Following Developments :: "What's Coming Is WORSE Than A Recession" - Richard Wolff's Last WARNING

..With Transcript 

...

Dec 9, 2024

Richard D. Wolff is an American economist and professor emeritus at the University of Massachusetts Amherst. He is known for his critiques of economic inequality and his advocacy for worker cooperatives as a way to empower individuals and address systemic issues within the economy. Through his books, lectures, and public appearances, Wolff explores topics such as economic democracy and alternative economic models.TRANSCRIPT

when an Empire declines a variety of

0:03

things have typically happened number

0:06

one overreach that is a general term in

0:09

which the Empire declines and as it does

0:12

it tries to solve too many problems in

0:16

too many of the far-flung reaches of the

0:19

Empire and it can solve one or two of

0:21

them but it

0:23

misunderstands what it means for that

0:25

Empire to decline what it means is you

0:27

can't do all those things you may have

0:29

been able to do them 20 years ago or 40

0:32

or 60 but you cannot anymore I believe

0:36

that what we're watching is the American

0:39

Empire declining as the British Empire

0:42

and so many other Empires before it

0:45

declined engaging in overreach and

0:49

here's what I mean we fought a war in

0:51

Korea back in the early 1950s we

0:54

couldn't finish it and so Korea was left

0:57

cut in half half to one side half to the

0:59

other

1:00

in Vietnam we tried the same game with

1:03

an already split system because the

1:05

French weren't strong enough to prevent

1:08

The Cutting of the country the way it

1:09

happened and the United States failed

1:11

again only this time the failure was no

1:14

split country left Vietnam became a

1:17

unified country under the leadership of

1:20

hoi Min the leader of the Vietnamese

1:23

Communist party in Afghanistan we were

1:26

defeated again and the country is now

1:28

run by the Taliban which was the

1:31

ostensible enemy I could go on but I

1:34

won't I'll draw the conclusion you can't

1:36

do what it is this country sets out to

1:39

do it's not within your power it may

1:43

have been after World War II we really

1:45

were at the top of the mountain at that

1:47

time and there's an argument that we

1:49

were for the rest of the 20th century

1:52

but you cannot make that argument now

1:54

the dollar is everywhere becoming less

1:57

and less important it was once as good

2:00

as or better than gold in the central

2:03

banks across the world it isn't anymore

2:06

it's barely half their reserves down

2:08

from much much more than that more and

2:11

more trade is conducted not in the

2:13

dollar as it once was but in other

2:16

currencies not just the Euro but also

2:19

the Japanese Yen Chinese Yuan and so on

2:23

what's my point Israel is an outpost of

2:26

the United States Empire it was

2:29

literally the creation of the British

2:31

Empire beforehand and it was handed off

2:34

from a war if you like of the British

2:37

Empire into becoming a ward of the

2:39

United States Empire Israel exists

2:42

because the United States supports it

2:44

financially economically politically

2:47

culturally and militarily never more so

2:50

than right now can the United States

2:53

afford to do that my answer and I

2:55

believe this is the majority view in the

2:57

United States is a resounding and a

3:00

clear no and the reason for that is

3:03

there is no end in sight there will be

3:06

generations of hostility between Israel

3:09

and the Palestinians what has just

3:12

happened since October guarantees it now

3:15

that will be extended to include not

3:18

only the Palestinians of the south in

3:20

the Gaza Strip but the Palestinians of

3:22

the North in West Bank and now the

3:25

people of Lebanon and who knows how far

3:28

this will go will the is Israelis really

3:31

want to be in a state of bitter

3:34

hostility with their Arab neighbors

3:37

indefinately well if that's what they

3:39

want that's what they're getting and

3:41

their only safety already is and will

3:44

continue to be drawing the United States

3:48

in to a participation with them as far

3:52

as they can they cannot win this alone

3:56

they probably can't win it with the

3:58

United States but without the United

4:00

States it's over in a Heartbeat by the

