"BE CAREFUL! This Is Serious..." - Richard Wolff's Last WARNING

0:00 if ever you wanted an example of the notion of unintended consequences here you have it the last thing that the United States's neocon foreign policy establishment wanted was to strengthen Russia they seem to have decided that Russia is the great problem in the world and that they would concentrate on weakening Russia that's a major part not only of the war in Ukraine but particular particularly of the economic side of it sanctions program of stopping purchases of oil and gas by Europe from Russia Russia provided the cheapest oil and gas that Europe could have found anywhere because of the cheapness

0:46 European products were lower priced they didn't have to raise the price as much CU they got to cheap energy and that made European economy successful competitive able to export which the of European growth has been Germany above all as an exporter all of that was undercut when the sanctions went into effect in order to weaken Russia but they didn't work and they didn't work for two reasons that will help everyone understand why bricks is so important the first reason is that Russia was able to turn to its bricks partners with whom Russia had been developing relationships for many years bricks wasn't an

1:34 organization formed last year or the year before it's older and Russia had cultivated in lots of ways relationship with India China South Africa Brazil and so they bought Russian oil and gas to make a complex story short and sweet Russia turned out to be strengthened the second unintended consequence was that Russia strengthened itself by turning to the bricks but it was a two-way arrangement in order for India and China to buy the oil and gas from Russia they had to work out the economics of this enormous business imposed on them by the sanctions levied by the United States

2:20 and its G7 Europe allies and so the bricks became better coordinated more dependent one on the other more having their economies intertwined bottom line Russia and the bricks became stronger and the United States became less powerful because of it more isolated because of their own decisions to have the war in Ukraine and that isolation of the United States is now deepening because of its decision to be as supportive unilaterally to Israel as they have decided to be the unintended consequence of trying to isolate Russia

3:07 has been to isolate the United States the world has changed and the United States is denying that to its own detriment China is coming closer and closer to being an economic equivalent of the United States and its Alliance now accounting for nearly half of the population of this planet is going to overtake and surpass the United States which is 4 and a half% of the population of this planet the unique position of the United States as dominant coming out of World War II couldn't possibly have lasted forever it was a delusion to

3:52 imagine it and all that's happening now is the foreseeable reality that the rest of the world has caught up has figured out how to grow fast catch up to the United States surpass it that was in the cards from day one should have been planned for wasn't should have been understood wasn't should have been discussed and debated in the United States wasn't and I leave it to you all to understand there is no virtually no discussion of what is probably the most important economic issue facing this country which is how do we cope with how do we work with how do we live with the

4:39 decline of the American Empire the decline of American capitalism the rise of other capitalist economic and other systems around the world that's what we're going to have to figure out that is the issue we face and denial dealing for for example with this bricks conference in Russia as if it were a Russian event as if it were all about Mr Putin it wasn't it isn't that's the same denial you can't see what's going on because you have to rewrite it as the old Cold War struggle of the United States versus Russia it's not only tiresome it leads you to make

5:25 catastrophic mistakes like the war in Iraq like the policies in the Middle East and indeed everything else coming down the pike so long as one of the two superpowers pretends that it's not one of two superpowers it's pathetic and dangerous to watch the economic growth of the United States for this year is scheduled to be 2.8% let me ask everyone keep that in your mind 2.8% growth and that's fast than any one of the other of the G7 okay now let me compare that first to Russia their economic growth rate by the way all these numbers come from the

6:10 international monetary fund the IMF a western institution dominated by the G7 Russia's growth in 2024 3.9% let's turn next to China 4.8 that's almost double the economic growth rate of the United States this year and then we come to India which is 7% almost triple the level of United States and I wouldn't bring you these numbers for one year if they weren't in fact the kinds of numbers we have seen for decades that's why the Chinese are where they are they caught up they grew faster they figured out how to raise the standard of living of their people much faster than

6:57 anyone ever did before for this is not an endorsement of the Chinese economy or Society or suggesting they don't have lots of problems they do all countries do but when it comes to economic growth that's their strong suit folks and that's what makes the difference in the world economy doesn't it to pretend that this isn't going on that this isn't suggesting where the future lies of course they have a good humor among themselves at their conference they are the growing Dynamic core of the world economy now the West isn't and that's not about to change that's why you have to come to terms with it rather than pretending that such situations don't

