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Sam. Saint gonna change. Welcome friends, to another edition of Economic Update, a weekly program devoted to the debts, the incomes, the jobs we have or don't have, and what the future looks like in terms of our economic activities. I'm your host, Richard Wolff. I've been a professor of economics all my adult life and I currently teach at the New School University in New York City. Before jumping into our economic Updates for this beginning of March 2016, a couple of announcements and requests. First, as I occasionally tell you, I do a monthly public lecture in a church in New York City. It's a famous church. It's called the Judson Memorial Church on equally famous Washington Square in Lower Manhattan. And I would like to invite any of you that might be in the New York area, in New York City to come. The next one is on March 9th and indeed they happen every second Wednesday of the month, 7:30 in the evening, Judson Memorial Church, Washington Square. It gives you and me a chance to meet, a chance to go over in greater detail the kinds of topics we treat on this program and it gives me a chance to directly interact. It's something I look forward to. And as I say, consider yourself invited. The next one, March 9, 7:30, Judson Memorial Church. I want to also make a special plea for those of you that are into this to remember to like democracy at work on Facebook. We do a great deal of work on our Facebook page and would love to have your participation and your involvement and likewise to follow us on Twitter and on Instagram there. The way to follow us is democracyatwork, with the one little caveat that the democracy at work has no o in that last part work. So it's democracy wrk all one word. And that will allow you to follow us on Twitter and Instagram. This is a way of sharing what we do here with a much larger number of people. We want you to be our partner in reaching this audience that might otherwise not have the time or even know that this program exists. So do consider sharing what we put on Facebook and Twitter and Instagram as well as what we do on this program. It would make us that much more effective. I'll have more to say later in the program about our websites and so on. Let's turn now to the updates. I have on occasion in the past talked to you about a problem that has existed since the year 2000 in the relationship between Argentina, one of the largest and most important economies in Latin America, and the United States and the American court system and some hedge funds, usually known as vulture funds. Here's the basic problem back in 2000. So 16 years ago, the country of Argentina hit a very, very bad period of time. Its international accounts were in difficulty, its export markets shrank, and a certain set of chickens had come home to roost. What are they? The debts of the country. You see, in many countries, not just the United States and Europe, but around the world, in many countries, the leaders of those countries seek to curry political favor by not taxing their people and particularly their industries, who are always fighting against taxes. So the political leaders, the politicians, seek to curry favor by not raising taxes. But on the other hand, they dare not cut government services because the very people upon whom they levy taxes and who don't want to pay them do not want to be denied government services. Well, how in the world is any government going to provide the services its people and businesses want without taxing its people and businesses? And the answer is borrowing. And in smaller, poorer, third world type countries like Argentina, it becomes particularly tempting for politicians in power to particularly respond to their corporate funders, the people who control their economies, the people who usually fund their political parties, much as they do in Western Europe and North America, it's popular for those politicians to solve this problem by borrowing money abroad. That's right. They go outside their country, borrow money, and that allows them to fund the provision of public services without taxing their own people. But of course, this can't last because as their obligations to foreign creditors grow, the demand of their paying off the interest and paying off the principal means they have to use more and more of the taxes they raise domestically, not to fund public services, but instead to pay off the foreigners from whom they've borne borrowed the money. So eventually they are in a real jam. This happened in Argentina in the year 2000. So what Argentina did is the same thing governments like that normally do. And indeed Argentina has done that in its past as well. They declare that they cannot pay it back. And so in the year 2000, Argentina technically defaulted, said it could not and would not pay on about $100 billion of foreign debts that a succession of governments had used to keep themselves in power to provide the services particularly corporations wanted, while the corporations evaded or did not pay or arranged the law so they would not have to pay taxes. When this happens, typically negotiations are entered into. And that's what happened in this case between the debtor country, Argentina, in this case, and its creditors. And most of the creditors were here in the United States. And typically these negotiations end up with a settlement. It's sort of the Same thing that happens if you declare bankruptcy here in the United States and you enter into a court procedure which ends up in a settlement, and the creditor gets back a portion of. Of what was owed, and we go back kind of to square one and start the whole process over again. So much money is made by the creditors when they make the loan in the first place, and over the many years that they get back very cushy interest payments that they kind of have built in, in what they charge the provision to cover themselves in the event of