John Coates at Harvard Book Store

Harvard Book Store welcomes JOHN COATES—John F. Cogan Professor of Law and Economics and Deputy Dean at Harvard Law School—for a discussion of his new book The Problem of Twelve: When a Few Financial Institutions Control Everything.

About The Problem of Twelve

A “problem of twelve” arises when a small number of institutions acquire the means to exert outsized influence over the politics and economy of a nation.

The Big Four index funds of Vanguard, State Street, Fidelity, and BlackRock control more than twenty percent of the votes of S&P 500 companies—a concentration of power that’s unprecedented in America. Then there’s the rise of private equity funds such as the Big Four of Apollo, Blackstone, Carlyle and KKR, which has amassed $2.7 trillion of assets, and are eroding the legitimacy and accountability of American capitalism, not by controlling public companies, but by taking them over entirely, and removing them from public discourse and public scrutiny.

What can be done to check this level of power? Harvard law professor John Coates argues that only politics can fight the problem of twelve.

Praise for The Problem of Twelve

“The problem of concentrated power in a few hands is one that we should all be deeply worried about. John Coates provides a compelling account of how the growing influence of index funds and private equity is making this problem much worse in ways that most of us do not even realize, not least because the activities of the key players are shrouded in mystery. The book is a wake-up call for all who are concerned about the future of American capitalism.” —Oliver D. Hart, Lewis P. and Linda L. Geyser University Professor, Harvard University, winner of the Nobel Memorial Prize in Economic Sciences

“In this concise but broad-ranging exposition of how index funds and private equity funds are changing the nature of American capitalism, John Coates unpacks the complex economic and political effects of these financial intermediaries. He offers some sensible first steps in what he explains will be the long-term challenge of containing their negative effects without losing the substantial benefits that index funds, in particular, have produced for American households.” —Daniel K. Tarullo, Nomura Professor of International Financial Regulatory Practice at Harvard Law School, and former member of the Federal Reserve Board

“This is a must-read for policy makers and policy influencers on both sides of the aisle. Coates lays out—with deeply informed, thoughtful, and near-forensic precision—the complicated balance of financial and political power in America, as well as ways to address the increasing concentration of wealth and the problems that presents for a thriving economy and democracy.” —Allison Herren Lee, former SEC Acting Chair and Commissioner, now Senior Research Fellow, NYU School of Law

Mask Policy

Masks are encouraged but not required for this event.