The Petrodollar Is Cracking Varoufakis And Wolff On Empire Iran And Capitalisms Crisis

TITLE: The Petrodollar Is Cracking: Varoufakis & Wolff on Empire, Iran and Capitalism’s Crisis CHANNEL: DiEM25 DATE: 2026-06-01 ---TRANSCRIPT--- Welcome everybody to this event about the petro dollar and fossil fuel capitalism with professors Richard Wolf and Jiannis Verafakus. We are so happy to have them joining us here today. My name is Mike Tedesco. I’m a member of the political education collective that’s hosting this talk, but I’m also a doctoral candidate in economics uh researching imperialism and unequal exchange. So, this is a very exciting event for me. Uh I’ll be monitoring moderating today’s discussion along with co-odderator Sharam Mazar and I’ll hand it off to him to introduce himself. Hello everyone, my name is Shahara Mazer. I’m associate professor of economics at Bucknell University where I teach courses in political economy and world systems theory. Uh I’m also the host of the show the dialectic at work alongside professor Wolf where we explore world of proxy and political economy. I’m really looking forward to this exciting conversation. Mike, what do you think?

All right. Thank you very much. Um so to start I’ll introduce our speakers and then provide some overview of today’s topics before we begin posing some questions um to get the discussion going. So all right so first off I’ll start with Richard Wolf. He’s a professor ameritus at the University of Massachusetts Amherst and a visiting professor at the new school’s graduate program in international affairs. Uh he is well known as one of America’s foremost Marxist economists and founder of the nonprofit democracy at work. Honest is professor of economics at the University of Athens. Uh he’s the author of several books on capitalism and political economy and was famously Greece’s finance minister in 2015 during its sovereign debt crisis. So next we’ll do some check-ins, which is something this group does for every meeting. Uh we don’t have time to go around all the participants and ask for a check-in. So if you’re in the audience uh you can just put your check-in in the chat. Uh your messages can include your name, pronouns, where you’re calling in from, and just generally how you’re feeling today. And a quick reminder about recording. We will begin to record this event now and the video will be widely shared on Richard and Yatis’s YouTube channel. Uh participants will not be recorded or shown on screen unless they specifically request to do so by clicking on the prompt in the bottom right corner of the main stage window. Um and for audience member questions, we’ll save those to the end. They should be submitted using the Q&A chat feature found in the right hand column of the main stage window of the Riverside view viewing pane. And uh we’ll get to those uh at the end if we have time. All right. Uh I’ll just introduce a couple of opening by way of a couple of opening remarks uh before launching into some questions. So through a series of agreements leading up to 1973, the Nixon administration secured a commitment from Gulf oil producers to denominate oil transactions in US dollars resulting in what’s come to be called the petro dollar system. This provided this provided two main benefits to the US. One, in so far as there would be demand for Gulf oil, there would also be demand for US dollars. The strengthened the green back as the world’s reserve currency and ensured low borrowing costs on US dollar denominated assets. And secondly, surpluses earned by Gulf powers through their sales of petroleum products would be recycled back to the US as those powers use those dollars to purchase US debt instruments. We are now 12 weeks into a war with Iran which threatens to destabilize this petrod dollar system and despite a ceasefire we have few signs that progress is being made in the ongoing negotiations. Meanwhile the strait of Hormuz remains effectively closed with global consequences. Oil prices have skyrocketed. Inventories of gas, diesel and jet fuel are dwindling. Hardhit nations in Asia have begun begun rationing. Uh factories are closing and borrowing costs for governments and consumers are ticking up. Not to mention the direct suffering inflicted on the people of Iran and Lebanon from indiscriminate US and Israeli bombing campaigns. We on the left recognize the dir of material class analysis in the mainstream reporting on this issue which too often focuses on the particular decisions of policy makers. We hear that Trump folded to pressure from Tel Aviv or was tricked into believing Iran would go the way of Venezuela or even that this is simply a distraction from the Epstein files. However, as good historical materialists, we know that we do not get below these superficial [clears throat] takes unless we identify the deeper structural conditions which make possible the current conjuncture and what that implies about where we’re headed. And so we’re very fortunate to have our guests here to help us do that today. All right. Uh so I’ll just pose my first question. Um I’ll start with you, Professor Wolf. Um uh before we get into some of the specific issues of US agy and the petro dollar uh I want to start by asking our speakers um whether you have general comments on the current moment and crucially how you think we got here. What were the material conditions and anticedants which explain why now that the US has started this conflict and for what purpose? So take it away Rich. Okay. I’ll I’ll make my introduction brief. I I want to hear what Yiannis has to say. I I always learn a great deal from him. Uh and I think everyone will and I want to also leave time for the questions and the back and forth so that we respond to what’s in your minds uh in the way of questions. So my brief overtake is the following. We are at what I think now is a historic transition moment. There are usually several of these and I don’t want to over make the point but I do think as many of you know if you follow my work that the extraordinarily exceptional situation in which at World War II the colonial capitalist experiment reached its peak in an orgy of mass mutual murder. uh that the only thing that was left standing protected by the Atlantic Ocean on one side and the Pacific on the other, in other words, from Germany and the war in Europe and from Japan and the war in Asia was the United States. And so in 1945, it it it reached an absurd nodal point. The war was over. And not only was the war over, but the United States was the only one left standing with an intact economy. The only bombs that fell fell on Pearl Harbor at the very beginning of the war and after that nothing. No damage factory, no damaged railroads, nothing. On the contrary, the war had enabled US capitalism to recover from the Great Depression, which nothing else it had done had achieved. The war had to be fought in the end because everything else that they tried was hampered one way or another. And so the economy at the end of the war was stronger than at the beginning. Not only had they escaped destruction, they had recovered a capitalist moment, uh, a capitalist potential for growth. And then the greater irony, the growth in the United States was enhanced by being the only way for recuperation from the war in Europe, Japan, and so on, creating an enormous demand without the money to pay for it. And so again, to make a long story short, the Marshall plan to provide the finances that could then enable the demand to become effective and the boost to American production even greater than it would otherwise have been. This situation coming at the same historical moment as the decline of the British Empire that had already begun earlier that had been badly boosted by World War II. One was then finished in World War II. India left, the empire fell apart. Uh the first research I ever did as a young person on the Mao Mau revolt in Kenya was another chapter in all of that. And so the American Empire fell into its hands. The British too late, everybody else destroyed. And what should have been understood as a very temporary, highly conditional uh situation became in the mind of the American people, heavily cultivated ideologically as something exceptionally American, uniquely American, that there was something about American capitalism that would not subject it to the kinds of limits, constraints and so on that we could apply and had applied to most other capitalisms. And my point, why do I do this? Because the petro dollar was one of the early vague recognitions that there were some limits. After all, there was that crisis around then. The goal was taking the gold back. the the special situation now in the 70s was a generation old uh given what the war was in 45. So it became necessary to shore it up. The petro dollar system as you nicely summarized did that. It shored it