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Sam. Saint gonna change. Welcome, friends, to another edition of Economic Update, a weekly program devoted to the economic dimensions of our lives, our debts, our incomes, our jobs, the futures we face and those faced by our kids. I'm your host, Richard Wolff. I've been a professional economist all my adult life, having taught at a number of universities and currently at the New School University in New York City. I'm just back from a short trip to Europe, so you're going to see me talking a little bit about the tumultuous changes there. Much of this program will circle around the Brexit issue, the decision by the voters in the United Kingdom to withdraw from their participation in the European Union, and all that it does mean, and indeed, a good bit that it does not. But we'll get to that a little bit later. First, I want to begin with a couple of announcements. Bear with me, because this is an opportunity for me to tell you something I'm very, very proud of. First of all, over the last couple weeks, we added the 60th 6 0, the 60th radio station to regularly broadcast this program. That's quite an achievement. We started in March of 2011 with WBAI in New York City. And to be able to tell you that we're now on 60 stations, north, east, Southwest and a few abroad is an enormous achievement of which I am very, very proud. It tells us that this program meets a desire and a need of a large number of people. Besides patting ourselves on the back and letting you all know and hoping that you enjoy this growth and success as much as we do, let me also take this opportunity to ask any of you that are located in a place that does not yet have a radio station that carries our program. We are very eager to get on more stations. We have a very energetic and effective young man, Michael Palmieri, who reaches out to any person or station that might be interested, giving them all the information, technical, logistical content that they could possibly need to make a decision. So if you know of anyone, if you have any contacts at a radio station that might be interested, please get in touch with us through our democracyatwork.info or rdwolf.com either of those will work to let you communicate with us. I will put you in touch with Michael Palmieri or put anyone you recommend to us in touch with Michael and we'll take it from there. And of course, our deepest thanks for helping, for partnering with us in reaching more people with what this program does. I also want to make a second announcement. We have been sending out not only this program, but something we called Workers Independent News Shorts, W I N Shorts and a special feature, a new one Left Out. Left out is something that two of our folks here produce a monthly podcast, Michael Palmeira and Dante Delaval. And they are doing this. And if you are interested, please subscribe through the podcast systems that you're familiar with, itunes, Stitcher and Google Play, for example. And you can subscribe to Win Shorts or Left out and get more content than you already do from our team here at Economic Update. We'll also be increasing the number of platforms that carry Economic Update in the near future and and I will announce that to you as well. All right, last announcement. A couple of weeks ago, Betsy Avila was a guest, as you know, if you listen to the program, and she and I together talked about democracy at Work action groups creating groups around the country and indeed abroad of people who like what they hear on this program but want to take it all one step further. That is in addition to informing themselves and letting other people know hopefully about what they hear on this program, they want to get together with other like minded folks and actually do something to change the economic direction of the United States to give Worker Co op something that we strongly advocate for, support in their local communities, things like that. And we call them Democracy at Work action groups. And Betsy Avila, who is our coordinator of these things, invited people to let us know if they were interested. Well, you might be interested to know that we've had an avalanche of people that are interested. Democracy at Work action groups are forming all over the United States and beyond. And the way you can find out about it, if you're interested, is to go to our website, democracyatwork.info check on the menu at the upper left hand corner and then check on groups, simply the word groups, democracyatwork.info groups and you will see where the groups exist around the country. We're particularly interested to let you know that we have a very active group in San Juan, Puerto Rico to give you just a sample, but all over the United States and abroad we are forming these groups and we would love you to become part of that process again. Go to democracyatwork.info groups and you can learn all the details you need to pursue your interest and know that we will be very eager to welcome you into this process. Let's turn then to the updates that we have for today and they are many. Let's start with Puerto Rico. Since I've already mentioned it, President Obama signed a new bill passed by the House and Senate to deal with the economic problems of Puerto Rico. I want to talk about those problems as I have in the past, but I'm going to assume you have a rough idea. Puerto Rico owns on the order of 70 plus billion dollars. That is an enormous amount of money for a small island of three and a half million people. It is the island that is the poorest part of the United States. They have an official poverty rate of 45%, which is literally staggering. They are in a very serious economic crunch. And their governor, Mr. Padilla, said he could not pay the amounts of money due on that enormous loan unless the United States government did something to help them. And he doesn't want to be