Economic Update: Capitalism's Anxiety About the State

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On this week's show, Prof. Wolff presents updates on how capitalism gets in the way of fighting Covid-19, systemic racism and Covid-19, why Europe did not allow the mass unemployment imposed on the US, and Wells Fargo CEO's fake excuse for lack of diversity among bankers. In the second half of the show, Wolff explores why capitalism fears the modern state and how it controls that state. 

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Transcript has been edited for clarity.

Welcome, friends, to another edition of Economic Update, a weekly program devoted to the economic dimensions of our lives: jobs, debts, incomes — our own, our children's. And I'm your host, Richard Wolff.

Before jumping into the economic updates I had planned for today, I learned about something this morning that I wanted to tell you about. It has to do with the frontline health-care workers that are called upon for literally heroic actions over the last six or seven months to deal with this pandemic, to pick up the hard work of dealing with it that our leaders failed so desperately to prepare for. And I'm particularly interested in a story that came out of New York City, where Communications Workers of America, a union, Local 1180, represents the administrative managers in the New York municipal hospital system. And I learned about this from a frequent guest on this show, Bob Hennelly, a reporter for the newspaper The Chief Leader, which is carrying this story.

The administrative managers have, among their other tasks, to provide doctors and nurses with personal protective equipment — absolutely crucial in this era when at least 1,000 health-care workers have already died of covid, from the exposure their work involved. They were told to give the masks to the nurses and doctors, which they did. And they were also told by the hierarchy of the Health and Hospitals Corporation that they were prohibited from wearing the masks — whatever lunatic mentality would do that. So they didn't wear them. And at least one woman worker, an administrative manager, has now died of covid that she contracted, perhaps, probably, because she wasn't allowed to wear a mask. Not a shortage of masks, but instead the ranking — the way we organize every factory, every store, every office. Those on top give the orders; those in the middle give some orders, take some orders; and then the majority at the bottom just take the orders.

We're not going through this crisis of virus together, are we? We have a capitalist ranking system, based in our enterprises, that gets reproduced in our public institutions, like health and hospitals. That rank order — who gets the equipment and who doesn’t, who lives and who dies — it's a statement about a system that is quintessentially incapable of dealing with this kind of a crisis, even in the most basic human way.

I want to turn now to the interesting updates for this week. On Tuesday, September 22nd, Dr. Anthony Fauci — a name you all now know; he's sort of the leader of the fight against the coronavirus; officially, he's the head of the National Institute for Allergy and Infectious Diseases — he gave a talk last Tuesday, on Tuesday the 22nd, at the Bloomberg Equality Summit. And here's what he pointed out that I wanted to share with you. People of color — people with brown and black skins — in America hold an enormous, disproportionate number of the essential jobs in this country at this time. They care for others in countless nursing homes, in countless hospitals, in countless clinics. They deliver vital supplies. They are first responders across the board. They have the most dangerous jobs imaginable right now, and often at the lowest pay.

But that's not all. Dr. Fauci went on. They suffer disproportionately, black and brown people, from obesity, high blood pressure, and diabetes. That means they have more than the usual health problems. But because they are relatively poorly paid and have no wealth, they have less access to the quality health care they need more of. And guess what: They have the highest covid infection rates. You know what this picture shows? It shows that everything Black Lives Matter was about — systemic racism — is baked into the way this country works. Think about it. Dr. Fauci, talking about covid, explains what systematic racism means.

I want to turn next to the stark difference between the United States and Western Europe when it comes to unemployment. We have seen a tremendous spike in unemployment in this country, zooming up to 17, 18 percent over the summer, and still involving tens of millions of unemployed people. Nothing like that happened in Western Europe. Those countries did not experience the spike in unemployment. Italy has a lower rate of unemployment now than it did a year ago, before the virus hit. Germany's unemployment went from roughly five percent to six percent — nothing like what happened here. What's that about? In Europe, the decision was everybody keeps their job. The government helps corporations, but on condition. You fire nobody. You keep everybody working. Nobody is going to suffer here. Yes, you may lose a little of your pay. The government comes in and picks up 60, 70, 80, 90 percent of your normal pay. So you'll go down a bit, but you will not have the anxiety that there's no job for you. You will not have the agony of wondering whether the job will be there when you're ready to go back. None of that. None of that.

And let me drive home: Yes, the United States gave people unemployment benefits, extra — although that stopped on the 31st of July, but for a while — but that's only part of the equation, keeping people at income. Another crucial thing is you have a job, that job is yours, it's there for you, no one else is going to get it or take it from you. Catastrophic what was done here, to plunge millions of Americans into the limbo they're still in. Only now the extra money has been cut back as well, treating tens of millions of your working class very shabbily. And, of course, we didn't solve the problem here the way they did there. There everybody kept their job.

