Podcast Summary: Economic Update with Richard D. Wolff

Episode: A Tale of Two Crises: 1929 & 2008

Date: August 31, 2017

Overview of the Episode

In this episode, economist Richard D. Wolff draws powerful parallels and contrasts between two monumental crises in American capitalism: the Great Depression of 1929 and the Great Recession of 2008. Through a critical lens, Wolff explores not only their economic causes and outcomes, but, crucially, the difference in public responses and the underlying structural forces shaping each era's recovery or lack thereof. Wolff emphasizes the importance of systemic change and collective political action, underscoring the lessons learned—and not learned—from history.

Key Discussion Points & Insights

1. American Working Conditions: Revealing the Reality

(00:53–07:34)

• Wolff begins with findings from the “American Working Conditions Survey,” a comprehensive study revealing significant hardships and deteriorating quality of work for US workers.
  • 1 in 5 workers reported a hostile or threatening work environment, including harassment and bullying.
  • Over half (55%) reported unpleasant or hazardous conditions.
  • 75% spent at least a quarter of their time in intense or repetitive physical labor.
  • Telecommuting remains rare; 78% required to be physically present.
  • Only 38% see prospects for advancement, a percentage which drops with age.
  • Over a third have no control over their schedules.
  • Stark class-based disparities abound: e.g., only 68% of men without degrees can routinely lift heavy loads, and far fewer have freedom to take breaks compared to college-educated counterparts.

Notable Quote:

“For the 300 years that the capitalist system has been the dominant way we go about producing goods and services... [technical progress] was justified... as a way to make less work necessary and to make the work we do less arduous... But the reality is... we have results of the sort I just talked to you about.” — Richard D. Wolff (05:57)

Implications:

• Despite centuries of technological progress under capitalism, work has not become less harsh for many. This fact undermines the promise that technological gains improve overall working conditions.
• The decline in labor force participation may be explained by the poor quality and demanding nature of available work, prompting millions to stop seeking employment altogether.

2. Inequality Worsens: From Scheduling to School Lunch

(09:30–13:00)

• Wolff touches on growing inequality through an anecdote: a Florida school offering wealthy parents the ability to pay so their children could skip lunch lines, a policy met with local outrage and ultimately defeat.

Notable Quote:

“Well, I’m happy to tell you that the parents…went ballistic. Thought this was the worst conceivable way to divide, humiliate students…But besides shouting out, good for you, I do want you all to think about what it means that…administrators and parents and teachers could have come up with the idea…” — Richard D. Wolff (12:14)

Implications:

• Even seemingly small policies can manifest and reinforce the “haves and have-nots” division, exposing deep class stratification in everyday American life.

3. Crisis Management Tools: The Specter of Negative Interest Rates

(07:34–09:30)

• Anticipating the next downturn due (based on capitalism’s business cycles), Wolff discusses economist Kenneth Rogoff’s advocacy of negative interest rates as a policy remedy.
  • Explanation: Negative rates charge depositors for saving, theoretically pushing them to spend.
  • Critique: Wolff doubts its effectiveness. If faith in the economy is low, no one will risk capital in real production merely because banks penalize savings.
  • Harm: Particularly devastating for retirees and savers, whose nest eggs would erode in a negative-rate regime.

Notable Quote:

“What in the world are we saying and doing to the elderly part of our population by seriously entertaining a regime of negative interest rates to deal with the instability of the capitalist system?” — Richard D. Wolff (09:13)

4. Fascism Defined: Economics and the State

(13:00–20:16)

• Following the violence in Charlottesville, Wolff pivots to explain what “fascism” means economically.
  • Definition: Fascism is when the business community merges with the government to maintain capitalist production at all costs, suppressing labor and leftist opposition.
  • Historical Example: Germany in the 1930s—business leaders allied with Hitler’s Nazi Party, destroying unions, socialists, and communists to keep capitalism running despite systemic crisis.
  • Warning: Observes similar trends in contemporary America, urging listeners to recognize early warning signs.

Notable Quote:

“Fascism is that coming together of the business community and the government to together dictate, and I mean the word dictate, exactly what happens in the economy, because they can’t see any other way of getting the system to survive.” — Richard D. Wolff (19:48)

Main Feature: 1929 vs. 2008—A Tale of Two Crises

(23:25–end)

The Great Depression (1929–1941): What Made the Difference?

