Economic Update with Richard D. Wolff

Episode: Declining Global Inequality And Socialism
Date: September 21, 2023

Episode Overview

In this episode, economist Richard D. Wolff discusses how the U.S. now ranks poorly among developed nations for worker conditions, the soaring profits of America’s largest corporations amidst stagnating wages, and the importance of worker solidarity both domestically and globally. He then explores recent global trends in inequality—emphasizing the major impact of China’s economic model—and confronts commonly repeated claims that “socialism doesn’t work” by highlighting China’s economic success. The episode blends sharp critique with international perspective, challenging mainstream economic and political narratives.

Key Discussion Points and Insights

1. U.S. Standing Among OECD Countries

• Report from Oxfam & Forbes: A recent study titled Where Hard Work Doesn’t Pay Off compared working conditions among 38 developed (OECD) economies.
  • U.S. Ranks:
    • Wages: 36th out of 38
    • Worker Protections: 38th (worst)
    • Right to Organize Unions: 32nd
  • Quote:

    “This is the best place to be a working person. No, it isn’t. It’s not even close to the best. It’s more accurate to say it’s the worst.”
    — Wolff, [05:25]

  • Wolff emphasizes that U.S. politicians' rosy narratives about work in America are “lies” and signals of the “decline of U.S. capitalism”.

2. Booming Corporate Profits Amid Wage Stagnation

• Stock Performance of Top Companies (First Half of 2023):
  • Nvidia: +192%
  • Meta: +134%
  • Tesla: +107%
  • Amazon, Microsoft, Apple, Alphabet: Substantial gains (over 40–50%)
  • Wages for ordinary Americans rose nowhere near this amount.
  • Quote:

    “If your wages didn’t go up by 192%, that’s three times what you got before, then you’re not doing as well as Nvidia.”
    — Wolff, [07:20]

  • Wealth Distribution: 10% richest Americans own 80% of the stock, reinforcing inequality.

3. Worker Solidarity and International Labor Actions

• Korean Writers on Strike in Support of Hollywood Writers:
  • Korean writers, and Hollywood-area janitors, joined U.S. writers’ strike in solidarity.
  • Quote:

    “That kind of worker solidarity is what will make the labor movement real again.”
    — Wolff, [12:10]

• Impact on Global Inequality and Migration:
  • U.S. policies suppress wages abroad, fueling both migration and global inequality.
  • True international solidarity would raise wages worldwide and reduce migration pressures.

4. UPS Teamsters and the Power of Striking

• Teamsters Union:
  • 340,000 workers at UPS voted 97% in favor of strike (August 1, 2023) unless a contract is reached.
  • Mentions International Longshoremen Workers Union’s (ILWU) tough tactics as an example.
  • Quote:

    “UPS profits doubled over the last five years…they don’t want to share any of that with the workers who make UPS what it is.”
    — Wolff, [16:50]

5. Pfizer & the Penicillin Shortage: Profit Motive in Health Care

• Pfizer’s Announcement: Shortage of penicillin for STDs, blamed on supply chain disruptions and a rise in syphilis.
• Critique: Companies use “supply chain” excuses to mask profit-driven failures.
  • Quote:

    “The problem here isn’t syphilis. The problem here is a profit-based health system.”
    — Wolff, [19:35]

In-Depth Analysis

6. Declining Global Inequality: The China Effect [Second Half, ~21:40]

• Based on Branko Milanovic’s Foreign Affairs Article:
  • From 1820–1980: Global inequality rose sharply, first under the British Empire, then U.S. hegemony.
  • Since 1990: Trend reversed—global inequality fell significantly for the first time in centuries.
  • China’s Role:
    • China’s rapid economic growth has “removed half the inequality that developed over the previous two centuries.”
    • India, Brazil, and other countries also contribute but are not at China’s scale.
  • Quote:

    “Half of the inequality that developed over the previous two centuries was removed in the last 30 years. In a way, that’s very good news.”
    — Wolff, [24:10]

  • Why? China’s hybrid model of state and private ownership, managed by a strong central government (Communist Party), prioritized escape from poverty.

7. Reassessing the “Socialism Doesn’t Work” Narrative [31:30]

• Popular Claim: “Socialism does not work and it never has.”
  • Wolff: Factually untrue when looking at economic metrics.
• China’s 30-year Track Record:
  • GDP has grown 2 to 3 times faster than the U.S. for 30 years.
  • Chinese real wages quadrupled; U.S. real wages have stagnated.
  • Quote:

    “The GDP…has grown two to three times faster in China for 30 years than in the United States…the real wage…has gone up about four times. That’s a period of time when the American real wage was stagnant.”
    — Wolff, [33:52]

  • For most of the world (esp. Asia, Africa, Latin America), economic growth and escaping poverty is the number one priority—China is the “number one success.”
• The “China is Capitalist” Argument:
  • Yes, China opened space for private capital, but under tight state control—a hybrid “socialism with Chinese characteristics.”
  • Quote:

    “Saying that socialism doesn’t work is a sign you either don’t know what’s going on or you’re so desperate you have to tell each other comforting lies.”
    — Wolff, [38:50]

Memorable Quotes & Timestamps

• “This is the best place to be a working person. No, it isn’t. It’s not even close to the best. It’s more accurate to say it’s the worst.”
  — [05:25]
• “If your wages didn’t go up by 192%, that’s three times what you got before, then you’re not doing as well as Nvidia.”
  — [07:20]
• “That kind of worker solidarity is what will make the labor movement real again.”
  — [12:10]
• “UPS profits doubled over the last five years…they don’t want to share any of that with the workers who make UPS what it is.”
  — [16:50]
• “The problem here isn’t syphilis. The problem here is a profit-based health system.”
  — [19:35]
• “Half of the inequality that developed over the previous two centuries was removed in the last 30 years. In a way, that’s very good news.”
  — [24:10]
• “The GDP…has grown two to three times faster in China for 30 years than in the United States…the real wage…has gone up about four times. That’s a period of time when the American real wage was stagnant.”
  — [33:52]
• “Saying that socialism doesn’t work is a sign you either don’t know what’s going on or you’re so desperate you have to tell each other comforting lies.”
  — [38:50]

Important Segment Timestamps

• [00:50] – U.S. OECD rankings & Oxfam report overview
• [07:00] – Big Tech stock booms vs. wage stagnation
• [12:00] – International labor solidarity (Korean writers, Hollywood janitors)
• [16:40] – Teamsters vote to strike and UPS profits
• [19:10] – Pfizer penicillin shortage and critique of profit-driven healthcare
• [21:40] – Declining global inequality (Branko Milanovic piece, China’s rise)
• [31:30] – Challenging “socialism doesn’t work” and China’s economic model

Tone

Wolff’s tone is candid, critical, and passionate throughout, using pointed language to challenge mainstream myths with empirical evidence and international examples. He directly addresses listeners (“friends”, “I want you to see…”) and calls for solidarity, systemic analysis, and honesty in confronting economic realities.

Summary

This episode interrogates American economic myths in the context of global developments. Wolff illustrates America’s relative decline for working people, exposes the mechanisms of intensifying inequality, and proposes solidarity—not nationalism nor profit motives—as the way forward for labor. He compellingly reframes the conversation on “socialism,” arguing that China’s model—however one judges it politically—has delivered extraordinary economic progress for workers, something the U.S. has not matched in a generation. Wolff’s message: empirical reality, not ideology, should guide our economic understanding and policymaking.