up. Well, we are at a point now where that empire, the American empire has reached limits. I do not think it is capable of overcoming. I think we are in the decline phase. Every empire in the history of the world has been born, evolved and died. The American obviously was born. We know that. The American has existed for a while. We know that too. It the decline is not a question of whether. It’s really only a question of when. And I think we are now in the when phase. It was prepared by the loss in my judgment in Vietnam which changed many many things we’re still not fully aware of in our culture here in the United States. But it was certainly boosted by the defeat in Afghanistan, by the fact of what has happened in Iraq, by the evolution of the Ukraine war, and now in a very dramatic way by this fight with Iran. Of course, we are in the middle of that. So, I I can’t speak about it as a settled matter, but it seems to me it does threaten the whole uh petro dollar arrangement. Iran is an irreducible reality for the Gulf States that they have to come to terms with one way or another. And I believe we’re watching the United Arab Emirates do it in one way and and uh Saudi Arabia in yet another and Qatar and Oman each trying to figure out how to survive what may be coming any day now uh in the way of resumed hostilities. But with or without them nothing will ever be the same in the whole world. uh you have touched the money situation, the currency situation and above all the energy situation. These are fundamental pillars of the capitalist empire. I don’t see how the United States can hold on. I see in fact both internationally but finally also here inside the United States the disintegration of all kinds of accommodations that had been made that underpinned the American empire abroad that consensus at home is disintegrating as we talk the level of division in this country and the level of hostility attending that those divisions are beyond anything I have seen in my lifetime uh in the United States. I was born here. I’ve lived here all my life. Uh and I am clearly confronted on a daily basis by shifting political winds I had not expected to live to see. I am sitting in Manhattan in an a city that enthusiastically elected a young Muslim socialist to be its mayor. I don’t want to overdo it, but that’s a remarkable event in this culture at this time. And it too, if you were to explain it, would build on everything I’ve just said as its foundation. uh for this moment. So it’s a declining empire and the symptoms are what we are talking about. Those symptoms and this is my final point include most dramatically Donald Trump, a character who would not have been the president had it not been for all of these phenomena coming to a head. and what he does and how he proceeds are symptoms of what we’re watching. Last week he in one week we had the withdrawal of 5,000 troops, US troops from Germany and 4,000 from Poland. 3 days later we were sending troops to Poland. This is a government on the edge of dysfunction. Does that mean we’re about to collapse? No. I’m not saying the United States isn’t an enormous economic power. Still, it is. It’s a decline. It’s not the end. It’s a decline. But that, I think, is how we have to understand the visit to Xi Jinping, the the spectacular behaviors. This is part of the desperate, and that’s the key word that keeps arising here, a desperate effort to cope with a declining empire. Thank you very much for those comments. Um, I’ll hand it over uh to Professor Verafakus um and ask the same question. Uh, what your general thoughts are, how do you think we got here? And do you agree with what Professor Wolf has just suggested? It’s fundamentally about the decline of uh, American Empire. Well, I [clears throat] I I’m so pleased to be having this discussion uh in the context of your uh introduction before Rick came in. Uh in other words, the fact that we are here conscious of the fact that unless you understand what’s happening in Iran as an extension of the class war in the United States and beyond, uh unless you understand this in dialectical terms, you simply won’t grasp what’s going on. Um, and I’m very glad that uh Rick laid down the historical foundations for for this dialectical class analysis. Uh, starting with World War II. Uh, look to motivate the conversation. I’m going to start with a puzzle. In the last few weeks, something remarkable happened. Scott Bessant, the US Treasury Secretary announced uh a 20 billion swap line with the Gulf States. Uh to me that needs to be shouted from the rooftops as a very significant moment. I read the Wall Street Journal. I read the Financial Times, the New York Times. They were talking about a potential bailout for the Gulf States because of the war in Iran. They got it completely wrong. The Gulf States really do not need a bailout. Uh if you take Saudi Arabia and the Gulf Cooperation Council states together, they’ve got about $6.5 trillion dollars worth of investments and of which one and a half 1.7 is is liquid cash 1.7 trillion. That’s 1,700 billion. The 20 billion of a swap line by Scott Bessant is just, you know, just a pipsqueak. It’s it’s not even worth talking about. So why did he go through the motions of announcing it? because it’s not a it’s not a small thing for a swap line uh to be offered to regimes like the Gulf States. Uh I’m going to tell you what my interpretation is, but then dress it up, dress it up, found it on a on the analysis that constitutes the answer to your question. What’s happening is that Scott Vessent is absolutely panicking about uh the financial circuits of Wall Street and this is a an indication. It’s simply a symbolic gesture the swap line that he proposed effectively telling people like himself because remember Scott Bessant um is a very accomplished um uh poacher that has turned gamekeeper. You know, he made a lot of money out of betting against governments. uh together with Joe Soros, they they broke the Bank of England. So he knows how that pack of wolves in the markets work and he’s he’s absolutely terrified that they’re about to move in against the bond market and against the stock markets of the United States. And why is he worried about that? And as I said, the 20 billion, he knows that it is not worth uh speaking of in terms of the size of the swap line. It’s symbolic. effectively he’s saying I’m here and I’m going to bail America out the American financial markets not a bail out of the Gulf states. So let let me explain that and now I’m going to you know base myself um step on the solid foundations that Rick presented us with the period between 1944 that’s the Breton Woods conference and today I break it down into three main area um time frames the first one is the bread and woods period between 1944 and 1971 the 15th of August the Nixon shock the second one is between then 1971 and the great financial collapse of 2008 and the third is beyond that. Uh but for the purposes of our discussion the petrol dollar I’m going to stick to the first two uh the bread and woods period and the post Bretonwoods period. Now the as Rick said when the United States uh was uh contemplating life after the end of the Second World War uh the new dealers in power in Washington DC were absolutely um freaking out about the prospect of the return of the great depression because they knew that the moment the factories wouldn’t be producing airplane aircraft carriers and bullets and ammunitions and tanks and so on uh and the men came back from the war. Um, so you know, labor demand would come down and labor supply would skyrocket and they feared they feared that the United States didn’t have the capacity as a political economy to absorb um all the the supply that the gleaming factories that had massively increased their productivity during the war due to the war could produce. So it was simply a question of you know how do we maintain our surpluses? This is without slipping into a great depression. And they they were talking about 1949. They were predicting in 1944 that 1949 would be a new 1929. And the answer they gave was the Breton Woo system. In other words, uh the answer to the question, okay, even if we convert all our factories to produce instead of aircraft carriers and tanks, uh white goods and uh automobiles and uh what you know, Boing jets and Macdonald Douglas jets, uh who’s going to buy all that stuff? The American economy can’t absorb all that? There isn’t enough aggregate demand, effective demand for that in Keynesian terms. Um so the the answer was the Europeans and the Japanese and where will they find the money to do it. They don’t have money. The the money systems of Europe and Japan were gone. The answer was we will create them and we will dollarize them. And the Bretonwood system was the dollarization of Europe and Japan um with fixed exchange rates and a system founded on the