Ask Prof. Wolff

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Professor Wolff receives hundreds of questions per week covering a wide array of topics, from economics and politics, to historical movements and current events. While Professor Wolff does his best to reply to some questions on Economic Update with Richard D. Wolff, he's received more questions than can be answered individually. Prof. Wolff will now provide video answers to his favorite questions on this page.
 
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Brazilian economic conditions

Professor Wolff, on your 2/6/18 program, you mentioned the ascending economies of China, India, and Brazil, among others. Could you please recommend publications or other information resources specifically about the economic conditions in Brazil. Thank you. John McDonnell Saint Petersburg, FL

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What's going on with the stock market? We haven't had a falling off like this in ages.

We have had a report of a great uptick in jobs, but all of a sudden, the stock market plunges and Wall Street is freaking out. What are the corrolations, if any. What's going on with this stock market plunge and how is that affecting the 401k's and other places that people try to park their money. Thank you for all you do. Lisa :)

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what is happening to all the money we are "saving" by Trump ...

...NOT hiring hundreds of federal jobs posts and positions?

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Did Russia and China go at it backward?

I believe Karl Marx said the economic system of a country is the foundation from which all else springs: politics, culture, education . . . . everything springs from the economic base and arises in service to that base. If that is true, can it be said correctly that Russia and China did it backward and paid a price for the error? They both seized political power and then attempted to use that power to establish a socialist economy. In other words, they attempted to prove that the economy can arise from a political base. Beginning, instead, with worker-owned co-ops starts right off establishing a socialist economy. It provides time for problems in the strategy and techniques to be worked out. It provides time for sympathetic politicians to come on the scene and help advance the effort, and from what I see the conservatives don't mind it at all since a co-op is a business. So, can it be correctly said that Russia and China got it backward?

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If we cannot peacefully change our economic system with strikes and protests, what is to be done?

Strikes, unions, protests, voting and worker cooperatives have in the past brought about great changes in history. However, many of these changes and institutions have been repealed, reversed or worse. What can he working class do when organized to secure their transition towards socialism? And could violence be necessary? This is a response to your comment "I am no liberal."

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Regarding your reply to Uffner

I see what you are saying here. But I need to know more. But it imparts a sense of inevitability - that no solution exists. If we can't support a notion of fair-trade what can we support? What am I missing? Well I'm missing a lot. What even IS fair-trade? If not fair-trade than what kind of trade is it that you suggest we make?

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Question about your explanation of surplus

When you say that the capitalist steals from the worker by appropriating part of the value that the worker produced, aren't you neglecting the fact that the worker is producing using equipment that belongs to the capitalist? In effect the capitalist is renting out the equipment (the means of production I guess) to the worker. What is outrageous of course is the rent that he charges for it, but still I don't think it should be zero, the way you are suggesting. Thanks a lot.

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Wont worker co-ops lead to inflation?

Here is my reason for thinking so: Worker co-ops are undoubtedly better than capitalist business model. However i dont think they go far enough as they are still structured in a capitalist market. That means the business is still dependent upon the capitalist money cycle. M-C-M'. What worker co-ops do is guarentee worker rights and protections since the workers won't harm themselves. However as a business they still operate on a profit principle. What i forsee as a potential problem is the same one we witnessed in the 70's when we had strong worker protections. The 70's we saw an inflation cycle that went kind of like this: Wages rise, profits fall, businesses want to increase profits, prices rise, workers realize their wage increase amounted to little and demand more, cycle repeats. Said another way By raising the price you revalorize labour's worth to be less than what it used to be, labour doesn't like it so they demand what they are worth which means a bigger cut of the profits. Buisnesses are always looking for higher profits so with more money floating in the economy they can then raise prices again. Wont this same cycle still be prevalent with the worker co-op system. The business as a whole will want to profit, after all that benefits the workers. They wont cut the workers pay to increase profit, that is silly in a worker co-op structure. so they raise prices instead. The same cycle repeats which leads to inflation. Certainly there are arguments that prices wont rise due to competition between co-ops and what not, but the historical example is still there. So my question is how do you combat this potential inflation as it deals with one of the contradictions of capitalism and that is the contradiction of capital itself. Using money to make more money can only ever steal its worth from the labour that went into it. Either 1. what is currently happening where workers are not paid what they are worth. or 2. where workers are paid what their worth but a need for profit generates inflation through rising prices effectively still stealing value from the worker, merely doing it after the fact by devaluing the money through price increases. This contradiction can only lead to two outcomes in my mind. 1. a money funnel to the rich, or 2. massive inflation where confidence is eventually lost in the currency itself.

