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Welcome friends, to another edition of Economic Update, a weekly program devoted to the economic dimensions of of our lives and those of our children. I'm your host, Richard Wolff. Before we begin today, we are happy to announce that enrollment for the Left Education Project's spring lineup of classes, new courses that are online and available to you, will begin this march. In other words, the Very soon I will be teaching a course on Marxian class analysis together with Professor Shahram Azer of Bucknell University. We will be doing the class every Wednesday from 4 to 6 Eastern Standard Time, beginning on March 4 and running for four consecutive weeks. You can find out details and register by simply going to www. Left forum.org LEP for Left Education Project. Your participation supports our work and makes these types of editorial and educational efforts possible. You can also support our work by visiting our website, democracyatwork.info by signing up as a paid subscriber to our growing substack community. And that is@Democracyatwork.substack.com we also offer members only content on our Patreon page and that you can Access by visiting patreon.com democracyatwork Please remember to like, subscribe and share this video and others we produce. This is the way you can partner with us to broaden our reach. Thank you for your continued support and your encouragement. It means the world to all of us. Okay, rather than tell you what we're going to do today, I'm going to just jump right into it. But I do want to mention that in the second half we will be interviewing Professor Richard Ray Madoff, a law professor at Boston College, about the US Tax system. I think you'll find it an extraordinarily interesting interview. I want to begin my economic updates by talking about the visit of the leader in Great Britain, Keir Starmer, who went to visit China first time a leader of Britain has visited China in eight years. A rather remarkable statement given that he has visited the United States more times than I can count, and Western Europe likewise. Why is Mr. Starmer going to China? Well, to use his own words, we're putting business over politics. I'm not sure I believe him. But the point is they need to diversify from the United States. They want to develop new, and here I quote again, strategic relations with China. In the course of his visit, he announced that the largest drug company in Britain, a company known as AstraZeneca, has committed to making a 13 billion pound investment in China to produce pharmaceuticals there. This will mean jobs in China. This will mean income in China. This will mean taxes paid to the Chinese government in China, all of those not in Britain. What did the British get? Well, they got visits to China without a visa, and they got some adjustment in other trade relationships. What is Britain doing? It is doing what many, including myself, have predicted for months now. The reaction to Mr. Trump hitting the whole world with tariffs, riding that horse like a tough cowboy, has been to teach the rest of the world that the United States is an unreliable, unstable trading partner. They'll hit you with a tax. They'll hurt your business by making Americans pay more. The price of whatever you sell, plus the tariff they pay to their own government. And so they'll buy fewer of your goods. And that will hurt you and hurt you badly. And first you're angry, and first you're pleading, and first you're begging. All of those things the Europeans, led by Mr. Starmer, have been doing. But at the same time, especially because it doesn't seem to work, they're looking to diversify. The United States is finding its trading partners looking elsewhere for their future. And you know what that is? It's not good for the U.S. economy. Not at all. May be good for headlines of tough Mr. Trump, but it is not what this economy needs. Quite the opposite. You know who else is doing that? Mr. Carney, the leader in Canada. He even says it out loud. Starmer doesn't have that courage. They're looking elsewhere. And China is one of the major places to go, which shouldn't surprise you since China is now the number two economy in the world. And catching up to the United States every year. You know, Mr. Trump commented on Mr. Starmer's visits to China. Mr. Trump said, that is a very dangerous thing to do. Really, Mr. Trump, it's dangerous? Look who hurt the British economy in recent months and years? The U.S. that's why he went to China. And he wants to cut deals with China because he can't cut comparable deals with the United States. You can denounce him all you want, but you're the reason he made the trip. But of course, with our media, that point won't be made. But it's all right. We'll make it. I want to turn next to the appointment of Kevin Warsh to replace Mr. Powell as the head of the Federal Reserve. Gives me a chance to remind you all why these appointments and why these institutions are important. Mr. Powell has been running the Federal Reserve. He's the chair for quite some years. Put there by Mr. Trump, by the way. But now Mr. Trump wants lower interest rates in America. I'll get to that in a minute. He wants them. And Mr. Powell doesn't agree that that's what the American economy needs. It's Mr. Powell's job to manage the money system in this country. That's what the Federal Reserve was established a little over a hundred years ago to do. You see, capitalism, everyone understood early in the 20th century capitalism is a horribly unstable system. It's given to inflations now, recessions later, up and down. That disorients, disrupts, destabilizes many people's lives because they can't make their mortgage payments if they're in recession. They can't keep up with rising prices. If there's an inflation, you know, like we've had the last few years, Mr. Trump's great worry is that we're about to go into a recession. Virtually