Common Sense

What's "Common Sense: The Investor's Guide to Equality, Opportunity, and Growth" about?

• Author's Perspective: Joel Greenblatt, a professional investment manager, offers his insights on policies that could foster equality, opportunity, and growth in the U.S.
• Main Themes: The book discusses education reform, immigration, financial regulation, and retirement savings, proposing practical solutions to systemic issues.
• Unique Approach: Unlike typical policy books written by politicians or economists, Greenblatt provides a business and investment-oriented perspective.
• Goal: The book aims to address societal challenges by leveraging the strengths of government and the private sector to create a more equitable society.

Why should I read "Common Sense: The Investor's Guide to Equality, Opportunity, and Growth"?

• Practical Solutions: The book offers actionable ideas for improving education, immigration, and financial systems.
• Diverse Perspectives: Greenblatt's investment background provides a unique angle on public policy issues.
• Engaging Style: The author uses humor and relatable anecdotes to make complex topics accessible.
• Broader Understanding: Readers gain insights into how economic policies can impact equality and growth.

What are the key takeaways of "Common Sense: The Investor's Guide to Equality, Opportunity, and Growth"?

• Education Reform: Greenblatt emphasizes the need for school choice and charter schools to improve educational outcomes for low-income students.
• Immigration Benefits: The book highlights the economic advantages of skilled immigration and suggests reforms to attract talent.
• Financial Regulation: Greenblatt advocates for restructuring bank incentives to prevent future financial crises.
• Retirement Savings: The author proposes a system similar to Australia's superannuation to ensure better retirement outcomes for Americans.

How does Joel Greenblatt propose to reform education in the U.S.?

• School Choice: Greenblatt supports breaking the link between zip codes and school quality, advocating for vouchers and charter schools.
• Charter Schools: He highlights the success of charter networks like Success Academy in providing quality education to disadvantaged students.
• Systemic Challenges: The book discusses the difficulties in reforming public schools and the need for innovative solutions.
• High Expectations: Greenblatt stresses the importance of maintaining high expectations for all students, regardless of background.

What are Joel Greenblatt's views on immigration in "Common Sense"?

• Skilled Immigration: Greenblatt argues for policies that attract skilled immigrants, who contribute significantly to the economy.
• Economic Impact: He cites studies showing that skilled immigrants create jobs and drive innovation.
• Policy Recommendations: The book suggests simplifying the visa process and removing caps on skilled worker visas.
• Balancing Act: Greenblatt acknowledges the need to address unskilled immigration and refugee issues but emphasizes the immediate benefits of skilled immigration.

How does "Common Sense" address financial regulation and banking?

• Incentive Structures: Greenblatt proposes aligning bank incentives with long-term stability by increasing equity capital requirements.
• Preferred Stock Solution: He suggests using tax-advantaged preferred stock to strengthen banks' financial positions.
• Regulatory Balance: The book critiques excessive regulation and advocates for smarter, incentive-based approaches.
• Systemic Risk: Greenblatt emphasizes the importance of preventing "too big to fail" scenarios through better capital structures.

What retirement savings solutions does Joel Greenblatt offer in "Common Sense"?

• Superannuation Model: Greenblatt recommends adopting a system similar to Australia's, where employers contribute to individual retirement accounts.
• Social Security Supplement: He suggests supplementing Social Security with private savings plans to ensure adequate retirement income.
• Investment Choices: The book advocates for limited, diversified investment options to protect individuals from poor investment decisions.
• Early Savings: Emphasizing the power of compounding, Greenblatt encourages starting retirement savings early in one's career.

What are the best quotes from "Common Sense" and what do they mean?

• "A long habit of not thinking a thing wrong, gives it a superficial appearance of being right." This quote underscores the need to question entrenched systems and seek innovative solutions.
• "Doing the right thing." Greenblatt uses this phrase to describe expanding the earned income tax credit, highlighting its benefits for low-income workers.
• "Where did this King guy come from anyway?" This rhetorical question challenges the status quo and encourages rethinking outdated systems.
• "Investing is hard." The author acknowledges the challenges of investing, advocating for structured, disciplined approaches to retirement savings.

How does Joel Greenblatt suggest improving the earned income tax credit (EITC)?

• Expansion Proposal: Greenblatt proposes expanding the EITC to ensure all workers earn at least $15 an hour.
• Cost Efficiency: He argues that the long-term benefits of reducing poverty and increasing workforce participation outweigh the costs.
• Implementation Changes: The book suggests paying EITC benefits as part of regular payroll to improve accessibility and reduce fraud.
• Economic Impact: Greenblatt highlights the EITC's role in encouraging work and supporting low-income families.

What is Joel Greenblatt's stance on charter schools in "Common Sense"?

• Support for Charters: Greenblatt is a strong advocate for charter schools, citing their success in improving educational outcomes.
• Opposition Challenges: He addresses the political and union opposition to charters, arguing for their expansion based on performance.
• Replication and Sharing: The book emphasizes the importance of replicating successful charter models and sharing best practices with public schools.
• Parental Choice: Greenblatt believes that charters provide essential choices for parents in low-income areas, offering a path to better education.

How does "Common Sense" propose to address the challenges of globalization and technology?

• Education and Training: Greenblatt emphasizes the need for education and retraining to help workers adapt to technological changes.
• EITC Expansion: He suggests using the EITC to support workers displaced by globalization and automation.
• Long-Term Perspective: The book advocates for thinking like long-term investors, focusing on sustainable growth and workforce adaptation.
• Policy Balance: Greenblatt calls for policies that balance technological advancement with social responsibility and economic equity.

What unique perspectives does Joel Greenblatt bring to public policy in "Common Sense"?

• Investment Lens: Greenblatt applies investment principles to public policy, focusing on long-term returns and systemic efficiency.
• Business Experience: His background as an investment manager provides a practical, results-oriented approach to policy challenges.
• Innovative Solutions: The book offers creative, market-based solutions to complex societal issues, such as education and immigration.
• Common Sense Approach: Greenblatt emphasizes straightforward, logical solutions that prioritize equality, opportunity, and growth.