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One of these days I ain't gonna change. Welcome friends, to another edition of Economic Update weekly program on the economic dimensions of our lives, our jobs, our incomes, our debts, our children's economic future, all of that. I'm your host, Richard Wolff. I've been a professor of economics all my adult life and I currently teach at the New School University in New York City. This is a program that normally begins, as most of you know who listen, with short updates, responses, then to listeners, questions, and then often either an in depth analysis of a couple of issues or an interview. But today we're going to change the format. Indeed, we're making an experiment in the early weeks of July 2015 that involves you as well. We're going to take advantage of the summertime to change the format today. Starting today and the next couple of weeks, we're going to divide the program into two halves and in each of them develop a detailed analysis of a particular topic. You have asked me to do this many of you. You've even given me the suggestions for the topics I've chosen, topics that many of you are interested in and have written to me about. And so we're going to do a bit more in depth examination, see how that goes. And I would invite you please to go to our websites and let us know whether you like or don't like the new format, would like to see more of it or less of it as you prefer. We'll assemble all your responses and let you know the results at the end of July. And again, the two websites to use for all communications with us and indeed to follow everything that we do here they rdwolff with 2f's.com and democracyatwork, all one word democracyatwork.info. those will be the websites that carry all of the stuff about us and give you a chance to. To communicate to us. All right, let's begin with the first topic for today. This has to do with the concept of class. What are classes? What's class conflict? How have people understood class differences, class problems, class struggles, all of that? It turns out this is very far from simple. And in order to get clear in our minds what class is, we need to do a little bit of examination of the different meanings that have arisen around this topic over the history of the human race. There's no shortcut here because you'll see quickly that some of the oldest concepts of class, ideas of what it means, are around us everywhere today. So let's begin with probably the oldest one we know about this is the idea that class has to do with what you own. It's kind of the idea of the rich class versus the poor class. And all the class means is you've classified a population, you've divided it into one group whom you call a class versus another group. You could do it with the class of tall people versus the class of short people or the class of elderly versus the class of young people. But in economics, and very old in the human experience has been the notion that it is important to understand a society, to see how it's divided between rich and poor, those who have a lot of property and those who have no property. It's often referred to as the propertied classes and the propertyless classes. And the reason why people divided their society trying to understand who was in which group was. They felt that that helped you understand both the problems of that society and perhaps how to fix them. The oldest idea, and this goes back to the ancient Greeks, if not earlier, and that's. We're talking 5,000 years ago, people in those societies felt that there were problems in those societies that you could trace back to the following fact. Too few people in the community, the city, the state, the country, too few people were in the class of the rich, and too many were in the class of the poor. So if that sounds familiar to you, that's what I meant before when I said these are old issues have been around a long time. Those who were critical of ancient society, who said that the problems of those societies, the inability of people to have good relationships with one another, the problems of dictatorships, the problems of disintegrating society where people were at odds with one another, that many of these problems, said the critics thousands of years ago, could be traced back to. To the class structure of ancient society. And what they meant was the division of people into rich and poor. Too few rich, too many poor. There were also people who wanted the analysis to be a bit more developed than that. That seemed a little simple. So they said, let's not only look at the rich, those who have a lot, and the poor, those, those who have nothing, but let's look at those in between. And there comes the first hint of the idea of the middle class. The people that are in the middle, they aren't rich, but they aren't poor either. They are somewhere in the middle. And so people, for thousands of years, trying to understand what's happening in their societies, how they're developing, what their problems are, what, what their internal conflicts are all about, have had often the occasion to Say that these problems and their solution have something to do with how we're divided in our community between rich and poor and those in the middle. What was the suggestion almost always that critics of ancient society made? The answer, which you already know has, has always been more or less the the gap between rich and poor should be much narrower than it is. The rich are too rich and the poor are too poor, and that what we want is a more equalized society. And by equalized they meantand by the way, it took terms like egalitarianism or equality or, or fairness. Lots of words were used, but the basic idea was we need to change the class structure to make more people in the middle and fewer people at either extreme, and the gap between rich and poor should