Economic Update with Richard D. Wolff
Episode: US Economy and the Market
Date: September 19, 2019

Overview of Episode

This episode of Economic Update features Richard D. Wolff offering a clear-eyed assessment of the U.S. economic situation at the close of summer 2019 and a sharp critique of the role and mythology of the “market” in capitalist society. Wolff unpacks widely circulated narratives about American economic strength, probes deeper statistics and social outcomes, and then explains why the market is more an institution that benefits the rich than a neutral mechanism for social good.

Part One: The Condition of the U.S. Economy (00:10–22:52)

Critical Analysis of Economic “Greatness”

• Wolff opens by challenging assertions from the Trump administration that the U.S. economy is “great,” pointing out that this claim is largely based on a historically low unemployment rate (3-4%). He critiques using a single metric—unemployment rate—as indicative of general economic health, likening it to a doctor assessing health based on only a thermometer reading.
  • Quote: “No one who has ever studied the economy, certainly no one with a claim to be an economist, would ever judge the economy by one statistic. … You have to look at multiple indices.” (01:30)

Economic Growth and Tax Cuts

• Massive 2018 tax cuts for corporations and the wealthy were supposed to restore U.S. growth to 3%; instead, growth stagnated at around 2%.
  • Quote: “We gave an enormous tax cut to get something which did not materialize. That's not a good sign.” (03:05)

Trade War, Tariffs, & Global Instability

• Presidents’ protectionist tariffs, especially against China, have disrupted global markets and brought the possibility of recession closer. Wolff highlights the contradiction of lowering interest rates while claiming the economy is strong.
  • Quote: “The poor man is caught up in his own chaos. … This is not good for the economy.” (05:15)

Stock Market vs. Real Wages and Inequality

• While the stock market is up 29% since Trump took office (as of mid-August 2019), it trails the 46% growth achieved in Obama’s first 645 days. Moreover, these gains have disproportionately benefited shareholders, deepening wealth inequality.
  • Quote: “The gap between the rich who own the shares and the rest of us has grown wider. The inequality has become worse.” (07:25)

CEO vs Worker Pay Over Decades

• In the 1960s the CEO-to-worker pay ratio was roughly 30:1; by the 1990s it was 100:1, and since 2000, 250:1. His conclusion: “More for the CEOs hasn't helped the economy, but it sure has helped the CEOs.” (09:20)
  • Quote: “Nobody in their right mind thinks they’re that much better today as leaders of corporations than they were in the 60s and 70s.” (09:32)

American Household Insecurity

• Federal Reserve data (2018): 1 in 4 Americans skipped necessary medical care due to cost—even those with insurance.
  • Quote: “That’s not an economy that’s doing great, no matter how you slice it.” (11:25)

Healthcare System and the AMA Shift

• Wolff notes a shift in the American Medical Association’s (AMA) position: for the first time, nearly half its members supported Medicare for All at their annual meeting (a shift toward single-payer advocacy).
  • Quote: “For the first time, half the doctors in America want what the right wing calls socialized medicine.” (13:25)
• The AMA has withdrawn from a coalition of medical industry lobbies, signaling cracks among traditional capitalist power blocs and increased openness to systemic change.

Part Two: The Market—Myth and Reality (22:52–End)

Capitalism and Markets: Distinction and Confusion

• Wolff clarifies that “capitalism” (a system of production) and "market" (a form of distribution) are not synonymous.

  • Quote: “Some people seem to use the word capitalism and the word market or free market as synonymous. This is a mistake.” (23:50)

• Markets have coexisted with slavery, feudalism, and socialism, serving as a mechanism for exchange, not a distinct trait of capitalism.

The “Free Market”—A Myth

• There has never been, and cannot be, a “free market” without regulation. All markets become regulated as soon as their negative effects—like poverty wages or monopolies—manifest.

  • Quote: “The free market that I just described has never existed. It is a figment of the imagination of people. It is also a wildly utopian image.” (28:05)

• Examples: Minimum wage laws, antitrust action—both government interventions necessary to counteract the damaging inequalities and abuses of unregulated markets.

How Markets Distribute Scarcity

• Wolff uses an ice cream cone example: when resources are scarce, markets distribute goods to those who can pay most—i.e., the richest.

  • Quote: “What markets do is distribute whatever is scarce to the people with the money. The most money wins.” (33:47)

• He contrasts this with allocating goods by need (as in the case of milk for children vs. cats), arguing markets are ethically troubling when they disadvantage the needy.

Market Mechanisms vs. Family and Community Values

• Wolff illustrates non-market distribution with the Thanksgiving dinner metaphor—families distribute food according to love and preference, not bidding wars.
  • Quote: “Bringing the market into this household destroys love there…I got news for you. It may have the same effect outside the household too.” (37:30)

Wealth Begets Wealth

• The rich use markets to perpetuate and grow their wealth—through access to better education, legal and financial services, and exclusive resources.

Market Signaling and Barriers to Entry

• High prices signal producers to make more—unless the rich, through monopolies, brands, and advertising, erect barriers to keep competition out and sustain their profits.

Philosophical Critique from Plato and Aristotle

• Wolff notes that even classical philosophers condemned markets for their divisive social effects:
  • Quote: “Markets destroy community. … They set people against each other. … We're always adversaries. … This is not a way to build community.” (44:25)

U.S. Historical Example: WWII Rationing

• During WWII, the U.S. abandoned market allocation for key goods in favor of government rationing, distributing essentials according to need, not wealth.
  • Quote: “We didn’t let the market distribute because it is socially divisive.” (46:47)

Notable Quotes & Memorable Moments

• On Unemployment Numbers as Economic Evidence:
  “It would be as if you went to the doctor, he gave you a thermometer to check your temperature. It was 98.6 and therefore you're done. It isn’t that wonderful. You’re normal. That would be a doctor you should never visit again.” (01:15)

• On the Real Impact of Markets:
  “The market is a system that favors the rich, which is why the rich love markets.” (34:20)

• On Household vs. Market Logic:
  “We are a family. … Bringing the market into the household is against the love we want there to be.” (37:15)

• On Market Regulation as a Historical Constant:
  “Every time a market has been created … it has immediately had so many bad effects that regulations had to be brought in to counter them.” (29:45)

• On Markets and Social Solidarity:
  “Markets disrupt and destroy society. … This is not a way to build community.” (44:30)

Key Segment Timestamps

• 00:10–22:52: U.S. economic health, GDP growth, unemployment, inequality, household insecurity, healthcare developments
• 22:52–29:35: The nature of markets versus capitalism, myth of “free” markets
• 29:35–37:30: Market outcomes—inequality, minimum wage, antitrust
• 37:30–41:30: Family, community, and ethical issues in market logic
• 41:30–44:30: Market’s effects on wealth reproduction, entry barriers
• 44:30–47:30: Philosophical perspectives and the WWII rationing example

Summary

Richard D. Wolff’s episode is a deep dive into economic myths, challenging both the self-congratulatory narratives of contemporary leadership and the ideological mystique of the “market.” With historical evidence, everyday analogies, and pointed critique, Wolff exposes the reality of widening inequality, systemic household insecurity, and the role of markets as institutions that perpetuate and protect privilege under the guise of neutrality and progress. For listeners seeking an alternative framework to mainstream economic commentary, Wolff’s analysis is both provocative and rooted in concrete social experience.