‘Capitalism in US runs dry’

There is no way the US can solve its tremendous financial problems within the settled economic system. America must go beyond capitalism, argues Richard Wolff, an economics professor at New School University, in an exclusive interview with RT.

­RT: Where do you think the US economy is right now?

Richard Wolff: The crisis that was bad in the US, then became bad somewhere else (in Europe), is heading back to America to give us as many problems now as we see the Europeans having, but we will have them a little bit later.

RT: You said it was WWII that drove the US out of a Depression. If so, were George W. Bush and his successor Barack Obama doing the right thing by pursuing wars and, in some cases, currently considering new ones?

RW: [Unlike WWII] today warfare for political and technological reasons does not require large numbers of people. It is both too politically dangerous to get large number of people involved and it is not necessary for the kind of high-tech warfare that we know specializing as a nation. So warfare is not going to do the job. The wars in Afghanistan and Iraq, and even the one threatened with Iran now are not the kinds of war that will soak up the unemployment in the US. So it does not represent itself as a solution. You’re going have to find some other way to take masses of people and give them work. And I don’t think the private sector is up to it.

[Despite the incentives given to the private sector by both Bush and Obama to hire people, the] private sector basically decided to keep the money, keep the incentives and do not hire the people.

RT: How much the global economic turmoil that the world is currently going through is a product of Wall Street?

RW: This is a problem of our economic system. It is not the fault of Wall Street more than it is of anybody else…There is a desire to find a scapegoat… People try to make a way for themselves in the system according to the way the system works. Bankers do what the banking system has them do. And the same applies to everybody else. When all the different people in a system act according to the rules of the system and the outcome is a bad arrangement, then it’s the system that is the problem.

RT: Occupy Wall Street arguably could give Barack Obama the political support to deal with the (rich) “1 per cent” if he wanted to. Why hasn’t he done so?

RW: If the OWS was stronger and was going on for several years rather than for several months, if it has gathered the kind of support that pushed President Roosevelt to change his policies in his time – Obama would listen to OWS… The OWS is not big enough yet… The sympathy is there but you’ve got to translate sympathy into mobilization that could go to Obama and say: You must do this.

RT: In the US and Europe bank bailouts coupled with austerity measures and at the end of the day it is the people that are being squeezed and suffering across the board. How much longer can this continue?

RW: It is the $64 trillion question and the answer is it will continue only so long as the mass of the people permit it. It is in essence the game of push… The situation in Greece is [America’s] future being played before us. They cannot pay their debts – we cannot either. The US is the most indebted country in the world. Our debts are in excess of our Gross National Product. That’s when problem got bad for Greece, when its total debt went above its output. We’re already there.

We have a very serious problem and we do not have a plan for solving it anymore than the Greeks did.

The hope of the rich and the corporations is that they can get enough time to kind of work it out, disperse the costs among the people and maybe slither through. The risk is that they maybe miscalculated.

Warren Buffett, one of the richest people in the US, is warning the rest of the rich people in America “pay more taxes, give the government the way with all, help people, or else the system that made us rich is going to collapse.”

For a long time in the US the ideology, the ruling way of thinking is: If you make the money – Lord knows how you do it – if you make it, it is yours and you are entitled to it. And this mythology, this notion that I have the right to hold on and to make as much as I can and to keep as much of it as I possibly can is making everyone who plays in this economic system loath to part with it: If I am not forced to, I’m not going to. Whatever gets done, don’t touch mine. With this mentality you don’t face the seriousness of the problem.

If you don’t, you will miss the chance to give up a little – and you pay the price of having to give it up altogether.

RT: Does capitalism have a future?

RW: I was great defender of capitalism as a professor of economics in the United States… But at some point the very system you gave praise when it delivered, has to be given criticism when it does not.

Maybe we are finally mature enough as a nation to ask the question: Can the United States do better than capitalism?


Eurasian (unregistered) April 03, 2012, 13:42 quote +6

When there is huge divide between rich and poor, class society, mass unemployment, staggering percentage of poverty; capitalism is the very last system to resolve any of those problems thus is the one having created the problems in the very first place. The answer only is Socialism, and even more so as a global system.

Charles (unregistered) April 03, 2012, 14:59 quote +4

I agree with Eurasian, Socialism is the only answer for our future. We must be patient, but in time it will be obvious even to the greedy capitalist that there system of permanent inequality simply does not work.
Of course Socialism has many forms, it must evolve. I am an old man now, the fourth generation to fight for Socialism. We are getting there, slowly!

Orm Girvan April 03, 2012, 15:13 quote 0

Eurasian (unregistered) wrote in #1

When there is huge divide between rich and poor, class society, mass unemployment, staggering percentage of poverty; capitalism is the very last system to resolve any of those problems thus is the one having created the problems in the very first place. The answer only is Socialism, and even more so as a global system.

