Economic Update with Richard D. Wolff
Episode: Rising Costs of Capitalism's Failures
Date: April 27, 2017

Episode Overview

In this episode, Richard D. Wolff dissects the mounting costs of capitalism’s shortcomings, focusing on recent economic news and their deeper systemic causes. The episode ranges across topics including job losses in retail, corporate takeovers, European political upheaval, the impact of technology on labor, global youth unemployment, U.S. tax reform under Trump, and the dangers of attacks on Social Security Disability Insurance (SSDI). Throughout, Wolff ties together these threads as examples of how capitalist priorities leave ordinary people vulnerable and how alternative economic arrangements might better serve society.

Key Discussion Points & Insights

1. Recent Outreach and Community Engagement (00:30–04:45)

• Wolff details his recent speaking engagements in Los Angeles, highlighting growing grassroots interest in alternative economic models:
  • Praises the enthusiasm at fundraising events and local activism (Democracy at Work Action Group).
  • "Over a thousand people listening to a different way of understanding what's going on. It's an amazing experience...we're all part of a project." (03:30)

2. Legal Setback for Trump’s Sanctuary City Order (05:00–07:20)

• Reports on a federal judge blocking Trump’s executive order to defund sanctuary cities.
• Emphasizes the economic reasoning alongside the moral/ethical:
  • "One of the economic reasons [for resisting deportations] is that serious harm will come to many, many communities if these deportations are carried out..." (06:55)
• Notes the broader trend: evolving economic struggles are intertwined with legal, local, and federal tensions.

3. Rise of Financial Capital in Everyday Life (07:21–09:52)

• Explains how mega investment firms (e.g., Cerberus Capital Management) increasingly control consumer companies:
  • Cerberus owns Albertsons, attempts takeover of Whole Foods.
  • Decisions about supermarkets—and consumer choices—are made by "a tiny number of financial executives" (09:20).
  • "It's all about the money....what happens in your supermarket...is being decided by a tiny number of financial executives..." (09:12)

4. Steady Decline in Retail Employment—Unmanaged by the System (09:53–14:35)

• Highlights a dramatic loss: Department stores lost ~1/3 of jobs from 2000–2017.
• Points to a lack of coordinated effort to support displaced workers.
  • "Why is there no concerted effort, no community effort, no Government effort, no private effort to deal with this problem...?" (11:50)
  • Criticizes a system that “uses you up and spits you out” (12:55).
• Draws connection to previous episodes about mall bankruptcies, signaling deeper structural issues.

5. France’s Presidential Election as a Reflection of Political Realignment (14:36–24:55)

• Details the first round of the 2017 French presidential election and its significance for democracy and capitalism:
  • Macron as a “banker and a socialist politician” compared to Hillary Clinton but "more center than left" (17:30).
  • Explores the collapse of the French Socialist Party, the rise of leftist Jean-Luc Mélenchon and right-wing Marine Le Pen.
  • "The center isn’t holding. Capitalism’s decline, its evolution into more and more inequality, is a feature of our time and it is reflected in the politics as well." (23:45)
• Media bias noted: Le Pen received "50 times the exposure" than Mélenchon in U.S. media (41:55).

6. Worker Cooperatives as Alternative (24:56–28:00)

• Discusses the UK’s Summa Co-op, a Queen’s Award winner, and the broader worker co-op movement:
  • Summa: “entirely owned and operated by its employees...they’ve decided that everybody is to be paid exactly the same...” (26:15)
  • "England has 6,700 worker co-ops. These worker co-ops employ 222,000 workers." (27:04)
• Suggests worker co-ops as viable, politically powerful strategies within capitalism.

[Ad break, music interlude skipped] (29:15–30:00)

7. The “Three Decades of Pain” from Technology—Misplaced Blame (30:05–34:09)

• Relays Jack Ma (Alibaba) predicting “three decades of pain” due to technological disruption.
• Wolff counters that the problem isn’t technology itself, but how capitalism uses it:
  • “If you have a technical change that saves half the work people need to perform...give everybody half the time in their work week off...Technology could immediately benefit working people.” (31:20)
  • "In capitalism, technology is a tool...to enable capitalists to get more profit out of their business." (31:50)
• Technology is not inevitable suffering; it’s a question of who benefits and how change is managed.

