← Economic Update with Richard D. Wolff
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Sam. Saint gonna change. Welcome, friends, to edition of Economic Update, a weekly program devoted to the economic dimensions of our lives. Our jobs, our incomes, our debts, those of our children, those looming down the road. I'm your host, Richard Wolff. I've been a professor of economics all my adult life, and currently I teach at the New School University in New York City. Well, we're coming on the Christmas season that's already here, and as usual, there's a lot of talk about peace on earth, goodwill to men and women, and what the tradition of Christmas, at least for Christians, represents in terms of the better parts of our natures. And so, in that Christmas spirit, I wanted to talk a little bit about where the economy has been and where it's going. Before I do, I want to remind you all, as I sometimes do, to make use of the two websites that we maintain as part of the team effort that lies behind this program. The first one is democracyatwork.info that's all one word, democracyatwork.info. the second one is rdwolf, that's me with two Fs.com rdwolf.com these websites contain a wealth of material being updated and added to literally every day. And it's all there for you 24. 7. No charge whatsoever for anything there. It is a service to supplement to add to whatever this program means to you with more material. The website also allows you to follow us on Facebook, Twitter, and Instagram. It allows you, in a sense, to partner with us, to take what we do on this program and share it with people you know you love and that you think might be interested. Both websites contain ways for you to communicate to us what you like and don't like about the program, what you'd like to see us talk more about, etc. Etc. It is a way to follow my speaking engagements around the country. In short, it lets you connect to relate to, participate, support. Anything that can be a partnership between us is made concrete and available to you on those two websites. Please make use of them. Okay, let's turn to the updates for today. This last week was the farewell press conference of President Obama on his way out, and it contained a number of interesting comments, but one that caught my attention and and that is worthy of an economic update for a number of reasons. Here is a quote from President Obama from that press conference. Since I signed Obamacare into law in 2010, our businesses, he means, of course, the businesses of the United States have added more than 15 million new jobs. Okay, I need to talk to you all about that because it's an example of why so many American people no longer trust, no longer believe, and no longer pay attention to what political leaders do or say, either ever, or maybe not until a couple of weeks before the election. Let me show this in the case of Mr. Obama, and then for fair, the fairness reasons, I will do the same for Mr. Trump. The way to deal with what Mr. Obama has said is to make use of a recent paper by two very famous economists, Lawrence Katz of Harvard University and Alan Krueger of Princeton University. I have made reference to their research earlier this year. Mr. Krueger was a former head of the Council of Economic Advisers. That's the top economic advice counsel for the President of the United States. These are well respected, well known, very much published economic experts in the United States, and they are famous this year for having produced a study of the jobs created during the Obama administration. I don't know for sure, but my guess is that both of these economists were and remain supporters of Mr. Obama. So this is not some right wing effort to discredit, which I would not bring to your attention if I thought that's what it was. Here's what they their research shows 94% of the jobs created during the Obama era were temporary positions. And here's what they meant. They were either literally short term assignments or they were contract positions. That's when you're not a regular employee, but you get a contract say for a month or 12 weeks or whatever it might be. Or they're literally part time jobs or they're part time gig economy jobs. That's another way of saying contract for a particular amount of work for a short time. Basically these are jobs that are insecure, carry little or no benefits, and are cheaper ways for our labor to be picked up by an employer than if that employer were to hire us as competent workers on a regular basis as in the old days. So most of the jobs, the overwhelming jobs that Mr. Obama created or were created during his presidency, were jobs that are way less desirable than the kinds of regular wage and salary positions that were the norm before that. We are moving into an economy which heightens the uncertainty of the working class. That's what they're showing us. Mr. Obama didn't change that. In fact, he presided over an acceleration this kind of change and did little or nothing to prevent it. Here's a second statistic that's kind of crucial. Under Obama, there are 1 million fewer workers in the United States people working at a job overall than there were before the beginning of the Great Recession. In other words, before Mr. Obama takes office, effectively 1 million more people were working in this country than at the end of his eight year presidency. In other words, the jobs he boasted of having presided over, the job creation actually leaves us worse off by a million workers than when he came in. So his glowing reference to 10 million jobs created is, and I'm going to be polite, misleading, because we're still behind where we were. And let me underscore, over eight years we've added millions of people to our population. So to say that we have a million less jobs when we have millions more people is not something to boast about. It is a failure of this system to provide meaningful work to, to the people who live in it. And Mr. Obama, whatever he achieved, didn't solve that problem, not even close. And to say things that suggest otherwise is to cultivate the disbelief, the distrust in the population that I spoke about earlier. Mr. Trump is engaged in the same activity, even though he's not yet president. And I'm referring to this remarkable game with the Carrier Air Conditioner Corporation in Indiana. Let's review. The company announced that it was going to move about 2,100 jobs out of Indiana to Mexico. This is a ploy that is used by many corporations. They threaten whoever they find as their host, a city, a state, the whole country. If it's a big company, they threaten to leave. And the threat has two functions. First, it alerts the government to the impending risk that there will be unemployed people, devastated communities, who will blame politicians, because that's what Americans do. So the politicians are scared. And what they will do, the company hopes, and they often get this, is that the frightened politician, to avoid something that could come back and hurt his or her political career, will dip into taxpayer money to give the corporation a reason not to move the jobs to Mexico or China or whatever the threat was. This often works. The company gets a subsidy. In the case of the carrier corporation, the governor, former Governor Pence of Indiana, who will be the vice president, he arranged that the state would give them a subsidy, a gift, $7 million. Was this a bluff by the company? We don't know. Did the company realize that this is an old tradition, Make a threat, get some money into your hands for nothing? We don't know. Is there any truth to the risk that they were going to leave? We don't know. But it's a clever ploy of a company because not only can it get politicians to shell out our taxpayer money, and I won't go into how that works out. Will they take the money they give to this carrier corporation and not give as much money to public schools? Will they recover the money they're giving to this corporation by raising our taxes? Either way, we lose and the company wins. But that's not the only reason the company threatens to go to Mexico or China. It now can use that threat against its own workers, unionized or not. Dear workers, the company says we're going to leave unless you make it worthwhile for us to stay. And here's how you could do it. Take a wage cut, give back some of the benefits you have, take a cut in your medical coverage, take a cut in your pension assignments, take a cut in the number of holidays you have, take a cut in the number of hours that you are off, etc. Etc. So making a threat to leave is good business. It increases your leverage against your workers and increases your leverage against local politicos. And that's why the game is played. Because you never know, do you? Like a poker game whether the company is bluffing or not. Now enter Mr. Trump, having made a big noise about keeping jobs here. He plays into this piece of theater by the company by flying out to Indiana and having a scolding session with the company, you mustn't do it, blah blah, just it's game, it's a movie. And the company says, well maybe you can help us get a subsidy from Indiana. Which of course Trump and Pence then did. And okay, our part says the carrier corporation, our part is we're going to keep 800 jobs here. The other 1100 jobs are going to Mexico. This leaves us with the following possibility which any of you listening know from what negotiation is. Maybe the carrier corporation never intended to move more than 800 jobs, but it knew that wouldn't be as good a threat as saying 2100 jobs. Because that frightens the politicians even more with the effect it could have. And it frightens the union even more with the effect it could have. So they quickly give the company a subsidy from the state, maybe some give backs from the workers. And when the dust clears, the company, which may have only intended to move 1100 jobs, will still be able to do that. But for the 800 it had never really intended to move. It now has a 7 million dollar subsidy and a better deal with its workers. If this is disgusting, welcome. You understand the games being played. Mr. Trump plays the game and that's why he won't be trusted any more than Mr. Obama or the other politicians who behave in these ways, trying to hype and make good what isn't good at all. They've all taken a page from advertising. Advertising is a business whose purpose is to tell you everything good about a product. Everything good that's actually true, and everything good that they can get away with telling you so that you spend money on it. Advertising is not interested in a balanced assessment of a product, its strengths, its weaknesses, not at all. They're paid to hype the product and that advertising shapes a culture. And it isn't surprising that our politicians follow the cultural model of advertising. They tell you everything positive about what they're doing, some of it true, a lot of it made up in the hope that you will vote. It's a corrupt system at its root and we're living in the consequences. And that's why it turns off so many of our fellow citizens. From paying attention to what politicians say, to paying attention to politics altogether, to trusting what they hear from politicians, etc. Next update. The year 2016 was a year in which major banks in the United States culminated several years in which they were found guilty of immoral, unethical and or illegal activities and paid billions and billions of dollars in fines. Every single major activity of our large banks was found to be an arena for their misbehavior. A rational society looking at this sort of behavior would long ago have concluded leaving banks in the hands of private, profit driven capitalists is a one way route to corruption, misbehavior and severe costs for the society. But we don't do that in our country because we put capitalism first and rationality way behind. So it caught my mind and caught my eye to read about the Swiss government, which this last week decided that a handful of global banks need to be punished for having conspired to rig interest rates over at least the last decade. I have reported on this before when it was done in London at the Libor scandal. But here, in just one little country, Switzerland, the government spends 10 years investigating all of this carefully, with the lawyers of all the big banks there to block them at every turn. And when the dust has cleared, they've decided that the big banks all behaved badly, illegally and damagingly. So here's what they did. The Swiss Competition Commission disclosed its investigation of the rigging of rates and related financial products and it said last Wednesday that it issued a total of 99 million Swiss francs in fines. That's just short of $100 million in American money. The worst offender was the JP Morgan Chase Company of New York City. But the others Just so we're fair, included Royal bank of Scotland, the Deutsche Bank, Citigroup, Barclays, Societe Generale in France, and Credit Suisse, a Swiss company. Royal bank of Scotland turned state's evidence because they had conspired with JP Morgan to do the major damage that exposed JP Morgan, which is why they got the largest fines. We continue to permit to function as the leading bank executives and corporations in this country, controlling our money supply. People who have demonstrated the most complete utter contempt for law, ethics, normality in financial transactions. The only stunning issue is how we permit this to continue. Okay, next item. I don't want to be the harbinger of news that's always troubling, so let me give you some news that's a little different. This was an election in November that of course brought to power a more right wing political establishment than we have seen in this country for quite some time. And we're all wondering once the inauguration happens on the 20th of January, what we're all in for when these folks begin to try to do what they said they're committed to do. So it's all the more interesting that we had one state, and it wasn't the only one, but we had a state of our 50, namely Maine, our northeastern kingdom state, Maine, which bucked the trend, which went in a different direction. So let me tell you, as an economist, how interesting it was to see that in Maine there were referenda ballot issues that allowed the people of Maine to vote on a number of economic issues and to vote in a way that may surprise you. Number one, they voted to raise the minimum wage for low paid workers in their state. Two, they voted to raise taxes on the wealthy to better fund their public schools. Oh, and finally, they passed a law to legalize the market in marijuana. The people of Maine, whose governor has to be listed among the three or four most right wing extreme governors in the United States, the people who elected him in past elections have now apparently decided to go in a different direction. And I thought that that would be of interest to you. Here's one more. Actually, we'll have two more. But here's one. You may not know it, and perhaps Mr. Trump doesn't know it, but in categorizing Muslims and other foreign people as evil or dangerous or potential terrorists, etc. Etc. As he makes a practice of doing, he is threatening the viability of American colleges and universities. Let me explain. And indeed, perhaps Mr. Trump won't mind this if he marks these institutions of higher learning as enemies, more or less like the Foreign students. Okay. Foreign students are now a major part of higher education in the United States. There are Last year over 1 million international students in the United States. That's a record number. They have come to the United States to pursue higher education. They bring their money. They pumped $32.8 billion. According to the association of International Educators here in the United States, foreign students, unlike our own, American domestic students pay the full freight. They are not entitled in most cases to financial support the way American students are, and they are out of state. Therefore, they have to pay the full tuition that in state students at public institutions are usually not required to pay. And here are the three countries who together make up a majority of the students studying in the United States. China, India and Saudi Arabia. That's right. 