Here we could have done the following: We could have said, okay, you're unemployed by your private employer. Don't worry; the government has a job for you. We have infrastructure to rebuild in this country. We have the greening of this country, dealing with our climate disasters — you know, like the hurricanes, and the floods, and the fires — those all around us. Lots of work to be done. No reason and no excuse for unemployment. Pay people the money they need and get them to do the socially useful things we all know we need. No, not this capitalism. And let me be blunt with you. Where is Mr. Biden on a mass public-employment program? Where is he?

And think about some of the secondary consequences. You know what it means if millions of people are unemployed? They're not making their contributions to the Social Security System, so it's not getting the money coming in that it needs to pay out the retirement benefits that millions of Americans have been paying into. That's just coming down the road. It is nuts to have millions of people unemployed.

But now let me stick it to everyone watching and listening. Why is the experience in Europe so much better than the one in the United States, for the working class as a whole and for the millions of unemployed? And here's the honest answer. If the European governments — the British, the French, the German, the Italian, or any of the others — if they had dared to do to their working class what the American business community and the American government did to the American working class, here's what would have happened: All of those people unemployed? They wouldn't have gone home to watch TV; they would have gone right out into the streets. And those economic systems would have come to a complete halt. No trains, no buses, no food coming into the city, no truck moves — nothing. And everyone in Europe who runs a government knows it. So that wasn't an option. They didn't even toy with it. Of course everybody got paid, and of course everybody got a job guarantee. That's the way those societies work. Here in America we have to face something. We don't have the muscle in the working class to make it clear to the Trumps, and the Republicans, and the Democrats that they cannot do what they have now done. Think about it, please.

My next and final update that we'll have time for takes us, unfortunately, into the mind and mouth of the CEO of the Wells Fargo Bank Corporation, one Charles Scharf. Scharf, by the way, is the German word for “sharp,” which clearly Charles isn't. Here's what he did. He told an audience that was interested, he told them the reason why the top ranks of bank executives in his company — but he meant it generally, apparently — were not “diverse” (his word). And why were they not diverse? And by the way, you do all know what “diverse” means. It's a code word for black, and brown, and female, more or less. And here's his answer. Classic. Quote, and I'm quoting, “a shortage of qualified minority candidates.”

Well, let's help Mr. Scharf, who isn’t. Black, brown, and women? That's not a minority; that's the majority — the overwhelming majority, if you put those three together. White males? That's a minority. The banks of America, particularly the big ones like Wells Fargo, have had affirmative action in place for 300 years. You know what it meant? White men got the jobs, and other people didn't. It was affirmative for them and exclusionary for everybody else.

And let's see what the white males that run Wells Fargo achieved in recent years: massive corruption. They've had to pay billions of dollars because they got caught cheating in a dozen different ways, setting up massive numbers — millions — of fake accounts for people who didn't want or need them, charging them money for it. I mean, the bank has gone real well with its affirmative-action, qualified candidates that they have put in positions to operate these monumental scams.

But let's give them the benefit of the doubt. Let's imagine there might be a shortage of qualified minority candidates. You know why? Because you don't let them into the institutions from which you hire, do you? Who do you think you're fooling, Mr. Scharf, who isn't. It's a crooked enterprise, the Wells Fargo Bank, and has been caught out doing that for a long time. You're not “not diverse” because there aren't qualified people. You're too busy doing the things you ought to be ashamed of.

We've come to the end of the first part of today's show. Before we move on, I want to remind you that we've just released my third book with Democracy at Work. It's called The Sickness Is the System: When Capitalism Fails to Save Us From Pandemics or Itself. It's a compilation of essays that aim to explain how and why capitalism is the sickness underlying all the symptoms we see around us. Get your copy at democracyatwork.info/books. I want to also thank our Patreon community, as I always do, for their ongoing support. If you haven't already, please go to patreon.com/economicupdate and sign up today for access to exclusive content and more. Stay with us; we'll be right back.

Welcome back, friends, to the second half of today's Economic Update. I want to talk today about a major topic of importance that many of you have written to me or asked me about: What is the relationship between capitalism and the state, the government? What is the relationship, if you like, between economics and politics, if politics is focused on the state? And I want to answer it because I think in that way I can engage many of your questions.

There's a fundamental problem that the state represents for capitalism, and it always did. And that has to be foregrounded — that's why I'm starting with it — so that you keep that in your mind as we go through the rest of it. The problem of the state for capitalism has to do with what we call “universal suffrage,” the extension of the right to vote to everyone. That has now become the norm in modern society. At first, in the early days of capitalism, they didn't have this problem with the state because early capitalism didn't give the vote to everybody. Even in the United States in our early years of independence, voting was restricted to males, not females; to white people, not brown people; to people who had wealth, not people who didn't — all kinds of restrictions.

