Richard Wolff: Marxism and Communism | Lex Fridman Podcast #295

Richard Wolff 0:00 Slaves produce a surplus which the master gets. Serfs produce a surplus which the lord gets. Employees produce a surplus which the employer gets. It's very simple. These are exploitative class structures because one class produces a surplus appropriated, distributed by another group of people, n- not the ones who produced it, which creates hostility, enmity, envy, anger, resentment, and all of the problems you can lump under the heading class struggle.

Lex Fridman 0:43 The following is a conversation with Richard Wolff, one of the top Marxist economists and philosophers in the world. This is a heavy topic, in general, and for me personally, given my family history in the Soviet Union, in Russia, and in Ukraine. Today the words Marxism, socialism, and communism are used to attack and to divide much more than to understand and to learn. With this podcast I seek the latter. I believe we need to study the ideas of Karl Marx, as well as their various implementations throughout the 20th and the 21st centuries. And in general, we need to both steel man and to consider seriously the ideas we demonize, and to challenge the ideas we dogmatically accept as true, even when doing so is unpleasant and at times dangerous. This is the Lex Fridman Podcast. To support it please check out our sponsors in the description. And now, dear friends, here's Richard Wolff.

Lex Fridman 1:52 Let's start with a basic question but maybe not so basic after all. What is Marxism? What are the defining characteristics of, uh, Marxism as an economic and political theory and ideology?

Richard Wolff 2:05 Well, the simplest way to begin a definition would be to say it's the tradition that takes its founding inspiration from the works of, uh, Karl Marx. Um, but because these ideas that he put forward spread as fast as they did and as globally as they did, literally it's, uh, 140 y- years since Marx died, and in that time his ideas have become major types of thinking in every country on the Earth. Um, if you know much about the great ideas of human history, um, that's an extraordinary spread in an extraordinarily short period of historical time. And what that has meant, that speed of spread and that geographic diversity, is that the Marxian ideas interacted with very different cultural histories, religious histories, and economic conditions. So the end result was that the ideas were interpreted differently in different places at different times. And therefore Marxism, as a kind of first flush definition, is the totality of all of these very different ways of coming to terms, uh, with it. For the first roughly 40, 50 years, um, Marxism was a tradition of thinking critically about capitalism. Marx himself, that's all he really did. He never wrote a book about communism. He never wrote a book really about socialism either. His comments were occasional, fragmentary, dispersed. What he was really interested in was a critical analysis of capitalism, and that's what Marxism was more or less in its first 40 or 50 years. Um, the only qualification of what I just said was something that happened in Paris for a few weeks. Uh, in 1871 there was a collapse of the French government, uh, consequent upon losing a war to Bismarck's Germany, and then the result was something called the Paris Commune. The working class of Paris rose up, basically took over the function of running the Parisian economy and the Parisian society. And Marx's people, people influenced by Marx, were very active, uh, in that commune, in the leadership of the commune, and Marx wasn't that far away. He was in, uh, London, uh, and these things were happening in Paris. You know, that's an easy transport even then. And for a short time, very short, Marxism had a different quality. In addition to being a critique of capitalism, it became a theory of how to organize societally differently. Before, that had only been implicit. Now it became explicit. What is the leadership of the Paris Commune going to do, and why, and in what order? And in other words, governing, organizing a society. But since it only lasted a few weeks, the French Army regrouped, uh, and under the leadership of people who were very opposed to M- Marx, they marched back into Paris, took over, killed a large number of the, of the Communards as they were called, and deported them to islands in the Pacific that the, that were part of the French Empire at the time. The really big change happens in Russia in 1917. Uh, now you have a group of Marxists, Lenin, Trotsky, all the rest, who...... are in this bizarre position to seize a moment. Once again, a war, like in France, uh, disorganizes the government, throws the government into a very bad reputation because it is the government that loses World War I, has to withdraw, as you know, uh, Brest-Litovsk and all of that, and the government collapses and the army revolts. And in that situation, a very small political party, Russian Social Democratic Workers Party, um, splits under the pressures of all of this, uh, into the Bolshevik and Menshevik divisions. Lenin, Trotsky, and the others are in the Bolshevik division. And to make a long story short, he's in exile. Uh, his position, uh, Lenin's position makes him, gets him deported because he says Russian workers should not be killing German workers. I mean, this is a war of capitalists who are dividing the world up into colonies and Russian working people have no... should not kill and should not die for such a thing. As you can expect, they arrest him and they throw him out. Interestingly, in the United States, the, the comparable leader at that time of the Socialist Party here, as you know, there was no Communist Party at this point, that comes later, um, the head of the Socialist Party, a very important American figure named Eugene Victor Debs, makes exactly the same argument to the... that Americans should not fight in the war. Uh, he's in the pa- he has nothing to do with Lenin. I don't even know if they knew each other. But, uh, he does it on his own. He gets arrested and put in jail here in the United States. By the way, he runs for president from jail and does very well. Really, very well. It's remarkable. Um, and he's the inspiration for Bernie Sanders, if you-

Lex Fridman 8:11 (laughs)

Richard Wolff 8:11 ... if you see the, the link. Um, although he had much more courage politically than, than Bernie has.

Lex Fridman 8:18 That's really interesting. I'd, I'd love to return to that link maybe later.

Richard Wolff 8:21 Yes.

Lex Fridman 8:22 (laughs) History rhymes.

Richard Wolff 8:23 Yes. A complicated story. Anyway, what the importance in terms of Marxism is that now this seizure of power by a group of Marxists, that is a group of people inspired by Marx, developing what you might call a Russian, uh, even though there were differences among the Russians too, but a Russian interpretation, this now has to be transformed from a critique of capitalism into a plan at least of what are you gonna do in the Soviet Union. And a lot of this was then trial and error. Marx never laid any of this out. Probably wouldn't have been all that relevant if he had, 'cause it was 50 years earlier, in another country, et cetera. So what begins to happen, and you can see how this happens then more later in China, in Cuba, in Vietnam, in Korea, and so on, is that you have kind of a bifurcation. Much of Marxism remains chiefly the critique of capitalism, but another part of it becomes a set, and they differ from one to the other, a set of notions of what an alternative post-capitalist society ought to look like, how it ought to work. And there's lots of disagreement about it, lots of confusion. Um, and I would say that that's still where it is, that you have a tradition now that has these two major wings, critique of capitalism, notion of the alternative, and then a variety of each of those, and that would be the framework in which I would answer that's what Marxism is about. It's basic idea, if you had to have one, is that human society can do better than capitalism-

Lex Fridman 10:17 (laughs)

Richard Wolff 10:17 ... and it ought to try.

Lex Fridman 10:19 And then we can start to talk

Lex Fridman 10:21 about what we mean by capitalism.

Richard Wolff 10:23 Fine.

Lex Fridman 10:25 So we'll look at the critique of capitalism on one side, but maybe stepping back, wh- what do you think Marx would say if you just looked at the different implementations of the ideas of Marxism throughout the 20th century? Were his ideas that were implicit, were made explicit? Um, would, uh, would he shake his head? Would he enjoy some of the parts of the implementations? Like what do you... how do you think he would analyze it?

Richard Wolff 10:54 Well, he had a great sense of humor. I don't know if you-

Lex Fridman 10:56 (laughs)

Richard Wolff 10:56 ... had a chance to take a look at his writing, but he had an extraordinary sense of humor. So my guess is he would deploy his humor in answering this question too. He would say some of them are inspiring, some of his interpretations of his work, and he's very pleased with those. Others are horrifying, and he wishes somehow he could erase the connection between those things and the lineage they claim from him, which he would, uh... There's a German word, I, I don't know if these lang- if you speak the other languages.

Lex Fridman 11:28 Nope.

Richard Wolff 11:29 There's a wonderful German word called Verzichte, and it's stronger than the word refuse. It's if, if you wanna refuse something, but with real strong emphasis. Ich verzichte darauf, is a German way of saying, "I, I, (laughs) I don't want anything to do with that." And he would talk then, you know, in philosophical terms, 'cause remember, he was a student of philosophy, he wrote his doctoral thesis on ancient Greek philosophy and all the rest, he would wax philosophical and say, you know, that, that the ideas you put out are a little bit like having a child. You have a lot of influence, but the child is his own or her own person and will find his or her own way. And these ideas, once they're out there-... go their own way.

Lex Fridman 12:16 And as you said, there's a particular way that this idea spread. The speed at which it spread-

Richard Wolff 12:21 Yeah.

Lex Fridman 12:21 ... throughout the world made it even less able to be sort of stabilized-

Richard Wolff 12:26 Right.

Lex Fridman 12:26 ... and connect it back to the origins of where the idea came from.

Richard Wolff 12:30 The only people who ever really tried that were the Russians, uh, after the revolution, because they occupied a position for a while, not very long. But they occupied a position for a while in which, I mean it was exalted, right? They, there had been all these people criticizing capitalism for a long time, even the Marxists ever since mid-century, and these were the first guys who pulled it off. They made it, and so then there was a kind of presumption around the world their interpretation must be kinda the right one, because look-

Lex Fridman 13:05 Right.

Richard Wolff 13:06 ... they, they did it. And so for a while, they could enunciate their interpretation, and it came to be widely grasped as something which, by the way gets called in the literature, official Marxism. The very idea that you would put that adjective in front of Marxism, or Soviet Marxism, or Russian Mar- There were these words that w- where the adjective was meant to somehow say, kind of, "This is the canon."

Lex Fridman 13:37 Right.

Richard Wolff 13:37 You can depart from it, but this is the canon.

Lex Fridman 13:40 Right.

Richard Wolff 13:40 Before the Russian Revolution, there was no such thing, and by the 1960s it was already dispar- it, it was gone. But for a short time, you know, 30, 40 years, it was a kind of ... And the irony is, particularly here in the United States where the taboo against Marxism kicks in right after World War II, is so total in this country that I, for example, through most of my adult life have had to spend a ridiculous amount of my time simply explaining to American audiences that the Marxism they take as canonical is that old Soviet Marxism which wasn't the canon before 1917, and hasn't been since at least the 1960s, but they don't know. It's not that they're stupid and it's not that they're ignorant, it's that ... Well, the ignorance maybe, but I mean it's not a mental problem. It, it's the taboos shut it down, and so all of the reopening, that in a way recaptures what went before and develops it in new direction, they just don't know. They just don't know.