this kind of thing happening and they're having to settle for losing some portion of the face value of the loan. So don't worry, the creditors have taken care of themselves. They've been through this repeatedly over the last two or 300 years and make sure that their profits are secure. And that was the case here, too. So it didn't take very long for the following to. Argentina declares it can't pay. The outstanding value of the bonds are therefore reduced. People who own the bonds, banks in New York and things like that, quickly realize that the bonds are not going to be worth what's printed on them, because even though part of that has been paid back, the rest of it won't be paid back in full. And so the bonds fall in value. Instead of being, say, at 100, they drop to 70 or 50 or 30, depending on how bad the situation is and how long it's lasted. And then a deal is made and the creditors get paid off 50 cents on the dollar or 70 cents on the dollar, and everything is sort of squared away, and the country begins borrowing again, typically from the same bankers and the same creditors. And the cycle repeats itself. What happened here was a little different. As the bonds tumbled in value, the bonds of Argentina, a group of hedge funds, jumped in and bought them, typically at $30 to $40 on a $100 bond issued by Argentina. They were gambling that somehow they could force Argentina to pay off the full face value, $100 for every bond that these hedge funds swiped up at 35 or $40. They were led by a famous hedge fund vulture named Paul E. Singer, whose company, NML Capital, bought a whole bunch of these bonds at their discounted value before all the deals were worked out. So when the deals were worked out and most of the debt of Argentina was accepted to be paid off at a partial discount, or a haircut, as it's sometimes called, to the major creditors, at that point, Mr. Singer and the other hedge fund stepped in and said, oh, no, we want to be Paid in full. We do not accept the deal that the other big creditors who always do these deals do, because we're not like them. We don't lend on the dime to foreign governments. We haven't been doing it for 200 years. We are a different kind of thing. A hedge fund hustler, a speculator. We bought these bonds at $38, for example, and we want to get the full hundred. We're not going to let the government of Argentina make the usual deal. And they started this process back, I think in 2012, maybe earlier than that, and they said they would not participate in the agreement and they wanted to get paid in full. The Argentine government said that was outrageous. Everybody knows how this game is played. The bulk of the creditors had already agreed with Argentina on the settlement that would get them back 60 or 70% of what they had lent to face value. They had of course, gotten all that back earlier in interest payments and fees and so forth. Anyway. So here's what these hedge funds did. They went into court, they went into American courts where they got the kinds of settlements they wanted. And to make a long story short, they basically blocked the Argentine government from being able to function anymore. In the old way. It couldn't borrow anymore because this hedge fund group had gotten the court arrangements that would prevent anybody from getting paid back by the Argentine government. Because the court in the United States said you cannot repay anybody until you pay off these hedge fund guys at the full value that they demand, or at least reach a settlement with them. In other words, the courts were used to tell Argentina, we won't let you borrow anywhere anymore until you pay off these people, because they can block you in court from doing it. And this last week, a settlement was reached. And the vulture funds, one, they got an agreement from the new Argentine government, a right wing government that was prepared to make a deal the previous left wing government wasn't. So the right wing government, in order to resume what all Argentinian governments have done, borrowing abroad to play the game of giving to their people what they won't tax their people to pay for the usual assessment game in order to resume playing it, they'll pay off the vulture funds. In the case of NML, let's give you the example written up, 48 million was what they paid for the bonds they bought Argentinian bonds. And they will get back for that 48 million that they spent. 620 million. That's a very good deal. Works out to about 40% per year for all the many years that they've been holding out for this gambit. What does it mean for the Argentinian people? Another $5 billion in debt that they're going to have to pay off. And how are they going to do it? Well, the Argentine government has already said it's going to be borrowing money in the international capital markets, which they can now do because of this deal. And the first 5 billion they borrow will be used to pay off these hedge funds. And in the end this will squeeze the budget of Argentina and it will not pay out for the public services. Its people need this money. It will be used instead either to avoid payingtaxing its own people or borrowing more abroad. In the end, it's the mass of people who pay the bill for these financial shenanigans in the world's capital markets, just like the American people are now paying the bill in cut services and a weak economy for bailing out the big bangs who played the same game here in the United states back in 2008. Sad ending for a broken international capitalist finance system. And in this case, Argentina, having gotten rid of its left wing government and bringing its right wing government, is eager to resume business as usual. Next UPDATE A remarkable statement again from the new pope. Not so new. He's been around now for a while. Pope Francis, the leader of the Roman Catholic Church, he announced and this is a story from the Washington Post, on March 2, he announced that he doesn't