Economic Update with Richard D. Wolff

Episode: Capitalism and/or Socialism

Date: December 28, 2015

Overview

In this episode, Richard D. Wolff examines the shifting tides of capitalism and socialism in both the U.S. and globally. He offers a critical look at recent political developments in Europe, the economic realities faced by Americans, and the evolving definition and prospects of socialism. Wolff emphasizes the need for systemic change, particularly workplace democracy and worker cooperatives, as core to moving beyond the limitations of capitalism. The episode is rich with historical context, contemporary examples, and a candid, critical tone.

Key Discussion Points & Insights

1. European Political Shifts and the Issue of Austerity

Timestamps: 02:01–09:09

• Wolff discusses recent elections in Spain, Greece, Portugal, and France, noting a backlash against austerity measures imposed in response to the economic crisis of 2008.
• Spain: The rise of the left-wing Podemos party, paralleling Greece’s Syriza, signifies widespread discontent with austerity, though Wolff cautions about the challenges of maintaining anti-austerity policies.
• Quote:

  “When the capitalist system breaks down, as it did in 2008, it turns to the government of all the people to bail them out. ...it then decides that the mass of people should pay the cost of the bailouts that they didn’t get to fix an economic system that they didn’t break.” (03:26)

• Greece and Portugal: Both countries replaced traditional parties with left-wing coalitions in response to imposed austerity, though Wolff notes the difficulties in creating genuine alternatives.
• France: An apparent rightward shift is actually a reaction to failed anti-austerity promises; the public is shifting parties but remains opposed to economic injustice.

2. Economics in Everyday Life: U.S. Examples

Timestamps: 09:13–29:32

• NFL Concussion Research: Government-funded research on sports-related brain trauma reveals the NFL’s lack of support; Wolff critiques how profit motives override public health.
  • Quote:

    “Here again then, an example of trying to face up to the human costs of capitalist money making and investment and finding it very difficult to do that.” (13:00)

• Harvard Endowment Debate: Critique of Harvard’s justification for not using more of its endowment to support students and communities. Wolff points out the tax-exempt status and lack of social accountability.
  • Quote:

    “This multi billion dollar corporation that prides itself on running like a business to preserve its assets rather than like a school who might talk first and foremost about its educational mission in the community. … That’s why they have all this money, because the public subsidizes them by not charging.” (16:31)

• Fresno Hunger Report: Half of Fresno households report food insecurity, highlighting deep inequality even in wealthy societies.
  • Quote:

    “51% of households in Fresno indicated food insecurity one or more months of the year. More than half. One of the richest countries in the world has delivered so much of its wealth to so few people...” (19:35)

3. Stock Buybacks & the Gig Economy

Timestamps: 21:08–28:01

• Stock Buybacks: Explained as a mechanism for corporations to enrich shareholders and executives, often at the expense of broader investment in the company or workers.
  • Quote:

    “Does that sound to you like a conflict of interest? Good. Then you’ve understood. Is that normal business in our capitalist system? Yes, it is.” (24:59)

• Gig Economy: Debunking the idea that the gig economy is modern or beneficial mainly for workers; instead, it's a tactic for employers to shift risk and costs onto workers, undermining stable employment and benefits.
  • Quote:

    “In a significant sense, the gig economy, just like the service economy, is a fake. It’s just another installment in trying to get an advantage for the employer at the expense of the employee.” (27:16)

4. What Is Socialism? Contemporary & Historical Perspectives

Timestamps: 32:07–55:36

• Wolff traces the history of socialism, from post-WWII anti-communist hysteria in the U.S. to its resurgence in the present.
• Socialism often meant government intervention in the economy, either through regulation or outright ownership (as in the Soviet Union or China).
• A core tension: Democratic ideals imply majority rule, but capitalism puts critical decisions in the hands of a minority (owners/executives/major shareholders).
  • Quote:

