Economic Update: The Great Replacement Theory

[S12 E26] New

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In this week's show, Prof Wolff discusses the replacement theory's grain of truth amidst its mostly ideological function: to save capitalism from criticism. He analyzes why US capitalists deprived so many white, male, Christian workers of their jobs, incomes, and social standing over recent decades and why that analysis was largely silenced by Cold War taboos since 1945. Were a new US left-labor alliance now to offer that critical-of-capitalism alternative, replacement theory's notion of a great conspiracy (largely by Democrats) to replace white, male, Christians with "others" would be far less socially influential.

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, and I'm your host Richard Wolff. Today's show is going to be focused on something that's come to be called The Great Replacement Theory. It is an argument put out by the right wing particularly of the Republican Party to the effect that there is an evil desperate plot afoot that victimizes Americans. Particularly if they are white and male and Christian and so on. And that it is trying to take over the world, starting here with the United States. That's what we're going to talk about. And the reason is not only to examine this theory but also to show you how many of the aspects of the world we live in lie behind the fact that there is this theory and that it captured as many people as it has.

Okay, let's begin. As with all theories there's a grain of truth somewhere buried in it. And the grain of truth in the Great Replacement Theory is this: we have, indeed, seen that well-paid, often unionized white working class people have had a harder and harder time of it economically. The jobs they once assumed they would get aren't there. The wages that go with those jobs they assumed they'd once get aren't there either. And this has come as a shock to many of them. They are unable to make the payments on their homes and cars. They always assumed they would have good jobs. And I want to be clear that many of these good jobs held by white male Christian folk were won over a long period of time by difficult struggles; struggles against employers, struggles for unions, struggles to get the decent quality of life that working class people everywhere want. It took a long time - a century or more - to have the so-called American dream come within reach. And so it has been very painful for, particularly, white male Christians to see those advantages, those privileges, those hard won gains enjoyed by them and their families be taken away. So their grief, their sadness is understandable.

But the explanation they've come up with is not only wrong factually and divisive of our society but it raises fundamental questions that this program intends to confront. So let's begin. If there's a grain of truth, as there is, if those jobs that were once there aren't there anymore what, in fact, accounts for that? If it isn't a conspiracy of the Democratic Party to get the votes of the people who are replacing the white male Christian workers, well then what is it that accounts for the loss of the good jobs and the good pay that went with them? Well here's the answer, because it's very well known and well documented.

The first reason those jobs are gone is because they've been replaced by machines. It's what economists call automation. And it's important to understand what that means. Otherwise we're going to blame the machine. And in case you think that's strange, let me remind you that at the beginning of the 19th century when industrialization came to Britain they had a mass movement called the Luddites. And you know what the Luddites did? They smashed machines, they broke into factories at night and smashed the machines. Because it was the machines they thought that had done in the jobs in the textile industry that they once had enjoyed, while machines don't come into the business on their own. Somebody brings the machine. Somebody buys the machine and pays somebody to bring it. Who is it? And the answer is the employer, the capitalist. And the only reason machines are brought in to replace workers is if it's more profitable to have a machine than a worker. Most workers know that, and here's the irony to understand, because it's a crucial reality of capitalism: the more successful workers are in driving up their wages so that they can have the American dream the greater the incentive of their employer to replace them with a machine. And over the last 40 to 50 years that's exactly what happened. Millions of jobs were automated out of existence. Workers were replaced by machines, workers were replaced by computers, by robots, by artificial intelligence.

But the reason had nothing to do with the Democratic Party. And the reason had nothing to do with the goals or interests of people who aren't male and aren't white and aren't Christian. It had to do with profit. Because that's a system we live in and that's how it works.

The second major reason that white male Christian workers lost their job and their privileges and their income was because of jobs relocated out of the United States. Factories, offices, stores that shut down here and moved to China, India, Brazil, or wherever else. And the motivation there and the folks who did it - not Democrats - businessmen and women, employers, capitalists. Why? Same reason. As some got machines others solved the problem of high paid American workers by shifting over to low-paid non-American workers in other countries. It was profitable to do so and that's why the capitalists did it.

The third and the smallest of all of these phenomena was bringing low-wage workers from other parts of the world into the United States. Immigration that was also motivated, financed, often facilitated by the employer who wanted to substitute the lower-wage worker and did so, thereby depriving the older, better paid workers of those jobs. Profit was the motive in every case. Profit was the driver. And profit is the core of the capitalist system.