53% of all that million students come from those three countries. China is being categorized as bad, evil, the enemy by Mr. Trump. And Saudi Arabia is obviously a Muslim country and therefore subject to all of the threats that he has made against them. American colleges and universities are now discovering that students, particularly in China, India and Saudi Arabia, are having second thoughts about coming to the United States. International students are cutting short their educations here. They don't want to be thrown out. They don't want to have their situations endangered. They don't want to look over their shoulders when they walk down the street, lest some deranged follower of Mr. Trump's might decide to take matters into his or her own hands. These are conditions that are driving them away. And because colleges and universities in this country are having a hard time and have come to rely more and more on. On foreign students, the 1 million last year was a record, the highest we've ever had in the number of foreign students. Mr. Trump is driving them away. And the consequences for American colleges and universities are just beginning to be played out. Here's another one. There's a deposit of gold and other products under the ground in Alaska at a place called Pebble Mine, and I wanted to talk to you about it. It's in a place called Bristol Bay, one of the most beautiful parts of Alaska. And this mine has been a project now for a decade, maybe more. And it is opposed. It's opposed by the people of Alaska. It's opposed by the people of Pebble, Bristol Bay. It's opposed by Native American tribes for whom this area is both a salmon fishing area, one of the most important in the world, as well as having all kinds of religious meanings. We're used to that these days. Let me give you an idea of the size. The proposed mine at Pebble Bay, if it were opened, would be the largest open pit mine in North America, perhaps in the world. The hole it would involve covers an area the size of Manhattan. The depth would be at the level of the Grand Canyon. It would generate 10 billion tons of waste laced with toxic chemicals. And all of this rubble, enough to fill 4,000 football stadiums, would be stored behind a giant dam at the headwaters of Bristol Bay in an active earthquake zone. This is a horror 12 times over, but it pits a company that sees lots of money. The company is called Northern Dynastic Minerals. They want to get that mine to make that money. The Environmental Protection Agency has been blocking them, but Mr. Trump, as you well know, has nominated someone to head that agency who seems to want to get rid of the agency he's been named to head. In any case, with a new Trump government, who knows what will happen to the EPA and its relationship to this ecological environmental disaster? If ever you wanted an example of how capitalism puts the priority of profits for a company against the religious ecological screams of masses of people, here it is. We shall watch what the Trump administration does about the Peppel mine in Bristol Bay, Alaska. Last item for today's updates. This comes from The Financial Times, December 16, 2016. It reports a study about 30 year old people in the United States. And it asks an interesting question. What has happened to the prospects of 30 year old Americans in terms of a lifetime in which their income will surpass that of their parents? In other words, what's the chances these days compared to the past of 30 year old Americans? Young people being able to look forward confidently to having a standard of living higher than that of their parents and thereby fulfilling the old American dream of each generation living better than the generation before. Well, here's what the numbers show. In 1970, 30 year olds had a 90% chance, a perfect almost, that they would earn more than their parents. Even 10 years later in 1980, it was still an 80% chance. In other words, pretty good odds you'd live better. Wow. In 2016. Right now, this year, half of 30 year olds are earning less than their parents earned at the same age. Oh wow. That means the prospects are much poorer. No one knows exactly what they are at this point, but whether you're 30 or even 40 years old, the numbers don't lie. Your situation relative to your parents has changed. The prognosis now is at best 50, 50 that you live better than your parents, which means 50% will not match the standard of living they grew up in. We've come to the end of the first half. This is a survey of short items. When we return, we will talk about longer items, items that take a bit more attention. Please stay with us. We'll have a very short interlude and then we'll be back for the second half of Economic Update.
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You're not the guy I met and if you are only getting one chance to prove it, baby, make it count. Make it count. Maybe she let you do that. Maybe some other fool had too many problems to respect herself. You got a woman who knows a worth and ain't prepared to compromise it. You better listen, you better make it better. But don't make me say you got a woman who knows her worth and ain't prepared to compromise it. You better listen, you better to make it better. But don't make me say you can't treat me that way. I hope it's my mistake. Simple misunderstanding. Trivial. We blew in.
