Economic Update with Richard D. Wolff

Episode Title: Economic Update: Ecosocialism
Date: January 10, 2019
Host: Richard D. Wolff
Guest: Victor Wallis, author of "Red-Green: The Politics and Technology of Ecosocialism"

Episode Overview

This episode dives into the rising concept of ecosocialism—the fusion of ecological and socialist politics. Richard D. Wolff opens with sharp commentary on recent U.S. economic events, critiquing the capitalist approach to public issues such as military funding, gig economy labor practices, and environmental transition. The second half features an in-depth interview with Victor Wallis, who elucidates ecosocialism’s intellectual roots, the resistance it faces, and the systemic changes required to address the twin crises of capitalism and environmental degradation.

Key Discussion Points & Insights

I. Economic Updates and Critical News (00:10–15:52)

U.S. Defense Budget Machinations (00:10–03:55)
- Wolff critiques President Trump’s handling of the defense budget, highlighting the routine practice of politicians yielding to military interests.
- Quote: "Mr. Trump, who promised to be different... is here doing what all other politicians have in fact [done], namely, give the government, and particularly the military pretty much what it wants." (02:21)
Regulating the Gig Economy: Uber and Lyft (03:56–06:28)
- Discusses NYC’s move to set a minimum wage for ride-hailing drivers—mirroring historic regulation of taxi drivers.
- Asserts the “gig economy” is often a workaround to escape labor standards for profit.
- Quote: "All the talk about gig economy, sharing economy and technological breakthrough was so much verbiage to pull a stunt to make money." (06:13)
Charter Schools & Labor (06:29–08:36)
- Notes charter schools mirror public schools in underpaying teachers—leading to strikes.
- Critiques privatization and erosion of public educational values.
U.S.-China Economic Tensions (08:37–12:23)
- Summarizes David Goldman’s Asia Times piece: U.S. resistance to China’s technological ascent, with cases like the Huawei executive arrest.
- Highlights reciprocal risks for U.S. tech if other nations apply similar security concerns.
Volkswagen’s Shift to Electric Cars (12:24–15:52)
- Discusses VW’s plan to end gas-powered vehicles by 2026 and the economic disruptions it will trigger (e.g., loss of gas stations).
- Argues capitalism focuses on profitable electric cars, not systemic solutions like mass transit, which have wider social benefits.

II. Interview: The Meaning and Urgency of Ecosocialism

Guest: Victor Wallis (Starts at 16:04)

What is Ecosocialism? (16:06–17:51)

Wallis explains: "It combines the idea of ecology with that of socialism... both of them clash with the idea that production decisions should be made on the basis of profit." (16:27)
Notes that human and environmental interests are inseparable, though “eco-” is used for emphasis given historical developments.
Capitalist prioritization of profit leads to environmental and social harm.

Impact of Scientific Reports on Ecosocialist Thought (17:52–19:56)

Wallis: Scientific findings underscore longstanding ecosocialist critiques; oil companies, like tobacco companies, have long known the dangers and deliberately obscured the truth.
Quote: "It's not just reckless homicide. It corresponds to an actual murder, I mean, of the planetary system... the level of criminality... is incalculable." (19:27)

Movement-Building and Obstacles in the U.S. (19:57–22:45)

Denialism, particularly in the U.S., serves to keep the public confused and politically immobilized—a reaction driven by political and capitalist interests.
The U.S., Russia, Saudi Arabia, and Kuwait notably reject climate science due to oil dependency.
Quote (Wolff): "You couldn't have a starker kind of, on the one hand, the world, on the other hand, people producing the world..." (21:50)

The Role of Government and Political Parties (22:46–26:35)

Wallis: Trump’s outright rejection ("I don't believe it") is a performance for capital interests. Denial serves to maintain a profitable status quo, even if privately acknowledged as false.
Both parties, especially Democrats, have only marginal policy differences and, in practice, continue to support extractive capitalism (e.g., support for fracking).
Quote: "The difference at the level of the party is minimal... There's sort of individuals... who may make more of a protest, but that is almost like a token." (26:08)

Where Will Change Come From? (26:36–28:26)

The movement for ecosocialist change must come from the working class, as the capitalist class is structurally opposed to environmental reform.
Wallis points to the overlap between frustrated working-class Trump voters and previous Bernie Sanders supporters as evidence of a base for progressive, systemic change.
Issues like “environmental racism”—the concentration of ecological harm in communities of color—could galvanize support.

