Economic Update with Richard D. Wolff

Episode: Economic Reality vs Political Theater

Date: November 29, 2018
Host: Richard D. Wolff (Democracy at Work)

Episode Overview

This episode dissects the distinction between "political theater"—the spectacle created by politicians to distract, persuade, or pacify the public—and the underlying economic realities facing American society. Richard Wolff scrutinizes widely publicized events, policies, and narratives, demonstrating how they often serve to obscure or gloss over the structural dysfunctions and irrationalities of capitalism. He emphasizes how the limitations imposed on government power, the distribution of wealth and jobs, and the privatization of public goods all result from deep-seated systemic flaws rather than just poor policymaking. Wolff’s aim is to expose how economic decisions are deliberately depoliticized or mystified, leaving the real levers of power untouched and the public misinformed.

Key Discussion Points & Insights

1. Political Theater vs. Economic Reality

• Wolff introduces the central theme: much of what is treated as economic "news" is highly staged political theater, disguising real economic issues.

• He uses the decline of the paper industry in Maine as a microcosm for how American capitalism creates uneven development and fails to plan for inevitable industrial changes (00:50 – 04:30).

  “The logical, intelligent way for an economic system to deal with this is to recognize that every industry faces the possibility that changes in technology or changes in resources will make an industry that was once thriving, shut down, close down. And of course, there needs to be planning for that eventuality… Maine didn’t do it. The United States government didn’t do it, and I want to talk about that, because it happens all the time.” (02:04)

• He attributes the lack of planning to a "fundamental fear" within capitalism: if government gains power, the working-class majority could use democracy to redress economic inequalities, so government is intentionally kept weak and dependent on business (05:00 – 07:30).

2. Contemporary Examples of Political Theater

• NAFTA “Renegotiation”: Trump’s rebranding of NAFTA is criticized as “lots of theater” with minimal substantive change, primarily serving to increase hostility and distrust among Mexico, Canada, and the U.S, to short-term political gain but long-term negative effects (08:00 – 10:36).

  “The short term political theater is positive for Mr. Trump. And that’s the equation you should keep in mind when you evaluate that story.” (10:23)

• Kavanaugh Supreme Court Hearings: Media discussion focused on personalities and accusations, while the larger economic impact of systemic discrimination against women in the workforce—losses in productivity, attrition from professions—are largely ignored (11:00 – 13:21).

  “Millions of women don’t go into whole areas of our economy because they’re afraid of how they’ll be treated there… The price paid by a system like our capitalist system that gives men the dominance over women… The costs are enormous.” (12:08)

• China as a “Threat”: New anti-China sentiment is another distraction; the real threat is China’s economic rise outpacing the US, not their internal political issues (13:30 – 15:46).

  “China is being targeted because it has had a successful economic growth… There’ll be lots of hand waving and political theater, and Mr. Trump will trumpet whatever deal they finally make…” (14:38)

• The 2017 Corporate Tax Cut: Presented as a plan to boost wages, it is another case of political theater; in reality, the benefits went to shareholders and executives, with no strings attached to benefit workers (16:01 – 19:03).

  “Virtually none of it went to wages... The notion of wages going up was political theater, not the reality.” (18:25)

3. How Capitalist Economics Produces Dysfunctional Politics

Displacing Economic Contradictions onto Politics (20:00 – 23:30)

• Systemic problems—like unemployment—are blamed on politicians, not on employers who make hiring/firing decisions.

  “The people who fired you are capitalists, employers. Why are you angry at the politician?” (20:48)

• Governments are caught between not being able to tax the rich/corporations (who'll back their opponents) and not being able to tax the masses further (which loses votes).

• They resort to borrowing (increasing public debt) and “economizing” by reducing or deferring essential expenditures (like maintenance of water systems).

Privatization Trap: The Baltimore Water System Example (23:31 – 26:40)

• Deferred maintenance leads to crisis, opening the door for private capital to buy public assets, raise prices, and ultimately force governments to buy them back at great cost.

  “Everybody plays this absurd game… The whole thing costs a fortune of money, all to be paid by taxpayers, and then the whole game is repeated.” (25:25)

Additional Example: The Logic of Government Borrowing

• Tax cuts for the rich/corporations lead to deficits. Government borrows—from those same corporations and wealthy individuals. They profit from lending to the government, instead of paying taxes.

  “Instead of paying taxes, once paid, they’re lost to you… You lend that money instead to the government. You, you earn interest for years on it, and at the end of those years, the government gives you the money back. That’s a lot better than taxes, don’t you think?” (28:38)

Higher Education Crisis (29:30 – 33:00)

• States reduced support for public higher education, raising tuition costs and forcing students to take out loans or forgo education, worsening social mobility.

