A (0:10)

Welcome, friends, to another edition of Economic Update, a weekly program devoted to the economic dimensions of our lives, jobs, incomes, debts, those coming down the road, those confronting our children, as well as those we have to deal with every day. I'm your host, Richard Wolff. I've been a professor of economics all my adult life, and I hope that that has prepared me well to go over the realities of what's happening in our economy with you. So let's jump right in for today. A remarkable piece of research has been done by the United States federal government for some years now. The Bureau of Labor Statistics and other government agencies carefully survey the labor market in order to provide us with some idea of where jobs are going to be coming over the next five and 10 years and where jobs are going to be disappearing. It's a useful thing for schools, for individuals to know, because it will affect the decisions we make about what we study, where we live, what skills we develop and so on. So I was really taken with the reports on these studies carried in the New York Times on 24 October, because it was really a bombshell, what they had to tell us. Here's what they said. Over the next decade, next 10 years, overwhelmingly the two job categories that will grow many times more than then, all other kinds of jobs combined are the following, and I'll give you their home health aides and personal care aides. What is that? Those are people who help ill folks and folks who are aged or have other needs for personal care. Here's what's important to understand about these jobs. They are among the lowest paid jobs in our economy. So what this is telling us is that if you look at the job picture, what's going to shrink in general? There are some exceptions, but in general are better paying jobs. And what's going to explode are personal service, low paid jobs, jobs with minimal benefits, jobs that are highly insecure, and jobs that are irregular. That is, you often don't know from week to week which hours you are working. What this means, and there's no pretty way to say this, is that the United States is changing its economic structure. This follows from the growing gap between a very small part of our population, 5 to 10% who have enormous wealth, and the vast rest of the population who don't. And what is happening is that as jobs shrink, and I'll have more to say about that in a minute, more and more people are going to earn a living by providing personal services to those 5% who have the money to pay for all those personal services. The personal Shopper, the dog walker, the aides to help your elderly relatives, if of course you can afford it, all of that. Now, why are the better jobs disappearing? That has to do with automation, capitalists making more profit by replacing people with machines and even more with job exports, moving the productive work, making the things we use. In other parts of the world, particularly China, India, Brazil and places like that, the good jobs, the better jobs that we used to have doing that are now being transformed into not so well paid jobs but in other countries. That's why the good jobs we had are shrinking and the explosive jobs in the future will be low paid, poor working conditions, personal service. In this way, the American economy is going back to what it was in the 19th century. A highly concentrated mass of wealthy people at the top with armies of personal servants. In those days, you didn't go to a store and get somebody who's a hired worker to do your personal service. You brought them into your home, your butler, your chauffeur, your nanny, all of that. That's where we're going. And we ought to be thinking about whether we want that kind of society. It is nothing short of a reconfiguration of the American economy to serve the 5% at the top. Last week also saw the United States Senate take a remarkable step. It basically voted to overturn a rule that had been passed earlier by the Consumer Financial Protection Bureau. And when I explain this to you, I sure hope you're shaking your head because if you understand what I'm saying, that's at least what you ought to do. Here we go. In the wake of the biggest banks in America over the last seven or eight years, having literally violated either the legal or the ethical norms of proper banking across the board, having been caught laundering money, having been caught overcharging us for bounced checks, for mortgage help, all the rest of it having faked interest rates to make more money, even though we all have to pay based on those interest rates, having you name it, they abused the law. They need regulation. But the United States Senate overruled the Consumer Financial Protection Bureau. On what? On a rule governing banks. The Protection Bureau had issued a rule saying that banks cannot use what are called arbitration clauses. In other words, in your dealings with a bank, if you have a dispute with the bank, what the bank wants to be able to do is require that the dispute go to arbitration, where you can hire, at your expense, your lawyers to make your case, and the big bank at their expense can hire their lawyers to fight you. Why do the banks want that because they win. They have big, deep pockets. They hire the bank of lawyers. You can't do that, especially with the risk that you'll pay all that money and lose your case, too. This. This is going to dissuade people. So the Financial Control