forced to make those payments because, as the governor explained, if he paid off the loans, he literally would not have enough money to maintain the schools and hospitals and other essential services for the people on that island, who are American citizens, as I assume you all know. Well, what was the problem? The problem, as I've explained in the past, was 30, 40, 50 years during which a very cozy relationship existed between the political leaders of Puerto Rico and lenders, mostly in the United States, New York, Boston and so on. The lenders were eager to make profitable loans, and the politicians in Puerto Rico were eager to look as though they could deliver wonderful services to the people and businesses of Puerto Rico, but without taxing them. There being no way to do that, that is, to provide services without taxing your people and your businesses. What they did instead was borrow money, which the banks in New York were only too eager to end. Result, after 30 years of this game, you are bankrupt. That is, you owe more money than you can afford. And that's where Puerto Rico is. The horror of all of this is that when the bill comes due, as it now is, and the political folks, of course, don't have the money to pay, they turn to the mass of the people and make them pay. That's why in Puerto Rico, the sales tax is now 11%, double what it is on average around the United States. So you have this absurd thing that the taxes are highest in the place in the country where the people are poorest. This is ripping off the people to pay for 30 years of profitable games for bankers and for politicians. We're all too familiar with that. That's the way our capitalist system works. Well, what does this new bill do? Does it solve the problem? Not even a little. This is a classic example of doing nothing. Kicking the can down the road, nothing to deal with the basic political situation. All the Politicians that brought this horror to this conclusion stay in power. None of them is removed. They are put in charge, indeed, of what's to happen next. But since it's clear that leaving Puerto Rico in their hands is a dangerous thing to do, the new bill creates an oversight board of four Republicans and three Democrats to be picked by the Congress, who are now going to take over and have the final say about what happens in Puerto Rico. That means, of course, that what little democracy Puerto Rico had before, and it wasn't much, is now gone. People in Washington will make the decisions and the folks in Puerto Rico will be told what to do. Since we have conservative Republicans in the majority here, since nothing was done in puerto Rico for 30 years as this obvious problem built up, to expect this board to do anything other than slow motion squeezing the people of Puerto Rico to pay off much or all of these loans, we've effectively done nothing but keep this horrible problem going. People are leaving Puerto Rico in large numbers. As American citizens, they can come to the continental United States, which they are doing because even though conditions for jobs are not good here, the conditions in Puerto Rico are even worse. Here is an example of America's Greece. That's what Puerto Rico essentially is suffering on that island, poverty on that island, high taxes. Part of this new deal is to lower the minimum wage in an already poor country. It's really beyond words where capitalism has led this part of the United States. And for the rest of the American people, those mostly listening to this program, what is going on in Puerto Rico is our future. If something fundamental doesn't change, things are being tried in Puerto Rico that will then be replicated elsewhere in the United States. Just as the Europeans, led by the Germans are trying to do in Greece, what they know very well, they will then try to do elsewhere. The other event, and there I was in the streets personally, nearby is in France. In France, there is a street war going on between the largest federation of trade unions, the cgt, it's called in France, Fighting against the government. The government has introduced a bill and it was recently passed by the Senate because the conservatives control the Senate, whereas the Socialists control the House of Representatives. They're called the national assembly, and the Socialists have the president. Mr. Hollande. Well, here's the interesting thing. It's the socialist government that has proposed changing labor rules to allow businesses more freedom in hiring and firing workers in the length of time they make the workers work in the rules governing that work. This is a bill that normally you would expect from a Chamber of Commerce Instead, it is put forward by a socialist government. To add even more bizarreness to the story involved France. This is a socialist government voted into power by the very working class with which it is now clashing in the streets every day. French television over the last two, three months carries pictures of police beating up demonstrators. First it was students, now it is working people unionists. So you have a socialist government voted into office, calling on the police to beat up the very people on whose votes they rely. We are witnessing the self destruction of the French Socialist Party. And if you remember that this is exactly what happened to the Greek Socialist Party, which was one of the two major parties of that country up until three or four years ago, and it now barely exists. And the similar things are happening to the German Socialist Party and so on we are watching. Socialists, having committed themselves to being a nicer kind of capitalism rather than an alternative to capitalism, are finding themselves in a position of maintaining a system which is no longer acceptable to their own people. And this is a moment of severe historical crunching down on what had been the socialist tradition. I will have more to