But we now have universal suffrage, meaning everybody has the right to vote. And the minute you have that, capitalism has a problem. Why? Because in capitalism a small number of people control the economy. You know, the employers. If you add them all up together, all the employers, all the bosses, whether it's a little business owned by an individual, or a bigger one by a family, or an even bigger one by shareholders in a corporation — whatever. You put them all together, and those who own and run corporations are a small minority of the population. The vast majority of the population — say, in the United States, or in Western Europe, or Japan, or virtually everywhere else — are the employees. Which means that when you have elections with universal suffrage, the employees should dominate, because they're the overwhelming majority. What they want rules.

That's what a democratic, one-person-one-vote, universal-suffrage-based state would mean. And that's a danger for capitalism. Why? Well, it's really pretty obvious. The workers have different interests from the capitalists. Since the workers would control the government in a world of universal suffrage, which is what we've got, then it's really only a matter of time, and not much of that, before the workers realize what their political power with universal suffrage might mean. Let me give you some examples. The majority of Americans indicate, in poll after poll, that they think that the wealth and income in this country are distributed unequally. The rich get too much, and everybody else too little. Well, if they're the majority, they could easily predominate, take over the state by winning elections, voting, and then the state could rearrange the tax system, moving wealth from those who have too much to those who have too little. End of story. Very simple. Easy to do — if the workers voted their majority position — would be easy to do.

Here's another example. Laws could be passed giving incentives, giving breaks, to worker co-ops, who decide how much everybody gets paid democratically by everybody getting together. Those co-ops never give a few people millions and everybody else hasn't got enough to send their kid to college. That's not the way co-ops work, or ever did. And if you had the working people voting their majority in a universal-suffrage system, they could convert businesses from capitalist enterprises owned and operated by a few, to worker co-ops, which would make sense because they'd be more democratic.

Let me give you another example — comes right out of the first half of today's program. If working people, who know what unemployment means, who have suffered unemployment directly or through their families — you’d think, if they were the dominant force politically in a system based on universal suffrage, they would long ago have agreed that if you lose your job in a private sector, if private companies are not hiring enough of us, then the government comes in and does it. A government hiring program would be obvious. You go work for the government until a job opens in the private sector that you would rather have. Then you move back. Easy, obvious, and workers could have that. We did that in the United States in the 1930s, so there's ample precedent. No problem.

And you could also have the governments running enterprises for the mass of people that compete with private enterprise. And let the more efficient run. Let the government run the food industry — clean, good, healthy food. And let's see. If the government can do it at a lower price than the private sector, why should we go with the private sector? We want to get the best quality for the lowest price. Let the government come in and compete, whether it's with utilities, or food, or — here's another one — health care. Maybe if the United States spends more than any other country on health care, which we do, and we get mediocre outcomes, which we do, it might be better to have the government run the health-care system, like they do in most other industrial countries, because we could get better care at a lower price.

We could do all those things by simply using universal suffrage. But you know who understands that best? The capitalists. They know how vulnerable they are. They are an embattled minority. So here's what they've done — and this is important — to make sure that the state does not threaten or undo their privileged position, their minority privileged position, in the American System particularly, but in capitalism generally.

Number one: They came up with this ideology called “laissez-faire,” that the government shouldn't meddle in the private economy; the government should stay out of the economy. Why? Because private enterprises are efficient, and government enterprises are not. I'm a professor of economic history. I've taught this subject all my life. There is no evidence for this. This is a believe-it-on-faith kind of argument. For every private company that's been efficient and successful, I can show you a dozen that haven't. And for every government program that has been inefficient, I can show you a dozen that haven't. There is no basis for this. This is pure ideological pap. But it's powerful. It gives people a reason to back away from giving the government the authority that the majority of people would give it if they understood what was at stake, and what their real power is.

The second way that capitalists have hobbled the state is by making it budget troubles. The government can't raise enough revenue. It gets people to believe that somehow the government is abusing or misusing the taxes it raises. You shouldn't trust the government. The government is stealing from you. And then when the government can't raise enough money to do even the most basic things, you know what we do? The government goes and borrows the money; it runs a deficit. And you know who it borrows from? The rich, the capitalists. They're the overwhelmingly dominant lenders. So the government is now dependent on the capitalists being willing to lend. They make the government dependent on them to control it.

And then there's the ideology that the government is the great danger to your freedom, you see, and so you've got to keep it small, weak, indebted, dependent, so it doesn't abuse you. This whole notion that the government is somehow a bad thing that you should keep at bay — that's where my libertarian friends come in. For them, it's the government that you have to watch out for — how convenient — not the capitalists, not the minority who own and operate all the businesses, that produce the goods and services we depend on. No, no, no, no no, not them. The government, those political officials.

But the capitalists are not content with ideology and budget problems. They have a battery of other uses they can pull in to control this scary government for them. They buy the politicians. They buy the parties. And they buy the lobbyists, who actually write the laws. That's right. Capitalists are the dominant funders of our political parties — at least the major ones, Republican and Democrat, in the United States. That makes sure that when they get into office, they don't use what universal suffrage might get, which is a real change for the benefit of the majority of people. They make the political apparatus depend on their money.