Board passed a rule allowing consumers with a complaint if they can locate others who've suffered a similar problem, they can engage legally in something called a class action. That's when large numbers of people aggrieved over the same issue can share the cost with lawyers of bringing a case against the banks that have abused them. It's a way to give individuals something like the same clout in a trial proceeding that the banks have. The banks didn't like it. The banks went to work with the Republicans who controlled the Congress and with Mr. Trump, and they got the Senate last week to overrule the efforts of the Financial Control Board. In other words, they undid the little bit of regulation of the banks that came out of the disastrous performance of those banks since 2008. It's extraordinary that a sector as badly behaved as the banks that have had to pay billions in fines for their bad behavior had the clout with the folks in Washington to not be regulated even to the little bit that was possible since 2008. My next update has to do both with the United States and the United Kingdom. And it comes initially from the Harvard College magazine. Being myself a graduate of that place, I get that magazine and I read it from time to time. It's not a very good magazine, but it comes for free. And so I read it occasionally. And here was a good story. The article in there says with some statistics that if you compare private colleges and universities in America to public colleges and universities and further compare both of them to what are called the historically black colleges and universities in America, here's what you discover. The amount of spending per student is the highest in the private schools, is considerably lower in the public schools, and is at the bottom with the historically black colleges and universities. And as the article points out, what this does is to confirm inequalities from generation to generation. Those who have the money to send their kids to the elite schools to prepare them from nursery school on. To do that, those wealthy people get their kids and into the elite schools, and those who are less wealthy get them into the public universities where the tuitions are more bearable. You see the story. It's a way of reinforcing the divisions in this society, making sure they go from one generation to the next. Then the article veers into crazy places. When the explanation comes, why is this happening? The author cites market forces. This has the same solid weight as if he had said magic or the moon or tea leaves or something like that. Because the obvious response to being told that market forces did it is to ask why the market forces work that way. In other words, you haven't explained anything when you say market forces. And my suspicion is they don't want to say the word that needs to be said. Capitalism. There, I've said it. It's a system in which the distribution of wealth goes to a very small number of people, those tiny boards of directors at the top of every big corporation who decide how to distribute the profits, not to all the people who help produce them, but rather to the shareholders and the top executives and the board of directors who run the business, a tiny minority. And they become very wealthy and they want their kids to go to the right schools. So they make sure that happens. This is an old story, and you ought to understand that if you allow corporations to work that way, a tiny group of people make all the decisions, take the wealth basically for themselves, you're going to see the rest of society reflect all of that. And that's why the private schools spend a lot more per student than the public colleges and universities, and both of them more than than the historically black colleges and universities. No one should be surprised at how these different communities do because the system is set up like this. You might even say it's rigged. But this is not an American problem. My attention was caught in the Guardian, a British newspaper that I often use. October 19, 2017. There is a story in which a former Minister of Education, David Lammy, L A M M Y, who's currently a member of Parliament for Tottenham, used the Freedom of Information act to discover that 82% of the admissions into Oxford University and 81% of the admissions into Cambridge University, those are the top schools in Great Britain. They're sort of like Harvard and Yale or something, something here in the United States. In any case, those huge percentages went to the students from the top two socioeconomic groups. That's up from 79% five years ago. In other words, England, like the United States, gives the richest people the special access to the institutions which keep them the richest people, thereby keeping it going generation after generation. Oxford stood out because it admitted no black students. There are black British people in large numbers all over England. Oxford and Cambridge had an unbelievably low acceptance. So not only were the low ends of the income scale excluded, so were racial and ethnic minorities. The United States is not alone in this kind of behavior, but it needs to be called out, don't you think? The next piece of information is extraordinary, and I want to bring it to you in its full flesh. And first I want to thank the researcher who made this available. Her name is Julianne Holt Lunstad. She is a professor of psychology at Brigham Young University in Utah, and