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Is The "repatriation tax" Portion of The New Tax Code A Good Thing?

Trump and the GOP have overhauled the tax code of the US and in it they've introduce a new, one-time repatriation tax. As multinational companies have reported earnings this last week, they've shown a much lower net earnings than has been seen in years. Many companies (like Apple) are blaming the new repatriation tax (though, they have up to 8 years with no interest to pay the full amount). While 12% is stupidly-low for $multi-billion companies to have to pay, isn't it better than the 0% they were paying before? In other words, while we'd all have hoped for more, wouldn't you say that, overall, getting the extra $3.1 trillion this is supposed to generate in taxes is a good thing?

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Why a Wall ?

Wouldn’t stopping the hiring and housing of illegal immgrants be better and cheaper that building a wall . Ps was Patton right ? See movie “Patton “ where he says in natural walls can’t stop Army’s nothing mankind made can.

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Wouldn't you say removing the hierarchical structure of society removes incentive for overachievers?

A point you made in an earlier video was the corrupt hierarchy structure that allows people on top to put people whose job depends on them in awkward positions with their demands and whims (e.g. Weinstein or basically any employer most people have had a horror story with). An opposite point that I would like your comment on is that the very nature of hierarchical structure tends to also allow SMART people who WORK HARD (i.e. competent people) to be recognized as experts in their field allowing them to rise above the rest and lead them, which gives them an incentive in the first place to work towards the top of such hierarchies. I understand the barriers of entry to many, many of the lower class , as I've seen most of your videos and have great respect for your work as a counter culture, but how would a society progress without the most industrious people being rewarded in such a manner?

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Can I make my marriage a co-op and no longer capitalist by default?

I've come up with my own answer to "how can the self employed be socialists" and have engaged with my own community to test it out. What happened was I recognized that as an artist I'm not actually technically alone. I am legally tied to my civil union (a variation of a marriage here in New Zealand) partner. The state in terms of tax benefits treats my economics as tied to hers. So my idea is to bring democratic values into this primary legal and economic relationship, as it is my business, my financial base for existence. I exchange my time to look after children and try to work at home, while my partner brings in steady money with a part-time job. Together we share all financial aspects of daily living, and use consensus in decision making. I feel that my domestic work, invisible under capitalism, is made visible and financially compensated for under what we've called a Civil Union Co-op (Cuco-op). So by using the profit generated in our co op to actively promote our legal relationship's economic base, I think that we are able to say that we are not capitalists, but socialists in a civil union co-op who are competing and beating capitalism! Is this anywhere near right? Or ok on some level? I may be stupid, but I like this idea, as it has a similar elegance to your idea of "Democracy at work", but with this being "Democracy at home".

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Prof. Wolff, what is your stance/thoughts on the matter of Co-op degeneration?

Of the limited writing on Worker Co-ops I've been able to find, much of it is a discussion on the matter of a Co-op degeneracy theory in which worker owned enterprises are said to often devolve into a kind of pseudo-capitalistic hierarchy as a result of external business pressures and internal conflicting or corrupting incentives. My question is simply: what do you think? What are your thoughts on the matter? Do you think it's a legitimate concern? And if you do think it has legs to stand on, what are your thoughts on possibly resolving it?

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What does automation mean for the worker and capitalism?

I've been reading a lot about automation lately and an estimated 1,000,000 jobs in Britain will be automated in the next 20 years among other harrowing statistics. So with that said, I was wondering what you think automation means for the workers. Is it something we should champion as it will slowly abolish exchange value? Will it lead to a post-work society and is that something that we should strive for? I know Marx comments a lot on how machinery is specifically used by the capitalist as a weapon against labour leading to increased alienation. Some theorists believe we can only achieve a post-capitalist society by moving THROUGH alienation rather than avoiding it, but I really want to hear your thoughts, especially as it relates to our current situation.

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