Economic Update with Richard D. Wolff — “Signs of System Decline”

Date: October 14, 2021
Host: Richard D. Wolff (Democracy at Work)

Overview

In this episode, Richard D. Wolff examines salient signs pointing to systemic decline in US capitalism. He argues the US is transitioning from a long period of global ascendancy into a phase marked by relative decline and dysfunction. Wolff analyzes recent economic, political, and social developments—from failed wars and COVID statistics to infrastructure neglect, demographic transitions, and labor unrest—demonstrating how they stem from underlying structural issues in American capitalism. Each topic is illustrated with current events and explored through a critical, often wry lens, offering not just critique but suggesting alternative, systemic approaches to the problems at hand.

Key Discussion Points and Insights

1. Evidence of Systemic Decline

[00:10 – 04:50]

• Wolff opens by discussing the “turning point” in US capitalism: a shift from 100-150 years of expansion to an era of decline.
  • Quote [00:40]: “US capitalism…has come to a turning point…after 100 to 150 years of remarkable growth and expansion, it has peaked. And that we are now in a phase of considerable long term decline.”
• Highlights two stark statistics as “signs of system decline”:
  • The US lost two 20-year wars (Afghanistan, Iraq) to some of the world’s poorest countries.
    • Quote [01:20]: “One of the richest countries in the world has just lost two 20 year wars to two of the poorest countries in the world…That’s about fundamental changes going on around us.”
  • The US, with 4-4.5% of global population, has 20% of global COVID deaths, despite advanced resources.
    • “There are a thousand parts that are moving in ways you wish they didn’t and produce outcomes you wish they didn’t too. It’s a sign of system decline.” [02:50]

2. Corporate Profit over Collective Action: Climate & Disaster Modeling

[04:51 – 08:02]

• Moody’s, a large investment firm, just purchased climate risk modeling firm RMS for $2 billion.
  • RMS helps businesses forecast and monetize climate disaster risk.
• Wolff uses this to critique capitalist motivation:
  • Quote [05:57]: “In a capitalist system, we can’t get together all of the businesses and all of the employees and our government to deal with a problem that confronts us all. Collective action around this subject matter is very hard to come by. But meanwhile, individual companies want to be sure and spend big bucks to know how to avoid a cost and how to make a profit from the very disasters we as a community seem incapable of coping with. Tells you something about what a private economic system does.”

3. Infrastructure Neglect: A Systemic Problem

[08:03 – 14:50]

• Wolff unpacks the infrastructure crisis and debates over the infrastructure bill.
  • Poorly maintained roads and bridges cost each American vehicle owner $300/year in extra costs.
    • Quote [09:45]: “Engineers have estimated that the poor quality of American roads is costing every vehicle owner 300 bucks a year. Wow.”
  • The high cost for repairs is a direct result of years-long neglect.
    • Quote [11:20]: “It’s an enormous amount of money because we haven’t done it year in and year out…That’s just the failure to understand what infrastructure maintenance means.”
  • Politicians are stuck between public demand for services and resistance to taxes, deferring necessary infrastructure work as a result.
  • Both Democrats and Republicans avoid addressing the root/systemic cause.
    • Quote [13:55]: “Watching the Republicans and Democrats debate this bill is an exercise in pathetic…Notice what neither of them is talking [about]: the system that produces the neglect.”
  • Systemic avoidance—fixing only when failure is impossible to ignore (e.g., New York’s 100-year-old water mains).

4. Demographic Shifts & Political Repercussions

[14:51 – 19:13]

• US 2020 Census: White population dropped by 8.6% from 2010-2020; people of color categories grew, with Hispanic and Asian populations up by double digits.
  • In Texas: ~40% White, ~40% Hispanic, ~20% Black.
  • Political coalitions (esp. Republicans) must adapt as demographic bases shrink.
    • Quote [17:52]: “The Republicans are terrified. They’ve built an alliance around white, and white is shrinking. What are they going to do? Well, you can see what they’re doing. Two things. That’s the strategy of the Republicans. Number one, get more of those shrinking white people to vote…Number two, cutting back voting by those people who might not vote Republican.”
  • National division reflects parties “desperately” jockeying to maintain power amid a shifting electorate.