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Welcome back, friends, to the second half of this edition of Economic Update. I'm your host again, Richard Wolff, and I bring this program to you as the combined work of a whole team of folks who not only maintain the work needed to produce these programs, but also the work that goes into the constantly updated websites we maintain for your use 24. 7 no charge ever for anything. Rdwolf with two Fs com and democracy at work. That's all one word. Democracyatwork.info info. Well, as I mentioned in the first half of the program at the beginning, it's the Christmas season, and in honor of that, I want to talk about the relationship between Christmas, peace on Earth, goodwill to men and women, and what's actually going on in our economy. And this time I want to relate it a bit more to the issue of immigration. Immigrants to the United States are now numbered in the millions. They are particularly those without documentation, which is a portion of them, usually at the low end of the totem pole. Economically, they are paid poorly. They are paid uncertainly. The number of stories that are reported in literally every state of the union of undocumented workers, afraid if they're not paid what they were contracted to be paid, afraid to go to the authorities because it would risk exposing their undocumented status. Employers know very well they can pay these folks very little and can pay them when they feel like it, because there's really nothing that they can do to get a better deal the way a documented immigrant or Native American worker, if that's the way to describe them, can do these days. So they are the weakest and the poorest, and the plan now is to deport them. Under the Obama administration, the last year or two, millions were deported, pushed out. Trump promises to accelerate that process, and in particular, Mexican immigrants, since they are a major part of the immigration, and particularly the undocumented immigration issue here in the United States. So let's briefly review the Christmas spirit involved in planning to deport them and what the alternative might be. A major reason for millions of Mexicans having come to the United States, including without documentation, has been the effect of nafta, the North American Free Trade Agreement that opened up Mexico to an invasion of American companies, many of whom, like Walmart and so on, were able to deliver commodities to the Mexican people under conditions much more advantageous than going to their local neighborhood store. Millions of Mexican storekeepers were driven out of business. All kinds of industries who could now dump their products in Mexico made those Mexican industries uncompetitive. And so they died because of what Mexico is as a society, perhaps as unequal or more unequal than the United States. Very little was done for the millions of people displaced by this agreement. Very few of them were caught up in the production in Mexico for sale to the United States. So a vast number of them had no work. And not surprisingly, given the choice between dying of no income without a job or moving to the United States, they chose the latter. And so they came. But American capitalism was a major pusher of the NAFTA agreement, seeing all kinds of profits in opening up the Canadian, American and Mexican economies to one another without tariffs, etc. So these are victims of a capitalist profit driven initiative who come here. Keep that in mind. All right, now they're here. It turns out that capitalism inside the United States, busy automating, replacing workers with computers, then with robots, on the one hand, busy capitalists moving to China and India and elsewhere to pay lower wages than they would have to pay here. It turns out that the way capitalism is making money is by doing things that cut down the number of jobs here. So as the immigrants arrive, they arrive in a society that is already unable to provide jobs for its own people, let alone the the immigrants coming in. Not surprisingly, the immigrants coming in with nothing offer to work under conditions Americans, local Americans, don't want. And now what happens? What happens is that the anger of the unemployed American citizens is turned not against the system that has failed to provide them with useful work, but against the immigrants who are themselves victims of the same system who've arrived in order to survive. And the business community plays on this antagonism because it's better to have them hating each other than being angry at the system which provides them with no work or no adequate amount of work and income. This is an old ploy of capitalists to set groups of workers against one another. White against black, male against female, more educated, less educated, and now native immigrant. Wow. Well, it's Christmas time. So let me suggest what an alternative policy might be, one that might be said to be infused with the Christmas spirit. Take a page from the 1930s, when capitalism proved itself unable to provide work for millions upon millions of Americans. A different policy was found, one which said, in the words of President Roosevelt at the time, if the private sector is either unable or unwilling to provide work for the millions of people who ask nothing other than to have a job job, then I as president will do it. And he created and filled 15 million jobs. Here's a Christmas policy for Mr. Instead of setting Americans against each other, instead of setting people who immigrated or whose family immigrated earlier against people whose family immigrated later, instead of doing all that ugly, nasty, dangerous stuff, why don't you have a federal jobs program? The rebuilding of our infrastructure, the greening of America. We have loads of work to be done, more than enough for all of the unemployed, whether they're immigrants or not, to be brought in, working side by side, doing important, useful social work, just as was done in the 1930s. Not only would that give people who need a job a job, but it would put immigrants and those who aren't immigrants together, both earning, both having a good job. It would build good relationships amongst us and not hatred. It's more Christmassy, don't you think? And who would pay for it now? Exactly the same way it was paid for in the 1930s, taxes on corporations and the