This interview is instantly my favorite thing Lionel has ever done. He interviews the brilliant economist Richard Wolff, and from the get-go, it’s a tour de force of common sense obliterating tired, hackneyed, jingoistic propaganda that somehow just won’t die no matter how many silver bullets of logic are fired into it.
If you don’t have time to watch/listen to the whole thing, here’s a basic breakdown.
1. Listen to Karl Marx
Lionel asks Wolff to explain what a “Marxist economist” is, since Wolff is often described as such. Wolff mainly points out that Marx was intentionally marginalized by even America’s elite universities precisely because Marx was such an incisive critic of capitalism, and that as such, Marx should be embraced rather than ignored. As Wolff puts it in the interview:
“If you mean by ‘Marxist’ that I have been informed by, I have learned from the works of Karl Marx, then by all means I am a Marxist. I’m not gonna run away from that, I’m not gonna hide under the absurd pretense that I’m not a Marxist out of the proud recognition that I never looked at one word that this man had to say. It’s just silly.”
2. Put workers in control
Lionel then asks Wolff to identify the single most pressing current economic issue and how Wolff would solve it, if he were made economic czar in a hypothetical Lionel presidency. In a nutshell, Wolff’s answer is that the most pressing issue is the domination of the lives of workers and basically everyone else by a handful of unelected people whose only concern is profit, not the well-being of the people that work for them or anyone else. Wolff is talking here about corporate boards of directors and the very negative and direct effect the policies of those who work for them, without those workers having any say-so at all about it despite being the ones actually performing the labor. Wolff again:
“We allow a tiny group of people, because most work is done in an institution called a ‘corporation’—a tiny group of people—these are the major shareholders of a corporation—and here we’re talking about 10 or 20 individuals or companies of one kind or another, and they own the shares, the bulk of the shares. And if you know how a corporation works, the leadership of a corporation—the board of directors, it’s called—is typically 15 to 20 individuals who are selected by the shareholders under the system, ‘one share, one vote.’ So if you’re a big bank, and you own a million shares, you—you bank—get a million votes. And if you’re a worker in that factory, and you don’t have any shares, you get no votes, and so forth. So what we have is a tiny group of major shareholders—maybe a dozen—who select, because they have all the votes since they own the bulk of the shares, they select the 15 to 20 people who are the board of directors.
And now follow the logic—the board of directors and the major shareholders together make all the basic decisions that corporations make; what to produce, what goods and services to produce, how to produce them, what technology to use, where to produce them, in Cincinnati or Shanghai or wherever they choose. And finally, they decide what to do with the profits generated by the labor of all the people who work there. In any sizable corporation, the vast majority of the workers who do the work are not major shareholders nor are they members of the board of directors—that’s a tiny group of people. Now the outcome of every economy depends, first and foremost, on the decisions made by this tiny group of people, people who are not elected by the public, people who are not elected by the workers in an enterprise, people who are not elected by the members of the community where that enterprise is located. People who are elected by the shareholders where the major shareholders make the decision about who sits on the board of directors. If we don’t like the results of an economy, such as most Americans don’t like the results of our economy today, the place you must look is at the decision-makers who brought this about.”
In sum, says Wolff:
“Really all that Karl Marx wanted was for us to face up—and boy are we long overdue about it—that if democracy is what we think is the best way to run our political life, then where in the world did we get off thinking that it wasn’t the best way to run our economic life?”
Lionel asks Wolff what can be done about this situation (approx. 18:36), and Wolff points to the current platform of Jeremy Corbyn’s Labour Party with respect of what has been called a “right to own.” The short version of Wolff’s description of the policy is this: if and when Labour controls the UK government, it will put into place a policy that whenever a corporation wants to sell itself, the workers of that corporation will have the first crack at buying said corporation, with money loaned to the workers by the government. Or, as Corbyn himself put it to The Guardian:
“Labour will look to create a ‘right to own’, giving workers facing a change of ownership or closure of a firm the first refusal in putting together a worker-owned alternative.”
3. Public control of the money supply
Lionel asks Wolff what role the Federal Reserve would have under Wolff’s hypothetical regime as economic czar. Wolff responds thusly:
“We should not put something that is a publicly important institution into the hands of people who structurally instructed to make money off of it, to make it be profitable. What’s profitable for a company isn’t necessarily what’s best for the community as a whole. And when there’s a difference between those two, it should be the community as a whole that prevails, not the private profit. And therefore for me, the key thing would be to democratize monetary policy. The decision of how much money to be circulated, the decision of what the price of a loan (in other words, the interest rate) ought to be, should not be decided by a Federal Reserve which is kind of half the private banks, who are [Wolff’s Skype connection garbles a portion here]…dependent for its money, its lobbying fees, and so on, on those same banks, that it really is more the banks who are making this decision more than it is the public well-being. And for me, that’s the problem of a democracy that never went beyond the political to encompass the economic and for that reason the political never worked out real well either and we see the constant buying of political decisions by the undemocratic economic system. For me, the Federal Reserve is just another example of that fundamental flaw that has to be fixed.”
Lionel concurs with Wolff’s assessment of the Fed and that money should be controlled for the benefit of the public rather than for the benefit of privateers, and asks Wolff what would replace the Fed. Wolff responds:
“Well, I’m an old believer in the following simple idea: Only the people can ever make sure that they, the people, are in charge. So I don’t expect what I’ve been talking about to come from the Republican Party or from the Democratic Party. Not its old leadership, and at least for the moment, not its new leadership either. That has to come—there’s no other way to say this—from below. That has to come when the mass of the American people—and boy do I think we’re getting there, and fast—when the mass of American people say: ‘The existing system is simply intolerable. We will not continue this way. It’s too unsettling for us, it’s too dangerous for the lives our children are facing—we’re not gonna take this anymore.’ When that happens, then suddenly the politics, the ideology, the economics, begins to give way to a much more powerful force. That’s what got us our independence from England, that’s what got us out of being half a society of masters and slaves, etc., etc.”
And as if we needed any more proof, from approximately 43 minutes in until the about 45 minutes, Wolff confirms what we have written about many times here at LRM, and that is that money is created out of thin air and that is the reason why, among other things, it is perfectly acceptable and not at all crazy to write off student loans. And then Wolff gives his last recommendation…
5. Make Jobs A Guaranteed Right
Wolff prescribes this fix in response to Lionel’s question about immigration.