revolving around the international mond fund primarily to a lesser extent the World Bank. uh the purpose of which would be to um you know to to to promise foreign capitalists that you know um even the to the Greek capitalists that for 30 dramanas they would get $1 as long as they controlled they had capital controls and the American government would determine through uh the Washington-based IMF how many dollars they would give to the German to the Italian to the Greek capitalists. Okay, it was completely control, but it was a it was a system that was hinged which was anchored on the American dollar. Forget the story that that that that gold was lurking in the in the background because of the uh convertibility of $35 to one ounce. That was also symbolic. It was a dollar. Okay. Uh so the dollar was the anchor that um uh held down a system whereby America’s surpluses were recycled to Europe and to Japan in order to maintain them. Okay. Uh and as Rick said, the Vietnam War must not be underestimated because it was two things, the Vietnam War and the Great Society program by LBJ that um which were of course related one to another. uh there was a a causal uh dialectical relations between the two. But those two two things together uh together with the fact that uh the Japanese and the German capitalists boosted productivity well beyond American productivity um American capitalist production productivity. The result was that that by 1968 1969 the United States had slipped from a surplus position to a deficit position. And it was then that Henrik Kissinger who was at the NSA at the m at that time the national security council before he moved over to the state department put a question to his team. He said how can we maintain our hijgemony now that uh we are a deficit country and a young man called Paul Vulkar who worked for him at the time 1970 I slipped him a note and said we’ll make the capitalists of the rest of the world pay for our deficits. We have to increase our deficits and have the capitalists of the rest of the world pay for them. And this is the post 1971 period. The period of financialization, neoliberalism, all those words that we use often with good cause describe a system where the recycling mechanism of the postwar period was inverted. We between the 50s and the 197 late 60s early 1971 American surpluses were being sent over to Germany and to and to um France and to Japan and uh after that once America became a deficit country all state was weaponized to recycle the surpluses of Germany of Japan and later China. Now again as Rick said before, petro dollar the Arab states effectively Arab state the opic states uh played a very important role in this because to begin with um from 1946 1947 onwards under the Turman doctrine in particular um essentially Saudi Arabia would not have existed without uh a deal a quid war between uh the CIA between the the state department and the Saudi royal family. Uh you do as you’re told and we will let you keep a substantial part of the oil rents but of course it will all be part of the dollar system which was of course absolutely straightforward back then because even the French Frank even the Dutch mark was part of the dollar system as part of the bread and wood system. um soon after that. Um the problem the problem the the interesting thing however was that remember Brethren Woods was predicated on capital controls because Washington wanted to control the um movement of uh dollar funds uh across the the borders of the bread and wood system. Uh but because so much money was accumulating um as petrol dollars in the pockets of the monarchs of the Gulf States, uh a lot of that money didn’t go back to the United States. A lot of it went to London and that’s where the petro dollar market and the euro dollar market which was a result of the fact that once America became a deficit country dollars were accumulating in Europe with every Mercedes-Benz that was being sold in the United States without a reciprocal purchase of a Cadillac by a Frenchman or woman. a bunch of dollars went to Europe and that accumulated as so it was euro dollars and petro dollars and that was the [ __ ] in the armor of the bread and wood system which which was supposed to prevent the free flow of dollars to the rest of the system uh and is the reason why the city of London became significant and it was not a backwater to [clears throat] to this day it remains somewhat significant. So, okay. So, to cut a long story short, let me answer my own puzzle, the one that I I began with. Why is Scott Besson freaking out? Well, he’s freaking out because Trump uh had succeeded during 2025 to extract from Saudi Arabia, from Qatar. I remember his visits in Qatar, the the plane gift and all that. there was something far more important happening behind the scenes and that was uh the Gulf States had um together Saudi Arabia, United Arab Emirates, Qatar, Bahrain and Kuwait together they had pledged and they mentored they had pledged to invest $1.8 8 trillion uh in the next 18 months uh that is before the end of 2027 uh in AI and other businesses in the United States. That’s $1,800 billion. Plus, Saudi Arabia together with uh the UAE had pledged to buy weaponry from the American military industrial complex uh of about 1 trillion. You remember the uh the US military budget used to be about 1 trillion. Now it’s going to go up to 1.5 trillion. Another trillion would come from the Gulf States and that would have that that would have been spent within 2026, early 2027. Together we’re talking about nearly 3 trillion that was about to flow to Wall Street from the Gulf States. That’s gone. And it’s gone because the Gulf States have lost their liquidity. They’re not selling enough oil. But it’s not just oil you know um Dubai has uh um diversified from oil to a very large extent. They are into the business of trading gold. Most of Indian gold is being traded through Dubai. Hotels I mean it’s a huge tourist business. They are running at 10% um you know of their capacity. 90% of the rooms are empty. They they they are running I mean it’s they’ve got as I said before they’ve got six something like almost six trillion dollars worth of of American dollars but that’s a stock it’s a stock of dollars right it’s not a flow money the 2.72.8 8 trillions that they had pledged to Bessant or to Trump for the for this year that was a flow and that flow dried up. Uh and Scott Bessant does his mathematics and he can see that if you deny Wall Street one 1.5 1.6 6 trillion in a period of 18 months. During a period when they are going haywire with um expenditure I mean you know there’s a huge bubble. Everybody knows there’s a bubble. Everybody knows it’s going to burst. But as always with bubbles uh you never know when the bursting is going to take place. It is impossible. It’s mathematic you can prove mathematically that it’s impossible to predict when it will burst. And he’s really worried that with this bubble in Wall Street, you take out one one one $1.5 trillion of a flow into Wall Street and people will go, excuse the Australianism, apeshit. And um and you know, this swap line was essentially his little message to financiers. I’m here. I’m willing and ready to print as much as you know dollars as is necessary in order to prop you guys up while at the very same time uh the companies in which most people work in the United States the blue collar workers uh are being bled dry uh if you look at consumer good companies corporations even pharmaceuticals um you will find transport companies you will find that they are tanking in the United AI is being propped up uh through the bubble, the self-perpetuating bubble, through Scott Besson’s symbolic messages. Uh and thus the point I made at the beginning that this is a very definitive, very vicious class war that is raging within the MAGA movement, within American corporate capitalism, within American society. It is spilling over to the to to Europe. Uh it’s um uh now does this mean that uh American hijgemony is on the way out? Well, look Rick, I hope it does because I’ve you know I’ve been looking forward to the waning of American hijgemony since I was 10 or maybe eight. Um but again it’s exactly it’s the same as as as with a bubble. You know it’s going to burst. You know American hijgemony is is a goner but you don’t know when it’s going to happen. And as Kanes very uh pifily said once, the markets can stay irrational longer than I can stay solvent. All right. Thank you. Thank you uh Rick and Giannis for that lovely historical context and setting the stage. Um I wanted to connect with some of the theatics that both Rick and Giannis um discussed and asked a slightly different question. Um cuz Marxian economists uh throughout the 20th century maintained that World War I as well well as World War II were connected that war in general was connected with the logic of capital and systemic accumulation. the 1973 crisis for example Giovani Wallerstein etc thought about that crisis as a crisis of accumulation so I wanted to ask you because I wanted to benefit from the presence of two eminent thinkers of that particular field the impact of this particular war number one do you see this as a crisis of capitalism in the terminal sense in the sense of systemic accumulation the Giovani Aristein kind of thing. And obviously the impact of this war is going to be felt around the world, not just in the USA, in Europe, but around the world economically, politically, strategically. And we’ve already seen oil and prices, oil prices surging, uh fuel shortages particularly in Asia have led to rationing and all the rest of it. The CPI report also reflects u this particular fact. So what can we expect the medium to long-term effects of this and crucially how will these interact with the already existing vulnerabilities and disparities in the global system as a whole professor Wolf and then Professor Valkus. Well, you know, my first reaction to listening to you pose the question is that neither I nor Giannis spoke about something which now in my head has to be inserted into this conversation. Uh, and that is the extraordinary rise and power of the people’s republic of China. It seems to me it changes everything. It it it introduces into a discussion. Look at the way both Giannis and I focused on World War II. Well, that’s a kind of Euroentrism and then the the the or Euroamerican centism. The remarkable thing is that Europe and and Yiannis can speak to this of course much better than I, but for me much more than the decline of American hegemony is the virtual disintegration of Europe. I I I feel as though I’m watching a hysterical scapegoatism. You know, I’ve been struck in the United States with the scapegoating of the immigrant, but in Europe is a combination of scapegoating an immigrant and now the kind of wholesale scapegoating of Russia. And I’m no, you know, I I’m not defending Putin or Russia here, but the hysterical creation of a monstrous uh danger to Europe that can now justify the desperate efforts they are uh which aren’t working but which they are pursuing with great intensity as they disappear from historical relevance. you know, becoming a corner of the world, the opposite of the center that they once were. So for me, I want to somehow insert into our conversation and your question, even though it wasn’t about China, sort of just brings me to want to to to insert uh all of that. You know, the class struggle here in the United States, well, one of the central realities of it has been the hollowing out of our manufacturing world. It all moved, I’m exaggerating, but it all moved to China. It’s gone. We can’t function anymore. All the people who over the 19th and 20th century slowly built up an identity, communities, a whole economy around manufacturing. And if you like the the growth of American manufacturing to displace and replace the British Empire manufacturing, all of that was taken away in a relatively short time. If we marvel at China, what an amazing economic development compressed into three or four decades, what took three or four centuries in Europe. Well, then you ought to also match that with an awareness that in three or four decades you wiped out the manufacturing culture of the United States. And that culture became MAGA. They saw in Trump some effort, however vague, that it would all come back, which he kept promising them he could and would do. Of course, he couldn’t. And so, in his first presidency, it became clear to many that he couldn’t and he wouldn’t. And now, it’s accelerating that he can’t and he won’t. and his MAGA is beginning the disintegration that comes from when you have great hopes and you’re forced to confront that they are not ever going to be brought to at least not by this orangehaired clown in Washington. So I think we are Giannis is very right. We are at a point of intense pre I’m taking I go on a limb. It’s the pre-revolution. I it it’s the the recognition on the part of the people that will be in the streets pretty soon. uh they are beginning now to put together the elements of a general understanding that we need massive basic change and that otherwise this is a story of decline without limit. Um absolutely absolutely Rick um I you know I go along with everything you said obviously uh you will recall that in my introduction I said that I uh divide the postwar period into three eras period the financialization period um globalization call it neoliberal whatever you might and then I mentioned another one after the great financial disaster pastel of 2008. Uh so my answer to your question um about the cris crisis of realization crisis of accumulation uh of of capitalism generally uh is going to focus on this third period which I didn’t speak to before. Now the second period from the 1970s to 2008 uh saw to it that the the transformation of um the American economy into a huge vacuum cleaner that was sucking into American territory the uh net exports of German, Japan and China uh at the same time as their profits 70 80% of their profits were flooding um Wall Street becoming in treasuries, real estate and shares. So that was a recycling system. Now this process, you know, uh stabilized American hijgemony, actually boosted American hijgemony. For the first time in the history of humanity, you have an empire that gets stronger the more into the red it gets because of this recycling mechanism. Now that’s a unique unique phenomenon. Uh many of us missed it in the 1970s and ’ 80s. uh we thought that because it was getting into the red um that it was going to get weaker. No, it got stronger as a result of recycling other people’s surpluses to use again uh Paul Vulkar’s expression. Um but what that meant was the American working class was being crushed. Uh factories were being shipped over to China to Vietnam to so on and so forth. This was also part of the strategy of driving a wedge between China and uh and the Soviet Union. This was the the Nixon Kissinger project that that actually worked really very well from that from that uh cold war perspective. Uh Britain because of Thatcher and and Reagan working hand hand in hand went down that role of de-industrialization financialization. So the engine of growth in the Anglosphere in the Anglosphere in the whole of the Anglophere and here I include if you want Australia and New Zealand along with the United Kingdom and America the engine of growth was the liquidation of pre-existing public properties and you know they they used in order to uh to power the financial financialization process and that went along of course with the industrialization and the importation into the Anglosphere of other people’s capital. Uh therefore from if you look at it from a microeconomic Marxist perspective right uh there is a huge accumulation crisis in the sense you know domestic accumulation crisis domestic capital goods were no longer accumulating. Um if anything there was negative accumulation but financial capital and were you know laughing all the way to the bank they were becoming far more hegemonic and the rest of the of the world’s capitalists were paying for the American military. Yeah. This is what happens. You know you have the you have the the Hermes bag producer in in France selling an Hermes bag for $15,000 in New York. Okay. that 15,000 buys American treasuries that buy American army power. So um so that that was a situation in 2008 with for that system to have to maintain itself because it was so it it was an unbalanced equilibrium or an imbalanced or a balanced disequilibrium. I mean call it what you might and these imbalances had to grow to stabilize that disequilibrium. So the American deficits had to get larger. The cris of accumulation in America had to get larger so the American could get richer. Uh while at the same time the the the German, the Japanese and the Chinese uh capitalists producing you know capitalist goods commodities were increasing their their rates of accumulation. cut in American dollars that were invested in the interior sector of the United States. Uh so it’s a tale of two cities here, right? Uh and then of course when you give Wall Street billions every day to play with even if they keep it only for 10 10 10 minutes, they find means derivatives by which to make a lot of money for themselves through betting through betting. Massive bets over bets over bets over bets. Everybody has in margin call. You don’t need me to explain how that that happened. And that just collapsed in

2008. And then then you have in the United States, but far more so in Europe. And that is the reason why Rick I I I you know this is how I explain the the the current conundrum in which Europe finds finds itself that you know what happened in the United States was turbocharged in Europe. And what happened? Socialism for the bankers and harsh austerity for the masses. But in Europe that was practiced to the power of N. I know that I experienced this. it. We went after the crisis of 2008 to save their their theirelves, you know, big business and primarily big finance practice a form of vicious um primal accumulation, primitive accumulation. That is, you know, I I’ll just give you an example. They came to to our country here and they talk they grabbed all the the airports, all their motorways, their their their railways, the ports. um the tax office, the pension funds, they just grabbed it. So, you know, it was a pure colonial thing and that happened across Europe. At the same time, the European Central Bank was printing trillions of euros, giving it to Folkswagen. Folkswagen didn’t invest it because the people were impunious. They wouldn’t be buying Tesla like cars and what they did the good people in Volkswagen, they took the the money printed by the European Central Bank and bought Volkswagen shares. This is the reason why Foxvagen cannot produce cars now. So what do they do? They are transferring whole production lines to rin metal to produce tanks that even with the Ukrainians don’t want because they are death traps. But we are producing now ran metal um tanks in order to keep those industries um you know to to to slow down the process of industrialization to produce those bloody tanks that nobody wants. They have to to stir up you know the rasophobia the whole thing that you know Putin’s tanks are about to take Berlin. So we need the Isra. So it’s a big fat lie which is functional to a stupid plan for slowing down the industrialization process which is due to the fact that now you know back in the 1970s Reagan um Nixon and then Reagan in the 1980s sped up the process of de-industrialization. Capital accumulation in the United States uh slowed down. Capital accumulation in Europe was going up. Now it’s going down everywhere across the and here I come to China. The the Chinese didn’t have this plan from the beginning. In the same way that you know I mean take AI, take Huawei, take uh companies like DeepS, they were not planned really. What happened was that, you know, at [clears throat] some point uh the Huawei took contracts out to make American models in the same way Foxcon makes the iPhone in uh in Shenzhen in Shanghai, right? Uh and and they learned through doing learning by doing how to to produce these things, right? And then the communist party was very worried about uh YouTube and uh Twitter and all those uh um social media algorithmic social media that are controlled from the United States and for their own propaganda and authoritarian reasons they simply erected the firewall between China and the United States big tech. So those companies that were working for the American companies initially and working with Google and all that they were vessels to the American conglomerates, you know, they had a firewall, they had a a a 1 billion person um market and they developed their own stuff and it turns out that it’s much better than that in the United States. Electric vehicles, they they just completely um did everything that was and and of course the the five-year plan series of fiveear plans was important. And now you have a situation where the only markets that actually do work well are the markets in China. Why? Because they are completely and utterly regulated because markets can only work if they’re regulated by a proper planning mechanism. This is the great uh um tragedy of the libertarians. They don’t understand that. They don’t understand that markets without a powerful state planning for for them and facilitating them simply doesn’t work. Uh and so they they made markets work. Um, but at the same time they’re doing things I’m I’m sure Rick can tell you more about it that are particularly interesting and quite useful. So for instance you when China’s Amazon Alibaba run by the Chinese version of of Jeff Bezos a guy called Jackm when they were collecting huge rents as a result in the same way that that Bezos is collecting on huge rents they said to him you will done it no more than 5% profit rates rental rates he had 60 and 70%. So he disappeared for a year. He disappeared for a year and the profit rate went down down down to 5%. Uh you know and you know this is this is not rent that is coming out of the secular flow of income. That’s why you have high huge levels of investment and you have idiotic macroeconomists in the United States in the west more generally accusing the Chinese of uh investing too much. So there I don’t know whether I answered your question or got carried away. Well, let let me just let me just add one more statistic that does that. You know, part of the mythology of capitalism is to make sure that certain things that are really dysfunctions are made to appear to be extraneous, external, beyond control. One of them is inflation. I I love it always. We can’t you know so it can’t go below 2%. You can’t the inflation rate in China for the last few years is less than 1%. You know they don’t have an inflation problem. It just none at all. And and you know it’s not an issue. It’s not worth conversation. And and I’m reminded of that because when when Giannis talks about the the Nixon shock, that famous speech there in uh August 15, 1971, the point of that speech was to deal with what was a quite serious inflation at that moment. And Nixon makes this amazing announcement for a Republican conservative, which is what he was, which he says basically, if you raise your if to the business community, if you raise any price starting tomorrow at 8:00 in the morning, we will come for you, we will arrest you, and we will throw you in jail. You know, we didn’t have an inflation the next six months. It turned out that the great difficulty of this complicated thing with the interest rates that have to be all [ __ ] All [ __ ] You know, it it was the Jack Mah moment. Although there was no Jack Mah at that point, but it it is retrospectively the Jackmaw moment of of disciplining. And you know, Giannis reminds me because he’s Greek that if you go back and you read Plato and Aristotle, they debated about the market. They both hated the market. Plato said there shouldn’t be one. Aristotle said, “Well, it would be so socially disruptive now that we’ve had one for a while that here’s the solution. Regulate it in an iron regulation. then we can tame it and we can get rid of all of its negatives and hold on to its positive. You know thousand years ago people understood what is been so carefully cultivated to to be forgotten. Anyway, to get back if I can to the to the Iran uh situation, there is something going on here in which a I know Iran is a country of 90 million people. I know geographically it, you know, it’s it’s like another Europe. I I get all that. But nonetheless, it is a poor what we used to call third world country. And it is now in a position to confront the American superpower. And the American superpower is making one blunder after another. It thought the war could be one in two weeks. That somehow they could do in two weeks a replay of what they did a year ago in two weeks only with more success. Wrong. They thought the Iranians would fold even if it took a little longer. Wrong. They apparently didn’t understand what the Iranians had said that they would close the straight of Hormuz and that that would have ex consequences. You know it. When you make too many mistaken judgments one after the other, it’s usually the sign of something else that’s wrong. It’s not that you can’t calculate. It’s not that you can’t do the research and reach the conclusion. There m there’s something happening that is impeding and that’s what I mean by the decline of an empire. There are too many other things going on and you can handle it as too many distractions from Mr. Trump or too many contradictory pressures on the American government. There are number of ways of getting at it, but there wouldn’t be a decline if there weren’t multiple factors over determining the situation the country is in and watching in the last few months as the polling numbers for Mr. Trump come down with a relentlessness despite everything he is obviously doing to try to reverse that. And now the desperation of using the oil from the strategic reserve to try to limit the amount of increase in the price of gasoline. It is you’re watching a kind of hysteria that I think is very similar, please correct me on this if I’m wrong, with what seems to me the Russophobia hysteria that’s that governs the governments of Europe, even as it seems to me as an observer, it is so overthe-top that whether from the left or the right, the the mass support for that Russophobia risks these governments being blown away in the months ahead. The way Mr. Stormer seems to be vanishing as we speak.