be much narrower. These ideas took the form of slogans in equality is better than extreme inequality and so on. And they have been championed by all kinds of people for thousands of years. That's really what Jesus had in mind when he said let's throw the money changers out of the temple. He was talking in a particular way, but about a general problem. And prophets from many different religions have weighed in on this subject, almost always critical of the gap between rich and poor and eager to narrow it and to have more people in between, which was what they favored as a way to solve those problems and to make for a better society. The French Revolution had as its first slogans liberty, equality, fraternity, brotherhood. Well, the middle one, equality, speaks exactly to this notion of class, that societies are divided between rich and poor in ways that are damaging to community, damaging to solidarity, damaging to the long run well being of everyone, even the rich, even if they don't understand it. The criticism usually went the rich in the end will suffer also for having taken more into their own hands and provided less for everybody else. Revolution has always been one response. The bitterness, the envy, the anger of the mass of people excluded from wealth, particularly when they can see what the wealth is enabling the rich to do, etc. Etc. So this is an old idea of class that it has to do with who has wealth and who doesn't, who earns a lot, who earns a little, and of course those in the middle. But since ancient times, and here's where things get a little complicated, since ancient times there has existed an altogether different idea of class then this first one. This new and different idea, very old, says that in order to understand how a society is working, in order to see and grasp its problems and fix them, what you have to do is divide the people in the community according not to how much they have or don't have. Not wealth, but something different. You have to ask the question, who has power and who doesn't? Who's an order giver to other people and who is an order taker, the one to whom the orders are given. How do you divide a society between those who have a lot of power and those who have none at all? And the language for this is also familiar, I suspect, to most of you. You refer to one group of people as the ruling class, the class that rules, and the other ones as the powerless people, the ones who have no power. And of course, if for those who want it a little more sophisticated and a little more nuanced, there are those in the middle. They don't have as much power as those at the top, but they aren't as powerless. Excuse me, they aren't as powerless as. As those at the bottom. The first concept we call the wealth concept or the property concept of class. But this one, which is as old as the first one, is a power concept of class. And let me show you how they really are different. Let's take for example, President Obama. He is not in the very top wealth of this country. He's not even close and he never was. So if you're dividing America into classes, Barack Obama isn't in the top class by wealth. But when it comes to ruling class people who have a lot of power, you'd have to rank Barack Obama right there at the top. By defining class in terms of power, he's certainly part of the ruling class. By defining class in terms of wealth, he isn't. And with everybody else, you can see that too. There are people with a great deal of wealth who have nothing to do with the political power struggles in our society or next to nothing. And then there are people who have enormous power and use it to acquire wealth because they didn't have it when they first got into power. There are many who look at the American political system and say, well, what it is, is a vehicle, a system in which some people with little wealth figure out how to get the power which once they get it, they use to acquire wealth. Have there been critics of the division of people into the class of powerful and the class of powerless? Absolutely. Just as there were critics of class analysis, class societies that were divided rich and poor, there have been critics of class societies divided, powerful and powerless. The United States has often been defined as a place which is particularly focused on the concept of class as power. And here's how it works. The Critics always say too few people have too much power relative to the mass of people who have too little power, that the gap between the powerful and the powerless should be narrowed and indeed everybody should be in the middle. In much of modern history, a single word has captured democracy. The idea of democracy was that the best way to distribute power was equally one person, one vote, everything important decided by an open, free election where nobody has more power than anybody else. Each person has an equal say in making the decision. Democracy is a radical idea about power, and it says it shouldn't be distributed. So a few have a lot, but. And the mass have nothing. It shouldn't even be distributed. A few have a lot, a bunch in the middle and then a lot at the bottom. In fact, democracy is the radical insistence that power be shared equally. And so it is the kind of partner, if you like, to the criticism of the other kind of class division that between those who own and those who have no property. That said equality, everybody should have pretty much the same, is the same kind of radicalism. Some of the great philosophers of Western democracy, like John Locke in England, were clearly committed and said so to the equalization of property and the equalization of power. The American Revolution was couched in terms of attacking the power of the King of England vis a vis his colonists here in the United States. And a revolution was made to change the distribution of power, to