7:44 exist or that it's all about Mr Putin it isn't let me remind you of another statistic the GDP of the United States remains number one in the world somewhere between 25 and 30 trillion dollar a year that's the legacy of being the dominant economy for the last century what is the GDP of Russia our so-called enemy two trillion maybe three people should understand Russia has never been an economic threat to the United States it can't be it's too small it may have a powerful military but economically not at all the United States could if it worked without an

8:29 arrangement easily come to terms with an economy that's so much smaller the Chinese economy that's a completely different thing their GDP is around 1718 trillion dollar catching up exactly and Russia and China together and India and Brazil added yeah that gives you the PowerHouse that I've been describing and that bricks represents the road forward with continued Den denal is a road into making mistakes let me remind everyone at the beginning of the war in 2022 there were predictions from the president on down Russia would be destroyed Russia would fall to its knees the rubble would collapse Russia would

9:15 become dismembered Putin would be ejected none of that happened why because they didn't understand bricks what it meant what it could do how it could intervene with Russia to change the outcome more such mistakes are coming if you continue to pretend that we're all in some old Cold War 2.0 rather than in a new economic situation look I do understand I'm an American citizen born here lived here worked here all my life it is very hard to be in the period of decline of an Empire I'm sure it was hard for the British who lost their empire a century ago and it was hard for the Dutch and

10:02 the Persians and the Greeks and the Romans but we do have the benefit of knowing that and making at least some choices to accept it to understand it and to work out a Live and Let Live with the rest of the world otherwise the Doom and Gloom predictions of World War III and all the forms that that is taking will in the end overtake us not because they have to happen not because they're built into the system but rather because a population having to face the decline of its Empire the decline of its system wants to deny it rather than treat it in the manner that adults kind of know they ought to do at the end of the war the

10:48 United States had had one experience with bombs falling on its territory that was Pearl Harbor at the beginning never again no damage was done here no explosions happened no Invasion occurred none of it we lost some troops but relatively much less than other countries meanwhile all the potential competitors of the United States Germany and Japan The Losers of World War Two but even Britain France Italy they were all defeated their factories were bombed their railroads wrecked all the rest of it so we came out a unique position we held that unique position for most of the rest of the 20th Century the second half of that century when we could do pretty much what we wanted it didn't

11:35 matter we were so dominant the economic system here we helped the others rebuild from the war in Japan in Western Europe and so on and we could do what we wanted they had this notion that you're kind of alone in the world that everybody has to adjust to you that's over and now it won't work I I explain why these tariffs are a mistake as if you were in the position you were before so I will slap you with a tariff and I will not suffer consequences this completely wrong I'm going to give you the example electric vehicles they are the vehicles of the Future Between the damage to our health and the damage to the resource base of

12:22 this planet burning fossil fuels to move our cars and trucks is on the way out it's going to be replaced not by the rational decision that would be mass transportation but by the irrational but profitable decision to substitute electric vehicles for fossil fuel burning Vehicles given that here's the reality the Chinese participated along with the Europeans and the Americans over the last 15 years to produce a profitable electric vehicle that competition has been won by the Chinese Above All by a particular company byd and if you don't know what that

13:08 company is that's a sign of denying what's going on in the world in this case by the mass media who haven't told you about it byd produces the highest quality lowest price electric car and truck Bingo there it is they're selling it all over the world including Europe by the way but you won't find those vehicles on the roads in the United States today why because there's currently a 100% tariff what that means is if the car cost $30,000 bringing it in from China you and I would have to pay $60,000 to buy it 30 to the Chinese manufacturer and 30 to Uncle Sam cuz that's what the Tariff is attacks here's

13:54 what that means my fellow Americans all over the world every company that makes things that compete with American Products companies that make shirts companies that make food companies that make software programs they make anything they all have to buy cars and trucks it's part of their business they're going to get the best quality cheapest electric truck and that will be reflected in low prices for what they produce in contrast Americans who have to pay way more for those electric trucks with the big tarff will charge much more for their product than their foreign competitors and they'll lose business and you and I will lose our jobs why because of the Tariff so this

