Economic Update with Richard D. Wolff

Episode: The Center Cannot Hold (June 10, 2021)

Brief Overview

In this episode, Richard D. Wolff explores the unraveling center of America's political and economic system, referencing the poet W.B. Yeats: "Things fall apart; the centre cannot hold." Wolff argues that the longstanding two-party establishment—rooted in a shared, business-serving consensus—is fracturing under the weight of economic decline, shrinking opportunities, and deepening social divides. Throughout, he dissects how both major party coalitions are coming apart, why repression is increasing, and how systemic problems go unaddressed even as elite leaders seek only to prop up the failing status quo.

Key Discussion Points & Insights

1. The "Center" Explained: America’s Political Duopoly

• Main Thesis: The traditional power-sharing between establishment Republicans (e.g., Reagan, Bush) and Democrats (Clinton, Obama) has sustained U.S. capitalism above all else. Both parties serve the interests of Wall Street, big business, and the corporate elite.
• Coalition-Building:
  • Republicans attract rural, evangelical, nativist, and white supremacist blocs.
  • Democrats bring together women, minorities, educated professionals, immigrants, youth, and the secular.
• Key Quote:
  • "At the head of the party, in terms of what really makes the decisions are a relatively small number of people. In both cases, those people are Wall Street, the business elite of this country, the CEOs of the big corporations." (02:40)

2. Why the System is No Longer Working

• Economic Decline:
  • The "pie" is shrinking; GDP dropped in 2020, and American capitalism is reeling.
  • "The goodies that can be handed out, whoever is in power, aren't as goody, aren't as big, aren't as available as they once were. American capitalism is having a harder time of it again." (08:10)
  • Outsourcing and globalization—“our businesses have left the United States... they're making money and hiring people in Brazil or India or above all, China." (10:55)
• Distributional Strains:
  • As the elite preserve their share, the working class and the poor bear the burden.
  • Republicans keep their core happy by shrinking benefits for others; Democrats do little more than offer less harsh versions of the same priorities.

3. Fragmentation of Both Party Coalitions

• Republican Side:
  • Working-class disillusionment and resentment are growing; coalition appeals to divisions along racial and class lines.
  • "You can begin to see there the splitting of white and black because that helps you take care of a part of the working class as you go down and really savaging another part." (13:55)
• Democratic Side:
  • The establishment (Biden, Obama, Clinton) is increasingly at odds with progressives who insist on bolder government action.
  • "The progressives are saying to their credit--no, no, no, this crisis is serious. You've got to do a lot more. This isn't just being less harsh than the Republicans." (15:10)
• Existential Stakes:
  • Maintaining coalition unity is vital: "If you don't hold it together, you can kiss the elections of the future goodbye. You won't be in power again, and maybe not for a very long time." (16:05)

4. The Downside: Repression as a Response

• Historical Context:
  • Since the 1980s, U.S. prosperity slowed; debt (personal, corporate, governmental) obscured the downturn but not indefinitely.
  • "From the 1970s and 80s to the present, the United States became a pioneer in a new way, borrowing money like there was no tomorrow." (24:10)
• Social Unrest & Repression:
  • As economic hardship mounts, so does desperation—for example, the rise of diaper banks symbolizes new depths of poverty.
  • "Masses of people in increasingly desperate circumstances take chances, push back, not because they want to, but because they have to." (27:22)
• Law Enforcement & Political Responses:
  • Republicans lean into repression to "keep the lid on." Democrats are wary, fearing it will spark further unrest.
  • "Republicans fear the consequences of repression more than the repression. Excuse me, the Democrats fear it more than the Republicans push it." (31:00)

5. Open Conflict Within Establishments: Notable Moments

• Corporate Leaders vs. GOP:

  • Mitch McConnell denounced CEO activism (re: voting rights in Georgia), signaling trouble in the old alliance between business and the GOP.
  • "It's very dangerous for the leader of a party to denounce big business and CEOs. They are the leaders of his party. They are the donors." (33:05)
  • Corporations, concerned about instability hurting business, are pushing back against hardline political tactics.

• Democratic Leadership & Progressive Dilemma:

  • Biden proposes progressive-leaning policies but is stymied by opposition in the Senate—including from within his own party.
  • "The only solution—he can go to the mass of people and say, hey, help me put pressure. But to mobilize the mass of people ... hands the party over to the people best positioned to mobilize. And that's the progressives." (36:21)
  • The risk: automation of real structural change threatens the power of the establishment core.

6. The Systemic Dead End

• Infrastructure & Stimulus Funds:
  • While Biden’s administration is proposing trillions for rebuilding, most funds will end up in contracts for large businesses, perpetuating the same systemic inequalities.
  • "Those big companies are going to use that money the way they use all their money over the last 50 years ... reproduce this system, and that's the problem, and that's what's not being faced." (39:30)

Notable Quotes & Memorable Moments

• On the Shrinking Economic Pie:

  • "It's an easy time. When the pie is growing, everybody gets a little more ... That's not the case when the pie is shrinking and the American capitalist pie is shrinking." — Richard Wolff (10:00)

• On Deteriorating Social Conditions:

  • "I learned recently about a network of something I had never imagined, which is my fault. Diaper banks. The United States has 200 diaper banks ... This is a country that calls itself one of the richest in the world." (27:40)

• On Party Tensions and the Center Not Holding:

  • "That's why Mr. Trump is as powerful on his side. That's why it's possible to have Marjorie Greene and people like that. And on the Democratic side, that's what fuels Bernie Sanders and AOC and the rising number of people challenging the whole idea of the monopoly of the two big parties even as they work inside one of them." (32:00)

Important Timestamps

• [00:10] – Episode introduction and Yeats quote
• [02:40] – Explanation of the "center" and elite power
• [10:00] – Shrinking of the economic pie
• [13:55] – Splitting along race and class lines
• [15:10] – Progressive vs. establishment Democratic split
• [24:10] – The debt illusion and capitalist decline since 1980
• [27:22] – Repression and social desperation (diaper banks story)
• [31:00] – Repression: Republican vs. Democrat approaches
• [33:05] – GOP vs. big business; McConnell quote
• [36:21] – Biden and the challenge of mass mobilization
• [39:30] – Where stimulus funds go: perpetuating the system

Conclusion

Wolff paints a picture of an American system wherein both parties’ coalitions are fragmenting under economic strain. The tools of the past—coalition-building, borrowing, mild reforms—are breaking down, and repression is on the rise. As both parties face internal revolts and external pressures, popular frustration grows. With bold public spending still likely to reinforce corporate power rather than change the system, the future remains uncertain—and unless the root causes are truly addressed, the “center” indeed cannot hold.