Neither system has, nor ever will, work; the past failures are there for all but the politically brainwashed to see. Any fool advocating some kind of world, or global system is little more than another ‘ useful idiot’ Local government you can ‘ get at’; shoot the jerks out if they try to act like they are other than servants. To get at global government, you need high-tech weapons; ‘ they’ have the money, you do not.

Brett Charlton April 03, 2012, 15:19 quote -1

the whole socialism vs capitalism debate is embarrassing. it’s like watching a fly go back and forth from one window to another because it is too stupid to think of a better solution. maybe it is time we tried something else.

seer April 03, 2012, 15:23 quote +3

Looks like all the internet Ron Paulies went to bed. I, too, feel that socialism is the only way to solve these problems that are not going away on their own. However, I think America is really in trouble in that regard, because the elites has seized so much of the wealth and have turned the entire system into their personal lady of the evening, that I fear the change is going to be a drawn out, difficult, and not so peaceful one. We have politicians that come to power through fraud and no longer answer to the people, a “fifth column” media that now only parrots authority and no longer conducts independent investigations for the citizens, and now even a padded supreme court that places the agenda of the elites above the constitution and the people. The media and the supreme court were historically the last lines of defense, and they, too, have now been corrupted. All of this amassed debt is going into the pockets of the extreme wealthy, while our tax dollars are being used to fund things like wars that do not see any benefit to us, and new weaponry for things like crowd control for the inevitable large scale protests that await. We’re literally paying for our own demise.

I look at the history of this country, the genocide of the native peoples in our obsessive expansionism, the racial tensions that absolutely refuse to subside despite the best efforts of the last 50+ years. And then the business elite who once again rule with an iron fist like the robber barons of history. There’s just no way in hell they are going to let America go socialist. Indeed, they’re working dilligently to gradually undo Roosevelt’s New Deal in the midst of the second largest depression in the history of the country, and they are only able to do it because of how massively corrupted the American system has become. They know the financial troubles that await. Why else did they hoard all the money from regular working people? Greed plays a part, but so does fear and foresight. They need this wealth to ride out the storm that approaches, or so they believe it will help them.

I do believe something closer to socialism is coming, but I also feel it is going to take years, not only to achieve the required change, but to pry the American public away from their disinformation and realize they’ve truly been had. Meanwhile, we drift toward fascism. And it’s not going to be a pretty ride.

Western Hypocrisy April 03, 2012, 15:32 quote +2

Capitalism … the best of all the worst systems yet tried?

HDumpty April 03, 2012, 15:42 quote +2

I agree with Eurasaian in principle but sadly, the disease of greed is more prevalent than the plauges of the dark ages. As long as we have people/businesses wanting more for less, we will never have a fair society. It’s inherent in human nature to get ahead of the rest and some will … but most won’t. The only way forward is for each individual to do a bit of good each day – we need to look out for each other – even greedy people could do that if they stopped thinking about themselves for a minute. 

Johnny Canuck April 03, 2012, 15:48 quote +4

I think that the word Socialist to an American smacks of Communism. Here in Canada we have a mix of socialism and capitalism.   There are many tax rebates from both the Federal and Provincial governments to the poor and low income people. Our Federal deficit is running around 50 billion dollars and with this months budget there will be 0 deficit.. All the while still maintaining monies to create jobs. There is a huge demand for skilled workers. During the 2008 meltdown, our banks did not get bailouts. You can still get a mortgage or buy a new car if you have the income to make the payments. If you lose your job you will be paid to retrain or move to where there is employment. No, Canada is not a perfect country. But the system seems to work. It took many years for us to get to this point. However we have been able to miss the world financial meltdown. 

Mothschild April 03, 2012, 15:59 quote +8

Capitalism is like a happy pill, luring people into a game that in the end, most will not win, and absolutely requires many to suffer so that a few can live in extreme luxury.I see no logic in risking massive odds of hardship for a lottery ticket that promises a fantasy life to a lucky few. This is by no means the humane route toward a better society. It is merely the foundation that permits the sleight of hand of those few who are no longer subject to the game, so long as they keep the ignorant masses running on their productive treadmills, high on nothing but a self-destructive fantasy.Run em into the ground and collect the loot. That is Capitalism.

certainquirk April 03, 2012, 16:06 quote -7

This a simpleminded opinion piece at best. It makes me cringe in embarrassment for RT. I love much of what they publish, but something like this is not even fit for a middle-schoolers (unless the idea is to demonstrate what a D for effort would look like).


The creation of the new BRIC central bank was hardly mentioned in western media despite it being the most significant financial event in a century. The combined wealth of Russia China Brazil and India will be the final nail in the coffin for the IMF and World Bank. The EU will also massively benefit from its creation.The death of the USA empire is simply not being reported or when it is its significance is played down.