erect a popular, democratic one person, one vote in the United States, at least moving in that direction. If you know American history, you'll know that in the beginning of our country, all kinds of folks were excluded from the one person, one vote image of democracy. It was only people who owned property, it was only people who were male, it was only people who were white, and so on. Took many struggles over decades to broaden this notion, but at least there was the radical idea of democracy, the equalization of power. Now, let's get to the meat of the argument. Over the millennia, over the centuries, human beings have tried repeatedly. From the revolutions that occurred in ancient Greece, from the revolutions in Rome, from the struggles, the American Revolution, the French Revolution, the Russian Revolution, the Chinese Revolution, all of them hundreds of years ago, right up to the present, one of the central goals of people has been to challenge, to end, to transform class divided societies where what was in people's minds was we've got to do something about the unequal distribution of wealth and the unequal distribution of power. Often people put the two concepts together. We want to do away with concentrations of wealth and power, put them together at the Top and bring up those who have neither wealth nor power at the bottom. Many efforts, many dramatic steps forward. But to be honest to ourselves and as a human community, we have not, and we still have not achieved societies that conform to the notion that we ought to have an egalitarian distribution of wealth and a democratic distribution of power. Neither of those goals has been accomplished. And you can divide people into the two groups. And as to how they explain the failure of the human community, despite progress in the direction, the failure nonetheless to capture to achieve what has been the goal for thousands of years, namely an egalitarian society in terms of wealth and income and a democratic society in terms of equal sharing of power. One group explains this in a simple way. I'm trying to be polite here, otherwise I would have said it in a simple minded way. And the argument they have goes like, can't achieve equalization because it's not the human personality, it's not human nature. It's an undoable thing. There will always be people who grab a disproportionate amount of wealth or power, or both. In other words, give up what people have striven to do for thousands of years, make a better society because it's undoable. This is not an argument that these people can substantiate in any way because it relies simply on the fact of this. We haven't done it, therefore we can't do it. If that mentality was in the minds of any of the people who make technical breakthroughs, electricity, modern machinery, the Internet, you name it, if people had thought like that in technology, we would still be rubbing sticks together to start fires. It makes no sense in science and it makes no sense in human communities either. So then the question, well, why did we fail? Why did all those efforts, noble as they were, dramatic, inspiring as they were, American Revolution, French Revolution, Gracchi brothers in ancient Rome, and so on, the answer is one of the achievements of Marx. Because Marx said we haven't been able because he was very disappointed about the French Revolution not having ushered in the period of liberty, equality and fraternity. The answer Marx said that is, we haven't achieved it because there was something in society we didn't change that had to be changed if we were ever going to get equal distributions of wealth and equal distributions of power. And that was the production process, the way we organize producing the goods and services we live on and depend on this fundamental part of what it means to be human, producing things, using our brains and muscles to transform nature into the things we want. That has to be Transformed how, said Marx, is the crucial question. And his answer was, you have to stop making production, be something done by a large number of people, but controlled by a small number. It can't be organized to produce wealth that the bulk of which is in the hands of a small number. If you organize production in that way, says Marx, you will undermine any sustained movement towards an egalitarian society in terms of wealth and a democratic society in terms of power. And he used three examples. Number one, slavery. He said the reason the slave society could never get democracy and equality was because of the way they organized production. Since all the work was done by the slaves and all the decision making and all the wealth gathered into the hands by the masters, all projects of equalization were undermined by the fundamentally unequal arrangement of production. The same thing in a feudal society with serfs on the land and lords, landlords overseeing the villages. The workers, the serfs did all the work, they produced an output, they delivered it to the lord. You're not going to get liberty, equality and democracy in that kind of an arrangement. And he said, capitalism is no better. The mass of people are workers. They come to work every day, nine to five, five days a week. They produce. And what they produce immediately belongs to a tiny number of people. The boss, the employer, the board of directors of the corporation, whichever one it is, it's a tiny number of people who gather into their hands the goods and services produced by everyone who decide how to use them, what to do with the revenue from selling them, and so on. And Marx's argument then is if you are among those who have struggled, who identify with the ages old struggle for democracy in an equal distribution of power and for egalitarianism and equality in a roughly equal distribution of wealth and income, then the way to get that is to change the