she has done a number of studies in which she looks at hundreds of other studies to try to figure out answers to the following Are the American people lonelier than other people? And is loneliness a factor in people's illness rates and early death rates? I won't bother you with the details. You can find it in a number of places. She has given testimony in the United States Senate. An article with her results is forthcoming in the journal American Psychologist, and you can look her up. Holt Lunstadt is her name. Here's what she the effect of isolation, loneliness and living alone has an effect on the risk of dying younger than other people. And that risk is greater than the risk of dying younger, well known that flows from obesity. In other words, loneliness is a serious problem in this society. It is an epidemic. It follows from the number of people who no longer work together with others in a collective workplace, who work on their own in an isolated way, who are part of the gig economy or the sharing economy. Nice words put on a reality that Professor Holt Lunstadt is is here to undo. So we understand is very serious. We know it from the taking of psychological drugging to help you get over your loneliness, or at least to try. We know it from the number of people who need care for, depression and so on. In January in England, this was recognized by when the Parliament in England set up a commission to tackle loneliness, it was inspired by the murder of Joe Cox, a member of Parliament that you may recall last year having been shot by somebody who turned out to be suffering from severe loneliness. As our capitalist system moves more and more into robotics and other ways to replace groups of jobs with groups of machines and more and more individually lonely, isolated workers, this problem, which we ignore at our peril, will in fact get worse. Before going on with the other updates for this week, let me remind you that we maintain two websites that are available for your use, which is why we maintain them rdwolf with two Fs.com and democracyatwork.info that's all one word, democracyatwork.info. those websites contain lots of material about what we do on this program. They allow you to communicate with us what you like and don't like, what you would like us to cover. And we read them and build these programs around them. They also allow you, with a click of a mouse to follow us on Facebook, Twitter, Instagram, and if you are interested, those of you that are listeners in seeing this program as a television program, please consider going to patreon.com p a t r e o n patreon.com economicupdate and there you can see the program as a television program. If you're not already doing that, let me return then to the updates. I want to call out the graduate students at the University of Chicago. They had an election very recently in which they voted to unionize. And the vote was overwhelming. Better than 2 to 1. 1,103 graduate students voted yes, and under 500 voted no. That's a very resounding victory. They are one of a dozen schools to host graduate student unions. Now, as the graduate students try, by unionizing, to be less exploited by their universities than they traditionally have been. And indeed, as I was also back in the day when I was a graduate student, as usual, the universities came up with the same old irrelevant argument against the students, an argument that failed, clearly in the University of Chicago. Here's the argument. Unions are not needed here. We don't want a third party. That's the key idea. A third party. The union to interfere in the relationships between the university students and administrators on the one hand. Excuse me, the university faculty and administrators on the one hand, and the students on the other. This notion of the union as an outsider, a third party, messing up the wonderful relations between Mrs. Two key points. One, the students are obviously getting the short end of the stick on this cozy relationship, which is why they're looking for a union. So telling them they don't need one when they obviously have gone to great lengths to produce one is bizarre. But here's the better argument. There already is a third party in every major university. It's called the board of trustees or the board of directors. At Yale, it was called the. The Yale Corporation. You know who's on these boards? Businessmen and women. Not faculty, not administrators and not students. Guess what? A third party with enormous power to run the universities the way they see fit. What is this argument? We can't have a third party. You already do. And that's the problem. Congratulations to the students in Chicago. And I'm not alone in congratulating them. Let me tell you the congratulations they got from a graduate of the University of Chicago. Some years ago, a man by the name of Bernie Sanders. Here's what he Having a union ends the arrangement where the employer makes all the decisions unilaterally and it institutes a legal process where a union can represent the students and get a fairer, more adequate relationship. And he added, quote, I respect the critical work you, the union, do every day and I wish you the very best in your efforts to create a democratic workplace where your voice can really be heard. Interesting. A sign of change doesn't get enough attention, but deserves all it gets. I want to also turn quickly to something that came across from Brazil and it's horrifying, frankly, and