CORRECTION: April 03, 2012, 16:36 quote -3

Europe Is Just fine thanks RT!, We are in Growth and have a bailout emergency fund in place many times bigger than all our debts should we need it. We will also be the new BRICS biggest trading partner soon and China has deep pockets to invest in the EU too!.

It is only uk, usa that are suffering contraction NOT EUROPE!

We are hapily out of recesion now so please stop helping the zionists propaganda machine drag EU down with USA and UK.

ComradeWinston April 03, 2012, 16:49 quote +6

I live in America, and I’m registered as a Socialist in my State. Though for some reason in a letter I recieved confirming my voting registration it says I am not allowed to vote for a Senator for my state or the President.
Freedom here is just a slogan.

dmidify April 03, 2012, 17:27 quote +3

The reason American jobs are going overseas, the reason corporations in general are leaving America and going overseas is because the United States of America boast the 2nd highest corporate tax rate in the world, settling in at 35%. Why the hell would you run a large corporation here and get taxed out the wahoo, when you can go elsewhere and have cheaper labor AND lower tax rates. 
If you want to see more jobs come back to America, we need to start producing our own goods again, we need to start mining and drilling for our own resources again and we need to lower the corporate tax rate. 
Also, we need to get rid of all the tax loop holes, laws and social programs that hurt our economy and country more than they help it.
In due time.

Rven April 03, 2012, 17:36 quote +4

Please interview more honest “economists”.There is no “capitalism” in the USA. The system is, as Max Keiser says, CRONY CAPITALISM. As for “socialism” – there already exists some socialist type of economy – the main beneficiaries of this are BANKSTERS and Wall Street financiers – the “Too Big To Fail” – who are complete failures and also criminals for taking trillions of dollars from the US taxpayers (who will be paying for this for the next 100 + years).Sorry RT – this economist has no credibility. He is a shill for the crony capitalists.

USA: DECLINE AND FALL April 03, 2012, 17:45 quote +5

The US never had capitalism. It has always had oligarchic corporatism/fascism. The state controls the markets by manipulating stocks and interest rates at the direction of the Business Roundtable, aka the banksters. The entire scam is sold to the American people as a 2-party democratic system. This brand of “democracy” is marketed the same way as toothpaste, worldwide. If the masses weren’t so conditioned to remain idiots by the coliseum games (sports) and circuses (carnivals and multimedia entertainment), they might have gotten the clue decades ago. After the US presidential election, entitlements will be axed and austerity will come to America European style. Then, it will be time for the authorities to revive blood sports–the preferred diversion of the tyrannical Roman Empire.

AcrossHU April 03, 2012, 18:06 quote +3

Full employment + social security for the whole society + democracy = socialism.
Central banks, army and security forces cannot be in private hands, they must serve the interest of the whole nation. Private companies should be allowed only in the non strategic  competitive sector of economy. Socialism is the only economic system which is in harmony with democratic political system. Socialism is antagonistic both to capitalism and to communism. The liberalized capitalism of US is leading to fascism, creating feudal privileges to ruling class and communism for the oppressed masses. Socialism is the arch enemy of fascism, that’s why so many lies are told about it in the US. Solving the problem of capitalism will lead to socialism, like it or not. Cooperation instead of exploitation, peace instead of war.

rezashahrzad April 03, 2012, 18:15 quote +1

There is nothing wrong with Capitalism — whether in the U.S. or anywhere else. In fact, Capitalism; the economic system in which ordinary people are allowed to compete freely in a free-market-based, level-playing-field environment, is the only economic system that can be dependent upon to bring economic prosperity and at the same time social harmony, by responding to human need for self-worth.

The problem with U.S. Capitalism is that it is not capitalism at all, but Criminalism; an evil economic system based on criminal enterprise, where Mafia oriented standards are used to rule the market, where the government — the arbiter intended to guarantee the level playing field — is merely an enforcer on behest thieves, crooks and criminal that are the operators of the corrupt system.

The former chairman of the FED, the so called oracle, Alen Greenspan, was known to have blocked any and all attempts to enforce antifraud regulations meant to prevent subverting legitimate economic activity on Wall Street and beyond — with the full support of the so called “lawmakers”, who practically went out of their way to silence his critics! That, “If you make the money – Lord knows how you do it – if you make it, it is yours and you are entitled to it.” With Wise Guys like him in charge throughout the system, the current economic collapse, is only a surprise to the idiot.

Unfortunately for Mr. Wolf and his colleagues, “Can the United States do better than capitalism?” Is the same wrong way of looking at things that has already bankrupted the U.S., while at the same time jeopardizing the safety and security of the rest of the world as well. The real question must be, can capitalism survive subjected to the lawlessness with which it is being pushed around by the Mafia?




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