production system. That's what earlier efforts didn't do, and that's why they failed. It has nothing to do with some intrinsic greed or evil that people have that frustrates all efforts to move forward. None at all. That's the fatalistic pessimistic argument of people afraid to make the effort, willing to accept inequalities that are crushing, particularly now in our times. No, the answer that comes out of Marx and makes him so interesting as a thinker is we have to change the way we organize production. And here comes the punchline. If we want a society that is democratic in its equal distribution of power and egalitarian in its equal distribution of wealth, we must begin by making the production process the way we Work, a major activity of our adult lives. The way we work has to be organized in a democratic, egalitarian way way. We call that on this program worker self directed enterprises. And here in a nutshell, is what it that the workplace, the enterprise, the household, wherever work takes place, that it is done in an equal sharing way. This means all the people who work in an enterprise together, one person, one votemake the decisions all what to produce, how to produce, where to produce, and what to do with the products and the profits their labor generates. If we do that in an equal way, then the people together will distribute the fruits of their labor in a roughly equal way. Sure, somebody may get more who's done something special that's always possible, that's always done in all communities. But we will never allow the huge inequalities of wealth on the one hand, and the huge inequalities of power on the other that are the norm in societies that insist on having either a slave or a feudal or a capitalist way of organizing production. So Marx introduces, in a sense, a new class concept. It has to do with how we organize production. Do we organize it so that the mass of people produce for a tiny slavery, feudalism, capitalism? Or do we finally organize production in the one way that would sustain, support and reinforce democratic political distributions and egalitarian distributions of wealth? The concept of class as it has evolved from property to power to now. This question of organizing production is a crucial thing to keep in mind. Whenever someone begins talking about classes, class differences, they have to clarify what they mean. Otherwise we are talking incoherently to one another, mixing concepts that have very important differences. Thank you very much for your attention. We've come to the end of the first half of this program. I want to ask you to please stay with us. I want to remind you about what we said at the beginning of this half hour, which is that this is a new format that we are experimenting with. We've just spent the entire period of time of the first half focused on one particular problem and we will shortly move in the second half to do that again for a different question. Please make use of our websites to let us know your interests, your reactions to this format experiment. Rdwolff with two Fs.com and democracyatwork.info There also you can sign up for our newsletter which is free. You can communicate to us, you can follow us on Facebook and and Twitter, which we really do urge you to do. You can see where we're traveling and you can perhaps work with us to help develop our radio audience by letting us know of radio stations in your area that might be interested. Stay with us. We will be right back. Welcome back, friends, to the second half of today's economic update. To remind you all this is an experimental format, we are now going to look at another major issue that many of you have written to me about and have asked me about and that we're going to analyze in some detail. Please again, use our websites, rdwolf with two Fs.com and democracyatwork.info to let us know how you like or don't this new format, whether you'd like to see more or less of it and also take advantage of all the material gathered on those websites. Click on the icons if you want to follow us on Facebook and Twitter, sign up for our free newsletter and partner with us in whatever ways you can. All right, today's second major topic that we're going to analyze in the second half of the program has to do with capitalism and socialism. Why that topic? Well, there are so many reasons, I really don't know where to start. Here are a couple. The dissatisfaction with capitalism. Since the collapse of modern capitalism in 2008, the major global crash that we are still very much in and living with since that, since the failure of government programs to get the world out of it, since the gross injustice of who was bailed out and who wasn't, more and more people have come to question capitalism as a system. And when you do that, it's only another couple of steps before you encounter one. What has been the single most important alternative posed to capitalism, namely socialism? Now, on the one hand, people have stopped thinking much about socialism, either because they thought it had disappeared with the collapse of the Soviet Union, or that somehow the collapse of the Soviet Union and changes in places like Cuba, Vietnam, People's Republic of China have somehow made it not relevant. That was a kind of view that happened between the end of the Soviet Union, 1989 and the crash. We're now living with 2008. That's a 20 year period roughly. And so you could see that it kind of faded away. But now it is coming back and many of you have asked about it. But there are other reasons. There are some remarkable things. In 2013, in in Seattle, Washington, a courageous young woman named Kashama Sawant, of Indian extraction, Indian American, a woman of color, calling herself openly a socialist, ran for the city council of this large American city, Seattle, and defeated a longtime Democratic incumbent. She got 94,000 