And then finally, they demonize the government. Here again my libertarian friends come to the rescue. The government is the bad thing. What a terribly convenient ideology for capitalists. You know, in America I've always been amazed to watch the following: Unemployment affects one state or another, and people get angry. But who do they get angry at? The senator, the congressman, the congresswoman. They get angry at their political representatives because private capitalists fired them. During the great recession of 2008, 9, and 10, when millions of Americans lost their homes, you know who foreclosed on them? Banks did. And private lending companies. You know who threw you out of your home? A capitalist threw you out. But who'd you get angry at? The government. Libertarians are doing capitalism a major service by getting people to scapegoat the government. Never asking the obvious question: Why does the government — in a society of universal suffrage, where the majority is the working class — why is the government serving the capitalists so well and the working class so poorly?

And you know, we all pay the price of a hobbled, crippled, underfunded government, because when we really need it, it can't perform. Example? The pandemic. We weren't prepared for covid. We haven't been able to contain it. The United States has four and a half percent of the world's people and 25 percent of the covid cases and the covid deaths. You know what that's called? Big, fat failure. And part of that is a weak, underfunded, scapegoated government where the political leader who wins office and gets the biggest amount of donations is the one who says that he or she is not part of the government, is an outsider, won't have the government . . . it's endless.

The irony is, the government is the greatest threat to capitalism, and they know it, which is why they've spent so much time, so much energy, and so much money — to this moment — to control, to limit what the government can do. Don't be fooled. Government could be a positive, transformative agency, helping all of us live better lives. But to do that, we, the majority, would have to control what the government is and what the government does. And that could be very different from the role it plays now. There's nothing intrinsic about what the government does now. What you're seeing when the government functions, is you're seeing the puppet. You're not seeing the fellow on top who pulls the strings.

In a future program, I'm going to talk about socialism and what its relationship to the state is, as a kind of parallel to what we have discussed today. Thank you for watching, thank you for your interest in Economic Update, and I look forward to speaking with you again next week.

Transcript by Marilou Baughman
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Showing 11 comments

  • Pasqual DiGesu
    commented 2020-10-20 12:52:16 -0400
    Hi William

    It is true that Darwin proved that throughout history natural selection and survival of the fittest has been the rule. I think his studies and lesson go beyond that. He is one of many examples of the evolving humane mind and how “Change” can progress our thinking, understanding and overcome primal actions or instinct. There is another great book on how we are able to measure and understand the change which is happening called " The white hole in time", by Peter Russell. This book details how we have evolved mentally and attained incredible achievements in science that we do not fully understand and are now overwhelming us. The Darwinian test now is whether we have mentally evolved enough to survive our discoveries or fall victim to them. Some of us have been able to design complex weapons only to be controlled by primates who could never comprehend their most basic engineering, very dangerous. Men like Christ, Plato, the forefathers, Marx, Gandhi, Einstein and even certain dictators are examples of the evolution of higher thinking humane beings from their origins millennia ago. “Consciousness” is a product of humane mental development or empathy over the simple use of might with disregard to deal with our problems.

    Going to your other paragraph describing the topic of government , I agree with you 99%. Every thing you say is true and yes the original text has been bastardized and compounded with new laws and amendment’s/ statutes which make it not only unrecognizable but also null and void. On The dogs of war I am reminded of the words of Emile Zola, " We have to challenge the might of those who dominate the world, it is not the swaggering militarists, they are but puppets who dance when the strings are pulled. It is the others who would plunge us into the bloody abyss of war to protect their power.
    Unfortunately my logic tells me that it was a dictator who said that ideal democracy cannot work despite admitting that it is ideal in theory. I also believe it will take a benevolent man with the power of a dictator to pull us off this path in which we are not simply hiking but are now a runaway train. (because of the failure or the people)

    The end game of these pigs is exactly what you state, but it can just as easily be called modern Americanism. The brutal government of Russia and china were not examples of communism which we call it, or even socialism. If Marx, Gramsci, Trotsky and company came back to see what has become in those countries and attract media to discuss their findings they would be put immediately back into the grave. No different if it happened here with the forefathers, Lincoln etc. In fact we did send some of them to an early retirement before their time. The use of words like communism, Fascism (as opposed to Nazism) is just a way to deflect the evil actions our own modern system of Americanism on to dead figures of history which we canned and labeled, works well !!
    Mick Jagger wrote a masterpiece song lyric called “Sympathy for the devil”, that poor fallen angel in hell takes the blame for every stinkin thing we do. Truth is as they say in Calabria, “The devil wears many faces” (and flies many flags)
    Yes, somewhere in the middle lies the goldilocks enigma of good government. It will take people like us to assemble and work it out to the level of detail that our present minds permit. Assemble like the early American “butchers, bakers and candlestick makers” in lieu of the lawyers or “bastardizers” who now control all branches of govt. in violation of the separation of powers act. In all the working groups back in the 1800’s, they were one of the few not included under the protection of the Knights of Labor.

    good talking to you again

  • Sonny Wiehe
    commented 2020-10-19 19:54:43 -0400

    You’re all over the place. Focus. Debate is not a stream of consciousnesses.

