For decades, Americans were promised that a college degree guaranteed a secure spot in the middle class. But instead of entering corporate management, many graduates are finding themselves trapped in low-paying service roles with crippling debt. Is this widening gap between expectations and financial realities fundamentally reshaping the modern American workforce?

New York Times reporter Noam Scheiber joins the podcast to unpack the core arguments of his new book “Mutiny: The Rise and Revolt of the College-Educated Working Class” about this labor shift. He argues that the psychological injury of these broken promises is sparking a unique wave of workplace activism.

The systemic failure of the college wage premium poses urgent questions for the future of American capitalism. If millions of highly educated citizens feel cheated by the system, the resulting political and economic destabilization could be severe.

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Economic models have treated the labor market like a perfectly competitive system where wages naturally align with worker value. Arin Dube, economics professor at the University of Massachusetts Amherst and author of “The Wage Standard”, challenges this long-held assumption. He argues that modern labor markets are riddled with invisible frictions that give employers outsized power over your paycheck.

These uneven power dynamics help explain why salaries at the bottom of the distribution have historically stagnated while the broader economy grew. Dube unpacks decades of data to show what actually happens when minimum wages rise, pushing back against the classic warning that wage floors automatically destroy jobs. Instead, he presents evidence suggesting that higher pay can actually reduce turnover and push workers toward more productive companies.

Hosts Luigi Zingales and Bethany McLean press Dube on the missing pieces of his labor puzzle. Zingales questions whether Dube is ignoring the massive impact of immigration on the supply and demand for low-wage labor. Meanwhile, McLean digs into the elusive concept of fairness, asking whether outsourced corporate janitors should compare their pay to Wall Street bankers or just to other janitors.

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You can find Arin Dube's book "The Wage Standard" here

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Most people associate Adam Smith with free markets and “the invisible hand”. But does this conventional narrative purposefully ignore Smith’s deep suspicions about monopolies and power?

Georgetown assistant professor Glory Liu argues this narrow interpretation is actually a deliberate historical reconstruction. In her book, “Adam Smith’s America”, Liu reintroduces the famous philosopher as a theorist of power who worried deeply about organized wealth distorting society. She notes that Smith watched early merchants use their disproportionate resources to capture political influence and actively suppress workers.

Hosts Luigi and Bethany debate whether early merchant wealth accumulation truly mirrors the massive capital concentration seen in today's corporate landscape. They also explore the argument that reintroducing moral foundations to economic theory might provide a better foundation for capitalism itself.

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