Economic Update with Richard D. Wolff
Episode: An Unsustainable System
Date: May 24, 2018
Guest: Chris Hedges
Main Theme and Purpose
This episode critically examines the current state of American capitalism, highlighting systemic trends that threaten its sustainability—ranging from increasing privatization and labor insecurity to political dysfunction and looming economic crises. The episode features both Professor Richard D. Wolff’s weekly economic updates and an in-depth interview with Pulitzer Prize-winning journalist Chris Hedges, delving into the roots and dangers of rising inequality, corporate dominance, and the erosion of democracy.
Key Discussion Points & Insights
1. Economic Updates from Professor Richard D. Wolff
Privatization & The Rise of “Private Cities”
- Trend: Moving from gated communities to entire cities designed exclusively for the wealthy, promoted by groups like “Free Private Cities,” modeled after Singapore (00:42).
- Wolff’s critique: “Private cities from which all who haven’t got the money will be excluded... If you ever needed a sign of the disintegration of contemporary capitalism, there it is.” (02:50)
- Fears of disintegration of collectivity, solidarity, and the public good.
Freelancing and Labor Insecurity
- Upwork data: 57 million freelancers in the US, or 35% of the workforce; among millennials, it's 47% (06:55).
- Wolff’s analysis: Growth of the freelance sector makes it nearly impossible for people to plan basic aspects of life (08:10).
- Links to declining birthrate in the US: “An impossible situation and has more than a little to do with the fact that the birth rate in the United States has been dropping...” (08:40).
Legalization of Sports Betting: Tax Base Shifts
- Supreme Court allows states to legalize and tax sports betting (10:15).
- Wolff’s take: This is less about morality than about desperate search for tax revenue, because states are “desperate to avoid taxing corporations and the rich” (12:22).
- Over decades, the tax burden has shifted from corporations and the wealthy to individuals, especially the middle and lower classes.
Emission Scandals and Corporate Malfeasance
- Fiat Chrysler (with suppliers VM Motori and Bosch) joins the list of automakers (after Volkswagen, Porsche) caught cheating emissions controls (21:24).
- Wolff’s point: “To trust large capitalist corporations not to cheat, not to lie—that’s been given the lie by what’s emerged here.” (22:31)
- Worker co-ops advocated as potentially more accountable alternatives (23:53).
Federal Job Guarantee Legislation
- Senators Gillibrand, Booker, and Sanders introduce a bill for a federal jobs guarantee (26:37).
- Wolff compares public employment to private: Public profit could reduce taxes or boost services; “Not to do that is a strange decision and depends only on the political muscle of private enterprises.” (28:40)
- Criticism: Systems in which workers are excluded from management but bear the cost of mismanagement (as in universities firing tenured faculty without financial emergencies) reflect “taxation without representation.” (31:20)
2. Interview with Chris Hedges (Second Half)
Diagnosis: Inverted Totalitarianism, Corporate Rule, and Declining Democracy
- Hedges:
- America isn’t facing classic fascism but “inverted totalitarianism” (borrowing from Sheldon Wolin), where corporate power is supreme and politics is secondary (31:10).
- “Trump is the product of a failed democracy... the symptom, not the disease.” (32:10)
- Draws parallels with the fall of Yugoslavia and Weimar Germany—rising inequality and instability produce authoritarian figures.
Is the US Approaching Fascism?
- Distinction:
- Not classic fascism, but a variant characterized by corporate power with state complicity, seen as “a species of fascism.” (35:32)
- Trump’s actions benefit corporate America most: deregulation, tax cuts, increased military spending (36:10).
- Consumerism and debt become tools to pacify the public, but cites the looming danger if the “debt bubble” (student debt, easy credit) bursts. (36:52)
Democratic Party’s Failures
- Hedges argues Democrats are an “appendage of the corporate state,” failing to address core economic issues (wages, healthcare, debt), making them “deeply anti-democratic.” (38:30)
- Left movements tend to collapse into Democratic Party support during elections, missing true systemic change.
The Role of Mass Media
- Mass media (CNN, MSNBC) profits enormously from Trump, creating a “symbiotic relationship.” (39:58)
- Hedges: “They function as courtiers in Versailles, gossiping about the proclivities and habits of the monarch.” (40:20)
- Media fails to cover real pain and oppression—contributes to societal paralysis.
Why the System Is “Unsustainable”
- Wolff asks what “unsustainable” means in practice—Hedges cites risk of losing dollar reserve currency status as the critical tipping point (43:02).