    Sacrifice is not the natural way. If you actually look at the evolution of living organisms, survival of the fittest rules the day through natural selection. Darwin proved this long ago.

    The human species has perfected this natural game and has become a “super predator” among virtually all animals species. This is why the oceans, which cover 70% of the Earth’s surface, has been 90% fished out of game fish. The extinction rate of animal species (other than humans of course) on land is alarming as well. Watch “Planet of the Humans” for additional insight. However, micro-organism still have us beat with their ability to change, adapt, and kill us. Viruses illustrate this well— with Covid19 simply being the latest (albeit weak) variant. The human response to this challenge under the rule of government has been pathetic. Borderline hysteria in my opinion. The superior rational human brain of which you speak has been seemingly sidelined.

    That said (and getting back to the topic at hand) I believe the original U.S. system of government as adopted in 1791 was the best in the world. The problem, like I said before, is that the people have been detached from engagement which is paramount and vital to its success. The “rules” for civil association have now been extremely bastardized by those in power (with the controlling help of oligarchs) and accountability (through our inherent checks and balances) all but eliminated. Read George Orwells “Animal Farm” which illustrates quite simply the full cycle of social revolution, democratic self rule, ultimate corruption, and collapse. We are in the latter stages of the corruption cycle where the pigs are living in the farm house and getting drunk while a small group of “others” do all the work. They have posted the dogs of war (through bribery and unfair advantage) on the front porch to protect their ruling self interest. Make no mistake about it, the pigs have appointed themselves and protectors “more equal than others”, and that’s the end game of communism. As I said before, the opposite end game of capitalism (executed under a fascist regime) is monopoly. I never indicated that capitalism itself was a from of government. It’s simply a form of commerce in a civilized society. Anyhow, somewhere in the middle is the Goldilocks enigma of good government. Unfortunately, that phase takes work (as Franklin warned) and is, thus far, proving short lived. Again, IMO that has been due to laziness and lack of collective will power. You could reasonably add in collective ignorance (as you argue) also.

  • Pasqual DiGesu
    commented 2020-10-19 10:49:33 -0400
    Hi William
    It is that direct quote by Franklin that I was referring to, I remember all things important, just can’t always remember things per batum. We share a lot of thoughts and understandings. Your interest in the subject goes well above average.
    I try to get a call in occasionally to CSPAN Washington Journal which is aired live internationally. Criticizing how this government works I was asked “what system of gov. would I want in place of our republic? Using the few minutes allowed I responded that using the modern tech which has eliminated much of the manual workforce, we could also eliminate representatives who once delivered geographic community demands to Washington using the fastest running horses. We have computers on line which can be used to vote on daily issues being aired on CSPAN daily, airing bills being tabled for congressional decision. Essentially we can now represent (or misrepresent) ourselves.
    It is the lack of will by the people to partake and to educate themselves in all the subjects of knowledge that will bring us down. This lack of education was preached to the Senate by ex senator Byrd who said our students education is more concentrated or driven towards courses which will make them factory ready as opposed to independent thinking humane beings (Renaissance?). As for uprooting the existing forces which dominate our government, I am afraid that the right to peaceful protest alone won’t do it. They will simply amuse themselves from mahogany row sipping cognac and smoking Cubans in 5000 dollar suites (5000 conservatively). No powers this greedy, this unbalanced – in power, will ever step down from their position of growing control, competition and continued upward mobility and manipulation…. voluntarily. It is this growing greed and its imbalance which will force them to have to deal with social issues in the eventual threat to their own existence despite their accumulated wealth,”Social issues" in their many forms. Nature itself will be the final force to reckon with and natural balance will prevail,,,,,,,, with or without us. What a waist of god given or nature given brain to the superior humane animal knowing what the ills are and electing to avoid dealing with them because they cut into our profits or leisure living (something that most of our entire ancestry never had the pleasure of experiencing in their lifetime or lifestyle). Sacrifice, ironically is the key lesson in the oldest texts and patriarchy serves a nature made purpose. (I know I digress)
    Cheers William
  • Sonny Wiehe
    commented 2020-10-17 17:14:45 -0400
    Dear P,

    Interesting. I often quote Franklin when he spoke to a woman on the steps of Independence Hall after the close of the Constitutional Convention of 1787. She queried the good doctor: “Well Doctor, what have we got, a republic or a monarchy” to which Franklin replied “A republic… if you can keep it”.

    According to Wikipedia, a republic is a form of government in which affairs of state are a “public matter”, not the private concern of the rulers".