• The stock market crash ended the Roaring Twenties; by 1933, unemployment was at 25%.
• Suffering sparked anger and action. Americans joined unions and radical parties en masse (communist, socialist).
  • Three Key Responses:
    1. Unprecedented Unionization: Millions joined unions for strength and mutual aid.
    2. Left-Wing Organizing: Socialists and Communists helped coordinate mass action, broadening demands.
    3. Direct Political Pressure: These groups pressured President Franklin D. Roosevelt, effectively forcing his administration to address common needs.
  • Historic Achievements:
    • Social Security system creation
    • Unemployment insurance
    • Minimum wage laws
    • Massive public works programs (15 million government jobs)
    • All paid for by heavily taxing the rich and corporations

Notable Quote:

“That coalition was able to save us from what might have happened in the Great Depression. Other countries… they went in a different direction. They reproduced that capitalism by going fascist… We didn’t have to go through that in this country.” — Richard D. Wolff (48:07)

Business Response & Backlash

• After WWII, business elites sought to “destroy that coalition,” systematically targeting and demonizing communists, then socialists, then unions.
• By undermining labor and the left, they erased the social force responsible for the mid-century American middle class.

The Great Recession (2008–?): What Was Missing?

• The collapse was severe—millions lost jobs and homes—yet the response was fundamentally different.
  • Absence of Mass Organizations: No strong unions, no powerful left-wing parties, no broad mobilization from below.
  • Policy Response: Bailouts for banks and stock markets, benefits “trickle down” from the top, with little direct aid to ordinary people and negligible systemic reform.

Notable Quote:

“The middle class didn’t disappear by some accident or by some mystery. You destroyed the middle class by destroying the political coalition that made it possible.” — Richard D. Wolff (51:44)

The Irony and the Danger

• Business leaders themselves, by destroying the coalition of unions, socialists, and communists, also destroyed the only forces with the capacity to demand effective reforms today.
• Without mass organizing, the same problems recur undeterred, while the system risks further instability—and a possible gravitation toward fascism, as history warns.

Hope on the Horizon: New Movements

(56:00–end)

• Wolff sees the seeds of fresh resistance in movements like Occupy Wall Street (“the 1% vs. 99%” slogan) and the unexpected political traction of “democratic socialist” Bernie Sanders.
  • These are early stages of a new coalition, though still far from the robust power of the 1930s.
• Essential Lesson: For any new movement to succeed, it must secure its gains by changing who owns and operates enterprises, i.e., shifting toward worker co-ops and democratic enterprise management. Otherwise, reforms will again be temporary.

Notable Quote:

“The lesson we have to learn this time is you can’t make that mistake again. Otherwise you will struggle again to achieve another set of reforms which will be just as temporary as those that they won in the 1930s.” — Richard D. Wolff (59:38)

Memorable Quotes & Moments (with Timestamps)

• “We have machines now that can do the labor that used to be drudge work for human beings... But the reality is... we have results of the sort I just talked to you about.” — Richard D. Wolff (05:57)
• “That coalition was able to save us from what might have happened in the Great Depression... We didn’t have to go through that in this country.” — Richard D. Wolff (48:07)
• “The middle class didn’t disappear by some accident or by some mystery. You destroyed the middle class by destroying the political coalition that made it possible.” — Richard D. Wolff (51:44)
• “The lesson we have to learn this time is you can’t make that mistake again. Otherwise you will struggle again to achieve another set of reforms which will be just as temporary as those that they won in the 1930s.” — Richard D. Wolff (59:38)

Episode Timeline/Key Timestamps

• 00:53 — Discussion of American Working Conditions Survey
• 07:34 — Explanation and critique of negative interest rates
• 09:30 — Example of school lunch inequality in Lakeland, FL
• 13:00 — Fascism, economic definition and warning signs
• 23:25 — Deep dive: comparing the Great Depression and the Great Recession
• 45:40 — How business destroyed the New Deal coalition, and the consequences
• 56:00 — Signs of renewal: Occupy Wall Street, Sanders, lessons from the 1930s
• 59:38 — Final lesson on the need for deeper, structural economic change

Conclusion

Richard D. Wolff’s “A Tale of Two Crises” episode offers a forceful and historically grounded reflection on why America’s response to economic disaster has transformed—and warns about the dangers of failing to heed history’s lessons. Above all, Wolff calls for renewed collective action and deeper structural reform, emphasizing the need to not only win protections for working people, but also to secure lasting, democratic economic power for the future.