Lex Fridman 14:56 Nevertheless, it's a serious attempt at making the implicit ideas explicit. The, the, the Russians, the, the Soviets at the beginning of the 20th century made a serious attempt at saying, "Okay, beyond the critique of capitalism, how do we actually build a system like this?"

Richard Wolff 15:13 Right.

Lex Fridman 15:13 And so in that sense, not at a high level but at a detailed level, it's interesting to look at those particular, uh, schools. Maybe-

Richard Wolff 15:23 Right, because, for example, I mean just to take your point one step further, you really cannot understand the Cuban Revolution, the Chinese Revolution, uh, Vietnamese, and, and the others, because each of them is a kind of response, let's call it, to the way the Soviets did it.

Lex Fridman 15:43 Yeah.

Richard Wolff 15:43 Are you gonna do it that way? Well, yes and no is the answer. This we will do that way, but that we're not gonna do. And the differences are huge, but you could find a thread, I can do that for you if you want, in which all of them are in a way reacting.

Lex Fridman 16:02 (laughs)

Richard Wolff 16:03 They are-

Lex Fridman 16:03 To the originals.

Richard Wolff 16:04 Yes.

Lex Fridman 16:04 (laughs)

Richard Wolff 16:05 Very much so.

Lex Fridman 16:06 Well, like, m- maybe most of rock music is reacting to the Beatles and the Stones.

Richard Wolff 16:10 Something like that.

Lex Fridman 16:12 (laughs) Can you speak to the unique elements of the various schools of that Soviet Marxism? So we got Leninism, Trotskyism, Stalinism, maybe even let's expand out to, uh, Maoism. So, um, maybe I could speak to sort of Leninism, uh, and then please tell me if I'm saying dumb things.

Richard Wolff 16:33 (laughs)

Lex Fridman 16:33 There's a, uh, I think for Lenin there was an idea that there could be a small sort of vanguard party, like a small controlling entity that's like wise and is able to do the central planning decisions. Then for, um, Stalinism, one interesting ... So Stalin's implementation of all of this, one interesting characteristic is to move away from the international aspect of the ideal of Marxism to, uh, make it all about nation, nationalism, the strength of nation. And then, um, so Maoism is, it's, it's different in that it's focused on, uh, agriculture, on rural. Um, and then Trotskyism I don't know except that it's anti-Stalin.

Richard Wolff 17:23 (laughs)

Lex Fridman 17:24 I mean I don't even know if there's unique sort of philosophical elements there. Anyway, can you maybe from those or something else speak to different unique elements that are interesting to think about, about implementation of Marxism-

Richard Wolff 17:36 Sure.

Lex Fridman 17:36 ... in the real world?

Richard Wolff 17:38 Probably the best way to get in the, into this is to describe something that happened in Marxism that then shapes the answer to your question. In the early days of Marx's writings, and you know, he, his life spans the 19th century. He's born in 1818, dies in 1883, so literally he lives the 19th century. And you might, I mean to make things simple, you might look at the first half or the first two thirds of his life as overwhelmingly gathering together-...the precursors to his own work. Marx was unusually scholarly in the sense that, partly because he didn't work a regular job and partly because he was an exile in London most of his adult life, he worked in the library. I mean, he had a lot of time. He got subsidized a little bit by Engels, whose family were manufacturers. And you might say the first half to two-thirds of his life are about the critique of capitalism, and that was what, in a broad sense, the audience for his work, Western Europe more or less, uh, was interested in. That's what they wanted, and he gave that to them. He wasn't the only one, but he was very, very effective at it. Um, by the s- last third of his life, h- he and the other producers of a anti-capitalist movement, people like the Chartists in England, that's a whole nother movement, um, the, uh, anarchists of various kinds like Proudhon in France or Kropotkin or Bakunin in Russia and so on. Uh, you, you pull all these together and there was a shift in what the audience, let's call it a mixture of militant working class people on the one hand and critical or radical intelligentsia on the other. They now wanted a different question. They were persuaded by the analysis. They were agreeable that capitalism was, uh, a phase they would like to do better than, and the question became, "How do we do this?" Not anymore, "Should we? Why should we?" You know, "Could we maybe fix capitalism?" No, they had gotten to the point the system has to be fundamentally changed. But they got... They didn't go, w- well, you might imagine, they didn't go and say, "Well, what will that new system looks like?" They didn't go that way. What they did was ask the question, "How could we get beyond capitalism? It seems so powerful. It seems to have captured people's minds, people's daily lives," and so on. Um, and the c- f- focus of the conversation became, this was already by the last third of the t- 19th century, the question of the agency, the mechanism whereby we would get beyond. And again, make a long story short, the conversation focused on seizing the government. See, before that it wasn't there at all. The government was not a major interest. If you read Marx's Capital, the great work of his maturity, three volumes, there's almost nothing in the, the state. I mean, he mentions it, but they, he's interested in the details of how capitalism works, factory by factory, store by store, office... What's the structure? The government's secondary for him.

Lex Fridman 21:21 But there's also humans within that capitalist system of, there's the working class.

Richard Wolff 21:26 Right.

Lex Fridman 21:26 It's a, it's about-

Richard Wolff 21:27 That's what he's interested in.

Lex Fridman 21:27 ... the class struggle.

Richard Wolff 21:28 That's what he's... He's interested in each, in the wor- Think of it almost mechanically like the workplace. In the workplace there are some people who do this and other people who do that, and they accept this division of authority-

Lex Fridman 21:40 Mm-hmm.

Richard Wolff 21:40 ...and they accept this division of what's going on here. Particularly because he believed that the core economic objective of capitalism was to maximize something called profit, which his analysis located right there in the workings of the enterprise-

Lex Fridman 21:58 And the-

Richard Wolff 21:58 Not, not... And the government was not the, the, the key factor here.

Lex Fridman 22:02 And he was looking at ideas of value.

Richard Wolff 22:04 Yes.

Lex Fridman 22:04 How much is the, how much value does the labor of the individual workers provide, and that means how do we reward the workers in an ethical way. And so those are the questions of, uh...

Richard Wolff 22:17 Right. Well, well, we'll g- l- we'll get to that.

Lex Fridman 22:19 Yeah. Okay. But the government-

Richard Wolff 22:21 Is really-

Lex Fridman 22:21 ...was not part of that picture.

Richard Wolff 22:22 That's right.

Lex Fridman 22:23 Okay.

Richard Wolff 22:23 So it's very significant that towards the end of the 19th century, Marx is still alive when this begins but it, it really gets going after he dies, is this debate among Marxists about the role of the state. They all agree, nearly all of them agree that you have to get the s- the, the working class has to get the state because they see the state as the ultimate guarantor of capitalism. When things get really out of hand, the capitalist calls the police or he calls the army or both of them. And so the government is, in a sense, this key institution captured in Marx's lang- Marxist language by the bourgeoisie, by the, by the other side, the capitalists, and yet vulnerable because of suffrage. If suffrage is universal or nearly so, if everybody gets a vote, which in a way capitalism brings to bear. Part of its rejection of feudalism in the French, American Revolution is to create a place where elected represented... So the, the government being subject t- to suffrage creates the notion, "Aha, here's how we're gonna... We have to seize the state." And then the, the, that gets agreed upon but there's a big split as to how to do it. One side says, "You go with the election. You, you, you mobilize the voter." That gets to be called reformism within Marxism. And the other side is revolution. "Don't do that. This system," if I may quote Bernie again, "is rigged. Uh, you can't get there." They, they've long ago learned how to manipulate, uh, parliaments.... they buy the politicians and all that, and therefore revolution is going to be the way to do it. Revolution gets a very big boost because of the Russians. They did it that way. They didn't do... I mean, they fought in the Duma, in the, in the Parliament, but they didn't... And that, this focus on the state, I would argue, goes way beyond what the debaters at the time, uh... And if you're interested in the great names, there was a great theorist of the, the role of the state in a reformist strategy to get power, uh, in Germany named Edward Bernstein. Very important. His opponents in Germany were Karl Kautsky and Rosa Luxemburg, the two other huge figures in Marxism at the time. And they wrote the articles that everybody reads, but it was a much broader, uh, debate. And by the way, that debate still goes on.

Lex Fridman 25:17 Reformism versus revolution?

Richard Wolff 25:19 Mm-hmm. And in, in terms not all that different. I mean, it's adjusted to history, but in terms that are different.

Lex Fridman 25:26 Can you comment, uh, on where you lean in terms of the mechanism of progress, reformation versus revolution?

Richard Wolff 25:34 I'd rather tell you the historical story.

Lex Fridman 25:36 Sure.

Richard Wolff 25:37 Over and over and over again, in most cases, the reformists have always won, because revolution is frightening, is scary, is dangerous. Um, and so most of the time when you get to the point where it's even a relevant discussion, not a abstract thing for conferences, but a real strategic issue, the reformists have won. I mean, and, I'll give you an example from the United States. In the Great Depression of the 1930s, you had an extraordinary shift to the left in the United States, the greatest shift to the left in the country's history, before or since. Nothing like it. Suddenly, you created a vast left wing composed of the labor movement, which went crazy in the 1930s. We, we organized more people into unions in the 1930s than at any time before or any time since. It is the explosion. And at the same time, the explosion of two socialist parties and the Communist Party that became very powerful, and they all worked together creating a very powerful leftist, uh, presence in this country. They debated in a strategically real way, reform or revolution. The reformers were the union people, by and large, and the, the communists were the revolutionaries, by and large, because they were affiliated with the Communist International, with Russia and all of that. And in between you might say that the two socialist parties, one that was Trotskyist in inspiration and the other one more moderate, Western European kind of socialism. And they had this intense debate, and they ended up, the reformists won that debate. There was no revolution in the 1930s here. Uh, but there was a reform that achieved unspeakably great successes, which is why it was as strong and remains as strong as it does, because it achieved, in, in a few years, in the 1930s, starting around 1932, '3, Social Security in this country. We had never had that before. That's the same one we have now. Unemployment insurance never existed before, that you have till today. Minimum wage for the first time, still have that today, and a federal program of employment that hired 15 million people. I mean, these were unspeakable gifts, if you like, to the working class.

