Economic Update: Externalities & Capitalism's Inefficiencies

[S11 E01] Externalities & Capitalism's Inefficiencies

This program introduces the economic concept of "externalities." Those are the real costs of employers' business decisions that employers do not pay for or take into account: costs "external" to businesses' profit/loss calculations. Examples include costly damage to the environment, to employees' private lives, etc. Those real social costs are external and additional to capitalists' private costs. Therefore, capitalists' investment decisions based on comparing costs and revenues do NOT take into account the real, external costs. Thus their decisions are not "efficient." Capitalism never was the efficient system its apologists claim.

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Learn more about Prof Wolff's new book, "The Sickness is the System: When Capitalism Fails to Save Us from Pandemics or Itself" released in September 2020. Available as a paperback now!

"Richard Wolff in his new book examines frightening and anti-democratic configurations of corporate power, offering not only a blueprint for how we got here, but a plan for how we will rescue ourselves and create new models of economic and political justice.” - Chris Hedges

Check out Prof. Wolff's other books "Understanding Socialism" and "Understanding Marxism"
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[bradypustridactylus]

I like the word "externalities." It improves my vocabulary. In my ignorance, I always called it, "how capitalists push the cost of doing business onto the public."

[gohachinightwin]

Honesty, empathy, compassion, fair play, loyalty, honor, love, curiosity...there are so many things in life that money can't buy.

[simonjackson]

Great point on the inefficiency of capitalism. We see that now showing up in climate change and collapse in biodiversity. But the capitalists would say - 'It's not our problem. We're cutting down the forest because I can make money from the wood.' Money was invented as a convenient system of exchange. Capitalism turned it into a monster. I was thinking about this in relation to privatisation - that there is an underlying, unchallenged, cultural assumption that the private sector is somehow more efficient than the public sector. But that assumption, like the 'trickle down' theory of tax cuts, are unempirical and biased by ideology. For a system that prides itself on accounting for every cent, capitalism has a remarkably big blind spot.

[nishasankaran]

I finally understand Capitalists and Capitalism. The only costs considered in our system are the ones that matter to the Capitalist...i never understood why certain costs were accounted for and others neglected. Arbitrary and driven by 'logic' aka

[notabene]

The French aristocracy never saw it coming either.

[lcstyle]

News Flash: "The World", "the environment", "people", "Community", such things don't exist in capitalism, if they do they are annoyances and inconveniences to be ignored or eliminated.

[franciscomillan]

I would vote for this guy to represent me in a heart beat

[curiousone]

Richard, I have so many thoughts I would fumble to describe here, but the essence of my response is "thank you" for seeing this in a sophisticated way, intimately and publicly, with great sensitivity.

[Lee-Van-Cle]

thnx, professor, for the crystal clear explanation!

[vlatkoteinovic]

Selfishness is the core of capitalism.

[peterjol]

Almost all problems could be solved by making it financially worthwhile for people to SHARE the jobs we NEED people to do and working LESS...no more working and doing anything FOR money but sharing the work we NEED to have done. No more building castles for the kings or pyramids for the Pharaohs but sharing the work WE need to have done. WE all have to be involved in democratically deciding what WE need and want to have done...and therefore the jobs WE do.

[lesliestenta]

Exactly what happen to me, I worked at a great hospital in Hawaii for 28 years. Then our politicians and fat governor slashed Medicaid and healthcare to barebones. The MBA’s on the bod, cut my hours drastically and fired and laid off many. Because of being the highest paid support staff I was the first to be send home Even when the ICU was
busy. My last 1.5 years were a living hell. No concern about my financial stress or time. Screw this. I. Retired early, sold my apartment in Waikiki and moved overseas to join my family overseas. The best decision I have ever made.I despise corporate America and the way I was treated.

[georgewmitchell]

This critique of our system is pretty brilliant. Thank you Dr Wolff

[thalesnemo]

Hear, Hear!

We have a front row seat to the empire’s collapse! Buckle up the ride is going to be very very rough!

[dann.]

This is probably the best Richard Wolff lecture I've heard.

[artrock]

We appreciate your information and expertise! Thank you!

[paulwellman]

Gerald Celente – trendsresearch.com “You are just a worker in the multi national plantation of Slavelandia.”

[skijay]

this video is an externality to defenders of capitalism. Thanks prof. Wolff.

[jgalt]

If this show was recorded near the beginning of the covid pandemic (not), that would
make it one hell of a holiday season...

[notabene]

"Bourgeois society stands at the crossroads, either transition to Socialism or regression into Barbarism."
― Rosa Luxemburg, 1916