14:41 may sound good it may look like you're being a tough guy Mr Trump but what you're doing is playing a silly political game that will come back and bite you and me where it hurts after World War II the dollar became virtually universally recognized as the Global Currency basically playing the role in the world that once was played by the British pound say in the 19th century or early part of the 20th central banks in virtually every country held as reserves to support their own currency gold and the dollar leading to the very famous phrase the dollar is as good as gold

15:27 Saudi Arabia and the oil countries adopted the program of selling oil around the world to any buyer but only for dollars and then parking those dollars in New York City Banks or in US treasuries it became the focus and there are enormous benefits to that the United States for example was able to pay for the goods and services produced around the world the French wine the Japanese computer the fill-in the blank by sending them dollars unlike in other countries those dollars didn't come back to buy goods and services here they held on to the dollar cuz it was useful to them to do so which means that for 50 years the United States was able to consume the produce of the world and

16:15 gave them in exchange little green pieces of paper our currency that cost us nothing and are worth per say nothing the benefits of doing this were incalculable you couldn't explain American economic well-being in the last 70 years without the role played by the dollar that's all gone today central banks around the world depending on the numbers you use hold reserves only 50% in dollar instead of the 80 or 90% that was the norm as little as 20 years ago so the symbolic meaning of that is enormous the financial meaning the real consumption all of that here's a second example we are now in a weird situation

17:01 the United States supports Israel in Gaza okay it's one of the few countries in the world to do that out of 195 countries in the world that are members of the United Nations and I keep track of this 146 out of 195 have recognized Palestine as a state in the same way that they recognize Israel as a state or the United States as a state or France is estate the United States and its allies are the only ones left supporting last week Spain Norway and Ireland joined the list of countries recognizing Palestine the United States is the only significant support Israel has even the other

17:48 countries that don't yet recognize Palestine give it at best nominal support perhaps you would want to make an exception of Germany cuz it has that odd history of being the place that operated a genocide against Jewish people but the truth of the matter is the decision by Mr Biden after the invasion of Gaza by the Israelis to give them 100% support what is he doing that wasn't even necessary he is so wrapped up in the way the world was that he doesn't understand that the Palestinians have won the battle against Israel IR the world right now you can't run a ship through the Red Sea through the Suz Canal why because the hotties in

18:35 sympathy with the Palestinians have made that impossible that has enormous effects on the world on trade on movement of shipping and I can assure you every Arab country every Muslim country and Beyond but right there I'm talking about I don't know half the world are trying to figure out how they can be supportive of Palestine turkey has stop trading with Israel in part because of this that's what their leader said my heart goes out to the Israelis too because they are in the process of miscalculating with the United States how the world has changed and it's going to impact Israel which doesn't have the resources to cope with that even worse than it is already impacting here in the

19:21 United States how valuable is NATO when three of its members Ireland Norway and Spain last week decide to go against the heavy pressure of the United States and recognize the Palestinian state in and of itself it's a small step symbolically it's an enormous step it shows we don't agree with you on one of the central geopolitical conflicts in the world and we're going to do it publicly and the Reason by the way it happened is because the leaders of all three countries know what Americans don't want to face which is the overwhelming majority of people in all three of those countries are

20:07 siding with the Palestinians not the Israelis in the issues of Gaza so that the local politicians had to act not out of sympathy with the Palestinians but to save their own political skin inflation means that prices in general are going up not all of them the same rate some of them can go down but the general direction of prices is up that's all the word inflation means okay step two in the logic if Rising prices are an inflation the next question is who determines the prices answer employers determine prices if you're an employee you've never been called into a room to participate in setting prices that's done by the boss that's done by the corporate board of directors the leading

20:53 managers it's a tiny group of people in our country the US Census Department lists employers 3% of our population the other 97% are not there's no democracy and inflation a tiny group of people never elected to the job which doesn't exist it's simply understood that if you're an employer you set the price you raise it you lower it you keep it the same your business okay so an inflation means employers made the decision why did they raise prices answer the same reason they do everything else to maximize profits that's what makes a business successful so we can answer the question an inflation happens if and when employers see profit in raising