Can I just add an inkl to this? Look, Rick, America doesn’t need or historically didn’t need to win any wars after the Korean War. You know, American Germany uh rose at a time of increasing deficits and losing one war after the other. They lost Vietnam. They lost Iraq. They lost Afghanistan. They are just making a mess of everyone. I mean, they’re trying to win everyone. They fail winning everyone. But that’s not the point. The point is to have permanent war. permanent war is has so far been crucial to the maintenance and reproduction of American hijgemony so far. The reason why I agree with you that Iran is different is again going back to something you said earlier, China. Now take for instance 1973 when uh oil prices skyrocketed. American consumers, American Republicans suffered at the gas uh station massively. You had these huge cues. You had uh um price hikes. Americans, you know, middle class Americans suffered a lot. uh which is you know which makes very interesting something that um Henry Kissinger wrote in his autobiography. There’s a chapter in it which I wrote I read years ago but I still it’s still burnt in my in my head. It’s entitled who caused the oil crisis and the first sentence of the chapter is we did. And the point he was trying to make was even if we didn’t but of course they did because remember OPEC the OPEC would never have gone against the United States. Who was OPEC back in 1971 172 it was Saudi Arabia the Saudi King would have you know the CIA could have toppled him in a jiffy. There was the the sha of Iran who was a stoge of the United States, a CIA operative and it was it was hard of Indonesia who owed his u his presidency to the fact that the CIA helped him kill 1 million communists or people who were accused of being communist. These people had no capacity to turn against the United States. So I believe Kissinger when he said we caused it. Now, why would you ever cause an oil crisis that um dislocates that that that damages so much your your your base, you know, Republican um drivers and and you know, and and consumers. Well, the reason that that that that is that Kissinger says puts out there is very consistent with remember what Paul Vulker had told him, we have to make the capitalists of the rest of the world pay for our deficits. Yeah. what what he he was getting at is that yeah, we allowed uh oil prices to go up. By the way, something that most people forget, oil prices did not go up after 1972 if you counted them in gold. In gold. What happened was the Nixon shock intentionally devalued the dollar visa v gold and the OPEC people said, “Well, we are going to get as many dollars as we need in order to continue to receive per barrel the same amount of gold.” Okay, I I closed the parenthesis here. Uh but you know why was the United why why did the United States lose its uh uh competitiveness competitiveness let’s say visav Japan and Germany at the time China had not come on on on stream at the time well because German and Japanese manufacturers had managed to increase their productivity and invest more in capital goods than you know Ford general electric and so on. Uh but they suffered from something that the United States didn’t suffer from. They had no access to oil. The United States in 1973 was not self-sufficient. But still there was a lot of oil production in the United States. There was zero in Japan and there was zero in Germany. And the um the majors the oil majors were American effectively. They controlled the flow uh of um of the oil. So the Kissinger thought there and the vulkar thought was very simple. We are damaging ourselves but we are damaging the Japanese and the and the German capitalists more. So essentially, we’re going to win in terms of competitiveness massively uh and encourage the German and the Japanese capitalists and later the Chinese capital to send their dollars to the United States because we are going to have higher rates of return here because even though our costs are going up, they’re going to go up by less than theirs. With Iran, that is not the case because of China. Because China doesn’t give a damn. Uh, China doesn’t depend that much on oil. Their investment in renewables um is gigantic. They still have a lot of coal that they get very cheaply and there’s no problem from Hormuz. People say, “Oh, but you know um ch China has been purchasing 90% of its oil from from Iran.” True. But that was only 12% of their purchases. and they have a stock which is three times the size of the of the stock of oil that the American government has in its strategic reserve. Uh on top of that they have Putin who is desperately trying to sell more to them. So unlike 19717273 when the oil crisis which hit the American Republican blue collar base uh nevertheless hit the German and the Japanese capitalist more. Now the great competitor of the United States which is China is not being hit by this. This is why I agree with you that uh Iran is the waterlue of um of Donald Trump. One more but then then I think maybe we should do the questions or let people anyway interact a bit more. Um when I was uh uh my first year in college, I I took a seminar and the seminar was taught. There were eight of us in the room, eight young men. Uh and our teacher was Henry Kissinger and he taught us what he thought about how the world worked. And it was a very interesting experience for me because it was the first time that I was in the presence of somebody who didn’t just talk about such things but who actually seemed to know. Uh he explained to us how close he was to the Rockefeller family. He told us that over and over again. If you listen to him, his real name wasn’t Kissinger, but was actually Rockefeller. Uh even though he he is in fact from German stock that comes from the name Kissinger, which has a is in part of Germany is where this comes from. One of the things he told us is relevant here. um the old tribute system, he said to us, the the system that is considered ancient history when one country was required and he gave us examples from the Roman Empire to provide tribute to another. He said to us, “It will come back because it never left.” When Mr. Trump threatened the world with tariffs, do you remember how he alleviated or promised to alleviate to drop a tariff from 30% to 15% or from 25 to 10? He often did it in the case of uh of Europe uh by saying you have to give me well what? Well, you have to commit to buying liqufied natural gas $700 billion and you have to commit to invest in the United States so and so much I believe it was around a trillion dollars over 10 years or whatever it was. Well, you know that’s tribute. Over two years, Rick. Over two years. Two years. Gross. Even worse, right? But that’s tribute. The real name for that is you you we will hit you with a tariff or you give us tribute. That’s what you you in your going to be a political leader. And here’s my comes my point. You’re going to be a political leader in Europe who has to raise money in Europe, out of the European economy, and then give it to us here in the United States, and somehow you’re going to survive politically in Europe doing that. That’s an that’s an incredible attack on the people you’re demanding a tribute from. I want a tribute from you in such a form that it will be political suicide for you to do it. But if you don’t do it, it’ll be political suicide because I’ll close you out of the American market. It’s an extraordinary That’s not the step of a confident global hegeimon. That’s the step of a desperate global hegeimon. Let me stop. But can can I just make a very brief comment on that? You know what? I love him for this. I absolutely adore him for this. I’m so glad he’s doing it, right? Because, you know, I’ve had enough up to, you know, up to there of American presidents, portraying the tribute system as their service to democracy and human rights. This guy comes in there, he says, you know, he comes to your home, he says, I like it. I’m going to take it and if you if I I if you protest I’m going to kill you and bury you in the garden and then sing on your grave singing hallelujah. Right. I love that for us leftist Marxists. This is a godscent because, you know, I’ve had so I’m so fed up for decades having to argue with centrists about, you know, uh the nicities of human rights, of the rulesbased global bloody order. You know, we are free of this. We now can talk about brute force, about tribute, about, you know, primitive accumulation, about sheer naked exploitation. It’s much easier to appeal to young people, especially because of Trump. We owe Trump a great favor. We are we’re very aware of that here in the United States. He’s our best organizer at this point. All right. Thank you very much for those comments. Um, it actually segus fairly nicely into my next question, which um [clears throat] I’ve I I want to ask you something about something I’ve seen hotly debated in leftist circles um recently and and in light of this discussion about the decline of US empire and how this war is a symptom of that decline. What does this reflect about Israel’s role in US empire? um given its central place in instigating the current conflict, does it continue to function to support US control over Middle East resources or has it become instead a liability to Western imperialism uh to the ex the successful extraction of surpluses from the region? If if you uh professor Wolf have comment on that. Well, for me um I’ll try to be really brief