Lex Fridman 28:09 So that's the '30s and the '40s.

Richard Wolff 28:11 '30s-

Lex Fridman 28:11 '30s.

Richard Wolff 28:11 Not much in the '40s anymore, but in the '30s. And here's the best part. It was paid for by taxes on corporations and the rich. So when, when people today say, "Well, you can't tax the corpo-" Th- the joke is I have to teach American history to Americans, uh, because it has been erased from consciousness.

Lex Fridman 28:33 We'll return to that. But first, let's, let- let's take a stroll back to the beginning of the 20th century with the Russians.

Richard Wolff 28:39 Right, with the Russians. So their interpretation goes like this. Everybody was right, the state is crucial. We were right, we were the revolutionaries. We seized the state here in Russia. Now we have the state, and socialism is when the working class captures the state, either by reform or revolution, and then uses its power over the state to make the transition from capitalism to the better thing we're going toward. And again, make a long story short, in the interest of time, what happens, which is not unusual in human history, is that the means becomes the end. In other words, Lenin, who's crystal clear, before he di- you know, he doesn't live very long. He dies at 23, so he's only in power from 17, say, to 22. By that time, he has his brain trouble and-

Lex Fridman 29:39 Ni- 1923, by the way, not at age 23. Just so people-

Richard Wolff 29:42 Yeah, yeah, yeah. I'm sorry.

Lex Fridman 29:43 ... are listening. (laughs)

Richard Wolff 29:43 1923. Right, he's only there for four or five years. Uh, he's very clear. He even says, and I've done work on, I've published, so I mean, I know this stuff. He says in a famous speech, "Let's not fool ourselves. We have captured the state, but we don't have socialism." We have to create that. We have to move towards that. Um, with Stalin, you know, Lenin dies, and there's a fight between Stalin and Trotsky. Trotsky loses the fight. He's exiled, he goes to Mexico. Stalin is now alone in power and does all the things he's famous or infamous for. Um, and by the end of the '20s, Stalin-... makes a decision. I mean, not any... It's not that he makes it alone but things have evolved in Russia so that they do the following. They declare that they are socialism. In other words, socialism becomes when you capture the state, not when the state capture has enabled you to do X, Y, Z, other things. No, no. The state itself, once you have it, is socialism.

Lex Fridman 30:56 So when a socialist captures the state, that's socialism.

Richard Wolff 30:59 Exactly.

Lex Fridman 31:00 (laughs)

Richard Wolff 31:01 And he- that's exactly right. And that-

Lex Fridman 31:04 I feel like that's definitionally confusing. (laughs)

Richard Wolff 31:06 Well, it shouldn't be because here we get an example.

Lex Fridman 31:09 Yeah.

Richard Wolff 31:10 If you go to many parts of the United States today and you ask people, "What's socialism?" they'll tell you, they look you right in the face and they'll say, "The post office."

Lex Fridman 31:21 (laughs under breath)

Richard Wolff 31:21 And you, you know, when I first heard this as a young man-

Lex Fridman 31:24 Mm-hmm.

Richard Wolff 31:24 ... you know, "What? The post office?" It took me a while to understand the post office, Amtrak, the Tennessee Val-, all the examples in the United States where the government runs something. This is socialism. See, capitalism is if the government doesn't run it. If a private individual who's not a, a government official runs it well, then it's capitalism. If the government takes it, then it's socialism.

Lex Fridman 31:56 So what is wrong with that reasoning? So the idea, I think that s-

Richard Wolff 32:01 Well, it, there's nothing wrong with... It's a way of looking at the world. It's just got nothing to do with Marx.

Lex Fridman 32:06 Well, there's Marx, there's Marxism, let's-

Richard Wolff 32:08 Right.

Lex Fridman 32:08 ... let's try to pull this apart. So what role, uh, does central planning have in Marxism? So Marxism is concerned with this class struggle, with respecting the working class.

Richard Wolff 32:27 Right.

Lex Fridman 32:29 What is the connection between that struggle and central planning that is often w- central planning is often associated with Marxism.

Richard Wolff 32:38 Right.

Lex Fridman 32:38 So a centralized power doing-

Richard Wolff 32:41 Russia did that.

Lex Fridman 32:42 ... re- allocation. So that's a, that's, that has to do with a very specific set of implementations-

Richard Wolff 32:48 Right.

Lex Fridman 32:48 ... initiated by the Soviet Union.

Richard Wolff 32:49 Had nothing to do with Marxism. It-

Lex Fridman 32:51 How else can you do-

Richard Wolff 32:52 I don't think you can find-

Lex Fridman 32:54 Yes.

Richard Wolff 32:54 ... anywhere in Marx's writing anything about (laughs) central planning or any other kind of planning.

Lex Fridman 33:00 Again, fundamentally then, uh, Marx's, Marx's work, it has to do with, um, with factories, with workers, with w- with the bourgeoisie, with the-

Richard Wolff 33:12 Yeah.

Lex Fridman 33:12 ... and, and the, uh, the, the exploitation of the, of the working class.

Richard Wolff 33:16 Exactly.

Lex Fridman 33:17 But you still have to take that leap. What is beyond capitalism?

Richard Wolff 33:21 Right. So maybe we should turn to that expli-

Lex Fridman 33:25 Yes.

Richard Wolff 33:25 ... focus on that.

Lex Fridman 33:25 Okay. Yes. What... Okay, we've already looked historically at several attempts-

Richard Wolff 33:31 Right.

Lex Fridman 33:31 ... to go beyond capitalism. How else can we go beyond capitalism?

Richard Wolff 33:34 Right. Let me push you a little further. They didn't succeed, in my judgment, as a Marxist, and I'm now gonna tell you why they didn't succeed, because they didn't understand as well as they could have or should have what Marxist was trying to do. I think I would've been like them if I had lived at their time under their circumstances. This is not a critique of them, but it's a different way of understanding what's going on. All right, so give you an example. Most of my adult life, I have taught Marxian economics. I'm a professor of economics. I've been that all my life. I'm a graduate of American universities. As it happens, I'm a graduate of what in this country passes for its best universities. That's a another conversation you and I can have.

Lex Fridman 34:27 (laughs)

Richard Wolff 34:27 So I went to Harvard, and then I went to Stanford, and I finished at Yale. I'm like a poster boy for elite education. They tried very hard. By the way, I had, I wa- I spent 10 years of my life in the Ivy League, 20 semesters, one after the other, no break.

Lex Fridman 34:44 Mm-hmm.

Richard Wolff 34:45 In those 20 semesters, 19 of them never mentioned a word about Marxism. That is no critique of capitalism was offered to me ever, with one except. One professor in Stanford, in the one semester I studied with him, he gave me plenty to read, but nobody else.

Lex Fridman 35:06 So, uh, that, that's really interesting. You've, you've mentioned that in the past, and that's very true-

Richard Wolff 35:10 (laughs)

Lex Fridman 35:10 ... which makes you a very interesting figure to hold your ground intellectually through this idea space where just people don't really even talk about it.

Richard Wolff 35:23 No.

Lex Fridman 35:24 Um, perhaps we can d- discuss historically why that is, but nevertheless, that's the case. So M- Marxian economics, did Karl Marx come up in conversation as a kinda...

Richard Wolff 35:36 Dismissal.

Lex Fridman 35:37 Dispa-

Richard Wolff 35:37 The best example, yeah, he came up only as an object of dismissal. So to give you an example, the major textbook in economics that I was taught with, and that bec- was for many years the canonical book, it isn't quite anymore, um, was a, a book authored by a professor of economics at MIT named Paul Samuelson. And people kind of, you know, a whole generation or two were trained on his textbook. If you open the cover of his textbook, he has a tree and, you know, and the tree is Adam Smith and David Ricardo at the, at the root-

Lex Fridman 36:12 Mm-hmm.

Richard Wolff 36:13 ... and then the, the different branches of... He's trying to give you an idea as a student of how the thing developed. (laughs) And it's a tree, and everybody on it is a bourgeois. And then there's this one little branch (laughs) -

Lex Fridman 36:25 (laughs)

Richard Wolff 36:26 ... that goes off like this-

Lex Fridman 36:27 Yeah.

Richard Wolff 36:27 ... and sort of starts heading back down.

Lex Fridman 36:29 Yeah.

Richard Wolff 36:29 That's Karl Marx. In other words, the-He had to have it complete, 'cause he's not a complete faker. But beyond that, no. There was no... Nothing in the book gives you two paragraphs-

Lex Fridman 36:42 Sure.

Richard Wolff 36:42 ... of an approach. But that's Cold War. I mean, that- that's really, that's really neither here nor there.

Lex Fridman 36:48 That's certainly not Cold War.

Richard Wolff 36:48 That, that's the craziness. Yeah, that's the Cold War in this country. My professors were afraid. Anyway, let me get to the, to the core of it, what I think w- will help. Marx was interested in the relationship of people in the process of production, that he's interested in the factory, the office, the store, what goes on. And by that he means, what are the relationships among the people that come together in a workplace?

Lex Fridman 37:16 Mm-hmm.

Richard Wolff 37:18 And what he analyzes is that there is something going on there that has not been adequately understood, and that has not been adequately addressed as an object needing transformation. Now, what does he mean? The answer is exploitation, which he defines mathematically in the following way. Whenever, in a society, any society, you organize people, s- adults, not the children, not the sick and... but, you know, healthy adults, in the following way, a big block of them, a clear majority work. That is, they use their brains and their muscles to transform nature, a tree into a chair, a sheep into a woolen sweater, whatever. In, in every human community, Marx argues, there are the people who do that work, but they always produce more chairs, more sweaters, more hamburgers than they themselves consume, whatever their standard of living. Doesn't have to be low. Could be medium, could be high. But they always produce more than they themselves consume. That more... By the way, Jer- Marx, when he writes this uses the German word mehr, M-E-H-R, which is the English equivalent of more. It's the more. That more got badly translated into the word surplus. Shouldn't have been, but it was. By, by the way, by German and English people doing the translations.