wantand the Catholic Church doesn't want money if it comes from exploited workers. That's the pope's language. In fact, according to the Associated Press story carried in the Washington Post on March 2, I'm going to quote now, Francis railed against employers who mistreat and underpay their workers during his general audience or Wednesday. It's a theme that the Jesuit pope has frequently emphasized, denouncing how the wealthy exploit the poor and working class for their own profit, often subjecting workers to slave like conditions. Francis told the crowd in a sunny St. Peter's Square that when he thinks about church benefactors who offer donations that are fruit of the blood of exploited workers, he that's Francis tells them, quote, please take your checks back and burn them. Pope Francis added at his audience in sunny St. Peter's Square, the people of God and the church don't need dirty money. They need hearts that are open to the mercy of God. Well, besides thinking that this is worth a moment of your and my time, here is an institution that relies on donations from businesses as well as from individuals. And here is the leader of that institution telling the Businesses, the employers, that if you exploit your workers and if that's the source of your profits, then we don't want your donation and we don't want your money. Something to think about these days when we listen every day to one politician or another begging and pleading for the money of people who are certainly doing what the Pope is saying the Church will no longer do. Wow. But it also leaves us with a question, and the question concerns this word, exploitation. Clearly what Pope Francis means is subjecting workers to slave like conditions, underpaying them, mistreating them. I think that's his clear meaning. And we certainly know how many employers do that and are doing that. But there's another way economists define exploitation. And if you look at it that way, well then the Pope's meaning goes even deeper. There is a view that exploitation is not about treating workers badly or abusing them or underpaying them. It's about something that happens even if you don't mistreat your workers. And if you pay them or whatever the going wage is, there may still be this argument has it, exploitation. Let me explain. When you go for a job in a capitalist system, you're looking to become an employee somewhere. You sit down with your employer or someone who represents your employer, and you negotiate over a variety of things. When you come to work, what kind of work you'll do, what the conditions are of the work you will undertake, and then you get to that key part. How much will the pay for this job be? And let's just assume for simplicity that you and your employer agree on $20 per hour. You will come in Monday to Friday, 9 to 5, or whatever the specifics are, and you will work at the desk or the work area that your employer specifies with the materials and equipment he provides, et cetera, et cetera. And then you will use your brains and muscles in the way he dictates. And at the end of the day you will go home. And at the end of the week on Friday afternoon, you will get a check equal to $20 for each hour that you have worked. And the employer knows that for each hour that you're there, you will add to whatever it is his company produces and that he will then sell to make the money he's in business to earn. Well, then this concept of exploitation that I'm talking about reasons as the only way the employer will give you, the employee, $20 an hour or any sum, is if for each hour you work, he earns off of your labor from what you do, more than $20 in other words, he's not going to pay you $20 for your hour of effort if that effort only generates $20 more worth of stuff to sell. Because then the extra he makes by selling what you produce is all used up in paying you for producing it. So the bottom line really, in capitalist enterprises is this. You get a job if and only if you produce more for your employer than he pays you. And in this view, that's exploitation, because you are always producing more in this system than you get, because that's the way the capitalist, the employer, makes a profit, by getting more out of you than it costs you to be brought there to do your work. And the answer of people who think like this has been we shouldn't have exploitation because it's built into the system. Doesn't mean we have to keep a system that works that way. One alternative, for example, would be a worker co op in which the workers themselves produce more than they pay themselves. But because the workers are the bosses too, they get that extra, that profit, that benefit of employing themselves. They hold onto it because they're the employer as well as the employee. If you want to get rid of exploitation, well, then you'd have to change your system. Now, I don't think Pope Francis meant that, but by using the word exploitation, he certainly opens the way for interested folks to interpret it, even beyond the courageous way he puts the issue in his speeches. Next little update. This has to do with a recent statistical reality that's getting hyped in all the ways that shouldn't happen. Here's the A statistic is kept in the United States called real median income. Here's what it means. The median is the midpoint to get a number that calls itself the median of anything. It means half of all the things you're measuring are higher than that median and half are below. So the median real income in the United States means 50% of people earn more than this and 50% of people earn less. So it's a measure of how people are doing over time in terms of where the midpoint in the culture, in the economy, sits. Well, in the year 2000, the median real income. By the way, real simply means adjusting the money you get for the prices you pay. So it measures how much you can actually buy of goods and services for the income you get. The median income of