here. Israel represents for me um a bizarre project that is several centuries too late for me. This is settler colonialism. And I’m very conscious of speaking to you from the United States because I live in in the results of a settler colonialism. What the Israelis are trying to do in that part of the world, Europeans did quite successfully in this part of the world. There is a solidarity. Therefore, that makes historical sense between the United States. Look at us. I mean the difference is the the Israelis have been doing it for several decades. This country did it in the first two centuries of its very existence. Were endlessly endlessly engaged in killing, moving and decimating the native population that was here before the Europeans came. And it is deep you know this is a whole another discussion but it is very deep in the culture here what I’m talking about as I think we are seeing how deep it is in the Israeli mentality uh as it is now evoked and the story I tell very briefly here is a visit I made to a very small community in Massachusetts called Old Deerfield. And the beauty, it’s very small town and half of it is reconstructed homes from the colonial era. You can walk there and and see the old houses filled with the old furniture. It’s like an outdoor museum. Very n for tourists. Very nice. So I went there. I’m I’m interested in history. In front of each old house is a plaque and the plaque describes an interesting event that occurred in the house. Many of them read as follows. August 12th, 1782. The savages attacked, but we beat them off with our rifles. Next house. The savages stole the horse. As you walk around this little community, you discover its self-identification is its origin in a tremendous battle with the savages. No, no tablet even remotely suggests that if the Europeans come and kill off everybody they find. If you’re going to use the word savage, it applies to the Europeans, not to the local people. Who’s a savage here? But it becomes, and pardon my Hegelianism, if you are a savage, it’s very tempting to project your savagery onto an other, an other. American history is the history of one savaging of the other, usually a victim, after another, black people, now immigrants. I mean the Japanese are doing the war and on and on. This is a country that has to have an other is engaged in fighting and who are savage. I listen to people that are spokespersons for what the Israelis are doing and their speech about Palestinians is about savages who you do you they’re not really people you can kill them in large numbers and they remain the savages who you have to kill it it it becomes the logic of a settler colonialism. that is slowly or maybe not so slowly recognizing that in order to realize its project, it has to literally erase the people that are there. Either move them or kill them, but get them out of the story one way or another. And you know, several centuries ago, this was a workable project. Horrible, but workable. But we now live in the postc colonial or if you like anticolonial period of modern history. We’ve been in it for a century is not going away. And that project in this century cannot work. And I think it’s just an sad spectacle in which the Israelis are self-destructing and taking a lot of people down with them. Well, to endorse fully everything Rick said, let me just add um a vignette from Australia because when the British arrived uh in uh New what is today New South Wales, they perused the land. They loved it. They wanted it. There were 5 million Aborigines there. They said, “Well, we will declare it teranulio, an empty land, a land without a people for a people without a land.” And of course, once you look at 5 million humans and you say these are not they’re not here, that’s the first step towards genocide. Um, and you know, it’s no accident that the Zionist um mantra is a land without the people for a people without the land. So it I’m just endorsing fully what Rick said. But allow me to to to answer your your question directly by you asked whether you know Israel is good for American capitalism or imperialism. Right. Um well it is it’s really very good for American imp it’s not good for American society. It is not good for 99% of Americans, but it is really very good for the military-industrial complex and for projecting its power, the power of the military industrial complex, not so much of Washington DC, uh um across west western Asia. Uh now what has happened is that at some point the tail started wagging the dog uh a long time ago and it did a lot more so with technological innovations [clears throat] and technological developments. And here I’m I’m going to tell you a story. It’s a story that I I keep telling in the last few months because nothing has disgusted me and excited me as much as that conversation I had with a certain gentleman who was sitting on my right at a dinner table. I was in one of the Gulf States. Uh there was a conference on big tech and um you know I was the invited there as the the the court fool the village idiot uh because of my book technofidalism in order to say nasty things to these people there because they were the you know managers and directors from Google from uh meta from so on and I was there as the the fool right Shakespeare’s fool u which I enjoy doing uh at the dinner after the conference I was sat next to a guy from Cisco on my left and to another guy that I didn’t pay much attention to initially and I was chatting with a guy from Cisco. It was an interest conversation that was about quantum computing and then at some point a gentleman aqatari from the opposite side of the table very rich man but nevertheless he thanked me for the work I’m I’ve been doing um against genocide uh in support of the Palestinian people. Uh and the guy next to me who I didn’t know I didn’t know who he was. I didn’t know his name whom he worked for. He said, “Gaza, Gaza, we owe such a huge debt of gratitude to Gaza.” And I said, “Who are you?” And he said, “Oh, I work for Palenteer.” And I said to him, “Well, so you owe whom exactly what? Uh, you seem to be enjoying the fact that tens of thousands of children died were killed there.” He said, “No, no, no, no, no. That was terrible. It was terrible.” But and then he pointed at my phone. I had my phone on the desk on the desk on the dinner table and he said you you see your phone it is useless to me because it is stationary when your phone is stationary it’s not moving it doesn’t produce data that I can use but if you bombard a densely populated area intensely people move a lot with their phones those who don’t get killed he said he he he was very cynical and but also quite pleasant you know during And he said, “So we that created so much data for us that we managed to train our AI that the one a piece a particular agent AI agent which we sold and I then I checked and it it was confirmed we sold for 1 billion pounds sterling right that’s 1.4 4 billion um dollars to the British public national health service. And I said, “What the hell was that piece of a AI? What did you sell them?” He said, “You know, when when you let’s say you’re in Manchester or in Birmingham and there is a pileup at the motorway and you know 10 15 ambulances arrive at the hospital, there’s panic amongst the nurses, the doctors and so on. So we have AI that helps them create some order out of the chaos of panic. And we trained that antipanic AI using the panic of the panic imprint. This was the expression u from Gaza. I think that answers your question. It does. It does. Just a footnote. Every war includes exactly that. every war and that through Iran now too is partly utilized by the military and they plan on this. They they know what I’m saying. I learned it from them. Every war is a testing ground for all of the latest technological possibilities because they can’t test them any other way. This war provides them these kinds of unique opportunities to test That’s why every war will produce good there is a fundamental novelty here and it is this in every war you have the military industrial complex that produces commodities lethal commodities which then it sells but it tries them out in in the battlefield right or even in in the occupied lands. That has always been the case. But the the their surplus value comes from the commodities themselves using proletarian labor. Yes. Here we have something unique which I keep writing about. That’s my obsession with what I call technism and so on and crowd capital. Here you’ve got the work being done. A large part of the work is the actual running around of injured people in Palestine because it’s their movement. Okay, it’s it’s unpaid labor. Think of it in Marxist terms that is actually an input into the capital goods. The capital goods are not produced by proletarian paid labor. they are produced by uh injured people, people running away from bombs, um carrying the their dead children. So, you know, this is something new for a Marxist political economy. Thank you. Um I’d like to bring in some of the questions from the audience if that’s okay with the two professors. Um John Shriner asks uh and I’m paraphrasing because it’s a fairly long question. The gist of the question is that given this dark and dismal situation that we’re in, what leverage do progressives or leftists or revolutionary movements in the imperial core have in this particular period? And specifically, how can we connect these abstract ideas about the petro dollar recycling and