- Imports would become expensive; empire expansion would be impossible.
- Wall Street’s fictitious capital (finance-driven economy) is ultimately doomed—“Speculators have just seized the economy and they’re looting and making money as fast as they can on the way down.” (44:00)
Opposition Movements & Prospects
- Hedges is skeptical about mainstream electoral routes; criticizes shifting grassroots energy to Democratic campaigns post-primary.
- Hopeful signs: Teacher strikes, direct-action models such as Standing Rock (45:36).
- Meaningful change requires sustained, community-rooted civil disobedience; state responses to real threats are far harsher than responses to large, symbolic protests.
US Foreign Policy & the End of Alliances
- Characterizes foreign policy as “chaotic, emotionally driven, willfully ignorant” (48:47).
- Points to dangers of antagonism with Iran and the rise of militaristic intervention with little understanding of complex realities.
- Predicts crumbling of transatlantic alliances over Iran sanctions and general US unpredictability (51:56).
Notable Quotes and Moments (with Timestamps)
-
On Privatization
“Private cities from which all who haven’t got the money will be excluded... If you ever needed a sign of the disintegration of contemporary capitalism, there it is.”
— Richard D. Wolff (02:50) -
On Freelancing
“It’s very hard to plan your life. You do not know from one week to the next... how in the world are you going to make the basic commitments of life?”
— Wolff (08:10) -
On Sports Betting and Taxation
“The number one goal is to save corporations and the rich from finally having to face the tax burden being put back on them when it shouldn’t have been taken from them in the first place.”
— Wolff (13:40) -
On Corporate Deceit
“To trust large capitalist corporations not to cheat, not to lie—that’s been given the lie by what’s emerged here.”
— Wolff (22:31) -
On Democracy and Trump
“Trump is the product of a failed democracy... He’s the symptom, not the disease. He’s what dysfunctional societies always cough up.”
— Chris Hedges (32:10) -
On a Corporate-Driven System
“Power really does rest now completely in the hands of corporate America. And so the proper term is... inverted totalitarianism, but it’s, I would argue, a species of fascism.”
— Hedges (36:10) -
On the Democratic Party
“The Democrats are worrying about messaging instead of worrying about social inequality, chronic unemployment and underemployment... They won’t address any of those issues. And that’s because they are an appendage of the corporate state.”
— Hedges (38:30) -
On the Dollar and Economic Collapse
“The fatal moment is when the dollar is no longer the reserve currency... At that point, the economy... imports become incredibly expensive. We can’t fund these military operations.”
— Hedges (43:02) -
On Activism and Direct Action
“There is... a spectacle of the left. I thought Standing Rock was a good example... sustained civil disobedience rooted in a community... which keeps it grounded and nonviolent, which is important.”
— Hedges (47:00) -
On US Foreign Policy
“We don’t have any foreign policy, really. It’s not articulated in any rational way. It’s a knee jerk. Emotionally driven, willfully ignorant.”
— Hedges (52:25)
Important Segment Timestamps
- Start: Introductions, update themes, Left Forum plug (00:10)
- Gated/Private Cities: (01:30–04:00)
- Freelance/Gig Economy: (06:35–09:00)
- Sports Betting & Taxes: (10:15–15:10)
- Auto Emissions Fraud: (21:24–25:40)
- Federal Jobs Guarantee: (26:37–30:05)
- Tenure, Worker Exclusion, ‘Taxation Without Representation’: (30:45–31:50)
- Chris Hedges Introduction: (30:15)
- Inverted Totalitarianism, Trump as Symptom: (31:02–33:20)
- Corporate Fascism, Debt, and Democracy: (35:32–38:40)
- Media Complicity & Political Paralysis: (39:30–42:36)
- Unsustainable System, Reserve Currency Crisis: (43:02–44:35)
- Grassroots Opposition, Direct Action: (45:36–48:04)
- US Foreign Policy, Iran, Alliances: (48:47–52:09)
- Conclusion: (52:09–End)
Summary Tone and Language
The discussion is direct, critical, and at times darkly humorous, with both Wolff and Hedges deploying sharp economic and historical analysis, personal anecdotes, and vivid metaphors. The conversation is deeply skeptical of mainstream institutions (corporations, political parties, media), and hopeful only in the potential for grassroots, sustained resistance.
This episode is essential listening for those seeking a critical, left-oriented analysis of late capitalism’s crises, delivered in the plain-spoken yet intellectually rigorous style of Professor Wolff and Chris Hedges.