But I want to talk to you a bit more about the relocation part of it - the jobs that left the United States and went to lower wage workers abroad. The reason for that is important to understand to get the whole flavor of what's going on. Over the last 30 to 40 years many countries in Asia, Africa and Latin America had economic difficulties because the way global capitalism works wealth is concentrated in Western Europe, North America and Japan and not in all those countries. Therefore they have suffered cataclysmic poverty, sickness, no education, and on and on. They've been desperate for economic development. So when the internet came in the 1970s, when jet travel became easy and quick to get from one corner of the globe to another these countries in Asia, Africa and Latin America saw their chance to win the jobs that could lift their people out of terrible poverty. So they offered their people as workers. Who did they offer them to? Big corporations, mostly in Western Europe, North America, and Japan. They basically said to these companies 'look, we need jobs, we need to lift our people out of poverty. Won't you come here and enable us to do that?' And here's what we offer you: low-wage workers in place of the high-wage workers you have back in the U.S or in Western Europe or in Japan. And if you come and put these workers to work they'll develop a market here and we are the majority of the people of the world - we in China, India and Brazil. So you'll have low-wage workers and an expanding market. It's a capitalists dream.

No one put a gun to the head of those capitalists. They could have said 'no we're American or we're Italian or we're Japanese or whatever and we're staying in our country, committed to the dreams our workers have.' But they didn't do that, they left. They were eager, they fell all over themselves to go to China, India and Brazil. Which is why so many of them have so many hundreds of billions of dollars invested in those countries. They went there to get the low-wage workers, to fire the high-wage workers here, to show the American working class that if you're successful in raising your wages to give your family the American dream we will be there to take that dream away from you with a machine, or by moving the jobs, or by bringing low-wage workers in here and hiring them instead.

So the right-wing comes along and what does it do? It protects capitalism, which is what the right-wing has always done. By telling a story that fits with the suffering, the bitterness, the anger and the resentment of white male Christian populations... tells them a story in which the blame goes everywhere but the capitalist.
That's the part that's forgotten. That's the part, if it isn't forgotten, that comes at the end of the speech. That's the part where there's some theater that we're gonna deal with it but no reality. Nothing really happens to change the situation.

And so the workers keep losing out, who were close to that American dream. And their bitterness gets worse. And the only social forces talking to them about what's really happening to them, the grain of truth that they are being replaced, blames the people who replace them. As if the machine did something. Or the poor Chinese worker did something. Or the poor immigrant, desperate to escape the poverty of Central America, is the cause of the problem. None of those forces causes anything. Capitalism and the profit motive is the issue.

So here comes the crucial question, which we will address in the second half of today's show: why hasn't there been a social movement, an argument explaining to the American people what I've just said? That the notion that you should be angry at immigrants is absurd, just as silly as smashing machines by Luddites was 200 years ago. Why isn't there an alternative story about what happened to these people that would draw their support and get their understanding? Why has it been left to the right-wing to tell it's fantastic conspiracy story?

We've come to the end of the first part of today's show. For those of you who may not know, Economic Update is produced by Democracy at Work, a small donor-funded non-profit media organization, now celebrating its 10th anniversary. For example, All Things Co-op is a podcast that explores everything having to do with co-ops, from theoretical and philosophical conversations to on-the-ground interviews with co-op workers. You can find it, along with other content we produce, on our website democracyatwork.info. There you can also follow us on social media, join our mailing list, support us in all the ways that help make these shows possible. Please stay with us, we'll be back for the second part of this discussion in a moment.

Welcome back friends to the second half of today's Economic Update. From the first half, what we have as our task in this second half is to explain why the understanding of what happened to well-paid American workers to deprive them of what they had thought was a birthright, what they had thought was American exceptionalism, what they had thought was a dream they were able to promise to themselves, their spouses and their children. They never got the explanation and I'm going to give it to you now, as I have in the first half. But I'm going to focus on why that explanation wasn't made in an appropriate way to the American people.

So again, the explanation. It wasn't the Democratic Party, it wasn't evil leftists, it wasn't fill-in-the-blank, it wasn't anti-whites, or anti-Christians, or any of those fantastic conspiracies. It was right there in your face: profit motive. It was capitalists, deciding to (when the workers won their higher wages, often through heroic struggles...) it was a decision of their employers; now it pays us to get that machine, now it pays us to go overseas and hire much cheaper workers, now it pays us to push immigration so we can hire lower paid workers. That's what it was. That's the people who did it. And they didn't do it because they were pro- or anti-Christian, white, or anything else. They did it for the profits thereby won. And that's how they survived. Because that's how capitalism works.

