This is Richard Wolff from Democracy at Work.
It's a mere ten weeks before the election.
So much is at stake, we're counting down
and in the process, trying to understand all the issues at play in this moment.
I want to talk to you today about the road to Fascism.
How Capitalism, and why Capitalism
tends towards a fascistic solution to it's problems
when alternative solutions seem to be fading away.
I want to begin by noting a change in Capitalism over recent decades.
Once upon a time, it was thought that Capitalism could keep itself going by an internal dynamic.
Now, here's what I mean.
That Capitalists would be forever on the lookout for new, exciting investments.
That the money saved by masses of people and businesses
would pour into investing in new technologies, in new products, and all the rest.
In economics, we tended to call this animal spirits,
a sort-of mysterious dynamic that kept capitalism going.
Because we all understood, that if and when capitalists saved money,
earned a lot of profits that they couldn't or wouldn't spend,
they'd better find another way for that money to keep going back into the economy.
For example, through investment, or else we would have stagnation.
We would have an economic crash and the whole system would be in trouble.
Well, it was half mythology, half real.
The mythology part was, we did have crashes, and it did break down, from time to time.
On average, every four to seven years the investment wasn't enough to keep the system going,
and had to be rescued by one or another government stimulus.
But it had some grain of truth in the fact that, other than in those four to seven year average crashes,
it did seem to have a certain dynamism.
I think, in recent decades, and particularly here in the 21st century, that is no longer the case
That is, Capitalism, in terms of it's internal dynamic,
in terms of the animal spirits motivating it's investors, is pretty much exhausted.
And something else has had to come in to keep the system from imploding in it's own failure
to generate new investments, new ways for the wealth to be thrown back into the economy,
so that we don't have a crash that simply drowns us in depression.
What is the new element?
The new element is credit. And above all, credit created and distributed by the government.
In particular, by the central bank. In this country, it's called The Federal Reserve.
In other countries, it's called the Bank of England, or the Bank of France, and so on.
What do I mean exactly?
Well, what's keeping American business going, and indeed, what's keeping capitalism going in most parts of the world now,
And I'm including China, India, and so on, are massive infusions of credit.
And it isn't anymore just 'a little bit of stimulus' with a 'little bit of credit' at a moment of crash or downturn,
No, it's a kind of continuing massive infusion of credit.
And make no mistake, that's what's keeping the economy going.
Look at it today, in the extreme moment of COVID-19.
But before COVID-19 hit, we were having record creations of new money, new credit, new loans
which is the form that new money takes. Credit is keeping this system going.
From the companies, who have more debt now than they ever did,
to the government, which has more debt now than it ever did,
to the average person, who carries more debt now than he or she ever did.
It's what's keeping the economy going,
and make no mistake, when the Capitalists of this world depend as totally as they do now on the government
for the credit, which keeps the system going.
The politicians, the credit distributors, will demand and get from the Capitalists
the kind of accommodation, adjustment, subordination,
that begins to merge government and Capitalist into a joint venture.
And that joint venture is the survival of Capitalism.
The survival of a small group of people at the top.
Employers overseeing, supervising, and exploiting a mass of the population: employees.
But in Fascism, the difference is that the lines between government and the private Capitalist employers,
those lines get blurred, and eventually they get erased.
And what we have is a military industrial governmental complex.
All one big machine of a tiny minority of folks at the top telling us all what to do,
how to do it, when to do it, and for how much money we should have to settle to get by.
Fascism always was a solution to keeping Capitalism going when it had produced so many enemies,
so many shortcomings, so many catastrophies, that it's survival was at stake.
That's happening now, as well.
Slowly, steadily, it is shown by the way in which Government credit has
replaced anything the private sector can do, could do, and would do in keeping this system going.
This is Richard Wolff, for Democracy at Work, with another Wolff Responds.