Notable Quotes & Moments with Timestamps

On Defense Spending:
"The military and the business—politicians know what they have to take care of before they get to anything else." (02:12)
On Gig Economy Scams:
"All that's happening now is once again we're learning the same. Leaving ride-hailing services to do what we originally let the taxis do is forcing us to do what we eventually had to do to the taxis as well." (05:42)
On Ecosocialism’s Rationale:
"We can't live without the natural infrastructure. So in one sense, it's even redundant to put the eco prefix onto it, because socialism implies that you make decisions in the interest of people." – Victor Wallis (16:40)
On Corporate Deliberate Obfuscation:
"[Oil companies] knew that it would cause global warming. They didn't care... So it's really. It's not just reckless homicide. It corresponds to an actual murder, I mean, of the planetary system." – Victor Wallis (19:13-19:27)
On Political Denialism:
"Denialism... serves a real political purpose... to keep people in a state of confusion, keep them distracted." – Victor Wallis (20:52-21:09)
On Systemic Obstructions:
"If you leave in power the class that currently holds power, those measures can be revoked, just as we're seeing the measures taken earlier, all the environmental protection measures being systematically undone..." – Victor Wallis (24:09)
On Political Parties and Real Change:
"So the difference at the level of the party is minimal... There's sort of individuals... who may make more of a protest, but that is almost like a token. I mean, it's not going to affect the actual policy." – Victor Wallis (26:08)

Important Timestamps for Key Segments

Defense Budget Analysis: 00:10–03:55
Gig Economy/Taxi Regulation: 03:56–06:28
Charter Schools/Labor: 06:29–08:36
U.S.-China Relations/Tech: 08:37–12:23
VW/Electric Car Transformation: 12:24–15:52
Introduction to Victor Wallis and Ecosocialism: 16:04–17:51
Impact of Science and Corporate Obfuscation: 17:52–19:56
Denialism and U.S. Political Resistance: 19:57–22:45
Party Politics on Environment: 22:46–26:35
Base for Ecosocialist Movement: 26:36–28:26

Summary Tone & Style

Richard D. Wolff delivers with his characteristic clarity and critical perspective, challenging capitalist orthodoxies and exposing contradictions in mainstream economic logic. Victor Wallis responds in a grounded, analytical manner, articulating ecosocialist arguments in accessible but uncompromising terms. The discussion is urgent, evidence-based, and reinforces the need for systemic change.

Takeaway

This episode is a compelling case for ecosocialism—not just as a niche perspective but as a necessary framework to address the environmental crisis. Wolff and Wallis make clear that piecemeal reform under capitalism will always fall short and that genuine solutions demand both ecological and systemic economic change, rooted in mass, working-class action.

Transcript

A (0:10)

