Economic Update with Richard D. Wolff
Episode Title: Economics Taught Badly
Release Date: July 20, 2017
Host: Richard D. Wolff
Guest: John Summa
Episode Overview
In this episode of Economic Update, Richard D. Wolff explores how economics is frequently taught in narrow, biased, and undemocratic ways, emphasizing the marginalization of critical voices in academia. The program discusses contemporary economic events (United Airlines, Jamie Dimon, China’s growth) and focuses on the challenges faced by economists like John Summa who seek to provide critical, alternative perspectives in their teaching. The conversation highlights the structural barriers to pluralism within the economics profession and the consequences of ideological conformity for both students and the broader society.
Key Discussion Points & Insights
I. Economic Updates (03:33–27:27)
A. United Airlines Profits Amid Poor Customer Treatment
- Context: Despite a major PR scandal involving customer mistreatment, United Airlines reported higher profits.
- Explanation: Financial desperation forces customers to choose the cheapest option, undermining the incentive for companies to improve service.
- Quote (Richard Wolff, 05:33): "Relying on a private, profit-driven capitalist system to deliver your services doesn’t guarantee you the best services. It doesn’t even guarantee that you won’t be physically and otherwise abused by the very company whose tickets you buy."
B. Jamie Dimon and the Myth of Innocent Big Banks
- Context: Jamie Dimon (JP Morgan CEO) blamed "political gridlock in Washington" for economic woes.
- Critique: Wolff points out the hypocrisy, noting big banks’ influential role in creating political gridlock through lobbying and campaign donations.
- Quote (Richard Wolff, 09:02): "To portray the gridlock in Washington as something they are the victim of but have no responsibility for, that’s breathtaking. It’s not just nonsense. It’s an attempt, as always, to shift the blame..."
C. Chinese Economic Innovation and American Response
- Mobike’s Global Expansion (10:00):
- High-tech bike rental developed in China, emblematic of China’s rapid innovation.
- Raises the issue of economic disruption and capitalism’s inability to plan for displaced workers.
- Quote (Richard Wolff, 13:28): "We lose the jobs, we lose the industries. Takes us decades to do what could have been preplanned and avoided in the first place."
- China’s 6.9% Economic Growth (15:00):
- U.S. media either ignores or casts doubt on China’s growth statistics rather than considering their implications for the U.S.
- Comparison: U.S. growth is 1.5–2%; China’s is nearly 7%.
- Quote (Richard Wolff, 16:29): "The Chinese economy is growing much, much faster than that of the United States. That has been true for many years and shows no sign of going away anytime soon."
D. Worker Co-operatives: Three Stories, Three Lessons
- VIOME Factory in Greece:
- After capitalist owners abandoned it, workers reopened as a collective, succeeding through communal decision-making and community ties (18:23).
- Quote (Richard Wolff, 19:50): "In a good relationship between community and factory, a worker co-op has been much more successful than a capitalist enterprise. And there are lessons there."
- NYC School Bus Co-op Proposal:
- Bus drivers propose a co-op to improve service and conditions, challenging the city to allow experimentation versus top-down privatization (22:56).
- Challenge: Liberal politicians are asked to support a real contest between capitalist and cooperative models.
- Wild Oats Food Co-op (Massachusetts):
- Consumer-owned, but not worker-owned; workers unionized due to poor conditions.
- Lesson: A consumer co-op does not equal a worker co-op; the need for models that involve both stakeholders (25:56).
- Quote (Richard Wolff, 26:42): "The workers have the bigger say. Why? Because their livelihoods depend on what happens there, whereas for the consumer, this is only one part of what they buy."
II. Interview: Economics Taught Badly (29:41–57:46)
A. Introduction to John Summa (29:49–32:30)
- Background: Professor at University of Vermont; previous wage laborer and union member; author and quantitative finance expert.
- Perspective: Combines academic theory with real-world labor experience.
B. Summa’s Experience with Academic Repression (35:55–41:14)
- Reappointment Denied: Despite positive external committee review, the internal department rejected Summa’s contract renewal, citing procedural issues and alleged lack of engagement.