Lex Fridman 38:58 What's the difference between more and surplus? Is there a nuanced...

Richard Wolff 39:01 Yeah, because surplus has a notion of it's discretionary, it's sort of extra. He's not taking a... He's not making a judgment that it's extra.

Lex Fridman 39:11 It's a simple math equation.

Richard Wolff 39:12 Yes, very simple.

Lex Fridman 39:13 One minus-

Richard Wolff 39:14 Literally-

Lex Fridman 39:14 ... the other.

Richard Wolff 39:15 Yes. X minus Y-

Lex Fridman 39:17 Produce versus... That's right. Minus the

Richard Wolff 39:19 ... X is the, X is the total output, Y is the consumption by the producer. Therefore, X minus Y equals S the surplus. Exactly. Exactly. Now, Marx argues the que- the minute you understand this, you will ask the following question. Who gets the surplus? Who gets this extra stuff that is made but not consumed by those who made it? And Marx's answer is, therein lies one of the great shapers of any society. How is that organized? For example, who gets it? What are they asked, if anything, to do with it in re- in exchange for getting it? What's their social role? For example, here we go now. If you get this, then you get the core of it anyway. Um, and I don't charge much.

Lex Fridman 40:12 (laughs)

Richard Wolff 40:12 Um, the workers themselves could get it.

Lex Fridman 40:15 Or at least less than lawyers.

Richard Wolff 40:16 Right. That's right. Right. Uh, the workers themselves could get it.

Lex Fridman 40:20 Yes.

Richard Wolff 40:21 That's the closest Marx comes to a definition of communism. Communism would, would be if the workers who produce the surplus together decide what to do with it.

Lex Fridman 40:35 So this has to do not just with who gets it, but more importantly, who gets to decide who gets it?

Richard Wolff 40:41 Well, who gets it and who get, gets to decide what to do with it.

Lex Fridman 40:44 Right.

Richard Wolff 40:46 Because you can't decide it if you don't have disposition over it. So then the lo- just the logic of the word sequence, it's produced, it's... Marx uses the word appropriated. In other words, whose property, who, who gets to decide, if you like, what happens? All that property ever meant is who gets to decide and who's excluded?

Lex Fridman 41:08 That's a clean definition of communism for-

Richard Wolff 41:10 Right. And that's the... By the way, it's not just clean. (laughs) It's the only one.

Lex Fridman 41:15 So what's, uh... Can we just linger on the definition of exploitation-

Richard Wolff 41:18 Yes.

Lex Fridman 41:19 ... in that context?

Richard Wolff 41:20 Easy. Becomes very easy now. Exploitation exists if and when the surplus that's produced is taken and distributed by people other than those who produced it. Slaves produce a surplus which the master gets. Serfs produce a surplus which the lord gets. Employees produce a surplus which the employer gets. It's very simple. These are exploitative class structures because one class produces a surplus appropriated, distributed by another group of people, not the ones who produced it, which creates hostility, enmity, envy, anger, resentment, and all of the problems you can lump under the heading class struggle. I use a metaphor, simple metaphorical story. You have two children, let's assume, and you take 'em to Central Park, a few blocks from here. It's a nice day, and the children are playing, and in comes one of those men with a ice cream truck, comes by. Ding-a-ling-a-ling-a-ling. Your children see the ice cream. "Daddy, get me an ice cream." So you walk over, you take some money, and you get two ice cream cones and you give 'em-...to one of the children. The other one begins to scream and yell and howl, obviously. What's the issue? And you realize you've just made a terrible mistake, so you order the one you gave the two ice cream cones to give one of those to your sister or your brother or whatever it is. And that, and that's how you solve the problem, until a psychologist comes along and says, "You know, you didn't fix it by what you just did. You should never have done that in the first place." My response, so you understand: all of the efforts to deal with inequality in economic, political, cultural, these are all giving the ice cream cone back to the kid. You should, you should never do this in the first place.

Lex Fridman 43:30 The reallocation of resources creates bitterness in the populous.

Richard Wolff 43:34 Oh, look at our... We've... This country is tearing itself apart now, in a way that I have never seen in my life. And I've lived here all my life, and I've worked here all my life. It's tearing itself apart, and it's tearing itself apart basically over the redivision, the redistribution of wealth, having so badly distributed it in the fir- But that's all in Marx. And notice, as I explained to you, w- what is going on in this tension-filled production scene, in the office, the factory, the store. I don't have to say a word about the government. I'm not interested in the government. The government's really a v- a very secondary matter to this core question, and here comes the big point. If you make a revolution, and all you do is remove the private exploiter and substitute a government official without changing the relationship, you, you can call yourself a Marxist all day long but you're not getting the point of the Marxism. The point was not who the exploiter is, but the exploitation per se. You gotta change the organization of the workplace so there isn't a group that makes all the decisions and gets the surplus ves- vis-a-vis another one that produces it. If you do that, you will destroy the whole project. You will... Not only will you not achieve what you set out to get, but you'll so misunderstand it that you... The Germans again have a phrase, es geht schief. It goes crooked. It, it doesn't go right. The project gets off the rails because it can't, uh, it can't understand either what its objective should have been, and therefore it doesn't understand how and why it's missing its objective. It just knows that this is not what it had hoped for.

Lex Fridman 45:26 I mean, there's a lot

Lex Fridman 45:27 of fascinating questions here, so one, one is, (sighs) to what degree... So there's human nature. To what degree does communism, uh, a lack of exploitation of the working class naturally emerge? If you leave two people together in a room and come back a year later, if you leave five people together in a room, if you leave 100 people and 1,000 people, it seems that humans form hierarchies, uh, naturally. So the, the clever, the charismatic, uh, the sexy, the p- the muscular, the powerful, what- however you define that, uh, starts, start, you know, becoming a leader and start to do, um, maybe exploitation in a non-negative sense, a more ge- generic sense, starts to become an employer, not in a capitalist sense but just as a human. "Here, you go do this and in exchange I will give you this," just becomes the leadership role, right? Uh, so the question is yes, okay, it would be nice, the idea sort of of communism would be nice to, to, uh-

Richard Wolff 46:37 It's nice in, nice in theory.

Lex Fridman 46:37 ... not steal from the world. It's nice in theory.

Richard Wolff 46:38 But it doesn't work in practice 'cause of human nature.

Lex Fridman 46:41 Because of human nature. That's... Thank you. (laughs) So what c- what can we say about leveraging human nature to achieve some of these ends?

Richard Wolff 46:50 There's so many ways of responding. Uh, in no particular order, here, here are some of them. Um, the history of the human race, as best I can tell, is a history in which a succession of social forms, forms of society, arise. And as they do, they rule out some kinds of human behavior on the grounds that they are socially disruptive and unacceptable. The argument i- isn't really then is there a need or an instinct? Is there some human nature (laughs) that makes people want to do this? Well, whatever that is, this has to be repressed or else we don't have a society. You know? And Freud helps us to understand that that repression is going on all the time and it has consequences. It's not a finished project. You repress it, it's gone. It doesn't work like that. So for example, when you get a bunch of people together at some point, they may develop animosities towards n- one another that lead them to want the other person or persons to disappear, to be dead, to be gone. But we don't permit you to do that. We just don't. Every economic system that has ever existed has included people who defend it on the grounds that it is the only system consistent with human nature, and that every effort to go beyond it has to fail because it contradicts human nature.I can show you endless documents of every tribal society I've ever studied, every anthropological community that has ever been studied, slavery, wherever it's existed. I can show you endless documents in which the defenders of those systems, not all of them, of course, but many defenders used that argument to naturalize a system as a way to hold onto it, to prevent it from going, to, to counter the argument that every system is born, every system evolves, and then every system dies. And therefore, capitalism, since it was born and since it's been developing, we all know what the next stage of capitalism is.

Lex Fridman 49:21 We can infer. You're-

Richard Wolff 49:23 It's gonna-

Lex Fridman 49:23 If what you're saying-

Richard Wolff 49:24 The burden is on the people who think it isn't gonna die.

Lex Fridman 49:26 Okay, so it doesn't mean they're wrong, but what you're saying is if we look at history, you're deeply suspicious of the argument-

Richard Wolff 49:34 Oh.

Lex Fridman 49:34 ... this is going against human nature because we keep using that for basically everything, including toxic relationship, toxic systems-

Richard Wolff 49:41 Absolutely.

Lex Fridman 49:41 ... destructive systems. That said, uh, well, let me just ask a million different questions.

Richard Wolff 49:47 Sure.

Lex Fridman 49:48 So, so one, what about the, the argument that sort of the employer, uh, the capitalist takes on risk? So, the... Yeah. Versus the employee who's just there doing the labor. The, the capitalist is actually putting up a lot of risk. What's, uh, are they not, in sort of aggregating this organization and taking this giant effort, hiring a lot of people, aren't they taking on risk that this is going to be a giant failure?

Richard Wolff 50:19 So, first of all, there's risk almost in everything you undertake. Any project that begins now and ends in the future, that takes a risk that between now and that future, something's gonna happen that makes it not work out. I mean, I got into a cab before I came here today in order to do this with you.

Lex Fridman 50:40 Yes.

Richard Wolff 50:40 I took a risk. I could... The cab could have been in an accident. The lightning could have hit us. A, a bear could have eaten my left foot. Who the hell knows?

Lex Fridman 50:47 But shouldn't I reward you for the risk you took?

Richard Wolff 50:50 No, hold it a second. Let's, let's do this step-

Lex Fridman 50:52 Okay.

Richard Wolff 50:52 ... by step.

Lex Fridman 50:53 Sure.

Richard Wolff 50:53 So, everybody's taking a risk. I always found it wonderful. You talk about risk and then you imagine it's only some of us who take a risk. Let's go with the worker in the, with the capitalist.

Lex Fridman 51:04 Mm-hmm.

Richard Wolff 51:05 That worker, he moved his family from Michigan to Pennsylvania to take that job. He had... He made a decision to have children. They are teenagers. They're now in school at a time when their friendships are crucial to their development. You're gonna yank him out of his school because his job is gone? He took an enormous risk to do that job every day, to forestall all the other things he could have done. He was taking a risk that this job would be here tomorrow, next month, next year. He bought a house, which Americans only do with mortgages, which means he's now stuck. He has to make a monthly payment. If you make a mistake, you capitalist, he's the one who's gonna... You're a capitalist. You got a lot of money, otherwise you wouldn't be in that position. You've got, you've got a cushion. He doesn't. If you investigate, you'll see that in every business I've ever been, and I've been involved in a lot of them.

Lex Fridman 52:10 So, you think it's possible to actually measure risk, or is your basic-

Richard Wolff 52:13 No.

Lex Fridman 52:13 ... argument is there's risk involved in a, in a lot of-

Richard Wolff 52:16 Right.

Lex Fridman 52:16 ... both the working class and the bourgeoisie, the capitalists-

Richard Wolff 52:19 That's right. That's right.

Lex Fridman 52:19 And it's very difficult-

Richard Wolff 52:20 And the worker, the worker would never come and say, because he's been taught right, "Um, I want this payment, a wage, for the work I do, and I want this page, this payment for the risk I take."

Lex Fridman 52:37 Well, there's some level of communication like that. You, you, you have acknowledgement of dangerous jobs, but that's probably built into the salary, all those kinds of things. You, you unders- But you're not-

Richard Wolff 52:47 Right, so you don't-

Lex Fridman 52:47 ... incorporating-

Richard Wolff 52:48 You don't rea-

Lex Fridman 52:48 ... the full spectrum of risk, like you s-

Richard Wolff 52:50 You don't believe that. This country is now being literally transformed from below by an army of workers who work at Amazon, uh, fast food joints. You know what their complaint is? "It's killing us. We get paid shit, and it's killing us." There is no relationship except in the minds of the defenders of capitalism between the ugliness, the difficulty, the danger of labor on the one hand, and the wage. Let me give you just a couple of examples-

Lex Fridman 53:23 Please.

Richard Wolff 53:23 ... because this is my... This is my job. This is my life, what I do. All right? The median income of a childcare worker in the United States right now, as we speak-

Lex Fridman 53:34 Mm-hmm.

Richard Wolff 53:34 ... is $11.22 an hour.

Lex Fridman 53:37 Mm-hmm.

Richard Wolff 53:38 Median. So, 50% make less, 50% make more. The median income for car park attendant is several dollars per hour higher than that. What does the car park attendant do? He stares at your car for many hours to make sure that nobody comes and grabs it.

Lex Fridman 53:59 Mm-hmm.

Richard Wolff 54:00 Maybe he parks it and moves it around to get it in and out. By any measure that I know of that makes any rational sense, being in charge of, of toddlers, two, three, four-year-olds, who are at the key moment of mental formation, the first five years, to do... To give that a lower salary than you give the guy who watches your car, come on. I know how to explain it. Gender explains... All kinds of issues ex- The, the car park people are c- are males, and the day- the childcare people are females, and that, that in our culture is a very big marker of what... But the one who said... Only the economics professor-... nobody else (laughs) says this stuff. Because in economy, I don't know if you are familiar with our profession, but we have something which we call-

Lex Fridman 54:52 (clears throat)

Richard Wolff 54:52 ... marginal product. This is a, this is a, a fantas- I, I was a mathematician. Before I became an economist, I loved mathematics. I, I specialized in mathematics, so I know mathematics pretty well. What economists do is, is silly, is childish (laughs) , but they think it's mathematics or sophisticated. It isn't. But think for a minute what it means to suggest that you can identify the marginal product of a factor of production, like a worker. Y- in, in the textbook when we, when it's taught, I've taught this stuff.

Lex Fridman 55:30 Mm-hmm.

Richard Wolff 55:30 I hold my nose, but I teach it. Then I explain to students, "What I've just taught you is horse shit," but I, first I teach it.

Lex Fridman 55:37 What is the marginal product? If, it might be useful to some-

Richard Wolff 55:39 It, the notion is if you take away one worker right now from the pile, what will be the diminution of the output? That's the marginal product of that worker.

Lex Fridman 55:51 Measured by?

Richard Wolff 55:53 The amount of the output that diminishes.

Lex Fridman 55:56 The output of the raw product-

Richard Wolff 55:58 Of the-

Lex Fridman 55:59 ... of, of the product.

Richard Wolff 56:00 Yeah. Usually in real terms, so physical not, not the value. You could do a value, but it's really more the physical you're after.

Lex Fridman 56:06 I mean, I, there is a transformation thing we'll, I'll, I'd love to talk to you about, about value 'cause it's so interesting-

Richard Wolff 56:12 Yes. Oh, I'd be-

Lex Fridman 56:13 ... what is value to-

Richard Wolff 56:13 ... I'd be glad to talk to you about value and price and all of that, but, but I just wanna get to the... Hegel, who was Marx's teacher, has a famous line, "You can't step in this, in the same river twice." And the argument is you and the river have changed between the first and the second time, so it's a different you and it's a different river. You can choose not to pay attention to that, just you can't claim you're not doing that. You can't claim that you can actually do that 'cause you can't. There is no way to do that.

Lex Fridman 56:45 Oh, so the, the, the meaning that you can't just remove a worker and have a clean mathematical calculation of the effect that it has on the output?

Richard Wolff 56:52 That's right.

Lex Fridman 56:53 (laughs)

Richard Wolff 56:53 Because too many other things are going on, too many things are changing, and you cannot assume, much as you want to, that the outcome on the output side is uniquely determined by the change you made on the input side. Can't do that.

Lex Fridman 57:10 Even in the, uh, even in the average, it's, it's not-

Richard Wolff 57:13 Not gonna work.

Lex Fridman 57:13 ... going to work out.

Richard Wolff 57:14 You can take... Look, mathematics is full of abstractions. You can abstract. You can say, as it, as we do in economics, (Latin) , you know? Everything else held constant, but you have to know what you just did. You held everything con... You know why you do that? 'Cause you can't do that in the real world. That's not possible. You better account for that. (laughs) Otherwise, you're mistaking the abstraction from the messy reality you abstracted from to get the abstraction.

Lex Fridman 57:42 As a quick tangent,

Lex Fridman 57:43 if we somehow went through a thought experiment or an actual experiment of removing every single economist from the world-

Richard Wolff 57:50 Right.

Lex Fridman 57:50 ... would we be better off or worse off?

Richard Wolff 57:52 Much better off.

Lex Fridman 57:53 Okay. (laughs)

Richard Wolff 57:54 Economics is... And I'm one. You know, I'm, I'm talking about myself. See, economics got w-

Lex Fridman 57:59 We're gonna ship, uh, ship all the economists to Mars and-

Richard Wolff 58:02 No, no, no.

Lex Fridman 58:02 ... see, see how well it works off.

Richard Wolff 58:03 It's just... No, but the serious part of this is that economics, you know, it's, uh, it's really about capitalism. Economics as a discipline is born with cap- There was no such thing. When I teach, I teach courses at the university, for example, called History of Economic Thought, right?

Lex Fridman 58:22 Mm-hmm.

Richard Wolff 58:22 And I begin the students with Aristotle and Plato. And I say, "You know, they talked about really interesting things, but they never called it economics." There was no... It meant, it made no sense to people to abstract something as central to daily life as economics broadly defined. It ma- made no sen- that's a creation much, much later. That's capitalism that did that, created the field of... So when I give them Plato and Aristotle, I have to give them particular passages. By the way, footnote, 'cause your audience will like it, Plato and Aristotle talked about markets because they lived at a time in ancient Greece when market relations were beginning to intrude upon these societies. So they were both interested in this phenomena, that we're not just w- producing goods and then distributing among us. We're doing it in a quid pro quo. "You know, I'll give you three oranges. You give me two shirts." A market exchange. And both Aristotle and Plato hated markets, denounced them and for the same reason. They destroy social cohesion. They destroy community. They make some people rich and other people poor, and they set us against each other, and it's terrible. And here's what... That's, they agreed on that. Here's what they disagreed on. One of them said, "Okay, there can be no markets." That was Plato. Aristotle comes back and says, "No, no, no, no, no, no. Too late for that. The disruption caused in society by getting rid of this institution that has crawled in amongst us would be too devastating. So we can't do that, but what we can do is control it, regulate it, get from the market what it does reasonably well and prevent it from doing the destructive things it does so badly."

Lex Fridman 1:00:19 So the, uh, the fundamentally, the destructive thing of a market is it's the engine of capitalism, and so it creates exploitation of the worker.

Richard Wolff 1:00:27 It facil- I wouldn't create.

Lex Fridman 1:00:29 Fa-

Richard Wolff 1:00:29 That's too strong.

Lex Fridman 1:00:29 Facilitates.

Richard Wolff 1:00:30 It facilitates it, and it is an institution that Plato and Aristotle feel is a terrible danger to community.

Lex Fridman 1:00:39 Is there...

Richard Wolff 1:00:39 Which, by the way-

Lex Fridman 1:00:40 Yeah.

Richard Wolff 1:00:41 ... is a way of thinking about it that exists right now all over the world. Look, the medieval Catholic Church had a doctrine, the prohibition of usury.... you know, i- and this was that God said-

Lex Fridman 1:00:56 Mm-hmm.

Richard Wolff 1:00:57 ... if there's a person who needs to borrow from you, then that's a person in need, and the good Christian thing to do is to help him. To demand an interest payment rather than to help your fellow man is - God hates you for that. That's a sin. Jesus is crying all the way to wherever it is he goes.

Lex Fridman 1:01:20 But would Jesus be crying when you try to scale that system? So that has to do with, mm, intimate human interaction. The idea of markets is you're able, uh, to create a system that involves thousands, millions of humans, and there'd be some level of, um, safe self-regulating fairness.

Richard Wolff 1:01:46 There might be, but it's hard to imagine- (laughs)

Lex Fridman 1:01:49 (laughs)

Richard Wolff 1:01:49 ... that charging interest would be the way to do that.

Lex Fridman 1:01:52 I wonder what ... so I, I guess-

Richard Wolff 1:01:54 Suppose, suppose you were interested in having, uh ... suppose you s- took as your problem we have a set of funds that can be loaned out. Now, people don't wanna consume it. They- they're ready to lend it. Okay. To whom should they lend it? Well, we could say in our society, um, we're gonna run this the way professors in institutions like MIT work this.