4:02

way the same is true in Ukraine that is

4:04

only winnable if the United States pours

4:07

even more than it already has because

4:10

what the United States has poured in

4:12

clearly failed again you can see where

4:15

the battle lines are in Ukraine the

4:17

Israelis are on if I were a shrink I

4:21

would call it a death trip there's

4:23

something here that is really so far out

4:27

of the range of a reasonable Poli policy

4:30

that you begin to wonder what kind of

4:33

mentality would keep going in this

4:35

direction the United States currently

4:37

maintain somewhere between 700 and 800

4:40

bases abroad and the entity that does

4:42

that is the Department of Defense all of

4:46

that we are told and the whole world is

4:48

told is done for defense is there a

4:51

defense component in it sure but is

4:54

there an offensive component equally

4:57

sure that's how you guarantee the

5:00

dominance of the United States in its

5:02

Empire since the end at least of World

5:05

War II if not some years before the

5:08

Israelis have an ongoing struggle with

5:11

the Palestinians that dates from the

5:13

beginning of the country of Israel as

5:15

people who know the history know to

5:17

think that all of this is about the

5:20

aggressive Palestinians and the

5:22

defensive Israelis is to take seriously

5:26

the kind of propaganda that even the

5:28

people who put it out when you talk to

5:30

them privately don't do here's a joke

5:33

more Israelis are clear that that's not

5:36

true than Americans they put out that

5:39

propaganda for foreign consumption

5:42

inside Israel by the way in recent weeks

5:44

and days as well massive Street protests

5:47

and other kinds of protests of huge

5:50

numbers of Israelis who don't agree with

5:52

this policy didn't agree with what they

5:54

did in Gaza want Mr Netanyahu out of

5:58

office want to reverse veral of the

6:00

politics he represents I mean in America

6:03

you get people shut down for saying this

6:05

but inside Israel you can say these

6:08

critical things and large numbers of

6:11

people do and the government dares not

6:14

cut it down at that point Mr Netanyahu

6:17

has no options anymore unless he has a

6:20

nuclear weapon and is prepared to

6:22

explode it where he would decide to do

6:24

it he has no chips the man is out of

6:26

chips that's why he needs the United

6:29

States what what is he going to do go to

6:31

war perpetually Israel is a small

6:33

country the Arab world is a very large

6:36

Place Palestinians are a small part of

6:38

it the whole Arab world is United on

6:41

this question more so than ever before

6:45

do they want to fight with Israel no

6:47

clearly they're afraid and they're

6:48

hesitant I understand that but there's

6:51

no solution here other than sitting down

6:54

and working out an agreement otherwise

6:56

you have Perpetual War people like

6:58

Netanyahu think think that that's an

7:00

option it isn't any more than for Mr

7:03

zalinski that's an option it isn't you

7:07

can talk like that but sane people

7:10

understand it's the bravado because

7:13

everyone knows that the war in Ukraine

7:16

by the way like every other war will end

7:19

with an agreement it'll may be a very

7:21

lopsided agreement that's being decided

7:23

on the battlefield and then the question

7:25

is raised which I raise as a human being

7:28

do you really really want to destroy to

7:32

kill to poison the relationships of

7:35

human beings to the extent you are doing

7:38

while you work your way to sitting down

7:40

for the agreement you know has to happen

7:43

Mr Putin in Russia made clear and

7:46

ironically he was quite right he said

7:49

the deal that I can make with you Mr

7:51

zalinski is much better now at the

7:54

beginning of our hostilities than it

7:57

will be if we fight and that's what

7:59

happen now they will be much poorer Mr

8:01

zalinsky can't face it in the end that

8:04

will be the Heritage the inheritance of

8:07

the Israelis that are left a legacy of

8:10

hostility and bitterness that I would

8:13

not wish on the Israeli people even

8:16

though they are in the end responsible

8:18

for it it is an

8:21

extraordinary situation and I'm not

8:23

arguing where the Rights and Wrongs are

8:25

my guess is they're very nicely