a household in the United States in the year 2000 was $57,371. Just keep in your mind 57,300 and something. That's what it was in the year 2000. When the crash hit in 2008, it hadn't gone hardly up at all. A little bit. 57,800. Not much of a difference, but wow, did it crash then? In 2011, it had dropped to 52,000. That's a 10% drop. That shows you how bad the crisis of 2008 was. And here we are in the beginning of 2016, and guess what? It's back up to 27 to 57,000. So from 52,000 in 2008 to 57,000 and a little in 2016. So, yes, it has recovered from the bottom of the crash of 2008. But here's what much more important where is it today? It is actually lower today by a couple hundred bucks, which isn't much, but it's lower today than it was in 2000. Let me drive home what that means. Over the last 16 years, the median income in terms of what you can afford to buy with the work you do has dropped. It was horrible what happened after 2008, but here we are eight years later, and we still haven't gotten to the level we had 16 years ago. Now, over the last 16 years, the output of goods and services in the United States has risen a lot. The computer has been put everywhere. Workers have become more productive for all kinds of reasons. The output of goods and services has gone up and up and up. But meanwhile, the real income, the real portion of those goods and services that an American household gets has gone exactly nowhere. Which means all the increase went to whom? To the folks at the top, to the corporations, and to the richest among us. The average, the mean, the basic condition of the American working class has gone nowhere. That's the achievement of capitalism over the last 16 years. Median income has gone nowhere in 16 years. That's why words about recovery from the depths of the crash are really much less important than the much more fundamental disaster of the failure of this system to improve the standard of living of the American working class. Well, we've come to the end of the first half of our program today. I would like to ask you to stay with us as we transition to the second half, where I will say something in response to some questions that have come in, very good questions. And I'll also deal with some major issues that I think you'll find interesting in terms of the presidential race that's underway in the United States and the important economic issues concerning it. So if you will please stay with us, we will be right back. And if you want, in the meanwhile, check out our websites rdwolf.com with two Fs or democracyatwork.info we will be right back. Sam yeah, I know I'm sleeping Cause this dream is too amazing she got to know don't know where I used to be One turn and I learned what it really means to see It's a magical mystery welcome back friends, to the second half of Economic Update. I'm your host Richard Wolff, and I want to pick up right away where we left off. At the end of the first half of the program. I was talking about why there really is no genuine recovery in the American economy that we have left the American working class unimproved in its standard of living for literally decades now, as if to underscore this, I want to pick a source you might not imagine that confirms this. The source is Mortimer Zuckerman. Mortimer Zuckerman is the chairman and editor in chief of The American magazine U.S. news & World Report, and he's also a publisher of the New York City newspaper the Daily News. Not known for progressive, radical, liberal, any of that conservative to be as polite as I know how. Let me read to you nonetheless from his editorial that he wrote and that he dated March 1, 2016. Quote I'm going toall of this is now quotations from his editorial the American dream is dying for millions of families and individuals. We are caught up in our worst economic recovery since World War II, and our trading world is shrinking. Global growth has failed to return to the rated average before the Great Recession. Our GDP grew at just 1% annually in the fourth quarter of 2015, and the growth estimate for the first quarter of 2016 is likely to come in poorly as well. The key indices wilt on continuing to quote from Mortimer Zuckerman. The number of employed has grown by over 13 million since February of 2010. But here comes the key thing for you to pay attention to in Mr. Zuckerman's but to make up for the recession and keep pace with population growth, we would have needed 17.5 million more jobs instead of the 13 million we got. Mr. Zuckerman goes on to quote former Treasury Secretary Larry Summers to the following effect. Quote this is a quote from Larry Summers. The recovery has fallen significantly short of predictions and has been far weaker than its predecessors. So even the right wing recognizes the problems of the American economy. I want to turn quickly to responding to a couple of questions that came in, in this case from listeners in Rome, Italy. Very proud that the program is circulating around the world and that it inspires people to send inquiries they ask two questions and I'd like to respond to both of them. First, they're worried that the cooperatives we talk about, worker co ops as an alternative to capitalist industries may have a troubling side effect in the sense that they could be seen as alternatives or substitutes to unions and that thereby contribute to the weakening of the labor union movement. Hurting workers by weakening unions because cooperatives, in their view, don't have a clear way of strengthening the union movement, in fact seem to be alternatives to it and may be used therefore to further weaken the labor movement. I understand the concern, but let me respond in the following two ways. First, in the past of the labor union movement there were many periods of time, both in the United States and other parts of the world, where labor unions and cooperatives were close working allies. And the alliance went roughly as follows. This