votes in the city of Seattle for her socialist candidacy. And she is in a good position running for reelection this year to do it again. That's interesting. Americans haven't been electing socialists in such clear and impressive ways. Even more remarkable, the one man in the Senate of the United States who accepts the label socialist, Bernie Sanders, is running in the Democratic primary and doing, I think most people would agree, rather much better than had been predicted by people who thought anyone who accepted that label could not get to first base politically in the United States. So for these, and indeed for many other reasons, we're going to spend a little time examining capitalism, socialism, what these terms have come to mean. And boy, is there a lot of confusion about this, so that we are clearer in the future to talk about this in a coherent and useful way. So let's begin. Capitalism is a particular way of organizing production. It involves a small group of people, capitalists, employers. They have different names. Entering into a contract with a large group of people, they can be called workers, employees, and so forth. The contract specifies what each will do for the other. The employers commit to paying an amount of money to those workers at the end of, let's say, a week, typically as what the employer owes the employee. What the employee owes the employer is brains and muscle. The employee agrees to come to work at a specific time, usually five days a week, and roughly from nine to five or eight to five, whatever it is. And the employee agrees to do what the employer tells him or her to do with whatever materials, tools, and equipment are provided, and to leave whatever the producers make, whatever these employees produce, to leave it at the place of work after the employee goes home for the night. Because whatever the workers produce belongs to the employer. That's the deal. That's what capitalism is. And it doesn't take a genius to understand that the employer only does this because what the employer gets from the workers is more valuable than what the employer pays out to the worker as a wage, and to buy the tools, equipment, and raw materials with and on which the worker works. Only if the employer gets back more than the costs of production will the employer undertake the production. So workers produce more than they get, and that's what the employer wants. That's the deal. That's what capitalism is. Doesn't matter whether the employer is one person or one family or a board of directors. With LOT Corporation, excuse me, with lots of shareholders. Those are different forms of capitalism. Here's another form that's very important. The capitalist can be a private person, a man or a woman who starts a business A man or a woman who's elected by the shareholders to be on the board of directors of a capitalist corporation, one that hires workers, gets from them more than is paid to them, and decides how to work with this profit, how to use it, whom to give it to, etc. Here's another different form. The government itself may become the capitalist. That is, the government can set up a enterprise with an individual. Some official of the government is designated, okay, you run this state enterprise, you will be the state capitalist. And why do we call it state capitalist? Because the person in the role of capitalist is a state official. We call it private capitalism if and only if the person in charge, the employer, is not a state official, simply a private person, however he or she has gotten himself or herself into that position. Do state capitalist enterprises exist around the world? And the answer is absolutely. In every country where capitalism exists side by side, you have private capitalist enterprises and state capitalist capitalist enterprises. Let me give you an example or some examples of state capitalist enterprises here in the United States. But they have parallels in every other country. Amtrak, our passenger rail system, is a state capitalist enterprise. It hires workers who produce train travel. And the employer makes all the decisions about how those workers work, where and when those workers work, and the revenue that comes in all the tickets purchased by all the passengers is drawn into the hands of the state officials put in charge of Amtrak. The post office, the Tennessee Valley Authority, most public high school, excuse me, colleges and universities are run in this way. Those are state officials put at the top of those enterprises. Just it is state employees that work in them. I worked for many years, for example, as a professor at the University of Massachusetts in Amherst. That was a state capitalist enterprise. And there are many others, many others in the United States and in many other countries. So it is nothing special or unusual that a capitalist economy has private capitalist enterprises alongside state capitalist enterprises. Why am I stressing this with you as we speak? I think the answer is that there's a confusion that has happened. And the confusion goes like when the state gets active in the economy either by setting up its own enterprises like the post office and TVA and so forth. There are those in the private capitalist sector who feel threatened. They don't want the competition from the government. They are fearful of the competition from the government. They recognize that when the government runs something, political decisions become relevant to what goes on in the enterprise. The mass of people with their power to vote in a modern society will vote for politicians who will do things in those public enterprises that the private capitalist enterprises don't want to deal with, don't want to have to compete with. So private capitalists have been very leery, very wary, very suspicious about state capitalist enterprises over the years. Sometimes private capitalists have gotten a little sloppy in their language and refer to the state when it runs its own enterprises as somehow socialist. We'll see in a minute why this is an error, but it begins to explain why there's so much confusion here. By the way, for some of you, you'll be wondering, gee, the examples I gave are examples where the government gives a subsidy to things like public colleges and universities or the government gives a subsidy to Amtrak. Quite true. The government typically gives subsidies to state capitalist enterprises. But if you know how private capitalism works, you'll know that the government gives subsidies to them or all over the place, all the time. So getting a subsidy from the government doesn't distinguish private capitalists from state capitalists. All right, enough about capitalism. Now let's bring in the alternative socialism. The idea of socialism is right there in the word social. Instead of capitalism, where individuals become employers, socialism has always had the idea the society as a whole should be the employer. We shouldn't allow some people to have all the power and all the wealth pulled out of a system that we all work for and that we all work in. So the idea of socialism was do away with the employer employee division. Everybody should be an employee, and all employees should together and democratically make the decisions about production and indeed about everything else. In other words, no slave versus master, no serf versus lord, and no worker versus employer. We are all members of society and ought therefore together to run the enterprises, to make the economic political decisions in a one person, one vote, democratic way. And capitalism is not compatible, is not consistent with that democratic ideal. Socialism claimed always for itself that it made democracy in the economy, and that without economic democracy there couldn't be any political democracy worth its name. Okay, now let's put this all together. Capitalism has repeatedly gotten itself into deep trouble from the beginning. There were critics and there were victims of capitalism who didn't like it and who sought to change it. And when change wasn't possible, to revolt against it. For those of you not familiar, we will in a couple of weeks have a guest here who's a specialist on the Paris Commune of 1870. Most people point to that as the first time working people made a successful revolution, even though it only lasted a few months. In the city of Paris, workers took over the government, pushed the employers out, transformed the work process into a democratically worker Decided worker, operated set of firms and ran the city of Paris for a period of months. And we know the Russian Revolution in 1917 tried for this and a variety of revolutions in many countries. Since they were all by self definition socialist revolutions. They wanted to get rid of capitalism, rid of the division between employer and employee, and instead have a socialized economic system in which everybody has an equal role to play in the decision making and in the income and wealth generated by everybody's work. Increasingly, after the 1870s, these socialists began to grow. With capitalism's growth, grew the critics and the victims, and they gravitated to socialism. And indeed, socialism got so strong at the end of the 19th century and the beginning of the 20th century that a major debate exploded among socialists. And this shapes the world today, this debate. So let me tell you what it was and what happened. First, the socialists as a group reached the point of view that the way to make the transition from capitalism as a system to socialism was by capturing the government. The idea was if you get the government, you'll have the power to change society. That if working people and socialists capture the government, they can use the power of the government to transform the economic system from a capitalist one to a socialist one. To change the organization of production inside every enterprise, from the top down hierarchical employer versus employee structure to the collective democratic workers self directed enterprise structure that the socialists favored. But notice please that the government was not the end of the goal of the socialists. It was just a means. They were to capture the state and then use the state to make the move. The transition from capitalism to socialism. And socialists who agreed on that, then disagreed on how to do it. Some socialists were revolutionary. They wanted to follow the image of the French Revolution, the American Revolution. A kind of violent explosion in which you push aside the old and you establish the new. There were other socialists who did not agree with that. They thought that the way you capture the state in modern times is not by revolution, but but rather what they called evolution. That is, they should organize political parties, the socialists should run for office, develop their own candidates, and basically win the power of the state by playing the parliamentary or the electoral game. Some socialists were revolutionary, other socialists were evolutionary. But please remember they all agreed that the state is simply the means to make a transition. Having captured the state isn't the transition itself. That would be silly. The transition is what has to happen on the ground, at the workplace, in the community, not at the height of the government. Okay, now we're ready to put it all together. When socialists finally achieved their goal, they captured the state. And by the way, some did it with revolution. That's the Soviets and Bolsheviks in Russia. That is the Mao Tse Tung and his followers in China, Fidel Castro in Cuba. And so some did it by revolution, others did it by evolution. For example, the current government right now in France is a government of the socialists, Socialist