Economic Update with Richard D. Wolff

Episode: Socialism: Past, Present, Future
Date: May 3, 2018

Episode Overview

In this episode, Professor Richard D. Wolff provides a critical exploration of socialism, examining its origins, evolution, and prospects for the future. Responding to renewed public interest in socialism and ongoing failures and challenges within capitalist systems, Wolff unpacks the historical context, core critiques of capitalism, and the transformation necessary for socialism to offer viable alternatives. Alongside the main theme, he analyzes several current events—including European crackdowns on Uber, equality in Norwegian athletics, and the scandal of overwork deaths in Japan—to illuminate the deeper problems of capitalist organization and values.

Key Discussion Points and Insights

1. The Uber Debate and the "Gig Economy" (00:10-11:24)

• Context: European governments are moving to regulate or fine Uber, responding to public outcry about safety and fairness.
• Economic History Lesson: The history of taxi companies shows that leaving public services to private profit-driven enterprises leads to cost-cutting at the expense of safety and quality, eventually requiring government intervention.
  • “There are countless ways in which making more profit can be not so good for the service you’re supposed to provide.” (A: 03:20)
• Uber as History Repeating: Uber’s gig economy pitch is just a recycling of old profit-maximizing tactics—bypassing safety, insurance, and labor standards for higher profits.
  • “All that Uber is, is the latest effort to do exactly that… They’re going to get taxi prices without taxi costs.” (A: 07:35)

2. Senator Ron Johnson on Healthcare as a Right (11:25-14:33)

• Johnon’s Statement: Health care is not a right, only something to be acquired through personal opportunity.
  • “What we have as rights are life, liberty and the pursuit of happiness. We have the right to freedom. Past that point, everything else is a limited resource…” (A: 12:00, quoting Senator Ron Johnson)
• Wolff’s Critique: This position preserves the status quo, giving the rich access and denying the poor, without acknowledging structural inequities.
  • “The rich will get and the poor won’t. He hasn’t the decency or the honesty to say what he means.” (A: 13:40)

3. Norway’s Equal Pay for Athletes (14:34-17:22)

• Historic Step: Norway decides to pay male and female national athletes equally.
• Values Over Market: This choice reflects societal values (gender equality) taking precedence over market-driven wage disparities.
  • “Isn’t it interesting that there are societies who set wages not by letting the market decide, but by letting the values of a community democratically arrived at make that decision?” (A: 16:45)
• Lesson: Societies can choose to structure compensation systems around justice and inclusion rather than profit.

4. Corporate Stock Buybacks—Ralph Nader’s Critique (17:23-22:43)

• How Profits Are Used: Boards of directors, representing shareholders, often use profits not for production, job creation, or societal benefit, but for stock buybacks that benefit themselves.
• Lack of Democracy: Despite tens of thousands of workers creating profits, a handful of directors decide how those profits are used, often in self-enriching ways.
  • “Hundreds of thousands of people help to produce the profits. [Yet] 15 individuals decide what to do with them.” (A: 19:40)
  • “People on the board of directors… do not get their hands dirty. How did they come to be in a position not only to decide what to do with the profits, but… to be free to do that in a way that personally benefits them?” (A: 21:00)

5. Overwork and "Karoshi" in Japan (22:44-27:15)

• Cases: Young Japanese workers dying from overwork (karoshi) illustrate the dangerous extremes of profit-first capitalism.
• Systemic Problem: Government fines and apologies do little as long as the systemic incentive to exploit labor remains intact.
  • “The profit-driven imperatives that govern capitalist enterprises intrinsically have no limits… That's the problem is systemic.” (A: 26:50)

6. Child Homelessness in New York City (Post-ad break, 27:16-29:14)

• Stat: 10% of NYC public school students were homeless part of the time last year—over 111,000 children.
• Cycle of Poverty: Homelessness leads to absenteeism, poor performance, and reinforces social immobility.
  • “You're giving the disadvantage of poverty a boost by adding the disadvantage of less schooling than is needed because of the homelessness.” (A: 28:45)

7. Corporate Tax Rate Myths (29:15-31:43)

• Myth: Corporations bemoan the 35% tax rate.
• Reality: Deductions, loopholes, and deductions mean the actual effective rate is much lower. Claims of “tax hardship” for major corporations are unfounded.