    The above captures the essence of our governmental problem. Citizens are unwilling to commit their social responsibility toward participating in the hard and ugly work of government sausage making. As you say, good government is not represented in a popularity contest. Voting every four yours does not fulfill your citizen obligations. In my opinion, folks would rather put their faith in a some messiah that they think will do the work for them. Heaven forbid that they have to actually think about the causes and possible cures for social ills and insecurity; that is for someone else or some other “party” (they like parties because that allows them to further decrease their level of critical though and put individual analysis into easier to comprehend “party” platforms) to do for them. Call it laziness;" path of least resistance" physics; whatever. The end result is the same: mass disengagement. But that is precisely what those select few that are in power (who ARE fully engaged) wish to achieve

    One important fact that the Professor regularly reminds us of is the fact that unchecked capitalism always leads to monopoly. No question that government must step in and regulate monopolies according to established laws. Indeed, our government fought many of those battles at the culmination of our industrial revolution with anit-trust laws. However, with IT and social media corporate conglomerates we seem to have forgotten to apply them…or at least do not seem to have the political backbone to do so. Perhaps that is because the monopolist oligarchs have bought all three branches of government wholesale and there are seemingly no longer operational checks and balances. So, what to do? I say it is up to the people to become engaged (as Franklin warned) and take the power of checks and balances back; knock the rust off the levers of government which are ostensibly in the hands of the people. If we don’t (for whatever excuse or reason), then your must simply conclude that “We, the people…” no longer deserve the equity and prosperity a democratically republican form of government delivers. In essence, we forfeit those civil rights and privileges— most likely due to simple passivity and laziness. Both sad excuses.

    To answer my own question on the purpose of government:
    Three fold:
    1.To provide for the defense of its citizenry against foreign invaders,
    2. Make laws that govern civil public action
    3. Provide for the adjudication of any infractions of those enacted laws.

    That’s it. Everything else that government has been asked to do in the U.S. (feed, house, provide a moral compass (that’s ostensibly what church is for), provide well fare, etc.) has been in my humble opinion, mission creep. Mission creep leads to lack of focus— and ultimately failure.

  • Pasqual DiGesu
    commented 2020-10-17 09:50:02 -0400
    Dear William
    I am not debating how our government was established, and as for capitalism
    competing with government – it can, it simply cannot take the place of government as a governing authority. Capitalism is not government. Its failure to govern is what the professors show is all about and FDR also realized it which is why he Acted.
    . The myriad of social issues falls under the responsibility of “good” government, Not capitalism – which is why it cannot govern the wide myriad of social issues. One revolutionary war general and his men who served honorably revolted against Washington after the war because only land owners were given the right to vote. Social issues are important despite what is sometimes written on paper for people to follow. (how broken is our constitution when it comes to due process in our courts? Julian Assange as you mentioned and fathers rights to custody affecting 60 million men in the last 30 years) You make my point.
    Why I believe certain types of totalitarianism is (not ideal) but necessary is because we need action to change course before we hit the wall that’s quickly approaching. Whatever form of government is in charge now, whatever solutions are being argued, like lawyers in litigation, ITS NOT WORKING. If one ignores the reality of our growing problems this to me is the shark pool awaiting. Incredibly during the Roman Republic, the senate gave appointed generals dictatorial powers to deal with emergencies realizing the need to overcome disunity, debate, and worse – procrastination. This appointment was only for the duration of the problem or threat. (unlike today, the men selected were not idiots driven by self profit by all involved, and when greed prevailed after 200 years, Imperialism stepped in)

    The new deals progress before being slowly countered as the professor explains, all the way to the elimination of glass steagall in 2000 is not only my own opinion and belief, (it is both reasonable and collective)
    In short,, The recent bailouts further enriched those in power ($$$) not the people as in 1931. The national debt increases primarily because of this " twisted socialism or hand out to the wealthy" And yes it is a growing problem, so how is “this form of government” dealing with it ??? I submit to you that it can’t, simply by your own statistics since Reagan.
    It was during his time that power (government) was greatly relinquished to finance and industry. Presidents from Carter to Eisenhower realized and admitted this trend.

    Again, I agree that balance is restored through natural order, yes.
    Unless that natural order is disturbed,,, manipulated legislatively,, and it has been both economically and ecologically (nature) Also media and the violent state we’re in.

    For your final question, The purpose of government is… to …. govern.
    In a CIVILIZED society “IT” would strive towards social balance, justice and security
    for all…. always weighing damage, abiding by moral codes FORCED upon it by “we the people” (we must do our part as Franklin stated) not simply vote for props every 4 years and call it democracy. And not be swayed by big money. An old text says you cannot serve morality and mammon at the same time.

    By the way I do enjoy and appreciate your thoughts and this conversation.