was the idea that a union is an organization that defends the interests of workers when they confront their employer because they expect that the employer will try to squeeze their working conditions, their wages in order to enhance his profits. In other words, that workers and employers are at loggerheads, are in conflict, and will sooner or later pressure each other in ways that advance the interests of one at the expense of the other. Unions are designed to protect workers by having them bargain collectively rather than individually. From this kind of problem at the hands of the employer and the alliance with the co op followed logically. What could be better than an endless struggle with an employer trying to advance your workers interests or at least protect them? What could be better than than becoming the employer yourself, then you wouldn't have an adversary in this way. It would be the workers taking care of themselves, which is a surely better arrangement than being dependent, however more or less on an employer with whom you have clashing interests. So first, unions and co ops have been allies and unions often thought that if they could not work a proper deal with the employer, that the workers could and should consume withdrawing from the employment of the employer and setting up a competing worker co op business themselves. And there is no reason for this kind of alliance not to reappear in the modern world as it did and worked quite well in the past. And number two, there may well be places for unions in a worker co op economy. Let me explain. It wouldn't be surprising to me if worker co ops made the decision to have a subgroup of a group, let's say there's two or three hundred workers at a workplace. They can't all be making kind of managerial supervisory types of decisions all the time. Presumably the workers as a whole will meet once, twice, three times a year to give general direction and overview. But they'll probably have a managing committee sitting between meetings of the assembly of all the workers. And there might develop some tension between what this managing committee does and what the mass of workers want between meetings of the mass of workers. Well, here's a place for a union. You could have a committee of the workers, that's the managers, and a union of the workers that makes sure that these managers between big meetings do what the workers want. The union could become a kind of in between agent of the workers as a whole to monitor what the managing committee does, to make sure it does what the workers want. And here comes the big to make sure that the managing committee does not in any way shape or form become a new owner, operator, board of directors, separate from the workers, by being literally the agency that monitors on behalf of the workers, that nothing like that happens. In other words, a creative effort to see how unions could work in a worker co op environment might lead to all sorts of of useful roles to play for labor unions. Secondly, question was raised that in Italy, cooperatives have often been means by which capitalists can get around paying workers appropriately dealing with their own workers appropriately. Because instead of appropriately dealing with their own workers, they subcontract out to a co op that provides them with something cheaper by abusing its own members. So the question was, how do you protect against that? Isn't that a risk? Well, this leads me to give an answer that's broader. A co op. A worker co op is an alternative way of organizing a business. It brings democracy into the workplace where it has never been under capitalism. It makes workers have not just a job to do, but but a leading role in an enterprise which allows them to develop leadership capacities and control and design capacities that should be shared that will make their lives richer. I have lots of ways of supporting and defending worker co ops, but I am not naive. I do not believe that worker co op by itself is some guarantor or some automatic royal road to perfection and ideal society. We've been around as a species, we human beings, too long to indulge in such fantasies. Let me give you a parallel. In the excitement to overcome slavery in the past, human beings proclaimed that if only we could get rid of slavery, the institution in which some people become the property, literally of other people, as if they were animals or real estate or something like that. In the enthusiasm to get rid of slavery, many activists working hard to get rid of slavery talked about how if you did that, then we would all be equal and free. Well, it turned out that we did get rid of slavery, but it didn't usher in the nirvana of equality and freedom and liberty that many of the enthusiasts had hoped for. That's not an argument that we didn't that we shouldn't have gotten rid of slavery. Getting rid of slavery was a momentous forward step in human culture, but it wasn't the end of everything. It didn't solve all of our problems. Many of the slaves went on to become workers in capitalist enterprises where their conditions, as Pope Francis has recently said, aren't that much different from slavery. So it turns out that even after you get rid of slavery, there's still work to be done. The same applies to worker co ops. Democratizing the enterprise, finally bringing democracy to the enterprise, so that all the people who work in an enterprise have real input into deciding what's produced, how it's produced, where it's produced and what's done with the profits that after all, everybody helps to generate. In an enterprise, doing that is a momentous step forward, like abolishing slavery. But it doesn't automatically mean that the co op is a wonderful place, that the co op's purposes or functions cannot be perverted, undermined. There will still need to be struggles inside a worker co op economy to make sure it fulfills its objectives. And just like the end of slavery