• Reduced government support makes universities more dependent on corporate funding, which comes with strings attached, shaping curricula and undercutting academic freedom.

  “When the government takes back its support, … We’ll give you some money, but we want to see you teach this and not that…” (32:18)

  “That’s the reality of a political system governed by a divided, broken economic system that is now even dangerous to itself.” (33:19)

4. The Job Creation Myth & Democratic Workplaces (Extra Segment)

Corporate Incentives and the Fallacy of "Job Creator" Rhetoric (34:10 – 36:00)

• Business lobbyists demand subsidies in the name of job creation, but there are no strings attached; money can go to anything—including outsourcing.

  “When the government cuts taxes for businesses in the name of job creation, the logical thing to expect is… you give the tax break to business on condition that they create a minimum number of jobs… No conditions were applied.” (35:11)

Quality, not Just Quantity, of Jobs (36:01 – 38:20)

• Most new jobs post-tax cuts are low-wage, low-benefit service work.

• The absence of decent jobs reflects a systemic unwillingness to create meaningful employment opportunities.

  “What you got was a mediocre increase in the worst jobs this system has. That’s what you got back from capitalists for giving them this enormous gift.” (37:50)

Public Work, Democratic Workplaces (38:21 – 41:18)

• Government should provide jobs, especially in times of unemployment, as in the New Deal era.

• Argues for “democratic workplaces” (worker cooperatives) as the next necessary step: workplaces governed by the workers themselves with one-person, one-vote systems.

  “If we believe in democracy as a society… then the first place it should be installed is the workplace.” (40:03)

  “Let’s use the catastrophe of capitalism’s failure to provide good jobs and good work as a way to promote new directions, new changes, new experiments that are long overdue and that this society so badly needs now more than ever.” (41:06)

Notable Quotes & Memorable Moments

• On uneven development:
  “Don’t put all your eggs in one basket. Don’t build your economic system in the way that capitalism unfortunately does…” (02:38)

• On the limits of government action under capitalism:
  “The government is held back. The government is made dependent on business as much as possible. And so it can’t do the very things that capitalism needs it to do because of this fear. It’s an irrational breakdown of the system…” (06:37)

• On political theater in trade deals:
  “There’s a lot of theater here and very little substance.” (15:20)

• On the illusion of wage boosts from corporate tax cuts:
  “Virtually none of it went to wages… The notion of wages going up was political theater, not the reality.” (18:25)

• On the privatization cycle:
  “The whole thing costs a fortune of money, all to be paid by taxpayers, and then the whole game is repeated.” (25:25)

• On student debt and corporate control of education:
  “We are diminishing our trained young people. That’s called shooting yourself in the economic foot.” (31:56)

• On the job creation myth:
  “What you got was a mediocre increase in the worst jobs this system has. That’s what you got back from capitalists for giving them this enormous gift.” (37:50)

• On workplace democracy as the next step:
  “If we believe in democracy as a society… then the first place it should be installed is the workplace.” (40:03)

Timestamps for Major Segments

• 00:10 – 05:00: Introduction; "Political theater" vs. economic reality; Maine paper mills decline
• 05:00 – 08:00: Limits of government caused by capitalist priorities
• 08:00 – 10:36: NAFTA renegotiation as theater
• 11:00 – 13:21: Kavanaugh hearings and women's economic status
• 13:30 – 15:46: New anti-China rhetoric as distraction from real economic challenge
• 16:01 – 19:03: 2017 corporate tax cuts—myth vs. reality
• 20:00 – 23:30: Outsourcing blame for unemployment onto politics
• 23:31 – 26:40: Baltimore water crisis and privatization
• 28:38: Logic of government borrowing from the rich
• 29:30 – 33:00: Funding public higher education; growing student debt
• 34:10 – 36:00: The myth of the "job creator"
• 36:01 – 38:20: Poor quality of new jobs, post-tax cuts
• 38:21 – 41:18: Public job creation and democratic workplaces

Summary

In "Economic Reality vs Political Theater," Richard D. Wolff unpacks how contemporary American economic policy and news are carefully stage-managed to distract from the persistent crises bred by capitalism itself. Using a range of current (as of 2018) and historical examples — from the decline of heavy industries to fights over trade deals, judicial battles, and corporate tax cuts — Wolff exposes how systemic failures are camouflaged by rhetoric and spectacle. He argues that lasting solutions, like democratizing the workplace and strengthening the role of government in economic life, are consistently thwarted by the very structure of the capitalist system and the interests of the elite. The episode calls for a radical reimagining — beginning with honest conversation — of how work, wealth, and power are distributed and how the economy might be organized to benefit the many, not just the few.