21:40 prices so they do that means that inflation is a profit driven phenomena that hurts the rest of the people who have to pay more for what they used to get for less and it's great for profits cuz that's why it's done all right the minute you understand that then you understand that we live in a system whose economic Arrangement is the opposite of democracy we don't democratically decide what things are going to cost in the store we never did we have an autocracy we have an authoritarian economic system that gives a tiny percentage of the people control over the prices we all pay when they run

22:26 an inflation and when we have a mass of people complaining about it and that's been the United States in the last 2 years we turn to an institution set up for this called the Federal Reserve our Central Bank and if you look at the charter of the central bank one of its jobs is to maintain price stability so right off the bat when we have an inflation we know that the Federal Reserve has failed to do one of the two things it was asked to do so what does the Federal Reserve do in the case of the United States in the last 2 years it raises interest rates now for the mass of people this makes a bad situation worse in addition to Rising prices of my breakfast cereal and my haircut and my

23:13 computer program I now have to pay more on my credit card because the interest rate on my balance has just gone up so this is a solution that makes the problem worse it's not the only solution that the Federal Reserve in acting in that way short cut what should have been the debate how do we deal with the inflation that the employer class has imposed on us we might have remembered that a Conservative Republican Richard Nixon on the 15th of August 1971 confronting an inflation then made the following decision which he announced on TV any company that raises its price we will come for you we will arrest you and we will throw you in the

24:00 clink and any Union that raises your wages or tries to we will do the same he declared what came to be known as a wage price freeze did it stop the inflation on a dime right away real quick did it raise interest rates no it chose an alternative policy we live in a country which not only did not do what it did a few years ago but acted as if there was no option so we have lots of experience with that tool to fight inflation but we live in a country that can't face most of its economic problems because they too function as distractions from these kinds of real issues a few years ago we

24:47 had shortages we couldn't get toilet paper we couldn't get medicines of all kind we have shortages right now the most popular nonsense spoken about shortages in the pass was ready supply chain disruptions that's a euphemism that's another way of saying shortages now I can show you shortages across the board all over the place virtually every year since 1971 to assign to shortages some sort of role as evidence at the very least you'd have to show me that there were more shortages during a time of wage price controls than there were during all those years when when there weren't price controls every policy designed to solve any problem turns out

25:35 to have strengths and weaknesses I'd be the last one to argue that a wage price freeze didn't have all kinds of problems not particularly the shortages the more powerful argument at the time since I follow these things since that time the biggest problem was escapism in other words there was an escape Clause you could apply for an exemption from the wage price freeze so every Corporation went to work hired the most expensive lawyers imaginable and lobbyists to go to Washington to get an exemption for your firm or your industry and that's a terrible that leads to all kinds of misallocation I get all that but interest rates have that as well interest rates have their strengths and weaknesses one of the weaknesses of the

26:22 interest rate is we've had elevated interest rates and they didn't prevent our inflation we're still still struggling with an inflation and there are as many people now saying that prices are going to go back up as there are people saying that they're going to go down so interest rate is not some magic bullet it's not some guarantee but it really hurts a lot of people and it helps others the bigger your company the less an interest rate increase is going to hurt you the reason we have central banks including the bank of the US and what later became the Federal Reserve at the beginning of the 20th century was because when we left interest rates to the quote free market we got crazy volatility that was extremely dangerous to the stability of the system we

27:07 brought in The Regulators we brought in the institution to deal with the ineffectiveness and the danger of not doing it we're stuck we don't work well without a central bank and we don't work that well with one that's a contradiction but it is not resolved by oscillating back and forth between the two pretending when you don't have a central bank that getting one will solve your problem makes no more sense than responding to the failures of the Central Bank by extolling the virtues of a free market you can't go with either of them the reason we see the Federal Reserve having anxious meetings over the last couple of years in which the top

27:53 news item that evening is they met and they either raised the interest rate or they didn't or they raised it by 50 basis points and not 25 etc etc is because the mass of people are already involved there is a small smidgen of democracy because they're making it hot for politicians not to do something we get rid of the boss inside the workplace it won't collapse we won't dissolve the world won't come to an end but we will be able to get everybody in a collective way to learn to make the decisions what to produce how to produce where to produce and what to do with the revenue our production achieves and I think we

28:39 would then have in our economic system the foundational democracy that will give us a better chance of getting a broader democracy than we have now