And so why was this story not told? The story was not told because the blame it finds falls on capitalism and capitalists. And, at least since the Second World War, any argument that blames capitalists for anything is rendered taboo, is shut down, is closed off. You can't find it, you can't hear it, you can't see it. After World War II was over and, remember during that war we were allied with the Soviet Union, the great enemy was fascism, not socialism. But afterwards all the games had to be changed. The evil Cold War ('the evil Russians' should sound familiar) meant that you could go nowhere near attacking capitalism. The capitalists were clever. They made a critique of capitalism into something that suggested you weren't loyal to the U.S, that you were friendly to the great enemy. So this argument couldn't be made. The very argument that describes to the workers who and what the problem is, the only argument that could get a mass of American workers, not just male, white, and Christian, but all of their relatives and friends and associates to see an alternative way to understand things, and thereby not to turn against the rest of this country... the argument that could have achieved that was silenced in the United States. It could not be spoken. The crushing of the socialist communist leftists, who would have made those arguments after World War II, the destruction of the alliance between those kinds of people and the labor movement meant that that way of thinking, in alliance with working people struggling for a better life, which could have presented a different explanation for what was happening to the working class, couldn't do so. A sock was put in its mouth. And so the field was left.

Working class suffering, American dream passing out of reach. Bitter, upset, frightened people suffering as they are today after two years of pandemic and an economic crash and now an inflation and a recession coming... you are subjecting the working class to one after another of a 40-year assault on the so-called American dream. And you're doing it while giving only one weird right-wing explanation the opportunity to be spread around.

Why are we surprised that people find it persuasive? Because the alternative isn't out there competing. The alternative isn't getting a hearing. If it did there'd be a lot of folks who would respond. You know why I'm confident of that? Because voices like Bernie and AOC - they're few, they're far between, but look at the response they get from the constituents who vote for them, to the audiences they are drawing.

There is an audience for the alternative, but we don't have the structure, the way of presenting it. So let me then conclude, perhaps on a more hopeful note. Because if I'm right then we know what we have to do. We have to bring together, on the one hand, those able and willing to say what's going on, like that little child in the story of the emperor's new clothes, you know the one who's willing to stand up and say 'what are you talking about? The emperor is naked.' Well, we need the people (and we have them) who are willing and able to stand up and tell the story about how and why capitalism's profit motive that at one period of history developed the United States as the premier capitalist country, continued to pursue profits, but this time by leaving the United States, not by focusing on building up its wealth. Same system, same profit drive, but it has moved on. What about having those of us who tell the story and who can demonstrate it and provide all the factual supports and all the graphs and all the numbers and whatever you need... Suppose we once again had what we had in the 1930s: an alliance of those of us who do this kind of work and those who are in the labor movement close to the working class on a daily basis able then to be the transmission line explaining to those of us doing the analysis what the situation on the ground needs, what the people working in the factories and offices and stores have to get clarified. And then we are taking that message, which is literally an instruction, and doing the work, which the same allies in the labor movement can take back to see to what degree it answers and responds to the needs and the desires to understand of the working people themselves.

Come on, we know that's what we need. Let me remind you all, back in the 1930s, when capitalism really collapsed here in the United States, there was an alliance between those who are critical of capitalism on the one hand and the American labor movement. And let's remember what that alliance achieved. The social security system we have today was created by that alliance in those years. The unemployment compensation that saves millions of Americans from destitution all the time, including the many millions that are unemployed today... that was created by that alliance in the 1930s. The first minimum wage ever passed in the United States was passed by that alliance working on the President and the Congress in those years. And the greatest public employment jobs, giving good jobs at good pay to 15 million Americans that the private capitalist sector could not or would not employ. That was achieved by that alliance in those years. So no one should have any doubt about what such an alliance would be capable of.

But to bring it back home right now to the United States, such an alliance offering a systematic alternative explanation of what has happened to white male Christian workers and to all the others who've suffered loss of jobs, loss of wages, loss of a decent life... we would give them a way to understand that that would not have us destroying each other, not have us at each other's throats, not have half of us believing in conspiracy theories that the other half of us find to be terrifyingly weird. If we don't develop this alliance, let me put the question to you: what else is going to stop the movement of this country towards more and more explosive divisions? Here we are; divided over the shooting of those children in Texas, and those adults in Buffalo. Here we are, divided over abortion. Here we are, divided over Ukraine. Here we... get the picture? This is a country in deep trouble - economically, but also politically and culturally. And part of the reason is we are silent or we are extreme right-wing.