8:27

distributed on both sides sides that's

8:30

not the question Hamas did a terrible

8:32

thing last October Israel has done a

8:35

terrible thing but the question of who

8:37

escalates I'm afraid that's all on the

8:39

Israeli side they made the decision to

8:42

respond first the way they did in Gaza

8:45

then in the north and now in Lebanon and

8:47

I fear for where that's taking them as

8:50

well as everybody else the course of

8:53

action is the one they should have

8:54

followed 2 years ago 6 years ago 10

8:56

years ago I understand the impatience

8:59

you had others okay we can't go back and

9:01

rewrite history or replay the game I get

9:03

it but you're going to have to stop

9:05

somewhere how many losses in a row are

9:07

you going to take the Russians have

9:09

shown the world something I didn't

9:12

believe was true that they have a very

9:15

powerful military apparatus not just to

9:18

ground troops and all of that but the

9:20

ability to ramp up the production of

9:23

missiles and planes and bombs and drones

9:26

on a scale I did not understand and I

9:30

follow this stuff a lot and it's true of

9:33

the people who I rely on for information

9:35

we're all sitting here amazed the

9:38

message it's a little too late to tell

9:40

everybody oh you don't have to worry the

9:41

United States that told Mr Putin you

9:44

can't do it you can't do it he did it

9:46

the reality is out you told the Israelis

9:48

look you have to work something out they

9:50

gave us the finger if you like and we're

9:52

stuck now with really unpleasant

9:55

decisions of the sort you've perfectly

9:57

nicely laid out if the Israeli IDF

10:00

invades Lebanon there will be very

10:03

quickly in the United Nations a

10:05

virtually unanimous votes excluding the

10:08

United States Israel and maybe one or

10:11

two little islands in the Pacific who

10:13

will vote in favor of the Israeli

10:16

American position and the rest of the

10:18

world will vote against it how are you

10:21

going to strengthen the argument in the

10:23

world that what the United States is

10:25

doing in arming of Ukraine is because we

10:28

are so dead against one country invading

10:32

another when we're providing the guns

10:35

with which Israel and the IDF are

10:37

literally about to do that the cost to

10:40

the United States is precisely to be

10:43

stuck in the Dilemma the answer is not

10:46

to choose which way to go let me give

10:49

you a metaphor if you don't mind you're

10:51

walking down the street it's late at

10:53

night you're eager to get home and out

10:55

of the alley steps a menacing person who

10:58

say says to you I have a gun here and I

11:01

have a knife and I'm going to give you

11:04

free choice as to which way I'm going to

11:06

kill you now there's two kinds of

11:08

reaction One reaction is to sit there

11:10

and puzzle over which way you should

11:12

choose the other one is to say I don't

11:16

accept the choice I am going to look for

11:19

another way out the United States cannot

11:23

continue to do what it is doing if the

11:27

Russians given who they are and their

11:30

size and their power if they want to

11:32

rework the boundaries of their situation

11:36

in Europe you got to sit down and try to

11:38

work that out and it's the same with

11:40

Israelis and the Palestinians I

11:43

understand that the negotiation is

11:46

difficult but going into more war is not

11:49

only not a solution it's the one that's

11:51

already failed piling on more you know

11:54

it's like that sorry political candidate

11:56

who believes that every time a criticism

11:58

is made you double down and do more of

12:01

it the earlier incursions used the same

12:04

argument that you're using now they were

12:07

defensive and they would quote put an

12:09

end to these hostilities and it's the

12:13

military brain thinking that when you

12:15

win the war you're done all the smartest

12:19

military brains from clausa witz on down

12:22

have understood war is just politics by

12:25

another form the whole point is that the

12:28

previous invasions of Lebanon by Israel

12:32

like the previous hostilities between

12:35

Israel and the Palestinians were

12:37

justified by many as solving their

12:41

problem it never did if you think

12:44

suddenly escalating the horror is

