy when none of it is in alignment with economic truth. They are made up ideas with no substantial academia or evidence to back them up. It seems that the war is on the wealthy and God forbid a wealthy white man know what he is talking about when it comes to economics. Why not start listening to the people with success and experience instead of judging them. It's time to stop going to the hardware store for a loaf of bread.

    February 27, 2014 at 8:32 am | Reply
  15. Lamont Sheridan

    I really wish the 1% would wake up and realize they didn't build the company,the people under him built that company?I bet he doesn't know one single person in his company at the bottom of the totem pole

    February 27, 2014 at 12:00 am | Reply
    • Jane

      So would Microsoft exist if it wasn't for Bill Gates? He created a business that has created thousands of jobs. If you want a better wage get off your dead ass, get skilled and work for it.

      March 24, 2014 at 10:00 pm | Reply
  16. ben

    without regulation our environment would be even more worse off than it is now, and the gap between the "job creators" (1%) and the rest of us would be even larger because they could pay whatever they wanted and pay who ever they wanted. people do not realize what they are saying when they want less regulation. its not necesarily the wage its the gap between ceo jobs and manual labor, a guy who sits down and crunches numbers and wastes resources is paid more than the people buying, shipping, and making their products and empires. he has that arguement because he is a super rich capitalistic jackwagon

    February 26, 2014 at 6:50 pm | Reply
  17. Diane Hires

    I've watched this man for several season's on
    Shark tank and Canada's, the Dragons.
    He repeatedly turns down and ridicules many start ups. He is all about making money for himself...that's fine and don't criticize him at all.pper
    But to go on a news program and criticize President Obama's approach is insulting to all the middle class. He's a smooth talker but isn't acknowledging that the job creators are being rewarded and the middle class is shrinking and sinking. No one I know wants the wealthy to not succeed. But he's not acknowledging the middle class isn't just losing ground – it's having it stolen from them by politics and policies that he supports. I'm not buying it Kevin. Nice slick, over sincere sounding rhetoric.

    February 26, 2014 at 4:29 pm | Reply
    • Jane

      The whole premise of Shark Tank is to help viable start-ups. The sharks are using their own money and don't suffer fools who would fail and waste it. Some who were denied have still become successful by merely being on the show. Nobody is OWED a living.

      March 24, 2014 at 10:09 pm | Reply
  18. SIlence Dogood

    I just can't agree with the minimum wage. According to several studies the minimum wage would be significantly larger if it reflected inflation rates.
    Otherwise all other points are sound, the rich pay A LOT in taxes. People think the rich don't pay enough taxes because they don't feel the tax burden like others do.

    February 26, 2014 at 3:11 pm | Reply
  19. George Ferdinand

    It doesnt take a rocket scientist to see the monumental tax shift from the rich to the middle class over the past 34 years. Wake Up America!!!

    February 26, 2014 at 12:16 pm | Reply
    • Az Talia

      Are you saying that the middle class pay more than the rich in taxes?

      February 28, 2014 at 9:32 pm | Reply
  20. Joey at Purdue Univ

    If a lower minimum wage was the answer to job creation, Arkansas would be some kinda Utopia of job creation.

    But it isn't.

    February 25, 2014 at 10:30 pm | Reply
    • Az Talia

      Your response makes no sense. A higher minimum wage certainly will do nothing for job creation, and will only benefit those that are working for minimum wage, and not THAT much for those it does benefit. You're delusional if you think that this is actually going help one iota.

      February 28, 2014 at 9:30 pm | Reply
    • Teaparty

      Does anyone even live in Arkansas?

      March 30, 2014 at 3:05 am | Reply

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