5. US-UK Relations, Afghanistan, and International Alliances

[20:00 – 23:15]

• Reviews Boris Johnson’s comments post-Afghanistan withdrawal and UK’s diminished position.
  • The UK, post-Brexit, is tied closer to a declining US.
  • British anti-immigration fervor exploited Afghanistan coverage, but that political cover is evaporating.
    • Quote [22:10]: “Cheering on the United States in that sad catastrophe in Afghanistan is not a smart move. It’s not a sympathetic move. It ranges somewhere between sad and pathetic.”
  • Other US allies may be questioning their strategic choices.

6. Long Supply Chains, Corporate Choices, and Inflation

[23:16 – 28:30]

• American corporations offshored production over decades for profit: lower wages abroad, growing markets.
  • Quote [24:40]: “Over the last 40 years, American corporations increasingly relocated out of the United States. And they did that for very simple reasons. Profit was the main one and here’s the second one, profit. And now the third one, you guessed it, profit.”
• Fragility of global supply chains exposed by recent disruptions (e.g., Suez Canal blockage, pandemic).
  • Companies failed to invest in infrastructure to anticipate and manage risks.
  • COVID “surges” in China are misrepresented in US media, masking the real comparative severity.
    • Data [26:50]: “On August 10th…China had 111 [new COVID cases]; the United States had 161,000.”
  • Corporate cost-cutting and profit-seeking creates global vulnerabilities; disruptions drive up inflation, disproportionately harming the poor.
  • Some companies use “supply chain issues” as an excuse to raise prices.

7. Labor Action and the Potential for Worker Power

[28:31 – 33:00]

• Case study: Fleischers Craft Butchery chain, where worker walkouts followed investor-ordered removal of Black Lives Matter and LGBTQ signage.
  • CEO caved to investor demand, but employees refused, leading to store closures when they withdrew their labor.
    • Quote [31:10]: “Once again the capitalists learned that you can have a beautiful shop and spectacular tools and fantastic raw meat, but without that butcher, you got nothing. You’re not going to make a nickel in profit, which is what you’re in the business to do.”
  • Wolff points out the essential power of labor and speculates about worker co-ops as a genuine alternative.
    • Quote [32:37]: “Suppose that power was the workers saying…No, no, no. And in fact, you’re not going to make anything because we’re going to run this business in a different way. We’re going to call it Fleischers too. It’ll be a worker co-op and we will collectively do the work, get the profits ourselves. What do we need the capitalist for?”
  • Suggests broader social transformation is possible through worker self-management.

Notable Quotes & Memorable Moments

• On systemic decline:
  • “That cannot be coincidence, that cannot be happenstance. That’s about fundamental changes going on around us.” [01:33]
• On failures of collective action in capitalism:
  • “Collective action around this subject matter is very hard to come by. But meanwhile, individual companies…know how to make a profit from the very disasters we as a community seem incapable of coping with.” [06:33]
• On political debate over infrastructure:
  • “Watching the Republicans and Democrats debate this bill is an exercise in pathetic.” [13:27]
• On labor’s essential power:
  • “Without that butcher, you got nothing. You’re not going to make a nickel in profit.” [31:10]
• On worker-owned alternatives:
  • “What do we need the capitalist for? That might be a day when workers power translates into the kind of system change somewhere most of us know we need.” [32:50]

Timestamps for Major Segments

• Systemic Decline: Wars & COVID — 00:10 – 04:50
• Climate Risk Profiteering (Moody’s & RMS) — 04:51 – 08:02
• Infrastructure Neglect & Systemic Avoidance — 08:03 – 14:50
• Demographic Change and Political Jockeying — 14:51 – 19:13
• US-UK Alliances and Afghanistan — 20:00 – 23:15
• Supply Chains, Profit, and Inflation — 23:16 – 28:30
• Labor Action: Fleischers Butchery Case Study — 28:31 – 33:00

Conclusion

Wolff’s analysis in this episode weaves recent news events together to argue that American capitalism is faltering under the weight of its own contradictions—profit-maximization over shared solutions, infrastructure neglect, demographic shifts, global vulnerabilities, and labor unrest. While often critical—sometimes bitingly so—Wolff’s tone also gestures toward hope in collective alternatives, most compellingly in the example of worker power and cooperatives. The episode is a call not just to lament decline, but to imagine and enact systemic transitions.