Richard Wolff in sheep’s clothing, on capitalism versus socialism

I heard Richard Wolff again on “Alternative [left-wing] Radio.” He’s the “Marxist” economics professor whose LOL take on first class airplane seats I wrote about. Wolf saw them as though created by God but unfairly handed out by dastardly airlines to rich folks, forcing plebeians to suffer in coach. In actuality, the rich subsidize the rest. That’s how airlines make their money. Without milking richies via vastly overpriced premium seats, they’d have to charge coach travelers far more, which wouldn’t fly — literally.

Wolff couldn’t see that reality. But he is a glib talker. His latest was on capitalism versus socialism. He thinks capitalism’s badness will cause socialism to triumph.

A chief theme was “socialism” getting a bum rap because people don’t understand it. This is part of the effort to sugar-coat socialism, making it seem innocuous — a wolf in sheep’s clothing. (We saw this with the Bernie campaign.) It’s the trope that if you like public roads and libraries and fire departments, etc., anything government does, why, that’s socialism!

Except that it isn’t. Providing necessary services that a free market cannot (at least not well) is just any government’s job. Socialism instead is government substituting for (and disallowing) a capable free market.

Now, if you think that’s a good idea, fine, try to persuade us. But socialists must doubt its persuasiveness, else why do they constantly hide what they really advocate, under false camouflage about roads and fire service?

Richard Wolff-in-sheep’s-clothing epitomizes this, again saying people misunderstand “socialism.” He repeatedly mocked the idea of any association with Stalin’s crimes. He stressed that “socialism” is not limited to any single categorical definition. But did he ever actually say what it does mean?


But, talking about “capitalism,” Wolff did exactly what he criticized — painting it as one limited thing — which, typically, was a gross caricature.

I was struck by the contrast with a book I happened to be reading, Relentless Revolution: A History of Capitalism, by historian Joyce Appleby.* Indeed, its key theme is that “capitalism” has been not one discrete concept but endlessly flexible, adaptive, and evolving, with vastly varying iterations — its great strength.

This is clear from the first great book on the subject — titled Capital — by Karl Marx. I will not deride Marx as a fool. He was in fact a brilliant thinker, observer, and analyst, who had some important insights. But he was fundamentally wrong in predicting capitalism’s future. Marx saw an “iron law of wages” always pushing them down to bare subsistence, just enabling workers to stay alive to produce the golden eggs for the capitalists, until they’d revolt. Marx did not imagine the mass affluence capitalism (and the associated industrial/technological revolutions) would bring forth. Even amid all today’s lamentations about inequality, and capitalism’s supposed injustice, the fact is that workers in industrialized societies were able to gain a large enough share of the economic pie to give them living standards unimaginably cushier than the bare subsistence Marx posited.

That’s because the pie has grown so spectacularly. And because of democracy. “Democratic socialism” is really a contradiction in terms because the two ideas have proven in practice to be fundamentally incompatible. That’s due to socialist systems concentrating so much power in government, whereas free market societies distribute power widely. Socialism is not the antithesis of fascism or communism. All three have the central idea of valorizing the collective over the individual, thus being inherently coercive and repressive.

No type of society or system will deliver justice and equality free from the depredations of people who will always try to exploit it for their own advantage. That’s certainly been true in all socialist or communist systems, wherein some individuals always amassed great power over others — using the machineries of the state and its monopoly on violence (legitimate in free societies, but not in others). A free enterprise system at least does not allow that. Instead, there you gain advantage by (in the main) creating value others voluntarily pay you for, making society as a whole wealthier. That’s how Steve Jobs, for example, got so rich. It’s how the whole industrialized world — including its workers — got so much richer than Marx foresaw.

Richard Wolff (Yes, socialism IS for dummies)

Such prosperity has never been produced by socialism. China is a very instructive case. It has two economic systems functioning side-by-side: a socialist one of state-owned firms, and another of very free enterprise. The latter runs rings around the former. It is the source of China’s phenomenal economic advancement, lifting hundreds of millions out of poverty in the last few decades.

* She’s no right-wing free marketeer; plenty critical of capitalism’s negative aspects, especially environmental. Appleby is often a trenchant observer, but I can’t let pass how many annoying bloopers I noticed. Like, “Ingenuous people found a new way to exploit electromagnetism.” Really? I thought that was disingenuous.

4 Responses to “Richard Wolff in sheep’s clothing, on capitalism versus socialism”

  1. frankzollo Says:

    “Providing necessary services that a free market cannot (at least not well) is just any government’s job.”

    Because you’re a reasonable person, Frank, you can acknowledge this. Unfortunately, the particular brand of capitalism that has evolved in the US often relies on the market to do things – like run prisons or provide low-income housing – that the market does NOT do well while ignoring externalities like polluting the environment.

    Also, because you’re a reasonable person, you may also see that the US military budget is far above what’s needed to protect the country due to serving as a cash cow for “defense” industries that have been slyly embedded in almost every congressional district in the country (see “Watervliet Arsenal, Knolls Atomic Power Lab, etc.”).

    The U.S. has the highest overall poverty rate of any industrialized country on earth and the average household income fell by over 10% between 2005 and 2015. This particular iteration of capitalism – I have heard you call it “crony capitalism” – is not working for most people.

  2. rationaloptimist Says:

    Defense budget way out of control. Most of what we spend on is not geared to actually protecting us or even actually fighting wars in the 21st century. Congress even pushes more money on the Pentagon than it wants. And the military is a pet fetish of the draft-dodger in the White House.

    “Highest overall poverty rate” is a pet theme of the left but a very dubious statistical exercise, as “poverty” rate is calculated in relation to the incomes of the non-poor. Also extremely misleading to cite stagnating or even falling middle class incomes. Such calculations rest on inflated inflation adjustments and typically ignore fringe benefits whose value (especially health benefits) have risen significantly. A more objective calculation shows incomes actually rising.

  3. Lee Says:

    The right mix is as you said it. Capitalism should rule the day, except in those domains where it fails, in which case Socialism is better. The decision is made by Democracy. In the end, I don’t care if you call it Democratic Socialism or if you call it Democratic Capitalism; that outcome is what I am hoping for.

  4. frankzollo Says:

    “Inflation and benefits can’t explain the decline [in Wage Growth]

    “So why has wage growth slowed since 2001, across many different measures, when unemployment is so low?

    “We can rule out two possible reasons immediately. It wasn’t because of a decline in inflation, and it wasn’t because benefits like health insurance and hiring bonuses crowded out wages.

    “As with wages, the government has many different inflation measures. But none that we analyzed have slowed by nearly enough since 2001 to explain the weakness in wage growth; some have even increased a bit.

    “And government data suggest that measures of pay growth that include nonwage benefits are also below their 2001 levels. Moreover, the fastest growth in nonwage benefits was before 1994; in recent years, the nonwage share of compensation has grown more slowly.”

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