Let me conclude with a kind of story of the sadness of the Democratic Party and Mr Biden. Because in a genuine economic democracy, let alone political democracy, the story that I've explained today, the explanation for why those better paid workers lost their jobs, their incomes, the future for their kids and all the rest... the Democratic Party could have and should have been the vehicle to make that alternative known. Why does it take those of us on the left to call for it now? Answer: because the Democratic Party hasn't been willing to do it. Much like Mr Trump, Mr Biden talks about some of this occasionally. He doesn't do anything. That's why the situation keeps getting worse. One of the reasons Mr Trump lost was because he didn't do anything about it either. And by the time he stood for re-election an awful lot of people noticed that. And if Mr Biden isn't very careful they're going to notice it again and then it'll go the other way. Not because people want the other way, but because we haven't done the job. The Democrats are too craven to their donors; those very capitalists whose profit motive the Republicans never criticize and the Democrats, sadly, follow suit. But this time it has hobbled them. They can't make the explanation that could turn the situation around for them, for their future election hopes for the country and, given the importance of the United States in the world, for the whole world. It's a very important matter.

What this replacement theory story pushed by the right-wing, celebrated by large parts of the Republican Party... what this brings home to us (I hope I've made clear what the situation is and what the solution for it requires.) We could do it. The key question is 'will we?'

Thank you all for your attention. We appreciate it here at Democracy at Work, as we do all of the support, all of the communications, and all of the goodwill that you send us. And I absolutely mean it when I say that I look forward to speaking with you again next week.

Transcript by Brendan Tait

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Showing 6 comments

  • Pasqual DiGesu
    commented 2022-07-19 09:33:11 -0400
    “But it is by now evident after so many years since the defeat of fascism that our own form of “capitalistic totalitarianism” or more accurately modern serfdom, can continue to thrive here in greater strength without the dictators or their Socialist state economic control, and under, or within our “Capitalist state economic control”. The subjugation of the middle class, and increasing gap or division of wealth in our nation has only grown since the expulsion of King George from the colonies, and 200 years later our problems with free markets have consistently expanded ~ in the vacuum of a monarchy or since the royal colonial totalitarians that ruled over us. Although we formed a powerful nation, it also was predominantly built on the blood and ashes of the unprotected working man, and his family members. (Reflection by John Guzziferno 2022 edition)

    And it is under this OUR system that media is so controlled and manipulated as are our constitutional laws.
  • Sonny Wiehe
    commented 2022-07-17 23:03:49 -0400
    @S.G.: FDR was about as successful at solving the problems of the depression in the U.S. as was Hitler in Germany.
  • Steve Greenberg
    commented 2022-07-17 19:29:52 -0400
    Sonny Wiehe, Apparently FDR ws so unsuccessful in solving the problems of the depression that he was reelected in November of 1935 and again in 1939..
  • Sonny Wiehe
    commented 2022-07-17 14:46:30 -0400
    Its interesting that Professor Wolff believes in the Covid19 pandemic/vaccine conspiracy that has made a very few capitalists in the pharmaceutical industry fabulously wealthy—virtually overnight. I find his conflicting beliefs in the cause for our slow, economic collapse since WWII (the most) “terrifyingly weird”.

    BTW, that worker and government “alliance” he regularly touts as successful never brought us out of the great depression of the 1930’s. The capitalist industrial war machine did. And the only reason it hasn’t completely devastated the American taxpayer is that war machine has been hungrily, systematically, and globally ravaging other sovereign countries in order to satiate its appetite for condensing wealth into the hands of the 1%.

    There is no solution to getting the alternative story out. That’s because it’s simply another “story”. It has not basis in a working reality.
  • Steve Greenberg
    commented 2022-07-17 11:05:19 -0400
    The solution for getting the story out there is right in front of you, but content creators just don’t seem to see it. Content creators need to form a cooperative that will provide the means to get the word out and support the livelihoods of the content creators. This cooperative would provide a subscription service that gives access to the content-creators and provide them micropayments from the paid subscriptions. The micro payments would be given out in proportion to the subscribers’ consumption of content creators’ product. As a proponent of everything Co-op, you should have the knowledge of how to do this. Why don’t you do this?
  • Pasqual DiGesu
    commented 2022-07-13 14:34:19 -0400
    Far right, far left, whats the difference?

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