    “In a capitalist economic system, a tiny number of people are in a position to make this system work really well for themselves, far better than it works for the average person.” (44:51)

• Socialists historically compromised, regulating capitalism rather than offering a full alternative, leading to watered-down policies (as seen with European Socialists or left-of-center parties today).
• Recent movements (e.g., Podemos, Syriza, Sanders) propose reforms but often stop short of fundamentally changing ownership/decision-making structures.
• Critical Insight: Emerging socialists argue that true systemic change requires democratizing the workplace and ending the separation between those who make decisions and those who must live with them.
  • Quote:

    “A modern socialist position, learning … from the achievements and the shortcomings of the past, focuses on overcoming the quintessential core of capitalism—the enterprise, the factory, the office, the store, in which a tiny group of people … make all the decisions for a mass of people … But they have no control over it.” (54:19)

5. Worker Cooperatives & Democracy At Work

Timestamps: 55:00–56:48

• Wolff underscores the growing movement for worker self-directed enterprises ("worker co-ops") as the practical answer to capitalism’s undemocratic structures.
  • Quote:

    “When you hear people like me talk about worker co-ops or worker self-directed enterprises, we are the tip of the iceberg of a recognition that it’s the core relationship among people that has to be changed.” (55:02)

Notable Quotes & Memorable Moments

| Timestamp | Speaker | Quote/Paraphrase | |-----------|-----------------------|---------------------------------------------------------------------------------| | 03:26 | Richard Wolff | "When the capitalist system breaks down... it then decides that the mass of people should pay the cost of the bailouts that they didn’t get to fix an economic system they didn’t break." | | 13:00 | Richard Wolff | "Here again then, an example of trying to face up to the human costs of capitalist money making and investment and finding it very difficult to do that." | | 16:31 | Richard Wolff | "This multi billion dollar corporation that prides itself on running like a business... That’s why they have all this money, because the public subsidizes them by not charging." | | 19:35 | Richard Wolff | "51% of households in Fresno indicated food insecurity one or more months of the year. More than half. One of the richest countries..." | | 24:59 | Richard Wolff | "Does that sound to you like a conflict of interest? Good. Then you’ve understood. Is that normal business in our capitalist system? Yes, it is." | | 27:16 | Richard Wolff | "In a significant sense, the gig economy, just like the service economy, is a fake. It’s just another installment in trying to get an advantage for the employer at the expense of the employee." | | 44:51 | Richard Wolff | "In a capitalist economic system, a tiny number of people are in a position to make this system work really well for themselves, far better than it works for the average person." | | 54:19 | Richard Wolff | "A modern socialist position... focuses on overcoming the quintessential core of capitalism—the enterprise... in which a tiny group of people... make all the decisions for a mass of people... But they have no control over it." | | 55:02 | Richard Wolff | "When you hear people like me talk about worker co-ops or worker self-directed enterprises, we are the tip of the iceberg of a recognition that it’s the core relationship among people that has to be changed." |

Key Segment Timestamps

• [02:01] – European elections & austerity analysis
• [09:13] – U.S. concussion research, Harvard endowment, food insecurity in Fresno
• [21:08] – Stock buybacks explained
• [26:08] – Critique of the gig economy
• [32:07] – Historical context: socialism vs. capitalism
• [43:42] – Democracy, capitalism, and the minority rule problem
• [54:19] – The case for worker cooperatives

Tone & Language

Wolff speaks in a direct, sometimes wry and critical tone, blending historical analysis with pointed observations on current events. He maintains a focus on systemic change, invites self-reflection from institutions and individuals, and delivers his critique in accessible, engaging language.

For New Listeners

This episode serves as a primer on the deep tensions within capitalist systems, the recurring failures of superficial reforms, and the need to democratize economic decision-making. Listeners will gain an understanding of the history and current debates within socialism, what real alternatives might look like, and why movements for workplace democracy are gaining traction as answers to persistent inequality and lack of economic control.