12:47

somehow going to solve the problem that

12:49

the earlier pre escalation Horrors

12:52

didn't then you live in a different

12:54

planet from me the Arab countries are

12:57

becoming stronger and and richer that's

13:00

part of the whole change in the world

13:02

economy it's reflected in their

13:04

participation in the bricks Alliance

13:07

they are gaining in wealth in capacity

13:10

in power Israel is looking at a

13:13

situation what are they going to take on

13:15

the whole world I mean this is a dead

13:17

end they ought to turn around before

13:20

they get even more deeply embedded in

13:23

this military solution the Israeli

13:25

economy that's a phrase that has no

13:28

content anymore it's like the null set

13:30

in mathematics there's nothing in there

13:32

anymore they're going to be a basket

13:34

case economically for years even if they

13:38

quote unquote win they're losing this

13:41

situation Netanyahu and the extreme

13:44

right-wing government they have is

13:45

itself a sign of the failure of what

13:49

earlier politics had achieved and the

13:52

solution wasn't more violence that was

13:55

crazy to think that military people

13:57

perhaps can be excused for thinking like

14:00

that but not the rest of us and I hope

14:02

that the sanity comes back and they come

14:04

to their senses and realize they have to

14:07

cut deals and that those deals will be

14:10

painful everyone in the world right now

14:13

including the United States although

14:15

here it's done quietly is readjusting to

14:18

an altered World economy there are now

14:21

two poles of power and wealth not one

14:24

and if you pretend otherwise if you

14:27

don't understand it you will make

14:30

miscalculations like the war in Ukraine

14:33

has made you'll make decisions about

14:35

sanctions that are stupid they're just

14:38

stupid because the people in Washington

14:40

I know many of them they're perfectly

14:42

smart but they have blinders on don't

14:45

want to face what I just said how the

14:47

world has changed and how it isn't going

14:50

to go away anytime soon by the way the

14:53

gap between the bricks and the G7 they

14:55

were roughly equal in 2020 now the GDP

14:59

added up 29% of world GDP is in the G7

15:04

33% is in bricks Bingo bricks is bigger

15:08

and the Gap gets worse each year

15:10

including right now so that's the

15:13

reality that's changing everybody's

15:15

Behavior after World War II the dollar

15:18

became virtually universally recognized

15:21

as the Global Currency basically playing

15:25

the role in the world that once was

15:27

played by the British pound say in the

15:30

19th century or early part of the 20th

15:33

central banks in virtually every country

15:35

held as reserves to support their own

15:38

currency gold and the dollar leading to

15:42

the very famous phrase the dollar is as

15:45

good as gold yes exactly Saudi Arabia

15:48

and the oil countries adopted the

15:51

program of selling oil around the world

15:53

to any buyer but only for dollars and

15:56

then parking those dollars in New York

15:58

City Banks or in US treasuries it became

16:02

the focus and there are enormous

16:04

benefits to that the United States for

16:06

example was able to pay for the goods

16:09

and services produced around the world

16:12

the French wine the Japanese computer

16:15

the fill in the blank by sending them

16:17

dollars unlike in other countries those

16:20

dollars didn't come back to buy goods

16:22

and services here they held on to the

16:25

dollar cuz it was useful to them to do

16:27

so which means that for 5050 years the

16:30

United States was able to consume the

16:34

produce of the world and gave them an

16:36

exchange little green pieces of paper

16:39

our currency that cost us nothing and

16:42

are worth per se nothing the benefits of

16:46

doing this were incalculable I mean you

16:49

couldn't explain American economic

16:50

well-being in the last 70 years without

16:53

the role played by the dollar that's all

16:56

gone today uh Central Bank around the

16:59

world depending on the numbers you use

17:02

hold reserves only 50% in dollar instead

17:05

of the 80 or 90% that was the norm as

17:09

little as 20 years ago and so the

17:12

symbolic meaning of that is enormous the

17:15