I want to bring it to you. The conservative mayor of Sao Paulo, one of the biggest cities in Brazil, together with the local Catholic Cardinal Scherer by name, have hit upon a plan to provide food for the massive number of poor people in Brazil. It's a chemically combined food that, that uses as its core. Ready? Here we go. Close to the sell date. Items of food that are pulled back from supermarket shelves because they're close to the sell date. That's the date after which it's too dangerous to eat, that food companies that give this will get a tax write off and poor people will be given food, clothes close to the sale date mushed together into pellets. When rich people become so rich that the mass of people are worried about food, it is not at all unusual for those at the top unwilling to part with their fair share of taxes, unwilling to share the wealth of their society with their fellow citizens, come up with plans like this to give nearly rotten food. Because let's be clear what we're talking about and tell people, poor people, you're doing them a favor. That the mayor, a conservative, thinks of this is bad, that a religious leader endorses it. Well, I'll leave that to your judgment as to how to understand that. For the last economic update that we will have time for today, I want to talk to you about a new study having to do with the costs, the economic costs and the human costs of pollution. And here I'm making use of a study reported on in US News and World Report on 19 October, for those of you who'd like to pursue it. The study was led by Philip Landrigan. He is the dean of global health at the Icahn School of Medicine at Mount Sinai Hospital in New York City. He's the lead scientist and medical professional who wrote this report. And here's what they environmental pollution by which they filthy air contaminated Water is killing more people on our planet every year than all the wars and all the violence, more than the smoking, hunger or natural disasters, more than aids, tuberculosis and malaria combined. What are the numbers we're talking about? Estimate of this report, 9 million people dying prematurely every year at a cost of $4.6 trillion and more than you can make sense of. The single worst country in the world for this is India, where two and a half million people died prematurely from the effects of pollution that were separated out from all the other things that could have killed them. In order to focus on this, and as Dr. Landragan says, it is interesting that pollution having these devastating effects has not gotten the kind of attention that AIDS or that climate change and other problems have gotten. And he wanted to rectify all of that. In the top 10 countries alongside of India are also included China, the United States and Russia. In other words, this is a catastrophe that affects underdeveloped so called countries and developed countries. It has to do with a disinterest in checking whether industries, because that's where most of this pollution comes from, industries that dump chemicals into the air or the water that pollute those crucial parts of our lives. We don't monitor what those industries do in, in the way of pollution adequately. In many countries, they don't monitor them at all. And even where they do, it's been recent and it is spotty. And governments, for example, like those of Mr. Trump and the Republicans in the United States and conservatives in most part of the world, are reluctant, slow and spotty in making sure that when you calculate whether a company is serving the community or not, you include not just whether it's profitable, but what it is doing to the environment. A company that's profitable but killing children in its environment is a company that ought to be questioned, investigated, and probably stopped because the net negative impact it has on the society in which it functions is greater than the profit it makes for a relatively few people, after all, and even more important than the jobs it creates. Pollution is a serious economic problem in the world and it needs our attention. Our thanks then to Dr. Landrigan and his colleagues for bringing this to our attention. Well, we've come to the end of the first half of economic Update for for today. It's been my pleasure to assemble these insights, to present them to you and to urge you, as we always do, to partner with us, to find ways of sharing what may have come across, I hope, in this program with other people. Because if you talk about these things with others, you extend the reach and the effectiveness of what we are trying to do. It's a way of partnering with, that we invite, that we welcome, that we encourage. It's a way for us and you to work together, which is what this project is all about. Stay with us. We will be right back after a short interlude. Welcome back, friends, to the second half of Economic Update as we are beginning the month of November. As always, we will have as our guest Dr. Harriet Fraad, who will discuss with me a variety of issues that deal with the intersection between economics and psychology. Dr. Fraad is a practicing mental health counselor in New York City. Her practice includes hypnotherapy and she also writes a great deal in various publications for the blog on democracyatwork.in fox and for her own website, harrietfraud.com and the fraud is spelled F R A A D. It is really my pleasure to welcome Dr. Frad to economic Update. Thank you very much.