8. Global Job Crisis: Capitalism’s Inability to Provide Employment (34:10–38:08)

• Cites data from International Labour Organization and World Bank:
  • “40 million people looking for work every year to 2030...”
  • “It’s crystal clear the economists...know...it doesn’t look like the world is in any way adequate to meeting the challenge of these new entrants...” (35:49)
• Emphasizes direct link between global unemployment and potential for social unrest, scapegoating, wage suppression.
  • “The failures are everywhere, but they are failures of a system.” (36:57)
  • “The system works that way. And for the capitalists to have millions of people without work...that’s just another profit enhancing opportunity.” (37:36)

9. The Twisted Meaning of “Populism” (38:09–40:14)

• Critiques the elite’s use of “populist” label for outsider politics, left and right:
  • “Bizarre term...as if in a Freudian slip, the people...kind of understand they are a small elite.” (38:14)
• Notes Mélenchon gets much less media attention than Le Pen—biases toward certain ‘populists’.

10. Trump's Corporate Tax Reform: Who Really Benefits? (40:15–45:46)

• Analyzes Trump’s proposal to cut the corporate tax rate from 35% to 15%:
  • "The effective rate [corporations pay] is much, much lower...[U.S. is] well below the average for all OECD countries." (42:15)
• Over 50 years, corporate tax burden fell, while the payroll tax—regressive, hitting working people hardest—soared.
  • "Over the last 50 years, the burden of federal taxation on corporations has gone down, down, down...the payroll tax...made up for what the corporate tax doesn’t bring in..." (43:25)
  • Higher earners get a "taxless gift" above the payroll tax cap. (44:07)
• Labels Trump’s plan as serving corporate elites while offering "theater for the masses, hard bucks for those in control." (45:37)
  • "If you are interested in getting some of the deals clear in your mind...Oxfam...issued a report on tax reform in the United States. It’ll open your eyes..." (45:10)

11. Attacks on Social Security Disability Insurance (45:47–49:00)

• Exposes misleading claims from Trump's budget director Mick Mulvaney about SSDI:
  • "Portrayals of people gaming the system are pure efforts to destroy a valuable social service program. Don’t be taken in." (48:28)
• SSDI exists for those injured or unable to work through no fault of their own—protects society’s most vulnerable.

Notable Quotes & Memorable Moments

• “This is a system that uses you up and spits you out...It ignores a genuine social crisis involving millions of workers and their families.” (12:54)
• “[Technology] could immediately benefit working people by reducing the amount of work they have to do without reducing their income. But that’s not how capitalism works.” (31:22)
• “The failures are everywhere, but they are failures of a system.” (36:57)
• “Over the last 50 years, the burden of federal taxation on corporations has gone down, down, down....the payroll tax...made up for what the corporate tax doesn't bring in.” (43:17)
• “The center isn’t holding. Capitalism’s decline, its evolution into more and more inequality, is a feature of our time...” (23:45)
• “For the masses, he has theater, he has tweets, he has brash behavior...Theater for the masses, hard bucks for those in control.” (45:37)

Timestamps for Important Segments

• 00:00 – 04:45: Opening, LA engagement, upcoming guest announcement
• 05:00 – 07:20: Sanctuary city executive order blocked
• 07:21 – 09:52: Private equity influence on supermarkets
• 09:53 – 14:35: Retail job decline, lack of systemic response
• 14:36 – 24:55: French election analysis; political realignment
• 24:56 – 28:00: Summa co-op and worker cooperative sector overview
• 30:05 – 34:09: Jack Ma, technology’s disruptive impact, capitalism’s role
• 34:10 – 38:08: Global youth unemployment and system failure
• 38:09 – 40:14: “Populism” and political outsiders
• 40:15 – 45:46: Corporate tax proposals and who pays federal taxes
• 45:47 – 49:00: Critique of Social Security Disability Insurance attacks

Summary

Richard Wolff’s analysis throughout the episode links each news item to a broader critique of capitalism’s priorities: profits over people, disregard for mass distress, and the absence of organized support for those left behind in the economic churn. He advocates systemic alternatives like worker-owned cooperatives and a refocusing of technological gains toward well-being rather than profit. The episode is both a news digest and a call for listeners to understand—and eventually act on—the need for structural change.