financial meaning the real consumption

17:18

all of that inflation means that prices

17:21

in general are going up not all of them

17:23

the same rate some of them can go down

17:25

but the general direction of prices is

17:27

up that's all the word inflation means

17:30

okay step two in the logic if Rising

17:33

prices are an inflation the next

17:35

question is who determines the prices

17:38

answer employers determine prices

17:41

everyone listening or watching this

17:43

program knows that if you're an employee

17:46

you've never been called into a room to

17:48

participate in setting prices that's

17:51

done by the boss that's done by the

17:53

corporate board of directors the leading

17:55

managers it's a tiny group of people in

17:58

our country that US Census Department

18:00

lists employers 3% of our population the

18:03

other 97% are not let's be honest 3% set

18:08

the prices 97% pay them and don't set

18:11

them okay there's no democracy in an

18:14

inflation a tiny group of people never

18:17

elected to the job which doesn't exist

18:19

it's simply understood that if you're an

18:22

employer you set the price you raise it

18:25

you lower it you keep it the same your

18:27

business Okay so when inflation means

18:30

employers made the decision why did they

18:32

raise prices answer the same reason they

18:35

do everything else to maximize their

18:37

profits that's what makes a business

18:39

successful so we can answer the question

18:42

an inflation happens if and when

18:45

employers see profit in raising prices

18:49

so they do okay that means that

18:52

inflation is a profit driven phenomena

18:56

that hurts the rest of the people who

18:59

have to pay more for what they used to

19:01

get for less and it's great for profets

19:04

cuz that's why it's done all right the

19:06

minute you understand that then you

19:09

understand that we live in a system

19:11

whose economic Arrangement is the

19:14

opposite of democracy we don't

19:17

democratically decide what things are

19:19

going to cost in the store we never did

19:23

we have an autocracy we have an

19:26

authoritarian economic system that gives

19:29

a tiny percentage of the people control

19:32

over the prices we all pay when they run

19:35

an inflation and when we have a mass of

19:38

people complaining about it and that's

19:41

been the United States in the last 2

19:42

years we turn to an institution set up

19:45

for this called the Federal Reserve our

19:48

Central Bank and if you look at the

19:50

charter of the central bank one of its

19:52

jobs is to maintain price stability so

19:56

right off the bat when we have an

19:57

inflation we know that the Federal

19:59

Reserve has failed to do one of the two

20:03

things it was asked to do so what does

20:05

the Federal Reserve do in the case of

20:08

the United States in the last 2 years it

20:10

raises interest rates now for the mass

20:13

of people this makes a bad situation

20:16

worse in addition to Rising prices of my

20:19

breakfast cereal and my haircut and my

20:22

computer program I now have to pay more

20:24

on my credit card because the interest

20:26

rate on my balance has just gone up so

20:29

this is a solution that makes the

20:31

problem worse so I'm here to tell you

20:34

that it's not the only solution that the

20:36

Federal Reserve in acting in that way

20:39

shortcut what should have been the

20:41

debate how do we deal with the inflation

20:45

that the employer class has imposed on

20:48

us and we might have then remembered and

20:50

I remind people we might have remembered

20:52

that a Conservative Republican Richard

20:55

Nixon on the 15th of August 19

20:59

1971 confronting an inflation then made

21:03

the following decision which he

21:05

announced on TV as of tomorrow morning

21:09

any company that raises its price we

21:11

will come for you we will arrest you and

21:14

we will throw you in the clink and any

21:17

Union that raises your wages or tries to

21:20

we will do the same he declared what

21:22

came to be known as a wage price freeze

21:25

did it stop the inflation hna dime

21:29

right away real quick did it raise

21:31

interest rates no it chose an

21:34

alternative policy we live in a country

21:37

which not only did not do what it did a

21:40

