Podcast Summary: "When Stale Debates Distract"

Podcast: Economic Update with Richard D. Wolff
Host: Richard D. Wolff (Democracy at Work)
Date: February 27, 2020

Overview

In this episode, Richard D. Wolff examines how persistent, outdated economic debates—particularly about the role of government in capitalism—serve to distract us from deeper systemic questions. He connects this theme to current events, including the rise of Airbnb, the response to the coronavirus, U.S. budget deficits, Brexit, and local pension crises, ultimately challenging listeners to refocus on transforming the underlying structures of the economy rather than getting lost in century-old arguments.

Key Discussion Points and Insights

1. The Unseen Costs of Airbnb and Wage Stagnation (00:10)

• Insight: The rapid growth of Airbnb is a response to stagnant wages; instead of gaining higher wages for increased productivity or experience, people rent out parts of their homes to make ends meet.
  • Quote:
    "What you used to get as an increase in your wages, you now pay for by losing access to your own home a certain amount of time per year." — Richard D. Wolff (01:08)
• Critique: The shift represents a subtle exploitation: workers don’t get more from their employers, so they are forced to monetize their living space.

2. Market Failures in Crisis—The Coronavirus and Price Gouging (04:35)

• Example: The surge in mask prices during the coronavirus outbreak demonstrates how markets allocate scarce goods: to those with the most money, not those most in need.
  • Quote:
    "There's really no moral defense of this, because it's outrageous. An authority, a governmental authority, particularly a democratic one, would distribute scarce things in a way that respected people's needs... But that's not how markets work. They're not democratic, they're anti-democratic." — Richard D. Wolff (06:30)
• Critique of Economics Orthodoxy: The textbook response that higher prices induce more supply is naive, as suppliers may withhold supply to profit more, and the people who can’t afford vital goods suffer.

3. America’s Trillion Dollar Deficit—Hidden Costs and Political Motivations (09:18)

• Fact: The U.S. government’s trillion-dollar deficit is a result of tax cuts for the wealthy and increased military spending under Trump.
• Political Analysis: The deficit is strategically used to prop up the economy ahead of elections, staving off downturns for political gain rather than necessity.
  • Quote:
    "A huge fat deficit. The government is spending way more than it takes in, in taxes, and there's no mystery as to why." — Richard D. Wolff (10:00)

4. Brexit—A Distraction from Real Economic Woes (13:54)

• Perspective: Brexit’s focus on separation from Europe diverts attention from the deep inequalities of the UK’s own economic system.
  • Quote:
    "Now they are once again what they once [were], a small offshore wet island away from the mainland of Europe. They're gonna go it alone... Having deluded themselves that the problem of the British people is Europe, they're now separated from what they pretended was the problem. And they're back face to face with what always was their problem. An economic system that makes a very few people quite wealthy and the mass of people not at all." — Richard D. Wolff (14:30)
• Takeaway: Political theatrics (e.g., blaming immigrants, Europe, or “the moon”) are used to avoid systemic issues.

5. Pension Crisis in San Diego—A Betrayal of Workers (18:44)

• Problem: Massive pension deficits lead business interests to suggest cutting promised benefits, effectively betraying decades of worker sacrifices.
  • Quote:
    "Cutting the pensions is the betrayal of workers and shows you an economy that's so desperate that that's how it solves its problems." — Richard D. Wolff (19:38)

Main Theme: The Stale Debate on Government Intervention (Second Half - 22:20)

6. Why Debate Over Government Intervention is a Distraction

• Central Argument: For 300 years, debates have centered on whether capitalism should involve more or less government intervention (laissez faire vs. interventionism).
  • Quote:
    "For the last 300 years, one issue has dominated the debate over this capitalist system... Is modern capitalism a system that ought to have active daily intervention by the government in the economy, or is it better not to have the government involved?" — Richard D. Wolff (22:36)
• Historical Recap:
  • In times of crisis (e.g., Great Depression), government steps in; when the crisis passes or conservatives regain power, the trend reverses.
• Core Critique: The ongoing focus on “more or less government” obscures the real issue: the structure of the system itself—employer vs. employee, the lack of democratic decision-making in workplaces, and the concentration of power.
  • Quote:
    "Debating the pros and cons of the government versus the private sector is a silly game until you realize that the purpose of it isn't what it is about. The purpose of it is to make sure we don't debate something else." — Richard D. Wolff (25:08)

7. Historical Parallels: Slavery, Feudalism, and Capitalism

• Comparison:
  • In slavery or feudalism debates, the key issue was the unfree, unequal relationship, not whether the master or lord was a private person or government agent.
  • Similarly, in capitalism, the critical question should be about the employer-employee relationship, not whether the employer is private or public.
  • Quote:
    "The debate over more or less government is not about capitalism versus another system. It's the same system, either run by the private or by the government." — Richard D. Wolff (32:53)

8. Worker Democracy and Systemic Reform

• Vision: Real alternatives would focus on democratic workplaces (worker cooperatives), not just tinkering with who is in charge.
• Critique of the Left/Right Debate: As long as “more or less government” is the focus, no serious challenge is made to the reality and power structure of capitalism.
  • Quote:
    "Arguing between government intervention more or less is no quarrel with capitalism. You're just quarreling over who the employing capitalist is. We don't care." — Richard D. Wolff (34:41)

Notable Quotes & Memorable Moments (with Timestamps)

• Airbnb and Wage Stagnation
  "What you used to get as an increase in your wages, you now pay for by losing access to your own home..." (01:08)
• On Market Allocation During Crisis
  "There's really no moral defense of this... They're not democratic, they're anti-democratic." (06:30)
• On U.S. Deficits
  "A huge fat deficit... and there's no mystery as to why." (10:00)
• Brexit as Distraction
  "Having deluded themselves that the problem of the British people is Europe, they're now separated from what they pretended was the problem." (14:30)
• On Pensions
  "Cutting the pensions is the betrayal of workers..." (19:38)
• Stale Debate Focus
  "For the last 300 years, one issue has dominated the debate over this capitalist system..." (22:36)
• Debate as Distraction
  "The purpose of it is to make sure we don't debate something else." (25:08)
• Critique of Debate Framing
  "The debate over more or less government is not about capitalism versus another system. It's the same system..." (32:53)
• On Real Alternatives
  "Arguing between government intervention more or less is no quarrel with capitalism..." (34:41)

Conclusion and Call to Action

Wolff urges listeners to recognize how entrenched debates about the proper role of government distract from transformative critiques of capitalism itself. He advocates for focusing on the system's undemocratic employer-employee structure and exploring true alternatives, such as worker cooperatives. The episode closes by encouraging listeners to challenge stale narratives and seek deeper systemic reforms.

For More:

• Richard Wolff’s book: Understanding Socialism
• Website: Democracy at Work