every president we've had has had to preside over a recession, which is dangerous for their popularity because Americans will blame the recession on whoever's sitting in office and vote in the other one, as if that were a solution, which it never is. When you vote in the other one and they come to their recession, you go back and the pendulum swings between Republican and Democrat, as we know. So Mr. Trump wants lower interest rates. Mr. Powell and the Federal Reserve have said no right up to the present. They're not ready to do it. They've kept them flat, they lowered them a little bit, but nowhere near as much as Mr. Trump wanted. Why not? Because they're worried about the other kind of inflation. If you lower interest rates, you make it easier for people to borrow, and they will. And here's the problem. If they can borrow more easily, every seller of a good or every seller of a service knows that the people out there to whom he sells whatever it is he makes have more money because they can borrow more cheaply. So he's more inclined to raise the price. In other words, if you lower interest rates, you boost your inflation. But we already have an inflation that nobody wants. So the Federal Reserve doesn't want to raise it, doesn't want to lower those interest rates, make the inflation worse. So they don't want to do what Mr. Trump wants. Mr. Trump apparently thinks that avoiding a recession is even more important for his upcoming election in November than controlling the inflation. But that's what's going on. Naming Mr. Warsh is supposedly Mr. Trump's effort to put his guy in there like he's doing everywhere else. Don't believe the words. The words are childishly fake. You know, it's like learning, as I did today, that Mr. Trump is closing the Kennedy center, you know, the one he named after himself, and he explained it's for renovations. You know what that's like? That's like a politician who gets caught doing something wrong and tells you how they're quitting in order to spend more time with their family. Oh, sure. Oh, sure. The Federal Reserve is an attempt to try to keep some balance in a system that goes off the rails. Inflation, recession, all the time. It hasn't worked real well. And in fact, the only defense of the Federal Reserve is we would have even more instability if we didn't have it. And now that Mr. Trump is manipulating it for political advantage. All presidents do it, but not as aggressively as Mr. Trump. We're seeing the rest of the world backing away from the United States because it's becoming more unstable, by the way. That's why we haven't had jobs come back to the United states the way Mr. Trump promised. Every corporate executive sees the chaos in the streets, the bitterness in the population, the instability of the economy, the. They're not moving their factories back to the United States. They'd be nuts to. You know why? They might have thought of going to Minneapolis, but they're not going to do that. Minneapolis just had a general strike. The government of the United States sent troops into the city of Minneapolis. The mayor there said, we don't want them, we don't need them. The governor said, we don't want them, we don't need them. The people said, we don't want them, we don't need them. They came in and because they are very much out of control, they killed two people, Renee Goode and Mr. Two upstanding American citizens. These people, supposedly engaged in ferreting out criminal illegal immigrants, are busy hurting and terrorizing all sorts of people. And I won't even go to what it means for those of you that take Christianity seriously. Refugees, immigrants, weren't we supposed to welcome those people? Weren't we supposed to say, there but for the grace of God go I and give them a glass of water, a warm place to sleep. Oh, no, we have a special Gestapo. And the people of Minneapolis, to their everlasting credit, rose up, called a general strike. 700 stores across Minnesota closed. No shopping, no school, no job. That was on the 23rd of January. A week later, on the 30th. All around the country, people followed, began to organize boycotts, strikes, general strikes. The whole country is finding in this moment the courage and the determination to begin to say this craziness has got to stop. And all I can say is what we all the rest of us, owe them an enormous debt of gratitude. Stay with us. We're going to have a remarkably good interview on our tax system coming right up. Before we jump into the second half of today's show, I wanted to thank you for your very generous response to our fundraising efforts this year and in particular in the last couple of months. And in part responding to that, we are extending the availability of our limited edition, linen covered hardcover version of Understanding Capitalism, the book I wrote and that we have been making available now for quite a while. If you are interested, I will be signing copies of that hardcover and they will be available to you as they have been over the last few weeks. Just simply send an email to us@infodemocracyatwork.info and put in the subject line limited edition. We will send you all the information you need to order and receive your copy signed copy of Understanding Capitalism in its hardback. And thank you again for your kind attention to the fundraising dimension of what we do. Welcome back, friends, to the second half of today's economic update. I am very pleased to bring to our microphones and our cameras Professor Ray Madoff. She's a professor of law at Boston College and the author of the new book the Second how the Tax Code Made an American Aristocracy. It's an expose of how the richest Americans avoid taxes using tools that we, the people, through our government, gave them. Her book was recently listed in the New Yorker best books of 2025. So first of all, Professor Madoff, thank you very much for being with us and giving us a little of your time.