SDPB Dakota Midday chats with Dr. Richard Wolff, professor of economics at University of Massachusetts–Amherst, about his new documentary, Capitalism Hits the Fan. Dr. Wolff argues that the anti-democratic way we run capitalism now—huge corporate decisions made mini-politburos of corporate boards—has led to huge corporate profits, stagnant wages, and American workers swamped by debt. Dr. Wolff says we must respond to the resulting economic morass by, among other things, revolutionizing corporate governance to give workers (and consumers?) more voice in corporate decisions.
The professor's discourse provokes me to ask:
Fascinating conversation! I totally dig your guest's point that we have the right to participate in making the decisions that affect our lives. My question: how does your guest respond to the free-market argument that consumers already have a mechanism for holding corporations accountable with their spending if I don't like a corporation's decisions, I can take my money elsewhere. Employees, too: if they don't like the board's policies, they can take their labor elsewhere or work for themselves. Isn't that enough of a check on corporate power?
I e-mail the question, and Paul Guggenheim reads it on air. Dr. Wolff responds that if capitalism were working right, that mechanism would work. But capitalism is off the rails. Market forces don't work in favor of consumers or workers. If we take our money elsewhere, the corporation sees a downturn in profits, and it responds by laying off workers. Those laid-off workers don't have the economic liberty to make significant choices with their dwindling savings. They spend less, more workers get laid off... and the only people left with money are the corporate bonus takers picking the industrial skeleton clean. The whole system is broken!
Thanks for the answer, Dr. Wolff! Paul, expect Sibby et al. to picket the Vermillion studios within the week.
Learn more from Dr. Wolff in this video at Rethinking Marxism (yup, the M word, for real!).
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By the way, Paul G. continues to introduce my Midday questions by saying "This comes from Cory in Lake Herman...." Now plenty of readers will tell you I'm all wet, but trust me: I won't be in Lake Herman for a little while... a least not until I put on my waders for water monitoring! :-)
I heard the last half of that show, and also heard your e-mail and Dr. Wolff's response. He seemed a bit long on the diagnosis of the problem, and a bit short on (understandable) solutions. Maybe my brain was dulled from swimming and snow shoveling.
ReplyDeleteDr. Wolff did not sound like a Marxist to me. Capitalism, as it has evolved in our country, is flawed. That much is obvious; if it weren't the case, we wouldn't be in the current mess. From what I could understand of Dr. Wolff's analysis, I suspect that his method of corporate governance might work better than the way most companies run themselves now.
I agree: we need a clearer roadmap os the solutions than 20 minutes on SDPB could provide. But I found the suggestion of an analogy to central planning interesting. If "central planning" is so awful, why do we let corporations run on a model of central planning that shuts the vast majority of its talent out of the decision-making process?
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