say about that in the weeks to come, that is sure. Let me turn next to another remarkable business having to do with that Brexit that I told you about, that you're all familiar with. The vote last week of the British people by a clear majority to withdraw from the European Union, a vote that had been building for a year and that has exercised the world as it wanders whether this is the end of European unification, whether this means competitive struggles among the Europeans and how that will play out in the United States and the rest of the world, in China and so on. Well, here's something that was striking right from the beginning. Literally within hours, the leader of Germany, Angela Merkel. And remember that Germany is the most powerful economy in Europe. Britain, which was in the European Union and was number two after Germany, is now going to withdraw. That leaves Germany pretty much alone at the top of the heap of what remains of unified Europe. And Mrs. Merkel went on television scolding Mr. Cameron, the leader of Britain, who had already announced his resignation after the vote, scolding him for thinking that he could slow the process down, that he could negotiate the various terms of Britain's withdrawal. No, no, no, she said, this happen quickly and it must happen cleanly. And she was pushing Mr. Cameron out. The British, the vote hadn't dried on the documents and she was pushing them out, telling everybody how she wants Europe to be. Let's repeat that. The Germans are going to tell all the Europeans how to function. If I had more time, I'd talk about an even more amazing thing by her Finance Minister, Mr. Schaubel, who told the Portuguese government that they must behave in a certain way, even though he wasn't asked and even though he made major mistakes in the statement he made over the last couple of days and had to withdraw them. But the Germans are busy through Mrs. Merkel, through Mr. Schaubel, telling the British, the Portuguese and anybody else they feel like how to be in the new German dominated Europe. Well, let's see whether that's a reasonable thing to be doing. The most important economic news out of Germany over the last six months was the one of the most important corporations, literally a symbol of Germany is the Volkswagen automobile company. And let's review what that company did with the complicity of the German government to get an idea of whether Germany has demonstrated the right of and the capability to be telling everybody else in Europe what to do and how to behave and how to have economic policy. This last week was full of headlines announcing that the VW Corporation had reached a settlement here in the United States with part of the people it has damaged and has agreed to pay just shy of $15 billion, one of the larger fines ever paid by any corporation in the United States to deal with the 500,000. Keep the number in your mind, the 500,000American owners of VW diesel automobiles. And if you recall, and I'm going to remind you in case you don't, if you recall what the issue was, the German company VW has admitted, so there's no dispute about this cheating, putting technology into the diesel cars that would systematically underreport the amount of pollution coming out of that car so that they could pass the maximum limits of such pollution, without which you would not be allowed to have the car on the roads here in the United States. And the point and purpose of that was to protect all of us, our health, our lungs, our desire not to have emphysema, lung cancer and all the other horrific consequences of polluted air. The point of the regulations was not to let cars that pollute on. The German company, one of the biggest in the world, systematically phoneyed the results, put technology into the car that would give a lower reading when it was tested than the actual amount of pollution that dumped out. Not only has the VW Corporation done it for years, but the German government never noticed it. It either didn't make the tests it could have and should have, or it knew what it had but decided to go along with the profit driven strategy of vw, the end result is the. The United states is where 500,000 of these polluting diesel cars have made all of our health more precarious than it was without them. They owe all of us money, a lot more than $15 billion. And there will be suits about this to come. But 500,000 diesel cars is a small fraction of the 11 million such cars VW has put on the road around the world. First and foremost in their own country. That's right, the leading capitalist Germans have mostly polluted and damaged the health of their fellow German citizens. So much for their commitment to Germany. Their commitment is to making money. But they have also shown both the company in what it was prepared to do for years and the German government in its grotesque failure to find or stop or prevent what was being done. It was an American tester who found out what the German company was doing. This is not a country and this is not a set of big companies that ought to be in any position to tell anybody else in Europe, British or otherwise, what to do. They don't have the standing, they don't have the world's confidence. And they've lost a little bit of admiration for their so called mechanical capability by showing us how they're prepared to use it. Let me turn next to Cleveland. Cleveland is getting a makeover of a sort that happens in many American cities. And because it's getting a lot of attention, I wanted to talk a little bit about the reality. Here's what's going on in downtown Cleveland, a city in terrible economic distress. Pretty much a story like that of Detroit, Camden, New Jersey and many others. But downtown it's being redeveloped. Oh, yes, they knocked down a few buildings and they're building up, you guessed it, fancy hotels, fancy restaurant and shopping area and fancy apartments to go all around it. Isn't that wonderful? We're supposed to read about, for example, a revitalized Cleveland by looking at all of this. Well, let's talk about the reality of Cleveland. Here we go. The average household income in the United States these days is about $52,000, pooling of course, the incomes of mother, father and any other adults, or for that matter, young people that are working. What's it in Cleveland? 