Public Employee Press

DVD Review
When the U.S. economy hit the proverbial fan

In an easy-to-understand 60-minute DVD, economics professor Richard Wolff points out that what many see as the current financial crisis is actually the result of a deep and longstanding problem of our economic system.

For over a century, workers’ wages in the United States — compared with the cost of living — rose almost continually.

But since 1973, real wages have stagnated and declined. Automation and increased foreign competition reduced the demand for labor. Productivity increased, but unions lost the power to claim a fair share for working people. Profits soared, workers got poorer, and the income gap between the wealthy and the working class exploded.

To maintain their living standard workers increased their hours and more family members went to work. Finally, working families went deeply into debt, borrowing against homes as their credit card balances ballooned, often at exorbitant interest rates.

Then the banks found riskier ways to increase their profits and lobbied politicians to loosen financial regulations. Dicey loans and low interest rates fed the housing bubble of the new millennium, which took Wall Street with it when it went bust and kicked off the current deep recession.

Wolff maintains that we are facing more than a financial crisis. Today’s economic collapse has evolved from the increasingly unequal distribution of income over the last 35 years and the crippled purchasing power of the great mass of American workers.

Fixing the financial crisis with more adequate regulations is necessary but not sufficient, and the rich will fight re-regulation or any radical redistribution of wealth.

So what can we do? Wolff recommends socialism in the form of worker cooperatives that would extend democracy to the economic sphere and return profits to the workers. A recent Rasmussen poll shows that only 53 percent of American adults believe capitalism is better than socialism.

Wolff’s video, “Capitalism Hits the Fan: Economic Meltdown,” is timely and could lead to wider discussion of socialist alternatives. It is available at the DC 37 Education Fund Library in Room 211 or for purchase or viewing online at http://www.capitalismhitsthefan.com.

— Ken Nash
DC 37 Education Fund Library