  • Sonny Wiehe
    commented 2020-10-16 11:42:05 -0400
    Dear Pasqual,

    With all due respect, you digress. You’re covering a myriad of social issues which, in my opinion, have nothing to do with the pretext of how our government was established in 1791 and why private capitalism can never be in position to reasonably compete with government. I don’t believe the responsibility of feeding and housing the American population is in our U.S. Constitution which includes the Bill of Rights. For good reason. However, the 1st amendment is in the Constitution and our Press (long considered the 4th branch of government) has now been silenced by oligarchs on this primary right. The Julian Assange extradition hearings in the U.K. is a prime example. The press (including N.Y. Times and Wash. Post (latter owned by Jeff Bezos not by coincidence) have not been present and have not covered it at all—when it is ostensibly in their existential interest to do so! So when you make an attempt to distinguish between “certain forms” of totalitarianism (whether by government or oligarchs) as being acceptable, then I believe you have gone off the deep end into murky water. That’s where sharks attack—-and you never see it coming.

    Further, the New Deal lifting millions out of starvation is not a fact; it’s your opinion. Its my opinion that folks did what they had to to lift themselves out of starvation. The fact that millions didn’t die of starvation during the Great Depression does not prove the New Deal was the reason. It may mean that hungry folks unabashedly took a government handout that was paid for in quickly accumulating fiat currency debt owed by the American taxpayer. So what? The recent Cares Act (at least temporarily) did the same thing. The national debt also ratcheted up $3 from April 2020 thru June 2020—one trillion per month as a result of the Cares act debt spending. Doesn’t make either government policy decision right. And neither put things in “balance”. Balance is only restored through the natural order. I refer you here to the seminal1982 film Koyaanisqatsi (meaning “life out of balance”) that, also not coincidentally, came out shortly after Reagan took office. This film documents that we were well on our way to natural imbalance following the depression and WWII. It should be noted that when Reagan took office in 1980 our cumulative national debt stood at just under $1T (not counting long term debt like social security). It now stands at approx. $27T. That s a 27x increase of debt in a span of 4 decades! —that is the antithesis of trend toward natural balance.

    In order to get us back to basics, I submit to you the following question: What are the primary purposes of government in a civilized society?
  • Pasqual DiGesu
    commented 2020-10-16 09:59:07 -0400
    Dear William / Sonny
    It’s nice to be responded to, sometimes we feel like were talking to ourselves. We all come from many different perspectives with limited knowledge, I welcome discussion to always add onto my own and I thank you. In hopefully understanding your response, I would say that the question of how much power and money should an average individual wield, as you stated rightfully does not have any relevance in many capitalist economies (but not all as history shows). My point is that it should, as I believe the professor also believes, since socialism is about balance primarily and not personal enrichment.

    Thinking out of the box which we have all been placed in, certain forms of totalitarianism do not scare me and other forms continue to exist despite the pacification provided you by media consensus since childhood. In America it is the most powerful oligarchy in history which scares me, (a form of totalitarianism, yes even if it is not one person). As children our fathers were totalitarian, they never invited us to the table to discuss how his money should be spent, but he did take care of us, did he not? Yes, I know there are bad fathers, a minority I hope. To clarify,,, capitalism… but controlled capitalism with limits from new deal tax to political influence in government. The patriarchal government looking over the best interest of the people controlling in lieu of being controlled by strictly profit driven enterprises. The professor talks about forceful governments (fascism) colluding with capitalism. Why can’t the people also use a form of it to re-organize , restructure, and force the stability which is so necessary now in light of our growing numerous problems some of which we are running out of time to repair (ecology). I believe that in a growing global population with the growing variables in each new voter along with the voters growing ignorance which is deliberate, it will become harder to come to an agreement. (easier to come to an agreement among 4 people in a room than it is among 100 people)
    I believe the American growth in China began in the 1980’s with Reagan and the empowerment of this industrial oligarchy, trickle down was actually turned into source out or outsource for greater profit which most of America never shared and China capitalized.
    As for the new deal and depression, yes your right about debt and currency, but it physically lifted 15 million starving men and another relative 75 million family members out of starvation “Which is a form or at least a Symptom of depression”, perhaps the most important. And we survived it.
    The devil is in the details William, and only our limited sight / categorical thinking / programing can stop us or allow our slow demise. I am of Italian descent but I admire an old Irish proverb which states “Where you stand on an issue depends directly on where you sit”
    Thanks for the response, a pleasure speaking to you,
  • Sonny Wiehe
    commented 2020-10-14 17:26:55 -0400
    Dear Pasqual,

    I appreciate your insight and lively debate. In fact, your responses are more thought provoking than the Professors blog above.

    Your rhetorical question “How much power should any average individual wield? (money is power).” is a non-sequitur. This is no such thing as an average individual.. and power is relative. The question also has no relevance in a capitalist economy. Maybe a totalitarian regime would ask such a question…and form policy on their subjective determination. That prospect should scare the hell out of anybody.