27? Half. Half the national average. Okay. The percentage of Cleveland families that live below the poverty line. And that means you are really poor. In the United States it's 14%. In Cleveland it's 33%. And here is the statistic which in a way says it all and says it best. In 1960, the population of Cleveland was just under 900,000 people. In 2015, the last year for which we have numbers, the population of Cleveland was 388,000. That is the clear vast majority of the people of Cleveland have left that place because there's no work for them. Because the life there is undone, unbearable, because the schools are collapsing. And you can play the game of the year by talking about fancy buildings downtown, mostly for businesses and travelers and visitors and the few rich people who preside over what's left of the Cleveland economy. You can talk about that all day long. But until you deal with the underlying reality, talking about a revitalized Cleveland is a hideous abuse of both the language and the reality. But there's an even worse thing. The key structure being built downtown. And when I read this, folks, I really did a double take. The key structure for the downtown revitalization of Cleveland is to be the 600 room, 32 story Hilton Cleveland downtown, one hotel. And where is the financing coming from to enable the Hilton Corporation to build the luxury hotel? Yeah, from the people of Cuyahoga county in Ohio. That's right. The public's tax money is being used not to attack the problems of Cleveland, the real ones, the poverty, the collapsed job situation, the abandoned houses. No, no, no, no, no. Tax money is used to give an already billion dollar, many billion dollar Hilton Corporation a clever financial deal to do what they're doing in downtown Cleveland. Wow. That's really all I can say is wow. Then there's a news from the National Park Service. That's the agency of the government that maintains our famous and justly famous national parks. If you not know it, if you don't know it, this summer is the hundredth anniversary of the United States National Park Service. How are the parks doing? Well, you can imagine if I'm bringing it up on this program that we've got a problem here. And oh boy, do we. It turns out the national parks have not been getting much help from the Congress. Republicans and some conservative Democrats don't think that the park should get help. I want to talk to you about this for a minute. First, let's see what it means for the park. Some of the conservatives in the government want the park to pay for itself. And by that they mean one of two either jack up the price to the mass of Americans that they have to pay for a campsite or a visit. And of course what that does, and they love to call that the market solution. Well, let's strip away what that means. What it means is millions and millions of Americans who have a decent vacation with their family because they can afford to go to the national parks will no longer be able to do that. So this market solution means that the national parks will be reserved only for a shrinking number of Americans who can afford it. What a lovely idea that is. But there's an alternative, say the conservatives and the Republicans, let private enterprise in. And indeed, that's where we seem to be going. So, for example, last year already a contract was signed between the Park Service and the Anheuser Busch Corporation, the world's largest brewery. And the idea would be that there would be a partnering and beer ads would be on park vehicles. Maybe when you turned around the corner in the woods on a hike, you would see somebody smiling, handing you a beer or at least a picture of it. Wow. What are we doing? For the conservatives and Republicans, a brief reminder. We do not require the churches in this country to pay their own way. We give them a subsidy. They don't have to pay any taxes on anything they do on any income they earn. That's an enormous subsidy, much, much larger than anything we're talking about with the National Park Service. We don't tell the churches to raise the price of going to church and we don't tell them to put beer ads on the pews, do we? Think about it, please. If you're interested, there is a website you can go to and I wanted to give it to you. It's called public goodspost, all one word, public goodspost.org and you will learn all about the national parks and what is being done. Well, we've come to the end of the first half of today's show. Please stay with me, make use of those websites we told you about earlier. And if you come back after a few seconds of interruption, we will have a lot to say about Brexit, what it means and what it implies and what the alternatives really are. Stay with us. We will be right back.
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Everybody knows that the days are loaded Everybody rolls with their fingers crossed. Everybody knows the war is over. Everybody knows the the good guys lost. Everybody knows the fight was fixed the poor stay poor, the rich get rich that's how it goes. Everybody knows Everybody knows that the boat is leaking Everybody knows the captain lied. Everybody got this broken feeling like their father or their dog just died.