allowed people to become employees in slave like conditions. And that therefore we now struggle to make capitalist enterprises less slave, like it may become necessary in a worker co op economy, likewise to struggle to realize its potential, to make sure it's genuinely internally democratic, and so on. It's important to struggle for social improvement without the fantasy or the naivete of imagining that the struggle will be completely done and over with that we will have found some institutional arrangement that automatically, by itself, without our worrying about it, solves all problems of human community. That has never been true. And worker co ops are not going to achieve what all the previous steps forward have failed to achieve. So is it worth going from capitalism to worker co ops? You betcha. If I may quote a leading politician. You betcha. Just as it was important to go from slavery to no more slavery, or from feudalism to no more feudalism, just like it was important to give everybody the right to vote, even though that didn't automatically solve all our problems, these are steps forward that change society for the better, but they continue to develop other problems which we will then deal with, but we will be better able to do it in my judgment with worker co ops than with the capitalist system as it is now organized. All right, I want to talk about a couple of major topics that many of you have asked me about and that this is a good moment to do. The first has to do with an economics lesson that comes from the campaign of Bernie Sanders for the Democratic nomination for President of the United States. And I want to talk about the relationship of Mr. Sanders campaign, on the one hand, to something that happened back in 2011 and 2012 here in the United States. The last four or five months of 2011 were an extraordinary and astonishing time in American history and in its economic life. A movement that most Americans had not thought possible anymore in the United States suddenly erupted in an unlikely way, in an unlikely place, and then swept the country. The name of the movement was Occupy Wall Street. I began this program, Economic Update, in the year 2011. And so I went from March of that year, when there was no such movement, to December of 2011, when there were encampments of people setting up tents in town Squares in 350 cities across the United States. It was a remarkable year. What did the movement of Occupy Wall street do? It did a number of things, but perhaps the most famous thing it did was to say loudly, clearly and without any hesitation that the United States had deteriorated into a fundamentally unequal, unjust and undemocratic society, which they captured with the slogan 1% versus 99%. And they meant by that that 1% of the people have the bulk of the wealth and control the political and cultural life of this society at the expense of the other 99%. And they were opposed to this and wanted to change the country so it didn't look or work that way. They pleaded and begged for an audience. They pleaded and begged with the media to give them a fair shot. That didn't work out real well. They begged and pleaded for the mass of people to support what they were saying. That worked out quite well. Polls consistently showed a majority of Americans saying they were sympathetic, if not necessarily with the tactics. Well, then clearly they were sympathetic with the goals and the analysis of what had happened in American culture. And most importantly, the Occupy Wall street people appealed to the government right up to the president Barack Obama, to support them, to show a sympathy with what they were saying and with the changes they wanted to make. The Obama administration rejected that appeal, as did governors, mayors around the country. They were not interested in hearing this analysis. They were not interested in sympathy to express sympathy to it, and they were certainly not interested in joining on the Contrary, they destroyed it literally on a coordinated day in all the major cities of the country where there were these encampments, starting with Zuccotti park in New York City, the local administrators, in a coordinated way that could not have happened without the federal government's participation, moved in and ejected all of those folks from those parks, effectively dealing a major blow to what was the symbol and the center of Occupy Wall Street's activities. In the tensions and conversations leading up to that, the President of The United States, Mr. Obama, and people like him around the country were fond of saying roughly the you, the Occupy walls, you don't represent a large part of the American people, so we don't have to take you seriously as representing their point of view. And you can't reasonably therefore ask us to support you, to encourage you, to show sympathy to you. We might be willing to do that, but you haven't done your homework to demonstrate that there is broad based support that literally not a few thousand of you scattered in city parks, but millions of Americans support your point of view. And using that as a justification, the powers that be crushed Occupy Wall street rather than support it while claiming they might have, they would have if only there were evidence that the point of view expressed by Occupy Wall street was broadly held in the United States. Well, the Bernie Sanders campaign provides precisely the evidence that the Obama folks and folks like that claimed wasn't available and that they didn't think existed. Sanders campaign has proven already, no matter what happens from this point onward, that millions and millions of Americans basically agree with the 1% versus 99% analysis brought forward by Occupy Wall Street. The Bernie Sanders campaign, because of the support it has already gotten, not just in the states where Mr. Sanders defeated Mrs. Clinton, but likewise in the states where he didn't. In most cases, not all, he has