Lex Fridman 1:02:20 Mm-hmm.

Richard Wolff 1:02:21 They write up a project. They send the project in to some government office where it is looked at against other projects, and this office in the government decides, "We're (laughs) gonna fund this one and that one because they're more n- needed in our society. We, we're in greater need of solving this problem than that problem, and so we're gonna lend money to people working on this problem more readily or more money than we lend over here, because we're going to ..." but instead what we do is, who can pay the highest interest rate?

Lex Fridman 1:02:56 (laughs)

Richard Wolff 1:02:56 Whoa. What, what, why do you do it? Why, why ... what ethics would justify you doing? It's like a market in general. Something is in shortage. All markets are about how to handle shortage. That's one basic way to understand it. And so if, if the demand is greater than the supply, which is all the word shortage means, has no other meaning, if the demand is greater than the supply, okay, now you got a problem. You can't satisfy all the demanders 'cause you don't have enough supply. You have a shortage. Okay, now how are you gonna do it? In a market, you allow people who have a lot of money to bid up the price of whatever's short, and you ... that solves your problem because as the price goes up, the poor people can't af- they drop out. They can't buy the thing at the exalted price. So you've w- got a way of distributing the shortage. It goes to the people with the most money. At this point, most human beings confronted with this (laughs) explanation of a market would turn against it, 'cause it contradicts their Christian, Judaic, Islamic ... all of them would say, "N- what?" You know what that means? It means that a rich person can get the scarce milk and give it to their cat while the poor f- person has no milk for their five children. I mean, there it is.

Lex Fridman 1:04:19 (laughs)

Richard Wolff 1:04:19 You want a market? Why?

Lex Fridman 1:04:20 The, the fundamental thing that seems unfair, there's the resulting inequality. Now-

Richard Wolff 1:04:27 Or death.

Lex Fridman 1:04:28 Or death. Well, that's the ultimate inequality.

Richard Wolff 1:04:30 Yes, it is.

Lex Fridman 1:04:32 What about ... and we're gonna

Lex Fridman 1:04:34 jump around from the philosophical, from the economics, to the sort of, uh, debate type of thing. (sighs) What about sort of the lifting ties raise all boats, meaning if we look at the 20th century-

Richard Wolff 1:04:49 Right.

Lex Fridman 1:04:50 ... uh, a lot of people, maybe you disagree with this, but they attribute a lot of the innovation and the average i- improvement in the quality of life, uh, to capitalism-

Richard Wolff 1:05:02 Right.

Lex Fridman 1:05:02 ... to inventions and innovation, to engineering and science developments th- um, that's resulted from competition and all those kinds of forces. Um, so j- not looking at the individual unfairness of exploitation as it's specifically defined, but just observing historically, looking at 20th century, we came up with a lot of cool stuff that seemed to have made life easier, uh, and better on average. What do you say to that?

Richard Wolff 1:05:35 I have several responses to that, um, but, uh, I do disagree, uh, pretty f- uh, fundamentally (laughs) with what's going on there. But, but let me give you the arguments so you, that you can hear them and then you can evaluate them, uh, as can anybody who's listening or watching. Um ... Marx was a student of Hegel, and one of Hegel's central arguments was that everything that exists, exists, quote, "In contradiction." Uh, in simple English, there's a good and bad side, if you like, to everything, and you won't understand it unless you accept that proposition and start looking for the b- good things that are the other side of the bad ones and the bad things that are the other side of the good ones, et cetera. So-

Lex Fridman 1:06:23 It's the dialectic.

Richard Wolff 1:06:24 Yes, exactly. And Marx, very attentive to that, explicitly agrees with this on many occasions, and applies it, of course, to the central object of his research, capitalism. So this is not a simple-minded (laughs) fellow who's telling you all the bad things about capitalism as if there were nothing that this system achieved or accomplished, and one of the things he celebrates a lot is the technological dynamism of the system.... uh, which Marx takes to be, uh, profound because, you know, he lived at the time when major breakthroughs in, in textile technology, in mining, uh, in chemistry, and so on were achieved. Um, but as to the notion that, that capitalism is therefore responsible for the improvement in, in the quality or the standard of living of the mass of people, Marx now comes back and says, "Oh, wait, wait a minute here. Number one, capitalism as a system has been mostly represented by capitalists," which makes a certain sense. "And those capitalists, with very few exceptions, some but very few, have fought against every effort to improve the lives of the mass of people. The goal of a capitalist is to minimize labor costs. What that means is replace a worker with a machine, move the production from expensive US to cheap China, uh, bring in desperate immigrants from other parts of the world because they will work for less money than the folks that you have here at home. Uh, every measure to help the standard of living of American workers had to be fought for, for decades over the opposition of capitalists from the beginning to right now. The reason we haven't..." Minimum wage, which was passed 19- middle of the 1930s. When it was proposed, it was blocked by capitalists. They got together. They don't want ... And today, uh, uh, just a factoid for you, the last time the minimum wage wa- was raised in the United States, federal minimum wage, was in 2009 when it was set at the lofty sum of $7.25 an hour, which you cannot live on. Over the last 12 years or so, whatever it is now, 11, 12, 13 years since then, we have had an increase in the price level in this country every year, and in the last year, 8.5%. During that time that the prices went up, the minimum wage was never raised. What? This is a time of stock market boom, of growing inequa- This is a soc- You know, the nerve of the defender of capitalists who wants now to get credit for the improvement in the standard of life of the workers that was fought by every generation. You know, it takes your breath away. Jase: (laughs) It's an argument. Whoa. Uh, but I take my hat off if I had one because that is one'the only ways to justify this system. Long ago ... Now let me get at the heart of it. Long ago, capitalism could have overcome hunger-

Lex Fridman 1:10:05 Yeah.

Richard Wolff 1:10:05 ... could have overcome disease, could ha- I mean, way beyond what we have now. But it didn't.

Lex Fridman 1:10:13 Yeah.

Richard Wolff 1:10:13 And that's the worst moral condemnation imaginable. How do you justify that when you could, you didn't? Look, I ... Let, let me get at it another way 'cause this may, may interest you anyway. The issue is not that capitalism isn't technologically dynamic. It is, and along the way, it has developed things that have helped people's lives get better. No question. But the notion that the, the mass enjoyment of a rising standard of living is somehow built into capitalism is factually nuts and is such an outrageous ... And I can give you a ... 'Cause you do math, you know, you'll understand it. Think of it this way. Imagine a production process in which you have, um, $100 that the capitalist has to lay out for tools, equipment, and raw materials and $100 that he has to lay out for workers, hire the workers. And he puts them all together, and he has an output. And let's say he, uh, the output is 100 units of something and whatever the price is, and that's his revenue. And when he, when he s- takes his product and sells it and gets the revenue, let's say the revenue is ... It doesn't really matter. It's 120, for lack of a better word, and he ta- uh, 220. Sorry. And he takes 100 of it and replaces the tools, equipment, and raw materials he used up, another 100 to hire the workers for the next shift, and the other 20 is his profit, and he puts that aside. Now along comes a technological breakthrough, a machine, a new machine. And the new machine is so effective, you can get the same out- the same number of units of output with half the workers.

Lex Fridman 1:12:12 Mm-hmm.

Richard Wolff 1:12:13 So you don't need to spend 100 on workers. You only need to spend 50. You can do it with half the workers. And so the capitalist goes to the workers. By the way, this happens every day. And he says to half of them, "You're fired. Don't come back Monday morning. I don't need you." It's nothing personal. He says, "I got a machine. I don't need 'em." Why does he do that? Because the 50 he now no longer has to spend on labor 'cause he doesn't need half of them, he keeps. Everything else is the same. The machine, everything else is the s- just to make the math easy. So he, he keeps as his own profit the 50 that before he paid for those workers.

Lex Fridman 1:12:53 Yeah.

Richard Wolff 1:12:54 Right? 'Cause when he sells it for 220, that 50 he doesn't have to give to the next gen- because he has a new machine.So that's what he does. The technology leads, he's happy. He's become more profitable. He's got an extra 50, which is why he buys the machine. The workers are screwed. Half of them just lost their job, have to go home to their husband and wife, tell them, "I don't have a job anymore. I didn't do anything wrong." Th- the guy was nice enough to say there was nothing wrong with me, but he doesn't need it. I mean, well... (blows raspberry) "So I'm, I'm completely screwed here. I don't know what I'm gonna do about the debts we have, the house on mortgage, my children's education," or whatever else he's got going for himself. All right now, now the point. There was of course an alternative path. The alternative path would've been to keep all the workers, pay them exactly the same that you did before for half a day's work. You would've got the same output, same revenue, same profit as before. But the gain of the technology would've been a half a day of freedom every day of the lives of these workers. The majority of workers would've been really helped by this technology, but instead they were screwed so that one guy, the employer, could make a big bundle of more money. You wanna support a system like this?

Lex Fridman 1:14:26 Well, uh...

Richard Wolff 1:14:27 (laughs) I'm sorry.

Lex Fridman 1:14:28 To go back to Hegel-

Richard Wolff 1:14:29 Yes.

Lex Fridman 1:14:30 ... the good and the bad.

Richard Wolff 1:14:31 Yes.

Lex Fridman 1:14:32 So you just listed the bad and you also first listed the good, the technological innovation of this kind of system. The question is the alternative, uh, whatever, as we try to sneak up to ideas of what the alternative might look like-

Richard Wolff 1:14:46 Right.

Lex Fridman 1:14:46 ... what are the good and the bad of the alternative? So you just kind of, as a opposite in the contra- by contrast showed that, well, a nice alternative is you work less, get paid the same, you have more leisure time-

Richard Wolff 1:15:01 Right.

Lex Fridman 1:15:01 ... o- opportunity to, to pursue other...

Richard Wolff 1:15:05 Interests.

Lex Fridman 1:15:06 ... other interests, the creative interests-

Richard Wolff 1:15:08 Yeah.

Lex Fridman 1:15:08 ... family.

Richard Wolff 1:15:08 Right. Right.

Lex Fridman 1:15:09 Flourish as a human being. Uh, basically, uh, strengthen and, uh, embolden the basic humanity that's-

Richard Wolff 1:15:17 Right.