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Welcome back, friends, to the second half of Economic Update. For this week, I've been deluged with emails, telephone calls, notes, asking me to make an extensive commentary on on the Brexit vote. That decision last week by Britain to leave the European Union to go its own way, rather than to be part of the economic unification of Europe that has been underway for many years now. I'm glad to do that, and I'm going to do it now because I think it's a very important issue. Not because it's important simply for the British people, which it clearly is, but it because it has ramifications and implications and consequences for the whole world, including the United States, and perhaps in some ways, especially in the United States. But to explain that vote, you really have to go back a little bit. Historically, you know that we often do that in order to understand how this all came to be. You can go far back, but we don't have the time. So let's go back to the 1970s and 80s. At that time, Britain, rather like the United States, was going through a big change. The leader that epitomized the change there, a woman named Margaret Thatcher, kind of the equivalent there of what Ronald Reagan was. Here it was to be the end of the New Deal, part of American history, or for that matter, the Labor Party social democratic period of British history. We were going to roll back the government's intervention in the economy so as to liberate the energies of businesses everywhere. Taxes on business were to be cut and they were workers. Wages were to be pressed down and they were. Unions were to be destroyed or at least weakened. And they were. All of those things that happened in the United states in the 80s and 90s happened also in Great Britain. And it had the same result. It was a promise of a better time, but the actual delivery was better profits for the top 5 or 10% and an increasingly difficult life for the average British citizen. But there was a lot of hoopla about it. Just as there was in the United States, there was in Britain. Okay, we're going to have some difficulties, but don't worry you, Capitalism is going to explode. Capitalism is going to go very well. Capitalism is going to bring us peace, prosperity and economic growth. And for a while it looked like it might. Lots of hyping in the press, lots of promises, lots of people borrowing money for the first time in their lives to live at a standard of living that went up, but only because they were getting deeper into debt again. You see the parallel with the United States. Over time, this situation built up. A depression, a sadness, a grimness, an anger and a rage. But the people of Britain, like the people in the United States, didn't know where to put it. They were being told that there was an economic resurgence, there was an economic growth. And if they didn't participate, the strong suggestion was it was their own fault, they should work harder, they should have gone to a different school, they should have, etc. Etc. And just as in the United States, as the tension built slowly the question was raised. Well, what's going wrong? And this made a problem. It made a problem for not just Thatcher and Reagan, but for the people who thought like that, the people who still think like that, who keep saying that the way to get economic well being is to cut taxes on business, to make the government smaller, to deregulate industry, to do now what they've been doing five, 10, 20 and 30 years ago. As if the economic troubles we have have no relationship to all of that. As if the collapse of Global capitalism in 2008 wasn't in fact a direct result of having loaded people up with debt because you didn't raise their wages the way you once had, that debt could no longer be paid back. The economy crashes. But we're still supposed to pretend that all the policy that led to all of that should be continued as if it had worked for the mass of people, when that's precisely what it didn't do? Yes, it made 5% at the top, very wealthy. Now, meanwhile, as all of this is unfolding, something real is changing in the economy. And it's very, very important to explain that, because therein lies the causes of Brexit. Basically, over the last 40 years, billion, at least a billion workers who were not part of global capitalism have become part. I'm talking about the collapse of the Soviet Union and Eastern Europe. That brings all of those workers who had been kept out because they were part of the Soviet bloc, they now become people looking for work where they can get it. In Western Europe, I'm talking about the Chinese people and the Indian people and the Brazilian people and people all over the world who were brought in to the world capitalist economy through political and other changes. But that had an enormous effect because all those people looking for work in the capitalist center of the economy of the world, North America, Western Europe and Japan, those people were going to compete with those in the west, in those old centers of capitalism, who had jobs. And when they came to compete, they offered to work for less. So that thousands of corporations left the United States, Britain, France, Germany, Japan, and went to India, China, Brazil and Eastern Europe, for example. And millions of the people in those countries moved to Britain, France, Germany and the United States looking for work. It's what you would expect. Now, if There had been planning. If this process had been managed by a collective effort to make it work, well, maybe it might have succeeded, but it wasn't. It was driven by one thing and one thing alone, profit. Western companies said, great, we can make even more money by moving to China. Other Western companies said, great, we can make more money by bringing in foreigners desperate for work, immigrants, and giving them the jobs at lower pay than we used to pay to our own people. Did corporations do it? You betcha. Did it change the economy? You betcha. It made people who work at the top of corporations, people who own shares in those corporations. They made out, if you pardon me, like bandits because they