Welcome, friends, to another edition of Economic Update, our weekly program devoted to the economic dimensions of our lives. Debts, jobs, incomes, all of that for ourselves, for our children, for the coming generations. I'm your host, Richard Wolff. I've been a professor of economics all my adult life, and I hope it has prepared me to offer you these economic updates. I want to begin with the defense budget and the story it tells us. President Trump announced early in December that he wanted to do something about the ballooning deficit, the result of the tax cuts he passed last year. Last December, by cutting back government budgets for the different agencies, including the Defense Department, he proposed a very modest decrease for the Defense Department for the upcoming fiscal year, the one that runs from 2019 to 2020, he wanted to cut it from $716 billion to $700 billion. He even referred to the request for 716, initially made and as crazy in one of his tweets. Very quickly, the generals sprang into action, led by General Mattis at the Defense Department. They quickly organized a luncheon with General Mattis, probably involving General Kelly and involving the head of the Republican dominated House still for the rest of this year, and the Republican dominated Senate. They all got together and had a lunch with President Trump, after which, full of smiles, they announced that the new figure for the defense budget would not be the 700 billion that Mr. Trump had originally suggested, would not be the 716 billion that had been initially proposed. It wouldn't even be the 733 billion that the military had said was the absolute worst minimum they could live with. No, it's going to be $750 billion given to the Defense Department. Well, I'm struck by that, and I have only really one comment. Mr. Trump, who promised to be different from other politicians, is here doing what all other politicians have in fact, namely, give the government, and particularly the military pretty much what it wants, if not more than what it wants. Oh, not much different there. And likewise, like so many politicians and presidents before him, promising one thing and doing another. What has he done? December of 2017, he took care of the business community by cutting taxes on profits. And in December 2018, he takes care of the military, the business and the military. The military and the business politicians know what they have to take care of before they get to anything else. The City Council of New York did something remarkable recently. It passed a minimum wage for, for on demand ride hailing drivers, Uber drivers, Lyft drivers. Those folks, they hadn't been covered before. And it's a final step in a way of showing that that industry is exactly like the taxi industry. Cuz that's what happened to them. They started out driving taxis a hundred years ago and they weren't very well insured and the cars weren't very well maintained and the workers were not properly vetted and they weren't well paid. And the result was an inadequate, dangerous taxi service. Until of course, the private profit hustles of all the taxi drivers led to a demand for better, safer conditions. A taxi and limousine commission was established in New York as in so many other cities, and a deal was struck because relying on the private capitalist economy is too dangerous. Wages were set, prices for cab drivers were set, rules were set requiring insurance and vetting and training and maintenance of the cars, etc. All that Uber and Lyft ever were were an attempt to get around that by calling it not a taxi, but a ride hailing service. They could for a few years make a ton of money by getting around, by paying workers less, by not taking care of their cars properly, by not ensuring the same game. And all that's happening now is once again we're learning the same. Leaving ride hailing services to do what we originally let the taxis do is forcing us to do what we eventually had to do to the taxis as well. All that those scams were were ways of getting around the rules to make a buck. All the talk about gig economy, sharing economy and technological breakthrough was so much verbiage to pull a stunt to make money. Here's a little one party politics in a capitalist society involve promising one thing and doing something else. Because people kind of know. So at least you have to promise and they can indulge the fantasy that maybe you will be different. And so it has been with Mr. Trump. He maintains a website store, Mr. Trump does, where you can buy all kinds of things that have the name Trump on them. You can go to the website and you can order them. And there's a study that was done by the Courts podcast and the Quartz website. 85% of the items on the Trump store are made outside the United States. 85%. Here's another quick one. Charter schools. The attempt to get around the public schools with a democratic unifying structure that they were always intended to have. By taking your kid out and putting him or her in a special school just for you, or people who are like you, or people who have the same faith you do, etc. Etc. Breaking down the unifying democratic impulse behind public schools, often done by people who are rightly upset with the quality of Public schools. But of course you could make the public school better and then you'd have the best of both of these objectives Anyway. Here's a way that charter schools are not different from public schools. They try to get away with paying teachers very little. It led to strikes earlier in 2018 across many states. How bad it was and how badly we have treated our teachers. Well, it's caught up to the charter schools as well. The, the acero charter schools, 15 of them in the Chicago area, employing 550 teachers and staff. Well, they're all went out on strike demanding the kind of better teaching pay and staff pay in these schools. Just like in the public schools. Some things don't change. Then there was a wonderful analysis in the Asia Times by one David Goldman and it's really interesting. It talks about the kind of absurd debate going on between the United States and China, the yelling, the threats, the counter