The Main Theme: Socialism—Past, Present, Future (31:44–End)

The Resurgence of Socialist Ideas

• Recent Trends: Young people’s interest in socialism stems more from dissatisfaction with capitalism than deep understanding of socialism’s alternatives.
  • “What they really mean is not so much that they like socialism, but that they don’t like the capitalism that confronts them.” (A: 32:55)
• Historical Impulse: Dissatisfaction with systemic injustice is a recurring theme, from slaves and serfs to workers under capitalism.

What is Socialism?

Foundational Critiques of Capitalism:

• Private Property: Socialists argue that democratic society is incompatible with private control of the means of production; social ownership is necessary for equality.
• Markets: Markets allocate resources to those with the most money, perpetuating inequality. Socialists propose democratic, needs-based distribution instead.

Models of Socialism:

• Radical Socialism/Communism: Government confiscates and operates all means of production and planning (as in the Soviet Union, China pre-reform).
• Moderate Socialism: Maintains private ownership and markets but adds strong government regulation to mitigate excesses and unfairness (common in Western Europe/Scandinavia).
• “The whole regulatory apparatus… in a way, socialists divided into two groups. One group, you might call the moderates… The ones who wanted to go further took a different name… Communist.” (A: 45:53)

The Failures and Lessons of 20th Century Socialism (46:15-49:15)

• Outcomes: Both forms struggled to deliver the liberty, equality, and fraternity they promised.
  • Russian communism collapsed; Chinese socialism has evolved toward a hybrid economy.
• Self-critical Turn: Contemporary socialists analyze errors—realizing that simply focusing on state/ownership and markets/planning is not enough.

The Socialism of the Future: Democratizing the Workplace (49:16–End)

• New Focus: Transforming the organization of production. Instead of top-down management by owners or bureaucrats, workplaces should be run by workers on a one-person, one-vote basis.
  • “What they didn’t focus on was how production itself was organized. What happens in the workplace, the factory, the office, the store… That’s what socialism didn’t attend to.” (A: 50:00)
  • “If you want to project an image of a future socialism that will not repeat the mistakes of the past… you have to add to those conversations something the old socialists didn’t do: the transformation of the workplace.” (A: 52:45)
• Anticipated Benefits: Democratic workplaces would align enterprise decisions with workers’ and community interests, promising more just, equitable outcomes.

Notable Quotes & Memorable Moments

• “There are countless ways in which making more profit can be not so good for the service you’re supposed to provide.”
  — Richard Wolff (03:20)

• “All that Uber is, is the latest effort to do exactly that… the old game…”
  — Richard Wolff (07:35)

• “The rich will get and the poor won’t. He hasn’t the decency or the honesty to say what he means.”
  — Richard Wolff, on Senator Ron Johnson (13:40)

• “Isn’t it interesting that there are societies who set wages not by letting the market decide, but by letting the values of a community democratically arrived at make that decision?”
  — Richard Wolff, on Norway’s equal pay (16:45)

• “Hundreds of thousands of people help to produce the profits. [Yet] 15 individuals decide what to do with them.”
  — Richard Wolff, on corporate power (19:40)

• “The profit-driven imperatives that govern capitalist enterprises intrinsically have no limits… That’s the problem is systemic.”
  — Richard Wolff, on ‘karoshi’ in Japan (26:50)

• “What they really mean is not so much that they like socialism, but that they don’t like the capitalism that confronts them.”
  — Richard Wolff (32:55)

• “If you want to project an image of a future socialism that will not repeat the mistakes of the past… the transformation of the workplace… has to become the core.”
  — Richard Wolff (52:45)

Timestamps for Major Segments

• Uber & the Gig Economy: 00:10–11:24
• Senator Johnson on Healthcare: 11:25–14:33
• Norway Athlete Pay Equity: 14:34–17:22
• Corporate Profits & Stock Buybacks: 17:23–22:43
• Japan’s Overwork Crisis: 22:44–27:15
• NYC Child Homelessness: 27:16–29:14
• Corporate Tax Rates/Myths: 29:15–31:43
• Socialism Past, Present, Future: 31:44–End

Episode Takeaways

• The repeated failures of capitalist systems—in public services, wealth distribution, and workplace justice—are giving rise to renewed interest in socialism.
• Socialism’s past shortcomings (whether as full state control or moderate regulation) stem from focusing on ownership/distribution while neglecting the power structures within production.
• A future socialism is likely to require deep democratization of the workplace as a foundation for genuine equality and justice.

Summary prepared for listeners seeking a comprehensive yet accessible understanding of the episode’s critical economic and political discussions.