got away with paying lower wages either to immigrants at home or to foreigners if they moved their companies overseas. And many big corporations did both, so they made out well. But the average American citizen, the average British citizen, and for that matter, the average fill in the blank citizen in North America, Western Europe and Japan, they didn't do so well. They discovered their wages weren't going up anymore the way they had. Their expectations of a better life in the future were smashed. They were told to borrow money until they had borrowed so much that the banks wouldn't lend them anymore or would demand interest rates that they couldn't afford. They were told that a college education for their kid would require the child to go into Lord knows how much debt. It was a society that was pinching the middle and the bottom more and more. It was only a question of time when this would blow, when the gap between rich and poor would be unsupportable politically, ideologically, morally. It was only a matter of time before a capitalist system that makes a tiny number of people absurdly rich and everybody else in economic difficulty would be recognized for what it was. That began to happen, particularly after the crash of 2008, when this capitalist systems breakdown might, you might have thought, might have led people to say, well, let's really change this system, or at least control it because it isn't working very well. That didn't happen. Instead, the very forces that brought the crisis to a head made sure to use public money to bail themselves out and then declare the need for an austerity policy to cut back on government spending for people when they needed it most in order to afford the bailout of the companies and the rich who needed it least. Oh my goodness. No wonder things have gotten hot under the collar. No wonder people are desperate and angry about what's happening to them and what looks like it's going to continue into an indefinite future. Well, when this happens to people anytime in history, there begins a search to figure out what's happening here. And likewise a search what can we do about it? And in that moment of search, all kinds of ideas are raised. One idea, and you get that on this program, is that we have a system that doesn't work anymore for the mass of people. So it's time to do what we should have been doing long ago, which is debating what's good and bad about our capitalist system, what alternative systems are there, and what can we do to move from the one we have to one that will work better for most of us, for the majority of which is what's supposed to rule in a democracy? That's one reaction, but of course, that's not the only reaction. Here's another one. This suffering that we are doing here in Britain is because immigrants. This is a kind of scapegoating that often happens. If you don't like immigrants, there are other groups you can get angry at. People who have a different religion from yourself, people who have a different skin color from yourself, people who have a different ethnic manner of dress from yourself, and on and on and on. You can find someone to blame because it's scary to think that you have to change the system. It's scary to confront the people who have all the power in the business and political communities who want to keep the system that has them on top. And you're beginning to think about changing a system. You know you're going to have conflict with them. So maybe it's easier, maybe it's quicker, maybe it's cheaper to be angry at the immigrant. It's peculiar in a country like United States, which is a nation of immigrants. It's a little less peculiar in Britain because indeed, part of what was arranged by the European Union, with the direct participation of the British, I might add, was to create a situation where people in the unified Europe could move from one country to another without having to find documents or cross a border. Free movement. And indeed, many of the people in the eastern poorer parts of Europe moved to places like Britain where they could get a better job, use their skills and earn a better living. Yes. Did that hurt the British standard of living of the rest of the working class? Of course it did. Denying that doesn't make it go away. It's a reality. It happened. Now you can handle that in a hundred different ways, create more jobs so that the people coming in are not competing for the same jobs that British already had. You could have done that if you had A planned economy. But this wasn't a planned economy because the Conservatives, the descendants of Mrs. Thatcher and the Liberals, who are not that different, and the Labour Party people, who aren't that different either, went along with all of this. Let it be managed by the market, okay? That's what the market did. It set the immigrants against the people already working there. It developed the idea that that's the problem. So there are people who want to beat up on immigrants, then there are people who want to be alone in Britain. We should determine our own destiny. I find this argument even more bizarre. The mass of the British people have been excluded from the basic decisions in that society for the last several centuries. Britain is a highly stratified society in which an old boy network that comes out of places like Oxford and Cambridge sits at the top of their hierarchy most of the time, ruling that society being in or out of the European Union isn't going to make much difference. If the European Union has a hierarchy, as indeed it does sitting at the top, that's not very different from what the British already have. And keeping themselves out of the European Union does not address, let alone change, the absence of real democracy inside Britain. So then, what was all of this? All of this was an expression of the anger of the British people. David Cameron, the Conservative leader of