threats and all the rest of it. He cuts through all of that and says basically what's going on is that the United States has now figured out that the Chinese economy is as dynamic, if not more so, than the United States once was and is not only catching up to the United States, but has already surpassed the United States in a number of areas. This is very upsetting to all kinds of people in the United States who somehow thought that unlike every other society that has ever been dominant in the world, that dominance eventually came to an end and was replaced by the dominance of another country or of another group of countries. The United States finds it difficult apparently to imagine such a thing could happen to itself. And so there's all these efforts and there'll be some posturing and there'll be some tariffs and there'll be some rules changes and the Chinese will buy some more and they're all of that. But it doesn't change, as Goldman nicely points out, the fact that the Chinese are spending way more money in certain advanced technological fields and therefore making great progress relative to the United States. They invest in their universities on a massive scale at the same time that the United States is cutting back on its support for universities. So the basic change is not being affected by any of these pieces of theater. And he notes that the Chinese leadership seems to get that, whereas the American keeps railing. Nothing illustrates that better than the recent arrest by Canadians, at the request of the United States, of a high official of one of the most technologically advanced companies in China. And it's part of a campaign against Huawei, the company that she's an executive of. That's getting countries around the world not to buy their high tech telecommunications equipment for fear that the Chinese might have embedded in them somehow things that will help their security. Well, you're on a very slippery slope here. Imagine if countries around the world, fearful of what the CIA might be doing, stopped buying American high tech goods for fear of how that might compromise their security. This is a very dangerous game to play that the United States is leading in. It could come back and backfire badly on the United States since it is now so reliant on Apple and Microsoft and all these other high tech enterprises. Be careful what you wish for. It might come back and bite you in a very troubling place. It's also the case that if we block countries from buying the best equipment, then the best equipment made in China will be only available to the Chinese and their friends. Do we really want that advantage to be lopsidedly located? Because we won't buy very dangerous these ideas and probably not going to last very long. There's a quick kind of mentality here that misses the larger, deeper picture. My last update has to do with a decision by Volkswagen, one of the biggest car companies in the world, to stop the production of gas powered cars forever. The projected date 2026 isn't that far off and they're already starting and their plan is to shift entirely to electric vehicles. Now VW is already the largest car producer in Europe and in China. This will have enormous effects since it will be followed by other companies. Think of the effects. Think of all the gas stations in the world that will now be out of business. What will happen to those parts of every community? What will happen to the people whose lives depend on them? What will happen to all of the real estate adjustments when we don't have gas powered cars? No planning that I know of is underway to deal with this. It's just being decided by car companies based on their profits. And that really brings me to the key point. We always had a choice between individual private cars and mass transit. Moving people and goods not by one at a time but in groups. Why would that be interesting? Well, let's go and review again. It's much cheaper to move people in a bus or a van or a train or a plane than in an individual car. It uses much less energy to pollute the universe and to use up fossil fuels. It causes much less in the way of death and injury from accident. It is much easier and cheaper to insure. I could go on. There ought to be in any rational society a choice. Human beings could make between the private car with all of its costs and public transportation with all of its savings. Suppose we all could have two hours less work a week if we used public transportation, more leisure to be with our families, to have a relationship. Those are the real choices we face. But VW doesn't want that choice. VW wants to make cars because it's profitable. And if they can't make cars using gas, they want the private car electric. Lord help us if we actually used the end of reliance on gas because it's dangerous to move to public transportation. High quality, fast and efficient in it's cheaper, it's better, and capitalism can't accommodate it. We've come to the end of the first half of Economic Update. Thank you for being with me, and I look forward to your coming right back after a short break for a remarkable interview. Welcome back to the second half of Economic Update. Before jumping into our interview, I want to remind you, please take advantage of the YouTube relationship we have subscribe to our YouTube channel for economic Update. Likewise, make use of our website democracyatwork.info there. You can follow us on Facebook, Twitter, and Instagram. And I also want to thank our Patreon community for its ongoing and enthusiastic support. Well, today I want to welcome Victor Wallace. Some of you may remember he's been on our show before. This time he comes as the author of a new book, Red Green the Politics and Technology of Eco Socialism, published this year by Political Animal Press in Toronto, Canada. Victor teaches political science in the liberal arts department at the Berklee School of Music in Boston. For 20 years, he was the managing editor of the journal Socialism and Democracy. And you can find out more about Victor Wallace at his website, victorwallis, spelled w a l l I s victorwallis.com thank you, Victor, for joining me again.