Lex Fridman 1:15:17 ... under a- all of us. Yes. But then what cost does that have on the, um, the deadline-fueled, competition-fueled machine of technological innovation that is the positive side of capitalism?

Richard Wolff 1:15:36 Slows it down.

Lex Fridman 1:15:37 It slows it down. And the question is, which is more important for the flourishing of humanity?

Richard Wolff 1:15:44 I lo- I agree with that. And I'd love there to be a democratic mechanism. So let's, let's discuss it, let's debate it, and then let's si- decide what mixture, 'cause it's not either or.

Lex Fridman 1:15:57 Mm-hmm.

Richard Wolff 1:15:57 The mathing problem I gave you is either or. We could mix it. You could have a third less of a working day instead of a half less, and then the other part would be extra profit for our employer, et cetera, et cetera. So, let's have a democratic discussion of what is the mix between the positive and... We have no such thing.

Lex Fridman 1:16:17 Yeah.

Richard Wolff 1:16:17 All of this is decided by one side in this debate, which not only... We know what they do. They always choose the one that maximizes their profit-

Lex Fridman 1:16:26 Yes.

Richard Wolff 1:16:26 ... 'cause that's what they were told to do in business school where I've taught, right? Um, so we... Not only is it an undemocratic decision, but it's lopsided to boot. So we don't have the opportunity, but I would love for us to be good Hegelian Marxists and say, "Let's take a look at the plus and the minus and make the best decision that we can." We'll make mistakes, but we'll all make them together. It won't be one of us making a dictatorial decision. You know, Marx developed the notion of the dictatorship of the proletariat not as a notion of how government... Uh, is not, I'm sorry, not Marx. Lenin did that. Not as a notion of-

Lex Fridman 1:17:05 Yeah.

Richard Wolff 1:17:05 ... how the government works, but as a notion of what the practical reality is. The dictatorship in these key decisions is not made by some sitting council. It's made by each little capitalist in his/her relationships with the workers in the workplace, which is why Marx focused his analysis on that point. And by the way, I can sketch for you right now so it doesn't lurk in the background-

Lex Fridman 1:17:29 Yeah.

Richard Wolff 1:17:29 ... what the alternative is.

Lex Fridman 1:17:31 Yeah. Let's go there.

Richard Wolff 1:17:32 Okay. It goes right back to what I said earlier. The workers themselves, the collection of employees together appropriate their own surplus and decide democratically what to do with it, which includes the decision of whether or not to buy a machine and whether or not to use the machine and the savings it might allow to be handled by more leisure for themselves-

Lex Fridman 1:18:06 Mm-hmm.

Richard Wolff 1:18:06 ... or as a fund for new developments in technology or new products

Narrator 1:18:13 (coughing)

Richard Wolff 1:18:13 ... or what- whatever they want. And you know, this, this is an old idea. And human... Ma- Marx loved that. Toward the end of his life, he, he started reading extensively in anthropology. And one of the reasons he did that toward the end of his life was because he kept discovering that in this society, in that one, including here in the United States, that there were examples of people who organized their production in precisely this way, as a collective democratic community in which everybody had an equal voice. So we all together decide democratically what to produce, how to produce, where to produce, and what to do with the output we all help to produce. So let's do it in... You know, in this country where democracy is a-... value nearly everybody subscribes to. Think about it this way, the stunning contradiction that there is a place in our society where democracy has never been allowed to enter, the workplace. In the workplace, a tiny group of people, unaccountable to the rest of 'em, the, the employer, whether that's an individual, a family, a partnership or a corporate board of directors. A tiny group of people controls, economically, a vast mass of employees. Those employees don't elect those people, have no con- nothing to... There is no accountability. It is the most undemocratic ama- uh, arrangement imaginable. And this society insists on calling itself democratic when it has organized the minor matter of producing everything in a, in a way that isn't the direct... It's autocratic.

Lex Fridman 1:20:08 Yeah. So to push back, uh, on, on a, on a few things.

Richard Wolff 1:20:11 Yeah.

Lex Fridman 1:20:11 So one is the idea of this society calling itself democratic is that the government is elected democratically and the government is able to pressure the workplace through the process of regulation. You pass laws of the boundaries of how... You know, minimum wage.

Richard Wolff 1:20:30 Right.

Lex Fridman 1:20:30 All those kinds of things. That's the, uh, one idea.

Richard Wolff 1:20:32 Right.

Lex Fridman 1:20:33 The other is there is a natural force within the capitalist, when there's no monopolies, uh, of competition being the accountability. So if you're a shitty boss, the employ- uh, the employee in the capitalist system has the freedom to move to another company, work for a better boss. So that, that creates pressure on the employers and the bosses. That's at least the idea, that you, um... There's two boundaries of you not misbehaving. One is the law, so regulatory- uh, regulations by, passed by the government, democratic. And the second is, because there's always alternatives, in theory, then that puts pressure on everyone to behave well 'cause you can always leave. Uh, (laughs) so, I mean, that's kinds of accountability, but what you're saying is that does not result in any... In a significant enough accountability where the employer, uh, that avoids exploitation of the worker.

Richard Wolff 1:21:33 Absolutely. I mean, whatever accountability you get in those mechanisms. And let me respond to that, and then I'll... The counterargument. Um, first, competition. (laughs) Here again we have to be Hegelians just a little. Competition destroys itself. It doesn't need any out... The whole point of competition is to beat the other guy. If I can produce the same product as the other guy, either a better quality or a lower price or maybe both, then I win because the customers will come to me 'cause my price is lower or my quality is better, and they'll leave the other guy. He'll go out of business. Now let's follow. When he goes out of business, 'cause I've won the competition, he fires his workers. I hire them because I'm now gonna be able to, to serve a market he can't serve anymore. So I'm gonna, I'm gonna buy the used equipment. I'm go... And thereby many become few. Monopoly is the product of competition. It's not the antithesis. It's the product.

Lex Fridman 1:22:42 Well, let, let's see. There-

Richard Wolff 1:22:44 That's where it comes from.

Lex Fridman 1:22:44 Well there's another s- there's another element to the system where there's always a new guy that comes in. Uh-

Richard Wolff 1:22:50 There isn't. There isn't.

Lex Fridman 1:22:51 Well, that's the d- that's the dream. The entrepreneurial spirit of a free... Uh, you know, of, of the, of the United States, for example, of a capitalist system is, uh, you can be, um, broke and one day have a strong idea and build up a business that takes on Google and Facebook and Twitter and, and, uh, all the different car... Ford, GM, which is what... You know, you look at Tesla for example, right? That's the American dream. Uh, one of the many ideals of the American dream is you can, um, uh, move from dirt poor to being the richest person in the world.

Richard Wolff 1:23:31 Right.

Lex Fridman 1:23:31 And, um...

Richard Wolff 1:23:33 It can happen.

Lex Fridman 1:23:34 It can happen. But you're against-

Richard Wolff 1:23:35 You know what that's like?

Lex Fridman 1:23:36 Yeah.

Richard Wolff 1:23:36 That's like, uh, you can win the lottery.

Lex Fridman 1:23:38 No, that's not quite... No. The lottery's complete luck. Here, you can work your ass off if you have a good idea.

Richard Wolff 1:23:44 The odds are better in the lottery.

Lex Fridman 1:23:47 That's not, that's not true. There's a lot of new businesses-

Richard Wolff 1:23:50 How many Teslas do you, do you know?

Lex Fridman 1:23:52 Oh, Tesla's a really bad example 'cause a car company... The, the... (laughs)

Richard Wolff 1:23:55 (laughs)

Lex Fridman 1:23:56 The automotive sector is so difficult to, uh... They operate at such a thin margin of profit that they're probably a good example of, like, capitalism just completely coming to a, uh, a halt in terms of in- lack of innovation becau- You know, th- that's a very complicated industry because of the supply chain but there's so much-

Richard Wolff 1:24:17 They are. Come on.

Lex Fridman 1:24:19 They-

Richard Wolff 1:24:19 They have their uniquenesses. You're quite right. But so does every other industry. The one thing that's common is that many become few. What you can also have is when you have a few, they jack up the price. They make an enormous profit. And then the irony of capitalism, Marx would love this, they begin to incentivize people to break into this industry 'cause the few remaining are making a wild amount of profit because they are a few and can jigger the market to make it work like that for them.

Lex Fridman 1:24:51 So-

Richard Wolff 1:24:51 But the reason every em- every small capitalist is trying to build market share... That's a police way, polite way of saying they wanna become a monopolist, or to be more f- uh, exact, an oligopolist, one of a, a handful of firms that dominates. That's what they're there for.

Lex Fridman 1:25:09 But, yeah, to push back a little bit also, because that's...... could be... This is a question also. Do you think we're in danger of oversimplifying capitalism, that completely removes the basic decency of human beings? So, if you give me a choice to press the, to press a button, uh, to get rid of the competition and that... But that's going to lead to a lot of suffering, there's a lot of people at the heads of companies that won't press that button. That it's not... In the calculation is not just money, it's human wellbeing too. So like, the, uh-

Richard Wolff 1:25:48 You think?

Lex Fridman 1:25:49 I... Yes. I've (laughs) inter-

Richard Wolff 1:25:51 You and I don't live in the same place then.

Lex Fridman 1:25:53 So you're saying that the forces of capitalism take over the minds of the people at the top?

Richard Wolff 1:25:58 You got it.

Lex Fridman 1:25:59 And then th- they, they cease being human, essentially.

Richard Wolff 1:26:02 No.

Lex Fridman 1:26:03 They, the basic c- okay.

Richard Wolff 1:26:04 I wouldn't go, I wouldn't-

Lex Fridman 1:26:05 Depending on your model of humans-

Richard Wolff 1:26:07 Yeah.

Lex Fridman 1:26:07 ... but they, they, they, uh, lose track of the better angels of their nature and, uh, they just become cogs in the machine but they're just happen to be the cog at the top.