Britain, who has been imposing austerity on the British people, making the average British people by losing wages and losing job security and losing government programs, pay the cost of the government of England bailing out their businesses in the crash of 2008. This Prime Minister, David Cameron, was beginning to feel the heat the last two or three years of the growing anger of the British people about the very policies he, like his predecessors, was imposing on them. So he came up with a clever idea. He thought he would distract everybody for a year by having a public referendum on whether Britain stays in the EU or not. He had no question in his mind that the British would stay. He knew that the financiers of London, who make a bundle of money off of their being the dominant financial player in Europe, would make sure to give the money to convince the British people, with whatever arguments they needed, that they should stay in the European Union. Meanwhile, everybody would be focused on this big referendum which indeed happened. And so there wouldn't be as much attention to the suffering of the mass of the British people under the economic policies of Mr. Cameron. What he never counted on, what he did not foresee, was that the mass of people would be so angry at what is happening to them that they would turn on him as the Prime Minister, holding him responsible, together with the whole elite of British society, for imposing this suffering without end on them, that they would vote to leave the European Union, mostly as a statement of we don't want you and we don't want the people like you to keep doing to us what you're doing. It was the anger and the bitterness, and it was a revelation because it showed that the elites that run England are so out of touch with the people whose lives they've made difficult to make themselves even richer. They're so out of touch they couldn't even monitor or control this vote that they thought from the beginning they had all sewed up. This should strike an American audience as familiar. It's like the leadership, the elite that controls the Republican Party, thinking that Donald Trump was some distractive clown at the beginning of the campaign who they didn't have to worry about, only to discover that they're so out of touch with the average people and the anger they feel about what is happening to their lives, that precisely because they made fun of Donald Trump, masses of people decided to support Mr. Trump as a way of affirming their own dissatisfaction. And ditto for the leadership of the Democratic Party, which had no clue that Bernie Sanders from Vermont could generate the millions of votes, the massive support. They too out of touch. They are too parts of a leadership in the United States, as surprised by the mass anger and resentment they have generated and now encountered, as Mr. Cameron and all those who favored Britain to remain in the EU discovered the day after Brexit was voted, when the people said no to all of them. Where does it all go? And that's really important. Where does it go? Well, this is not a vote that was meant to go anywhere. This is a vote of protest. Brexit is a statement of anger and rage. It's a little bit like working in a place where you have a boss and the boss is disgusting and the boss is crude and the boss is intrusive in your life. And so one day, on your way out of the workplace, you let the air out of the tires in his car. Is that a plan for what's going to solve your problem? No. Is it an act that will change your suffering? No. It is a reflection of your anger. It is a reflection of your bitterness. It is a reflection of a barely contained rage. But it isn't the solution to your problem. Your boss is going to treat you tomorrow more or less the way he did up until this. He'll just be maybe a bit Angrier because he had to solve a problem of flat tires on his car. The British, of course, are wondering where all this goes now they've expressed their anger, but they're going to recognize, and many of them already do, that this really doesn't change very much. The companies that were squeezing British working people before are going to continue to do it. The financial center of London is going to take care of itself and let Britain go where it will. They haven't dealt with the underlying economic problems. Even if they push 3 or 400,000 immigrant workers in England out, which is one thing they may do, if they act out their hostility to immigrants, that's not going to change much in England either. If it actually happens and you drive those people out. And if as a result, wages go up in England because there will be fewer workers available, guess what corporations will do in the face of rising British wages? They'll leave. They'll move production to where the wages haven't gone up, which will be in much of the rest of the world. So you're not going to solve the problems of capitalism in its situation today by these actions. And that will be understood by the working class sooner perhaps than we think. The most important effect all over Europe, people who feel angry about what's going on now have a model to follow. They have demands for referendum already happening in other countries. Scotland, which wanted to stay in the European Union, is thinking of breaking away. The United Kingdom is going to become the disunited kingdom pretty soon. The Irish are thinking about it in Northern Ireland as well. Marine Le Pen, the right wing force in France, has already demanded a similar referendum so that the French people can express themselves because she hopes they'll do more or less the same. So you've unleashed by this the disruption. But it's not a disruption of ignorant people or angry people merely. This is a disruption best understood as the coming to fruition of an economic change in the 1970s that was touted as deregulation and liberating capitalist ingenuity