rich, who've become much richer over the last 25 years. As every statistic shows, they can be tapped to make America great again as a nation that welcomes immigrants, not putting them against the people already here, but combining them in a public works program that would make this country better than it is now for everybody. Just think about it, please. All right, now some major discussions. We have the time. Let's do it. I want to talk about the new incoming Trump administration and the problem it claimed it was going to deal with. But to be fair, let's remember that Mrs. Clinton claimed pretty much the same thing. What am I talking about? The middle class. Republicans and Democrats alike, Clinton and Trump bemoaned the disappearance or the shrinkage of the American middle class. People with a secure job, people earning A decent income, people able to give their children and their families a decent growing up, a chance at a college education, etc. The disappearing middle class was a theme in both camps. Okay, let's then ask the simple question. How was the middle class that they all say is disappearing? How did it come into existence in the first place? Because that'll give us a good clue as to what we need to do to bring it back. Okay, let's ask, were Americans always divided into a few poor people, a few very rich people, and a big middle class? And the answer is unequivocally no. That is not the history of this country. We didn't have much of a middle class. We had rich people and a mass of other people who ranged from having trouble making ends meet to being unable to make ends meet. A middle class was created in the United States in modern times out of the collapse of capitalism in the 1930s. That's right. When capitalism collapsed, threw tens of millions of people out of work and made them desperate, those people did something that created a middle class. And what do I mean? They created the demand for good jobs and that the demand had to be filled. During the 1930s, masses of people did three things that we need to remember. Number one, they joined unions on a scale that had never been seen before and has never been seen since. They joined the cio, the Congress of Industrial Organizations in industry after industry by the millions. People who had never been in a union before, whose parents had never been in a union before, they saw the union as a way to get through this horrible Great Depression with less damage than if you didn't have a union to protect you. A sizable number of Americans, much smaller than those who joined unions, joined two political parties that presented themselves as advocates for working people. The Socialist Party, actually two Socialist parties and the Communist Party who said, we represent the demand for better wages, better working conditions, higher incomes, better labor protections, all of it. So that the working class in America had three institutions advocating for the labor movement, Socialist parties and a Communist party. And out of that came a demand on the Roosevelt administration Democratic Party to meet those demands. And that created the middle class. Here we go. One, it created the Social Security system, taking an enormous burden off of the mass of the American families that when their old people passed 65 years of age, the government would step in with a program of having tapped into their wages over their lifetimes, accumulated money for them, seen that money grow, and now bring it back to them as an old age pension, a real service to create a higher standard of living for old people and their families. Number two, unemployment compensation. If you lose your job through no fault of your own, the government will help you for a year or two to get you through this. That's a support for a middle class because the wages you get will be a shaper of how much unemployment compensation you qualify for. They pass the first minimum wage, guaranteeing that even the people at the bottom would have a decent life. And the people who get paid more than the minimum wage would have to be see their wages go up too. It helped create a middle class. And finally those 15 million public jobs that I talked about before, jobs that were paid at a middle class standard of living. That's how a middle class was produced in America, by the pressure from below, by organizations driven by committed to serving working people first, the labor movement, the socialist and the communist parties. So that's how the middle class was created. The middle class, which for the first time allowed working people after World War II to send their kids to college, to have their own home rather than to live in a tenement, to be able to begin to enjoy what came to be called the American dream. That was the result of struggle and the result of creating organizations to pursue that. The labor movement, unions, socialist and communist parties. Okay, folks. That's how the labor movement worked. That's how the middle class was created. At the end of the war, Roosevelt is dead. The business community was aghast because this combination of labor movement, socialist and communist parties had enough power on the president of the United States to really change America, to make it more a country that takes care and supports its vast working class than a one that rips it off. The business community was aghast. They had to pay for that. They had to pay the higher wages. They had to pay huge taxes to allow the government to do all the other parts of this arrangement. So they rolled it back. The last half century has been the undoing of that new deal