president. Socialists have the majority in the national assembly, and Socialists have a majority in the French Senate. So they control the government. They got there in an evolutionary way, not in a revolutionary way. But here's what's most interesting. Whether the socialists got into power in a revolutionary seizure of the state, or whether they got into power by politically building a vote, getting machine and winning enough seats to control the government. Either way, neither one of those was able or willing to make the transition. In other words, they got into power, but then, for whatever complicated reasons, either could not or would not transform the economies. It's really interesting. Typically in the evolutionary socialist pattern, when the socialists get the government, what they do is instead of making a transition to socialism, what they do is impose a whole lot of rules and regulations on private capitalism, maybe develop a little state capitalist part of the economy. But mostly they regulate private capitalism, put a little state capitalism alongside it, and basically declare, we've done as much as we can do. And thus it has become in their head and in the minds of many people that socialism means when the state makes capitalists pay reasonable wages, make a pension system kind of capitalism with a human face, friendly capitalism, gentle capitalism. Similarly, in the revolutionary places, Russia, China, Cuba, and we'll use Russia as an example, the revolution comes to power. Lenin, the great first leader in the Soviet Union, made a remarkable statement in the few years he had before he got sick and died. After the revolution, he said, we in Russia here have created state capitalism. We have converted all the factories and so on industrially into state capitalist enterprises, where state officials play the role of capitalists. That's a good thing, he said, but it's only one step. Now we have to do the big thing, which is to transform our economy from a capitalist, in his case, a state capitalist system, into socialism. A few years later, the leader who succeeded Lenin after much struggle in the Soviet Union, Stalin, made an amazing kind of switch. He announced that in his opinion, as the leader of the Soviet Union, socialism had been achieved there. That is, he declared that what was a state capitalist system, I.e. employers versus employees, with the employers being state officials and the employees being employed by the whole society, the government, that this state capitalism was socialism. He declared, it and even more amazing than his simply deciding what socialism now would be redefined to mean, namely, something that still kept hold of the employer employee distinction, that did a little fudge there, in which state capitalism, which had always existed, now becomes the socialism that everyone before that had thought was a radical alternative. Even more amazing than Stalin's move was the fact that ever since then, all kinds of people, friends of socialism and enemies, people who liked what Stalin did, people who hated and reviled people, both Stalin and Stalinism have basically agreed to this, that socialism is state capitalism, that somehow you're a socialist if you advocate that the state regulate or control or take over something. This is amazing. And it leads to confusion. Some people understand the difference between socialism and capitalism and have a clear idea. Others are all confused about socialism, state capitalism. That's why we have, for example, in America, people who watch President Obama pushing for a state health insurance program, calling him socialist because the state is involved, or people who want to get rid of the post office because it's socialism and things like that. They don't have a clear sense of what socialism always was, what state capitalism always was. And the confused history of how they melded into one another has never been taught or explained. Which is one of the reasons why I wanted to take this time to respond to the many of you who've asked for this to be laid out. Whatever your particular position, you, my listener, my viewer, you may like or not like state capitalism. You may prefer it to private capitalism. You may want the government to regulate more or less of the activities of private or state capitalist enterprises. But please, whatever your views on that, keep clear in your mind that socialism is a radical, different way of organizing production, that all systems have had private and state enterprises coexisting, that to have a state enterprise that is capitalist doesn't therefore diminish the capitalist nature of your society. It's still capitalist because of the employer employee division. The workers at Amtrak and the workers at public institutions elsewhere do not democratically decide what goes on there. If they did, then we might have the beginning of a socialist sector, but we don't. That's why we call it state capitalist. And that's a different thing from socialism. Well, folks, we've come to the end of this new format experiment. I want to again invite you to go to our 2rdWOLFF with 2F's.com and democracyatwork.info please let us know your thoughts about this format. Whether you like it, don't like it, want to see more or less of it. And please make use of our websites for all the information and material we post up on there every day to follow us on Facebook and Twitter to sign up for our newsletter to help us spread this radio program to other parts of the country. I also want to take a moment to thank the Manhattan Neighborhood Network, which is the host of where these programs are recorded and developed, and we appreciate their support a great deal. This has been an enjoyable effort to change the format to bring a little variety in. Let us know what you think and I look forward to speaking with you again next week.