and freedom for the market. Yeah, here's the bottom line. It produced the second worst collapse of capitalism in its history in 2008. And it is now producing the weirdest, strangest, bitterest internal divisions that Europe and the United States have seen in decades. Capitalism is a system of severe, profound contradictions. And like those proverbial chickens, they're coming home to roosters. That's what Brexit is all about. Well, if that voting to be out of the European Union is not a solution for Britain, just like Getting rid of immigrants is not a solution for people whose wages aren't high enough. Well then what is? Well, I don't have much time again today, but I want to make the point and make it perhaps in a sharper way than I have in the past. Capitalism is a system that puts a very small number of people in a very powerful position. The board of directors of a Corporation may have 50,000 employees. If it's like VW in Germany, it has hundreds of thousands of employees, but the decisions are not made by those employees. They live with those decisions, they live with the results of those decisions, but they are excluded from making them. A tiny number of major shareholders and the board of directors, 15 to 20 people that they sell, they make all the decisions. So if you are upset with how capitalism works, the inequality it produces, these terrible instabilities periodically happening, like 2008, in a catastrophic way. If you find these results of capitalism unacceptable, you got to go to where the decisions were made that led to these outcomes. And in capitalism, that's the board of directors and the major shareholders, they make the decisions what to produce, how to produce, where to produce and what to do with the profits. So that the solution really is staring us in the face. You want a different outcome? Put these decisions in the hands of different people. And when I say different people, I don't mean officials of a government, 25 of them versus 25 major shareholders. And the board of directors, they pick. No, no, no. That's not the change I'm talking about. I'm talking about democracy. I'm talking about saying, no, we're not going to get rid of the king and have three other people play the role of the king, but not the king. Another family, another region. No, no, no, no, no. We're going to have democracy. We're going to make the decisions made by all of us. Since we have to live with them, we should have the right to make the decision. And then the decisions will be different. If the workers in a factory together with the people who live around the factory, because they're affected by what goes on in the factory too, if those two constituencies decisions, they'll be made in a different way. Capitalism is a profit driven system because the tiny group of people at the top, the shareholders and the board of directors, they live off the profits, the rest of us don't. Of course. They do things that are good for profits. If the rest of us made the decisions, we wouldn't be doing things for profits alone. We would be concerned about our health, how we feel how we interact on the job, what's happening to the air we breathe, the children we are raising. We would make decisions based on what's good for the community. After deliberation and discussion, it's a radically different way of understanding what makes a decision good. Capitalism is the negation of democracy. It gives the decisions to too few people and it produces the results we don't want anymore. Now, I've always spoken about that in terms of enterprises, change the enterprise. But I've been asked recently to talk about this in terms not only of enterprises, but of, for example, things that aren't run as a business, a school, a hospital, a social club. And my answer here is, it's the same story. The reason we have top down dictatorship in our schools, even though they're not enterprises, is that they copy the way enterprises are running, which isn't all that surprising. If enterprises were run democratically, so would schools be, so would hospitals be, so would social clubs be. It would become the way we organize every institution in a democratic commitment. You know, it's funny, we say we are a democratic society, but we don't actually work that way. Our businesses are the best example. A tiny group of people, not elected, not controlled by the mass of people make the decisions and we all live with them. That is not democracy, that is the opposite of democracy. It's dictatorship, it's autocracy, whatever word you want, but democracy it isn't. And if we democratize the enterprises, that would become the model for democratizing all of our institutions, which should be run in exactly the same way and for pretty much the same reasons that can change the world. Not voting for the British people in or out of the European Union, that's not their problem. The smartest thing they could have said to Mr. Cameron a year ago is you're not going to distract us with that nonsense. We know that what faces us is an economic system designed to serve a tiny number of people at our expense. And that's the problem. And that's what has to be addressed. That would have made a big difference and saved a year worth of struggling over something that isn't the problem, but may now, for all we know, make that problem worse. We've come to the end of this program. I hope you found it of interest. I have responded to your requests that we talk about the Brexit issue. I hope I have illuminated it. Please remember to partner with us. Our websites provide you with countless ways of doing that. To follow us on Facebook, Twitter, Instagram and so on to see what we're doing in YouTube. We are growing. We're very proud of it. But the best thing for our growth would be more partnership on more levels with all of you. Thank you very much, and I look forward to talking with you again next week. Sam. Sa.