few years ago but acted as if there was

21:43

no option that the raising of interest

21:46

rates was the universally accepted only

21:50

way to stop in it for people like me let

21:53

me assure you I sat there stunned even I

21:57

I'm used to this and let me add a

21:59

personal note I went to the same

22:02

graduate school and got my PhD from the

22:04

exact same faculty that granted it to

22:07

Janet yelen she's a classmate of mine I

22:10

know what she knows I learned it from

22:14

the same Professor reading the same

22:16

books at Yale University at the same

22:19

time so there I'm watching a woman who I

22:22

know knows the same thing I was taught

22:25

about inflations and interest rates and

22:28

wage price freezes which by the way have

22:30

been used all over the world in many

22:32

countries over many many decades so we

22:35

have lots of experience with that tool

22:38

to fight inflation but we live in a

22:40

country that can't face most of its

22:43

economic problems because they too

22:46

function as distractions from these

22:49

kinds of real issues a few years ago we

22:52

had shortages we couldn't get toilet

22:55

paper we couldn't get medicines of all

22:57

kind we have shortages right now the

22:59

most popular nonsense spoken about

23:02

shortages in the past was ready supply

23:06

chain disruptions okay that's a

23:08

euphemism that's another way of saying

23:11

shortages now I can show you shortages

23:14

across the board all over the place

23:16

virtually every year since 1971 to

23:20

assign to shortages some sort of role as

23:24

evidence at the very least you'd have to

23:26

show me that there were more shortages

23:29

during a time of wage price controls

23:31

than there were during all those years

23:34

when there weren't price controls let's

23:36

be honest every policy designed to solve

23:40

any problem turns out to have strengths

23:43

and weaknesses look I'd be the last one

23:46

to argue that a wage price freeze didn't

23:48

have all kinds of problems not

23:50

particularly the shortages the more

23:52

powerful argument at the time since I

23:54

follow these things since that time the

23:57

biggest problem was escapism in other

23:59

words there was an escape Clause you

24:01

could apply for an exemption from the

24:03

wage price freeze so every corporation

24:06

went to work hired the most expensive

24:09

lawyers imaginable and lobbyists to go

24:12

to Washington to get an exemption for

24:14

your firm or your industry and that's a

24:17

terrible that leads to all kinds of

24:20

misallocation I get all that but

24:22

interest rates have that as well

24:25

interest rates have their strength and

24:27

weaknesses one of the weaknesses of the

24:29

interest rate is we've had elevated

24:31

interest rates and they didn't prevent

24:33

our inflation we're still struggling

24:36

with an inflation and there are as many

24:38

people now saying that prices are going

24:40

to go back up as there are people saying

24:42

that they're going to go down so

24:44

interest rate is not some magic bullet

24:46

it's not some guarantee but it really

24:48

hurts a lot of people and it helps

24:51

others the bigger your company the less

24:53

an interest rate increase is going to

24:55

hurt you because the reason we have

24:57

central banks including the bank of the

24:59

US and what later became the Federal

25:01

Reserve at the beginning of the 20th

25:03

century was because when we left

25:05

interest rates to the quote free market

25:08

we got crazy volatility that was

25:11

extremely dangerous to the stability of

25:14

the system we brought in The Regulators

25:16

we brought in the institution to deal

25:19

with the ineffectiveness and the danger

25:22

of not doing it we're stuck because I'm

25:24

a Critic of capitalism I don't mind

25:26

telling you that we don't work well

25:29

without a central bank and we don't work

25:32

that well with one that's a

25:34

contradiction but it is not resolved by

25:38

oscillating back and forth between the

25:40

two pretending when you don't have a

25:43

central bank that getting one will solve

25:45

your problem makes no more sense than

25:47

responding to the failures of the

25:49

Central Bank by extolling the virtues of

25:52

a free market you can't go with either

25:55

of them