that the union socialists and Communists forced on Mr. Roosevelt. That's why the working class is in the trouble it is. Today. Unions represent less than 7% of the workers in the private sector. The communist party and socialist party were hounded out of existence. They've disappeared. The union movement is a shadow of its former self. And guess what? The middle class disappears. The only logical inference from this story is obvious. If you want to rebuild the middle class, you have to permit and indeed support the very organizations that enable there to be a middle class in America in the first place. You have to have a strong labor movement. You have to have existing political expression of what workers want in the form of a socialist party, a labour party, a Communist party. The name doesn't matter. The reality of what it is as a party, that's what matters. For those of you that pay attention, you will know that the conditions of working people in Europe, Western Europe, are much better than here. They have a single payer health system, more or less. In all their countries, they have minimum wages much higher than those here in the United States, etc. Etc. Why? Guess what? Their unions are stronger, their socialist parties are stronger, and their communist parties are stronger. Big hint. That's why their welfare system hasn't been crushed like the one here. So if Mr. Trump wants to rebuild the middle class, or for that matter, if Mrs. Clinton had won and were she interested, the one thing they either one of them would have to do is to give the support for the reconstruction of the institutions and organizations of the working class, labor unions, socialists and communist parties. And to make that list is to let you know what you already do, don't you? Mr. Trump is not going to do that. Mrs. Clinton shows no sign that she would have. Either they are enemies or passively disinterested in the labor movement. Mr. Trump gives every sign with his appointments that he will be hostile to organized labor, maybe more so than previous presidents have dared to be. And the idea that he would support in any way a socialist or a Communist party redevelopment in the United States is not worth your or my time to discuss. So if you're worried about the disappearance of the labor, excuse me, of the middle class, you should be more worried, not less. The one way to rebuild it is something this new administration is never going to do and is in many ways the sworn enemy of doing. The rest is fakery. Bringing back the middle class is not going to be done by jawboning a company moving jobs to Mexico. Even if it's real, and as I explained earlier, it mostly isn't. But even if it were, that's not the way to do it. That's a detail that's small potatoes. You want to do it, do it the way it was done last time. That's not only a message for the government not to be an enemy, it's also a message for those of you who might be inclined to help build these movements. That that indeed is what needs to be done. If there's going to be any rescue of a working class suffering within a declining capitalism, which is what we have in the time that remains, I want to suggest a way forward I don't want to leave you with the notion of grim tidings. The Trump administration, as it's coming in, is very well equipped to take care of that problem. For me, that is to make you all depressed, as it is making so many in America depressed and others elated for reasons that make those who are depressed even more depressed. So what's a way forward? Well, as I argue often, a way forward is to understand that the problems I've gone through and that indeed I go through with you every week, are problems of a system. They're not a problem of this or that law, or this or that practice or this or that company, or this or that executive. We're way beyond that. This is a problem with a system that works in a systematic way to produce the outcomes more and more Americans find unbearable, such as the disappearing middle class, among many others. What's an alternative to this system? Well, if you're going to make a systemic change, you really have to stop, start at the bottom, at the basis economic system, and that basis is the enterprise, the place where the goods and services are produced, without which there is no economy and there is no society. Our food, our clothing, our shelter, our entertainments, our transportation, these are all products of enterprises that make these goods and services. So if you want to change a system, you got to change the enterprise. Well, what's wrong with the enterprise? The answer is the enterprise is driven, controlled, owned and operated by a tiny group of people, the major shareholders and the top executives in the board of directors that are elected by the shareholders. We're talking the 1% of America who own the bulk of the shares and therefore the bulk of the companies, and are therefore choosing the bulk of the boards of directors, the 1%. And they make the economy work well for them, which should come as no surprise. If you want the economy to work well for everybody, you've got to put everybody in charge. Once upon a time, it was thought that the way to do that was to have the government come in and own and operate the industries and control what happens in the name of everybody. Well, it turned out governments, having grown up over the last three centuries in capitalism, are not a reliable vehicle for making the economy work for people. Well, then what do we do? And the answer is, start at the bottom and change it. And the way to do that is to stop having