Richard Wolff 1:26:15 I would, I would put it differently that the system is so set up, it's a little bit like natural selection. The guys who make... Uh, I could say the w- women too, it doesn't matter. The people who make it up through the layers of the bureaucracy and get to the top in these things have had to do things along the way that become selective. If they can't stand it, because they have that human quality... And there are people, I, I've known them. They're the ones running an Airbnb in, in Vermont. They che- they went there and they said, "I'm not doing this anymore. I'm not gonna treat people like that. I'm gonna make a lovely place in Vermont with my husband or my wife or whatever, and I'm gonna be, you know, enjoying the people that come by and be a decent human." Of course, of course. But the system selects the firm... You know, if you don't do what has to be done to make the profit go up, you're toast there anyway. The, the rest of the people who vote for you are gonna kick you out. You can tell 'em h- all day long what a lovely person you are, they're, they're gonna look at you and wonder wh- what happened to you. How did you even get this far with the lovely person horseshit?

Lex Fridman 1:27:21 Well, it's not... Okay, okay, 'kay, 'kay, 'kay.

Richard Wolff 1:27:23 (laughs)

Lex Fridman 1:27:23 It's not necessarily just lovely person. So maybe my... I'll, I'll just say my bias is the, the people I know are, uh, especially at the top of companies or in the tech sector-

Richard Wolff 1:27:36 Right.

Lex Fridman 1:27:36 ... where s- innovation is such a big part of it. So I think a lot of the things we're talking about is when there's not much innovation in the system. So, uh-

Richard Wolff 1:27:51 Innovation usually comes... In the history of capitalism, innovation comes in spurts. There's the electric period, the chemistry period, the nuclear period, there's now whatever you wanna call it, the artificial intelligence or robotics or computer. It doesn't... It comes and then there's a flurry as everything is reorganized around whatever the newest technology is, and then you have a period where you can get excited about that. And the very rich people who come to the top can talk endlessly, as they always do, about innovation.

Lex Fridman 1:28:24 Yeah.

Richard Wolff 1:28:24 But again, it, you know, it, it really is... This is a recurring kind, uh, of debate and a recurring kind of issue. For me, (sighs) how do I put this in a way-

Lex Fridman 1:28:39 (laughs)

Richard Wolff 1:28:39 ... that... You know, I don't mean to offend, so I'm not-

Lex Fridman 1:28:41 (laughs) Yeah, please, please.

Richard Wolff 1:28:43 Oh, no, no, I don't. I don't want to. But... The problem with capitalism is, and maybe you'll like this, the problem with capitalism is not that it is the one thing that's consistent with human nature, that's what its defenders would like to have us believe, but if anything I would argue the opposite. That it is such a contradiction to parts of our nature, not other parts, that there... It can never quite make it. There's always gonna be the people who don't go along with it, people you're talking about, who do quit along the way. Or maybe a few of them actually make it to the top by God knows what hook or what crook that they did it, but most of them go. And you know why? Because their humanity is contradicted by what it is they're being asked to do. I mean, the, the corporate sector this year, just to give you an idea, CEOs, uh, are jacking up their, their wage package. They're already out of whack. I mean, the average CEO pay is now three, 300 times what, what the level of average worker pay is. But they're jacking it up even more. Why? 'Cause that's what's happening in their universe. That's what... They're all doing it and they have to do... Each one of them justifies it, "I have to do that otherwise I'd lose my guy to the next one," which of course is true, but is no comfort for the mass of people who aren't CEOs for whom this argument isn't very exciting. Uh, so there are... They're doing that at a time when the American people can't cope. They've just gone through the COVID disaster, they've gone through the worst, second-worst economic crash of capitalism in our history. After two years of this one-two punch, they got an inflation, a third punch, and we are now predicting rising interest rates and a recession at the end of the year or early next year. You can't do this to a working class. When this was done to the German working class in the 1920s, Hitler was the result. You keep doing that in this country, we're already watching it, you're gonna get that too. You're already getting bits and pieces. You can't keep doing this.

Lex Fridman 1:31:08 So there's a quiet suffering amidst the working-

Richard Wolff 1:31:10 Horror.

Lex Fridman 1:31:10 ... class that's growing.

Richard Wolff 1:31:12 Taking out on-

Lex Fridman 1:31:13 That can turn to anger.

Richard Wolff 1:31:14 ... some little 18-year-old kid who has to go three hours in his car and blow away people in a supermarket.Huh? What?

Lex Fridman 1:31:23 So, you-

Richard Wolff 1:31:23 And it happens every day in this country. Every day.

Lex Fridman 1:31:27 So, uh, the- that anger rises up in those little ways now, and then bigger and bigger potentially.

Richard Wolff 1:31:34 Yeah. Ends the system.

Lex Fridman 1:31:34 (sighs)

Richard Wolff 1:31:34 By the way, there's one more thing on the rationality, and this goes to Elon Musk. If you're interested, 49,000 people were killed in automobile co- uh, accidents this last year. The number was just released yesterday, 49,000. Automobiles are the single largest pollutant in the country. They use up an enormous amount of energy. They, uh, they use up enormous a- amount of resources. There is a way to make transportation much more rational, and we've known it for decades. It's called mass transportation. It's a really beautifully maintained, crystal clear, clean, frequent system of buses, trains, street ra- uh, trolleys, uh, vans. Uh, it could easily be done in this society. In fact, I once did a, uh, a project that I estimated cost $30 billion, uh, that's less than we're sending to Ukraine, to do this, to reconfigure it.

Lex Fridman 1:32:42 Uh, a public transit system where?

Richard Wolff 1:32:44 Everywhere in this country. All the major metropolitan... This country's overwhelmingly metropolitan area.

Lex Fridman 1:32:49 Well, it- it- it surely-

Richard Wolff 1:32:49 If you a-

Lex Fridman 1:32:50 ... has to be more than $30 billion, but, but-

Richard Wolff 1:32:52 Well, it was a few years ago.

Lex Fridman 1:32:53 Okay.

Richard Wolff 1:32:54 Whatever it was.

Lex Fridman 1:32:54 Sure, but you're saying it's not-

Richard Wolff 1:32:55 But I'm using a lot of it-

Lex Fridman 1:32:56 ... a number that's insane.

Richard Wolff 1:32:57 Right, it's not crazy stuff.

Lex Fridman 1:32:58 It's a, it's a reasonable number.

Richard Wolff 1:32:59 Right, right. So-

Lex Fridman 1:33:00 Hey, listen, um, but there's a, and we'll-

Richard Wolff 1:33:02 Let me just finish the point.

Lex Fridman 1:33:03 Sure, yes.

Richard Wolff 1:33:04 Okay? So, I'm trying to be rational here. If we have a climate crisis, which everyone tells me we do, if it's got a lot to do with fossil fuels, which everybody tells me it has to do, and, and with the use of the fossil fuel particularly for the automobile, then the solution to the problem would be mass transit. We don't, we're doing nothing to make that happen. Nothing.

Lex Fridman 1:33:31 Well, there's, you know, on, um, you could argue that autonomous vehicles is a kind of public transit because it's going to be reusable vehicles. It will end, in theory, um, car ownership, so you just have a more kind of distributed public transit system.

Richard Wolff 1:33:46 If it happens, but you know that that's a side effect. His major goal and the major goal of the other companies that are busy squeezing to get his share of the pie smaller so they have some, Ford, General Motors, Toyota, all of 'em are making electric cars now. So, what they've done is they've replaced the individual car with fossil fuel with another individual car.

Lex Fridman 1:34:11 Yeah.

Richard Wolff 1:34:11 That's fucking nuts.

Lex Fridman 1:34:13 Well, that's one o-

Richard Wolff 1:34:13 What are you doing?

Lex Fridman 1:34:14 That's one of the things they're doing, but automation is also another one. But on the Elon side, there's also (laughs) hilariously named Boring Company.

Richard Wolff 1:34:21 Yes.

Lex Fridman 1:34:21 Which is working on tunnels, which is actually expanding the, the, the, the flexibility you might have to start playing with ideas of public transit-

Richard Wolff 1:34:31 Right.

Lex Fridman 1:34:31 ... I think. Listen-

Richard Wolff 1:34:32 It-

Lex Fridman 1:34:32 ... I'm now-

Richard Wolff 1:34:33 Yeah.

Lex Fridman 1:34:33 ... partially living in Austin, Texas, that I don't know if they know what a public transit system is, period.

Richard Wolff 1:34:40 Yes.

Lex Fridman 1:34:40 Um, there's F-150-

Richard Wolff 1:34:41 Most American cities are.

Lex Fridman 1:34:42 ... pickup trucks.

Richard Wolff 1:34:43 Yeah.

Lex Fridman 1:34:43 They're, well, there's, this is an interesting, so-

Richard Wolff 1:34:47 The older, by the way, footnote.

Lex Fridman 1:34:49 Mm-hmm.

Richard Wolff 1:34:49 The older the city, the more likely it has public transportation.

Lex Fridman 1:34:54 So, you're saying-

Richard Wolff 1:34:54 Boston is the best example.

Lex Fridman 1:34:56 Yes.

Richard Wolff 1:34:57 You, have you been, well, you-

Lex Fridman 1:34:58 Yeah, yeah.

Richard Wolff 1:34:58 ... you know.

Lex Fridman 1:34:59 Of course, yeah, I have a place in Boston.

Richard Wolff 1:35:00 Boston with the street railway, Boston is your case study of how to do this 'cause they've been doing it all along. New York's-

Lex Fridman 1:35:07 Yeah.

Richard Wolff 1:35:07 ... pretty good too.

Lex Fridman 1:35:08 There, there's a trade-off. Yeah, New York I would say is better than Boston because-

Richard Wolff 1:35:11 Yeah.

Lex Fridman 1:35:11 ... so there's, you know, their technology also helps you out to do the public transit better. Uh, it's almost like Boston's a little too old, but yes, I get your point. Uh, but there is a, the, the Ford F-150 pickup truck-

Richard Wolff 1:35:27 Right.

Lex Fridman 1:35:27 ... symbolizes something about America. And, and there is a practical nature to the fact that in order to do public transit, in order to do some of these things that you're talking about with, uh, the working class, there has to be a central planning component, or there has to be a centralized component. And America is very much, uh, based on the idea of, at least in recent times, well, I would say from the founding, of individualism, of respecting individual freedom. Are you worried that in order