    There is no evidence that the New Deal lifted the U.S. economy out of depression. However, it is fact that it raised the national debt with the issuance of lots of fiat currency, just as increased defense spending did. Defense spending for WWII ramped up long in advance of the bombing of Pearl Harbor. This spending did not last just between 1941-1945. Bear in mind that the previous record for debt/gdp ratio (before CARES Act) was 1946 when it tapped out at about 113%. It’s now near 120%. China’s ratio is currently about 65%— which is half the U.S. As Trump recently said to Biden “China ate your lunch Joe”. While I am no big fan of Trump, he is correct in his current economic assessment of the U.S. economy which was legitimately steered by the 8 year Obama administration; of which Joe was an integral part of. But this trend of fiscal irresponsibility goes back at least 4 decades. So Joe is in plenty of good company from both sides of the isle.

  • Pasqual DiGesu
    commented 2020-10-14 12:42:03 -0400
    To William / Sonny the other commenter here; the 90% tax by the new deal was for income equivalent to income earned over 400K today. How hurt would YOU have been on your income after securing the first 400000 dollars and being taxed on the extra? How much power should any average individual wield? (money is power). The new deal did bring us out of economic depression, it was initiated around 1931, 10 years before WW2 or massive defense spending which it could not indulge in at that time, then using the plunder taken from the corporations to employee 15 million unemployed. As for socialism, In meeting with a Navy Admiral and his the attaché, I was asked about my position despite my admiration of socialism. I responded by asking if they intended on collecting their social security in retirement, they said of course we worked for it. I closed by stating " so did all the other socialist".
  • Pasqual DiGesu
    commented 2020-10-14 12:15:31 -0400
    “Democracy is beautiful in theory; in practice it is a fallacy” Universal suffrage does not guarantee equality, justice or solutions (as you have stated in the past) if the people are uneducated, greedy or unreasonable / illogical. Affirmative action exercised for any group of people is illogical, privileging them simply for the group that they are a part of. All people require access to education, free education if they cannot afford it, and those who indulge in learning, work hard and prove to qualify should attain the positions. Those who do not will be provided other means which meet the necessary security required of humane beings. To all in need from all who can provide. You would not want to place a person in the pilot seat of a Boeing 777 to fly across the Atlantic simply because they had some political privilege despite a lower qualification if your family was riding passengers on that aircraft, or operating a nuclear facility etc. etc. On the other hand, on the subject of privilege, I just saw a report on how some transit workers / rail road, have increased their healthy 70k salaries to 300k with overtime effectively implementing a change in their lifetime pension. Over 90% of them also retire collecting disability! In a state that should be declared bankrupt. Overpowered Union? Who’s minding the store professor? This is why we now start falling behind other nations. We simply are not the land of opportunity anymore or the land of milk and honey, but the land of privileged idiots. Capitalist control of our government has found a way to circumvent Universal suffrage by a combination of simply ignoring the people to subdue the issues and to help pacifying them on the issues of control and injustice. They make us believe through manipulation, lack of education and just enough meat and potatoes at supper time that we are OK and everything is better here than over there. In short my findings are that it is not simply a matter of left or right, up or down, this or that. There are some old sayings that have more weight than others, for me one which holds more gravitas is " the devil is in the details",,, as are the solutions when they are finally studied by all. A 2 party system which is easily controlled (only 2 parties) yet provides just enough parties for gladiatorial entertainment and emotional unrest / division,,,,,,, that’s just one party more than those nasty dictatorships. Unfortunately at this point in history, people still need to be governed and government requires power and use of force if only by the oversight of an educated populous.
  • Sonny Wiehe
    commented 2020-10-14 01:03:21 -0400
    It is interesting that Professor Wolff chooses to close with the slight of hand saying he looks forward to speaking with [us] again. Hah! Sorry Richard, you’re speaking TO us, not WITH us.
    This is probably why you get away with arguing, unchallenged, the logical fallacy that private enterprise should compete with the government for the provision of goods and services in order to provide the best possible economic and social outcome for society. If I were speaking with you, I would remind you of the monumental fact that private enterprise pays taxes on its economic efforts while government does not. Taxes are a handicapped expense of 25-30% for private enterprise. In Prof. Wolff’s imaginary “competition” that is totally ignored. To the contrary, the only level playing field on which any government can compete is on its own. Usually, that is referred to as communism. Last I checked, the U.S. was still operating under the pretext of a democratic republic. Not surprising Prof. Wolff is often enamored with the era of “The New Deal” in which the effective tax rate on private enterprise was closer to 90%. Go figure. That is probably as close to communism that the U.S. has ever come. I will also remind Prof. Wolff that the New Deal was not necessarily what brought us out of economic depression following the 1929 Stock Market crash. It was more likely WWII plundering; operating under the age old adage “to the victor, go the spoils”. That plundering continues to this day reinforced with an annual government defense (foreign and domestic) spending of nearly $1T—a budget larger than the next nine countries combined (which include, btw, China and Russia)!


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