enterprises run by tiny groups of people. Enterprises have to be run by the people who depend on them, who work in them and depend on them. Let me be very concrete. Businesses ought to make decisions that Are partly made by all the workers in an enterprise who are one person, one vote, democratically together with the surrounding communities, which depend on that enterprise for the taxes it pays, for the pollution it dumps into the air, for the quality of the lives of their people. In other words, the customers, the surrounding communities and the workers, they're the ones to decide what happens, so that it happens in their best interest, not in the interest of a tiny group of rich owners. That's capitalism. To break from that, the worker co op is a key institution. It brings democracy into the workplace. It makes it a democratic arrangement based on coming to good relations with the surrounding community and good relationships, of course, with the customers of whatever it is the company produces, the customers, the community and the workers. But it begins by changing that enterprise. Capitalist enterprises, you know, have to come to terms with their customers and come to terms with their surrounding communities. So that's already, in a sense, underway. Although it's done by capitalists. Imagine the difference with me if it were done by democratically operating working institutions, enterprises. I won't bore you again with reminding you that if we are a society that is committed to democracy, then we ought to have instituted it in our workplace, because that's where most of us spend most of our lives. Five out of seven days, the best hours of those five days we are at work. If democracy is what we think is the best way to organize collective activity in a community, it belongs in the workplace. Instead, we have a bizarre society that celebrates democracy but excludes it from the workplace. As if what happens in the community should be handled democratically, but what happens at the workplace shouldn't. Where was this exemption written in the Declaration of Independence? Uh, in the constitution? Not either in the Bible? Not at all. That is a human social construction. And if we were to go that direction, if we were to change, we would be in line with what history has already taught us. You know, before capitalism existed in Europe at least, there was feudalism. The world was organized into lords and serfs on the land. The early efforts to have a different economy, not one in which the lord makes all the decisions and the serf does what he's told, but a new one, an arrangement of an employer and an employee. Capitalism rather than a lord and a serf. Feudalism. The early capitalist enterprises had a great deal of difficulty getting going. One of their biggest problems. Where do we get the money to start a business? It was very hard. Sometimes the little capitalist had a little bit of money. He started it with his own or with his family or with his friends or with his churches or with local institutions, or maybe with a money lender or a banker. You get the picture. That's exactly what worker co ops have to do. They have to get out of capitalism, the capital with which to go in a different direction. Just as the early capitalists had to get money out of a feudal system to take the economy in a different direction. It's happening anyway, all around us. I'll end with a story. It's the story of a brewery in Boston. This is a true story. The name of the brewery is Harpoon Brewery. Perhaps some of you have had Harpoon beer. Back in 2014, the company was considering selling itself. The workers were very scared that if the company was sold, who knows what would happen to their jobs, so on. And so to make a long story short, the company's executives, the people who started the companies, Rich Doyle and Dan Kennery by name, made an interesting decision. They were going to change their company and sell it to their own workers to convert it into a worker owned, or at least partly worker owned enterprise. To save the jobs, to save the institution, to save the community that depended on the taxes paid by this brewery. And so the workers have become the owners, major owners of this enterprise. That's as far as they've taken it to this point. The next question, of course for them, and they're thinking about it, is whether to make it not only worker owned, but worker run, that is, they become a worker co op and not just a worker owned enterprise. I suspect it's coming. And I suspect that for the 190 workers, that's how many they have at Harpoon Brewery in Boston, they are finding their own way to a better economic system. Even if it's just in their little enterprise. And it's happening everywhere, friends, it's a way forward. We need one. We have no other options right now. And in the face of where we seem to be going with a new government, this other option and its ability to raise money in the conventional ways is something I will return to because it is a way forward. We've come to the end of our program. I want to thank you all for listening. I want to thank truthout.org that remarkable independent source of news and analysis that has been a partner for us in just the many ways we hope you will be by making use of our websites and sharing what we do here with as many people as you can reach. Thank you very much. And I look forward to speaking with you again next week. Gonna be my time, my time, baby. Thing gonna change, change, change, change, change, change, change. Thing gonna change. Yep, it is. It.
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