shown a vast counted in the millions of people support. He's done that by his fundraising as well as his vote getting. So we now know that there was support in 2011 when the argument was made by Occupy Wall street, and that if anything, it has grown stronger since then for a kind of fundamental declaration of war against a society in which 1% have the economic, political and cultural dominance that they do in the United States. Shame on those who pretended not to see it long ago. Fascism. This topic has arisen now because a number of commentators have used the term in regard to Donald Trump, or at least where Donald Trump might be leading folks. So I wanted to make sure we all know what fascism has been so we can determine whether or not we Face that danger now, and if so, where? And if so, what might be done about it? Fascism. Let's talk about what it has been. And we will of course have in mind the great examples of in recent history of fascism. Germany under Hitler, Italy under Mussolini, and Japan in the years leading up to World War II in all of these countries and elsewhere, Spain has had that other countries too. But in those major examples, we have a problem that is fundamental. Capitalism. Sooner or laterand it's usually doesn't take very long, yields a dominant economic position to major capitalist enterprises. They gather into their hands the profits of the system, huge concentrations of wealth, which they use to control the political system as best they can. But they are always a relatively small number of people. So in order to stay in power, if a small number of people have the power and the wealth concentrated in their hands, they know that the mass of people are going to feel aggrieved, resentful, bitter, envious, whatever words you like, they face a continuing danger to their position. Capitalism concentrates the wealth in their hands, but it's insecure. In order to live in that world, to stay safe, to hold on to their wealth, they try to control the political parties. They try to stimulate a way of thinking in the population that makes all of this acceptable. They refer to themselves not as the people who've concentrated wealth in their hands, but perhaps a nicer phrase, like job creators, since nobody can go to work without the tools and equipment which these folks have gathered into their hands. That's how capitalism works. Instead of being angry that all the wealth that has been produced by workers is concentrated in the hands of capitalists, you turn the problem around and say how grateful we are to the capitalists for having the equipment and the enterprises to give the people jobs. It's a little crazy, but that's the way ideology works. They need, in short, a mass base. They need to make alliances with other people, the capitalists do, or otherwise. Their political situation is too dangerous, too vulnerable, too fragile. That's why you see, for example, in the United States, a difficult, tense alliance between big business and capitalists on the one hand, and the religious fundamentalist community on the other, and with conservatives in terms of social values and so on. When these alliances work, when the ideology works, when controlling the political parties with your money works well, then capitalism is, you might say, stable. But periodically, capitalism undermines its own stability. One way it does that is with its business cycles. Periods like the last four or five years when there's massive unemployment, massive suffering and decline of people's standard of living and all of that. At that point, capitalism may enter into a really difficult time because its mass base breaks down. It can't rely on the ideology, it can't rely on the alliances because people are suffering too much and they're beginning to turn on the capitalists and capitalism just like they've done in the United States in the last five or six years. At that point, in some situations, the capitalists get really scared. They have their alliances aren't working, their control of the political situation is eroding and therefore they see themselves in danger. At that point, they may initiate or if there's one available turn to a mass movement that they think can protect their interests. In Germany, this was the Nazi party, a party that went from fringe to the government because the business community said we can't preserve our capitalist system on ideology alone, on political parties and parliaments alone. We have to clean house, we have to control the economy from the top down. Let's do it by merging the government and big business. That's what fascism is. When you do away with democratic procedures, you do away with the parliament, except as a theater, you do away with civil liberties and civil rights. The government becomes a powerful security force, making sure capitalism survives a rough time. That's why it's not surprising that fascism in Italy came when the Italian economy was suffering a downturn. It came to Hitler in the midst of the Great Depression, etc. Fascism is when capitalism cannot rule any longer except with the iron fist of a disciplinary top down society. And we have to see whether that's what we face. We've come to the end of another edition of Economic Update. I want to thank you for listening in. I want to remind you that we are relying on partnership with you to get this message out, to use our websites, rdwolff, with two Fs com and democracy at work, to partner with us by spreading the word through Facebook, Twitter and Instagram. You can click on those icons on our website and follow us in those ways. I want to thank truthout.org, that remarkable independent source of news and analysis, for their partnership, much as I ask for yours. Please work with us. That's the way we can make a difference in this country at this time. I look forward to speaking with you again next week. Gonna be my time, my time baby they ain't gonna change. Things gonna change. Yeah, Sam.