- Process Highlight: Despite providing evidence contradicting the official rationale (attendance of teaching workshops, faculty engagement), final decision rested with the dean, who disregarded facts in favor of peer criticism.
C. The Real Issue: Suppressing Dissent and Perspective (41:20–44:53)
- Summa’s Teaching: Integrates neoclassical models with critiques (Marxist, heterodox), rooted in personal experience and practical history.
- Student Impact: Students respond positively, gaining broader perspectives—seen as threatening by the mainstream faculty.
- Quote (John Summa, 43:08): "I'm too different. I open the eyes of students as well, and I'm popular at doing that. Students like me—not all of them agree with me. But I'm not there to win them over. I'm there to say... we've got other traditions. We've got the heretical traditions—Marx and Schaffa—and I bring it in and excite them. And they love that."
D. Deficiencies and Excuses in Academic Justifications (44:53–49:27)
- Department's Claim: Summa didn’t fully teach the standard model—a claim he says is without evidence.
- Wolff’s Take: Points out the hypocrisy—most mainstream economists present only their side, rarely the heterodox views.
E. Fear, Insecurity, and Conformity in the Profession (50:21–52:50)
- Underlying Anxiety: Academic insecurity and specialized silos breed intolerance for those who deviate from orthodoxy, particularly untenured faculty.
- Quote (John Summa, 51:24): "You can be a tenured member of the department and do a little of that Marxian stuff. There's nothing they can do about that. But Summa can't come in and do that... we can get rid of him."
F. Consequences for Economic Education and Society (53:28–57:11)
- Student Disillusionment: Bright students resist the narrow standard model, but alternatives are squeezed out.
- Ideological Function: Teaching as legitimacy for markets, hostility toward government intervention, status quo maintenance.
- Professional Crisis: Economics is in an “existential crisis,” especially after the 2008 crash, but change is slow and internal critics (like Paul Romer) face similar resistance.
- Quote (John Summa, 54:36): "It's a narrative of legitimacy... By removing me, you take out one maverick independent voice... So taking me out makes, like Jerry says, microeconomics... It just sucks, the standard model. It's boring."
G. Final Takeaway (Richard Wolff, 55:20):
- Result: The profession becomes “narrow, unifocal... It takes all the excitement out of fundamental differences that would engage students... It’s a country engaged in self-destructive narrowness of its own learning process.”
Memorable Quotes & Moments
- "[Capitalism] isn’t democratic and it would be a better way to go." (Richard Wolff, 27:19)
- "Conflict. It's part of the reason why more and more students don't study economics to learn. They study it to get a credential..." (John Summa, 55:42)
- "The profession is in an existential crisis... the crash of 2008 really knocked it." (John Summa, 56:08)
- "When the center of the profession begins to call it out, well, then we've got to pay attention." (John Summa, 56:59)
Timestamps for Key Segments
- [03:33] United Airlines, Jamie Dimon, and China updates
- [17:46] China's economic growth examined
- [18:22] Worker co-op success stories begin (Greece, NYC, Massachusetts)
- [29:41] Transition to interview with John Summa
- [35:55] Summa describes job loss and grievance process
- [41:14] Core discussion on department’s rationale and academic freedom in economics
- [50:21] Academic anxiety and repression of heterodox perspectives
- [53:28] Consequences for students, profession, and society
- [56:08] The existential crisis in economics after 2008
Tone & Language
- Richard Wolff: Critical, passionate, and sometimes sardonic; strives to empower listeners and expose hypocrisy.
- John Summa: Honest, reflective, and candid about his experiences; dedicated to pluralism and student engagement.
Summary Takeaways
- Economics education in the U.S. often marginalizes dissenting or critical perspectives, to the detriment of both students and broader social understanding.
- Professors who introduce alternative frameworks—especially in non-tenured positions—face institutional resistance and career penalties, even when their teaching is effective and valued by students.
- This lack of pluralism reinforces the ideological narrative that markets are optimal and government “interference” is detrimental, with little space for debate about real alternatives.
- The consequence is an economics profession and educational system in crisis: less innovation, less excitement, more conformity, and a diminished capacity to address real-world challenges.
For more information: