Pandemic Capitalism: A View from Asia - Economic Update with Richard D. Wolff

Economic Update with Richard D. Wolff

Episode: Pandemic Capitalism: A View from Asia
Date: July 30, 2020
Guest: Professor Jomo Kwame Sundaram

Overview

This episode of Economic Update examines the multifaceted impact of COVID-19 on the global economy, with a unique focus on East and Southeast Asia. Host Richard D. Wolff explores how responses to the pandemic have differed regionally, discusses systemic failings of U.S. capitalism exposed by the crisis, and engages with guest economist Jomo Kwame Sundaram for a comparative analysis of "pandemic capitalism" between Asia and the West. The show also addresses rising U.S.-China tensions, the ascendance of finance capital, and concerns about the stability and future of the global capitalist system.

Key Discussion Points & Insights

1. Opening Reflections on Justice and Wealth (00:10 – 05:00)

AOC’s Stand Against Misogyny:
Wolff opens with praise for Alexandria Ocasio-Cortez’s speech against gender-based insults in Congress, framing it as a powerful, long-overdue rebuke against entrenched sexism.
- "Bravo to her and bravo to all of those who I'm sure were moved by her eloquence..." (00:32, Wolff)
Jeff Bezos and Wealth Redistribution:
Suggests redirecting a portion of Bezos’ fortune ($20B) to global causes, specifically vaccine research, contrasting collective good versus private accumulation.
- "Compare leaving the 20 billion in Mr. Bezos's bank account... versus my suggestion... The first option is good for him and bad for the rest of the world." (02:10, Wolff)

2. The "Quiet Fleecing" of Pensioners (05:01 – 10:07)

Corruption in Pension Fund Management:
Wolff details a lawsuit in Kentucky against Blackstone Group and KKR, alleging self-serving, poor investment decisions and hidden personal enrichment.
- Highlights the link between political donations and the awarding of lucrative contracts.
  - "It's always good to give money if you're looking for contracts, isn't it?" (08:34, Wolff)
- Exposes conflicts of interest—companies reimbursed for using their executives’ personal jets, paid from pension funds.

3. Systemic Failures Exposed by the Pandemic (10:08 – 15:30)

Insurance Companies and “Golden Rule” Capitalism:
Pandemic-related business insurance claims are systematically denied, exposing a system where resources enable power.
- "Those who have the gold get to rule.” (12:29, Wolff)
Contrasting U.S. and Canadian COVID Responses:
A metaphor of two Niagara Falls tourist boats illustrates different levels of virus control.
- U.S. boat: 50% full; Canadian: 15% full.
- U.S. infection rate four times higher than Canada.
- "No wonder they won't let us in." (13:38, Wolff)
Retail Collapse and “Stakeholders”:
Retail bankruptcies (e.g., Ann Taylor, Dressbarn, J.C. Penney, Brooks Brothers) are linked to broader economic carnage, loss of jobs, and decreased municipal resources.
- Companies claim to “protect stakeholders” but fire workers and devastate communities.
- "They're not. They're firing all those people... but they're not being taken care of." (14:32, Wolff)
Stark Wealth Gaps in America:
Bezos’ wealth increases by $25B during the pandemic, while local governments fail to house the homeless.
- “$25 billion for Mr. Bezos, but not enough for 50 homeless people. Welcome to America, 2020.” (15:19, Wolff)

Pandemic Capitalism: An Asian Perspective (Guest Interview)

4. Comparative COVID Responses in East and Southeast Asia (15:31 – 19:01)

Governments Mobilized Early and Collectively:
Professor Jomo highlights vigorous, early interventions in East and Southeast Asia (Vietnam, Laos, Kerala in India), enabling containment of COVID-19 without debilitating lockdowns.
- “The responses by various governments... have been quite varied, but in East Asia particularly... have basically succeeded in containing contagion... without resorting to stay-in-shelter lockdown measures...” (15:54, Sundaram)
- Whole government and “whole of society” efforts akin to wartime mobilization, integrating public health, economic, and social responses.
- Even poorer regions (Kerala, Vietnam) achieved effective containment.
Contrast with Western Individualism:
U.S. and U.K. responses are critiqued as fragmented and inadequate.
- “Countries... celebrating the so-called private economic system... proved to be very poor at that kind of mobilization.” (19:01, Wolff)

5. U.S.-China Tensions and Regional Consequences (20:18 – 24:02)

Origins and Escalation of Hostility:
Sundaram traces U.S. hostility to China back to Obama’s “pivot to Asia”; under Trump, this escalates with trade wars and efforts to "externalize" domestic failures.
- “The disruption... has begun much earlier... In fact, I would date it to the Obama administration when there was a so-called pivot to Asia." (20:18, Sundaram)
- Regional supply chains threatened, creating broad economic uncertainty for East and Southeast Asia.
Militarization Fears:
Potential for a limited U.S.-China military conflict, most likely in Southeast Asia, drawing historical parallels (Falklands War, Iraq War) to leaders using international crises for political gain.
- "Those of us in Southeast Asia see such a military conflict as most likely to begin in Southeast Asia." (22:53, Sundaram)
- Nuclear risk on China-India or China-Pakistan borders makes South China Sea scenarios more probable.

6. The Durability of Global Capitalism (24:02 – 27:30)

Multiple, Overlapping Crises:
Wolff summarizes current burdens: pandemic, economic depression, and superpower rivalry.
- "You are loading up the problems of a global capitalism...” (24:02, Wolff)
Can the System Survive?
Sundaram responds:
- The global capitalist system is likely to survive because there's no immediate alternative.
- Power will accrue to the most dominant forces—primarily finance capital—while productive capital is eclipsed.
- “The system will survive precisely because there is no alternative available.” (25:10, Sundaram)
- Financialization (rise of Wall Street/City of London) supplants “productive capitalism.”
- Emerging forms of capitalism in China and elsewhere may serve different needs, but the future shape is uncertain.
- “...the ascendance of finance capital over more productive capitalism... I think is the fundamental problem we face in many parts of the world today.” (26:43, Sundaram)

Notable Quotes & Memorable Moments

On Systemic Corruption:
“Their pension fund managing companies... use the planes to fly their pension managers back and forth... and every time they do, Blackstone pays its own chairman's airplane bills and gets reimbursed... out of the pension funds set aside by the teachers and firefighters and clerks who work for Kentucky, ripping off the average person quietly and steadily. It's the American way."
— Richard D. Wolff (09:37)
On Social Mobilization and Success:
“Very importantly, whole of society mobilization has been important. This is important for us to recognize because in many ways we have a whole of society mobilization comparable, for example, to wartime efforts when society is mobilized to deal with the crisis.”
— Jomo Kwame Sundaram (17:44)
On the Future of Capitalism:
“My own expectation and fear is that the system will survive precisely because there is no alternative available. ...So what we will probably have... is survival of the most powerful elements which can emerge out of this crisis.”
— Jomo Kwame Sundaram (25:10)

Key Timestamps for Major Segments

00:10 – Opening reflections, AOC and Jeff Bezos
05:01 – “Quiet Fleecing of the American People”: Kentucky pension fund scandal
10:08 – Systemic rip-offs: insurance and wealth inequality
13:30 – U.S. vs. Canadian COVID responses, Niagara Falls metaphor
14:35 – Retail bankruptcies, “stakeholders,” and inequality
15:31 – Interview with Professor Jomo Kwame Sundaram begins
15:54 – Comparative government responses to COVID-19 in Asia
20:18 – U.S.-China hostility and regional impacts
24:02 – Multiple global crises and the resilience of capitalism
27:30 – Closing thoughts and recommendations

Tone & Language

Wolff maintains a critical, passionate, and at times sarcastic tone, using vivid examples and direct language to highlight economic injustices. Sundaram is analytical and cautious, offering a broad, comparative perspective and emphasizing structural forces over personalities or parties.

Summary

This episode juxtaposes the failures and inequities of Western capitalism—exacerbated by the pandemic—with effective, collectivist responses observed in parts of Asia. The conversation reveals how entrenched wealth, political patronage, and the ascendancy of finance are grinding away at societal resilience, even as new models of capitalism and global alignments may be emerging. Despite piling crises, both host and guest agree the current system is likely to remain, for lack of a clear, organized alternative. The episode closes with an invitation to seek alternative viewpoints and more nuanced critiques of global capitalism.

Transcript

A (0:10)

Welcome, friends, to another edition of Economic Update, a weekly program devoted to the economic dimensions of our lives, jobs, incomes, debts, hours, our children's. And I'm your host, Richard Wolf. Before jumping into the updates that begin today's program, I wanted to make two very brief comments. The first one is simply to say, as I know is true for many of you, that I was deeply moved by the comments of Alexandra Ocasio Cortez on the floor of the United States Congress, explaining for those who need to hear it, that being cursed at by a conservative Republican congressman using gender specific denigrating terms is something women have had to deal with for so long that it's kind of refreshing that a young, new dynamic member of the Congress has the courage and the insight to call it for what it was and what it is. Bravo to her and bravo to all of those who I'm sure were moved by her eloquence as she made her case and and did it powerfully. The other quickie for me has to do with Jeffrey Bezos. I know I mention him fairly often, but if you're the richest person in the world, it goes with the territory. He has now roughly 160, $170 billion. That makes him not only the world's richest man, but a man possessed of money, which, if it were taken away from him, could do a lot more good than leaving it in his pocket. So I want to make a suggestion. Suppose we took $20 billion from Mr. Bezos. He would then only have, say, roughly 140 billion. He wouldn't have to cry very long because he would still be the richest man on Earth. But. But we, the people of the world, would have $20 billion. And here's a suggestion of what we might do. That would be more than enough money to set up the greatest vaccine hunting laboratories the world has ever seen. Imagine a United States that committed that kind of money to a sustained hunt for an anti COVID 19 vaccine that would be made available to the whole world. Compare leaving the 20 billion in Mr. Bezos's bank account where he can let it sit and accumulate or do whatever he pleases with it, versus my suggestion. The first option is good for him and bad for the rest of the world. And the second option is good for the rest of the world and still leaves him the richest man on earth. You choose. My first update for today is called the Quiet Fleecing of the American People. I wanted to give you a glimpse into something often happening behind closed doors. It's full of a kind of lesson of what goes on? First of all, it has to do with the state of Kentucky. Second of all, it has to do with the public pension funds of the state of Kentucky. These are huge funds in the billions of dollars that are built up as every state employee, teachers, firefighters, all of them put aside a certain amount of money in their weekly paycheck that goes into their pension fund. And that fund accumulates over the 20, 30, 40 years that they do their work for the people of Kentucky whom they serve. The state of Kentucky then takes all of that money and hires a management company to invest it. And the job of the management company is to do the best they can so the pension values accumulate over time, hopefully more than enough, enough to pay the public employees of Kentucky when they reach retirement age, so that they have a decent retirement as part of their payment for all the years of service. Now, this all makes perfect sense, but the corruption here is deep and affects every one of the 50 states. I'm going to talk to you about Kentucky, but. But it applies more or less everywhere else. Here we go. Two of the biggest money management firms who manage many state pension funds are Blackstone Group and KKR. Mr. Steven Schwarzman is the head of the Blackstone Group. He's a billionaire. And two of the leaders of KKR are Henry Kravis and George Roberts. They're also billionaires. Keep that in mind. Here's the deal. They charge the state of Kentucky pension funds a fee for managing the money, and they also require that their expenses for doing that be reimbursed. That money comes out of the pension monies set aside by all the employees, so there'll be less money to distribute to the pensioners. The, the more the fees and the expenses mount up. And now we introduce Daniel Cameron, the new Republican Attorney General of Kentucky. He has gone to court, filed suit against Schwarzman, Blackstone Group, Kravis and Roberts and kkr. He charges them with making very bad investments that were personally profitable to their companies, but personally profitable to them, but not good at all for the many, many thousands of employees of the state of Kentucky. One of the things he points out and what the news reports have now pointed out, is that the reason, or at least part of the reason why the contract went to that company and those two companies might have something to do with the fact that those two companies include individuals who gave large sums of money to Senator Mitch McConnell of Kentucky. That's right. And to the Trump administration that Mr. McConnell is so close to. It's always good to give money if you're looking for contracts, isn't it? But here's the best part. I love it. Mr. Schwarzman owns an airplane company. So do Kravis and Roberts. Independently, little company. They own airplanes. Their pension fund managing companies, Blackstone and kkr, use the planes to fly their pension managers back and forth between New York and Lexington, Kentucky. And every time they do, Blackstone pays its own chairman's airplane bills and gets reimbursed, you guessed it, out of the pension funds set aside by the teachers and firefighters and clerks who work for Kentucky, ripping off the average person quietly and steadily. It's the American way. My next update has to do with the disintegration of capitalism. Property insurance companies are getting appeals from businesses that have lost a lot because of COVID because of the economic crash. And of course, the insurance companies are using lawyers to deny these claims to get out of them. You know the insurance racket, don't you? The job is for us to pay the premiums and the job is for them to get out of paying our claims at least as best they can. Because all bets are off now. The system is falling apart. The old game where you pay your premium and then at least you get something when you have a loss. Oh, no, no, no, not anymore. Now it's a question of how much money you have. How many lawyers can you hire? How hard can your lawyers fight? How big a budget have you given them to fight so that you don't have to pay what you were supposed to pay and other people will have to pay you what they were supposed to pay because you're not willing to to give them the break you're asking the people you owe money to give you. You got it. It's a lesson in what the real golden rule means. Those who have the gold get to rule. My third update has to do with a wonderful moment CNN captured. And I want to give them credit. They must have had a helicopter or a drone flying over Niagara Falls. And they captured there a lovely moment, the passing of two tourist boats, one based in the United States and one based in Canada. And the pilot of the drone or the helicopter noticed something and I want to pass on the implications. He noticed that the U.S. boat was 50% full. Lots of people on the boat crammed together on the deck to look at Niagara Falls. On the Canadian boat, it was 15% full. Sparse space between the people. Well, in case you didn't know, Canada does not allow Americans into Canada these days. It's too dangerous. The United States, as of the moment, that these two ships passed behind or in front of Niagara Falls. The United States was just arriving at 4 million coronavirus cases. Canada has 114,000. I adjusted those to per person. Here in The United States, 1.2% of our population has now gotten this disease. In Canada, three tenths of 1% per person. We are. The United States is four times. The average American is four times more likely to get that disease than the average Canadian. No wonder they won't let us in. My next update has to do with the Acena Retail Group. You may not know their name, but you'll know some of the chains that they own. Ready? This is very typical. The names you know, you think of often as independent companies. They're not. Here's what the Acena Retail Group, Ann Taylor Loft Dressbarn, Lane Bryant and others, 2,800 stores in Mexico, Canada, but mostly the United States. They've just declared bankruptcy. That means they're joining another list I want to present to you to make sure you have it in your mind. J.C. penney, J. Crew, Brooks Brothers, Neiman Marcus. And there are more. Now, I'm not just interested that these companies are collapsing and that they will fire tens of thousands of people and they will not reopen many of the stores they're closing. But I want you to hear that the company announcement of all of this said we are protecting stakeholders, people who have a stake. But of course, this is flat out phony and false. They're not. They're firing all those people, taking away their jobs, taking away their incomes, not only hurting all those people and the innocent members of their family, but for whom. They are doing nothing to build a transition, but they're also destroying the communities. Because with closed stores, taxes aren't earned. And taxes mean the city and the state don't get the money they once had. And they will cut back their services, hurting people yet again. Those are stakeholders. They have a big stake in all of this, but they're not being taken care of. The company is taking care of its own. And since I opened with Jeffrey Bezos, let me close this part of the program with Jeffrey Bezos again. Over the last 18 weeks, he has added somewhere in the neighborhood of $25 billion to what he owned. So my eyes caught a story from Pittsfield, Massachusetts. There was a closed school that had been opened up for 50 homeless people, but they had to be thrown out again because there weren't enough funds to keep this school open. $25 billion for Mr. Bezos, but not enough for 50 homeless people. Welcome to America. 2020 we've come to the end of the first part of today's show. Please remember to subscribe to our YouTube channel. Follow us on Facebook, Twitter and Instagram. Please be sure to visit democracyatwork.info our website to learn more about our shows, our Union Co Op Store, and the two books we've published, Understanding Marxism and Understanding Socialism. Last, but certainly not least, thanks to our Patreon community for their ongoing support. Stay with us. We'll be right back with today's guest, Professor Jomo Kwame Straight Sundaram. Welcome back, friends, to the second half of today's Economic Update. It is a great pleasure for me to renew an old friendship with Jomo Kwame Sundaram, who is our guest today. He writes on economic development, which he has been doing for a very long time in a wide variety of books and magazines. He was a professor of economics until 2004 and then he became, for 10 years, 2005-15, assistant secretary general for Economic Development in the United nations system. He received the Vasily Leontieff Prize for Advancing the Frontiers of economic thought in 2007, Jomo, which is how I've known him all my life. Welcome and thank you so much for spending some time with us.