all the rest of it into concrete mobilizing such as the one in the 19 the 1990s, the WTO protest and all the rest of it? How can we convert these abstract ideas into concrete movements particularly in this situation? Uh Rick, you want to go first? Sure. Um, I’ll speak only for myself, although I believe what I’m about to say applies to what Giannis is is doing as well. We’re talking about Iran, we’re talking about Israel, we’re talking about current things. But when we do that, certainly for me, when I do that, I am trying as best I can to apply a way of thinking, a way of posing questions and answering question. And that way is shaped by a long a life in my case a lifelong engagement with what I take to be Marx’s project and the project of the great Marxists that I have learned from since. So I want to be blunt here. If you find what I’m saying or what Giannis is saying to be interesting to to put together things that you hadn’t seen the link between or ways that please be aware that we are applying maybe with a little addition that is can be called original to ourselves but in my case only a little. I’m trying to apply Marxian theory. So my answer to your question is that’s the most important thing I can do. I’m not going to speak for others. I work at organizing politically. I happen to. But if I didn’t, then I would say to you this this is what we do. More people in America where I live and work and where I interact every day. more people are of your opinion, the way you phrase your question, that things are really dark, things are really grim, uh prospects are frightening more than ever in my lifetime in this country, much more. And what’s missing is your question, what do we do? But the first step is you have to be able to think about it in a critical where we go from here frame of mind and that does not get taught in this country. Quite the opposite. We are offered scapegoats. We are offered dis you know delusions of one kind or another. We are not offered neither the way nor the fruits of the way of posing questions in terms of class struggle in terms of empire dissolving in terms of new ways of surplus. Think of Giannis’s latest uh remark there. These are ways of thinking that are crucial to getting out of the mess. Otherwise, we will have yet another phase of capitalism encountering really serious problems, but also coming up with ways of getting another few decades of life because it dis distracts you in one way or another from what might get you out of this situation. that you know every casual dismissal of socialism or Marxism or communism or anarchism those are efforts of this system to keep you from the kinds of thinking the kinds of traditions the kinds of literature that can help you get a way out that teaching that getting people I have confidence that If we give the tools to the American working class, it will come up and surprise us with how those tools can get you a way out. We can’t do that. There’s too few of us. We got to make many more of us aware of thinking in this way. Professor Focus, let let me give you an example of uh what Rick says when he’s talking about putting into practice max analysis, right? Uh everybody’s now uh concerned, right? So about AI replacing uh white collar workers, blue collar workers, everyone, everyone, mathematicians, the whole thing. uh and at the same time there’s a lot of um liberal in American terms liberal uh concern about uh privacy about um you know surveillance you know Zubuff’s book surveillance capitalism now we need to dispel all that rubbish you know I don’t give a damn what they know about me I know that the NSA has a three-point uh uh tail on me uh because of my relations with Julian Assange from back then I don’t give a damn let them listen whatever they want. You know what I care about? I I care about who owns those machines. Yeah, that’s what the Marxist should beware about. You know, it’s not a question of how do you regulate? You cannot regulate AI when the the engineer who builds an AI model has no bloody clue as to how a particular prompt is turned into an output. How the hell is the state going to regulate what the AI is going to? You know what you can do? You can socialize the the machines. you know in pure Marxist time socialize the machines and you know have people work on algorithms that have a social purpose and not the purpose of accumulating the maximum amount of what I call cloud rents once you start explaining this to people once you start explaining to them that you know it doesn’t matter you know what government you have whatever attempts they try they they they put forward uh to um regulate x x.com you know former Twitter or Instagram um it’s not going to work. It really is not going to work because the algorithm is going to be much faster and much smarter than any regulator. But if you socialize that if you take it under social ownership which is not the same thing necessarily as nationalizing it. Okay. And we have, you know, the users who can decide what we want the algorithm to be doing as opposed to, you know, poisoning our conversations in order to keep our eyes fixed in a state of rage on the screen in a manner that destroys any chance that this can be operated as a public square. Yeah. So ownership mates, you know, the neoliberals keep talking about property rights that they are so essential. So do we Marxists, but the question is who owns what? Then you have the answer of who does what to whom, as Lenin put it. Fascinating. Um, Gina and Giola, I’m sorry if I’ve mispronounced your name, uh, asks a question. Could one or both of you comment on how the destruction of ecosystems globally is contributing to the geopolitical and economic chaos of our current times? If you’d like to, one or both of you would like to say something about the destruction of ecology and ecosystems in the same process in the same vein. People are curious to know your views about that. Well, only thing I can add is that one of the lessons I take from the Marxian tradition is a lesson that capitalism is a system one of whose unique characteristics is the essentialization of profit. Profit is the bottom line. Profit is the goal. prophet is and teaching every generation the following magic. Namely, that if you maximize profit, you thereby maximize all that is good in society because all that is good will be enhanced in the process of maximizing profit. The beauty of that argument is you don’t have to look at the rest of the world. Concentrate on profit maximization and all the rest will follow. The whole ecology movement represents to me a recognition, one that survived all of the efforts to crush it. a recognition that the magic is fraudulent that it was never true that profit magically maximizes everything else that you object have as an object in a reasonable person’s life. Your personal relationships, your emotional condition, your ecological environment can be horrifically damaged by that which is profitable. And it can be preserved often by that which is not. And once you open that door, if you allow it to be understood in this way and open you up to all the other externalities. Look at how the the neocclassical economics tradition teaches if you think about it dialectically or with Hegel’s awareness, it can’t but recognize that which it also represses. So in neocclassical economics they teach you about externalities without ever allowing you to understand that it’s all an externality. You idiot. You’re not seeing the point. You have to constrain it because otherwise your premise of profit maximization dissolves. Absolutely. Entirely. Look look to the question uh what is the relationship between ecological catastrophe and the latest geopolitical uh twists and turns the answer is not much the answer is not much as was saying you know capitalism is in the business of destroying everything that doesn’t have um an exchange value uh so you know the the most pristine ecosystems to the extent they have no exchange value they are being used as rubbish tips or as uh free resources and therefore depleted We we’ve known that that was always the case. But you know, if if you’re trying to understand what’s happening now in Iran, I don’t think that the ecological catastrophe, which is uniform, I it’s across the board and it’s been happening now for 300 years as long as capitalism has been with us. Um, helps you explain what I what I find astonishing is, you know, supposed to, you know, take the Green Party in Germany. I mean, how can they possibly claim to be interested in the ecology of the planet when they are gung-ho about more guns, more weaponry, uh more, you know, more support for the apart state of Israel destroying Gaza? Uh I haven’t heard a single Greeny, a single Greeny who doesn’t happen to be um you know, involved in the anti-genocide movement. uh but none of the established greens right I’ve said a word about the fact that Gaza uh the the the ecology of Gaza was completely poisoned and destroyed there isn’t one green shoot left that has not been napalmed out and you know those ecologist don’t don’t say a word right so they they they can’t possibly pose as ecologist uh but I have to say again I’m going to give a tribute to comrade Donald Trump because you know in his first term he he he he served humanity without realizing it when he banned the importation of solar panels in the United States because the Chinese that produce the best and cheapest solar panels had to send them somewhere. So if you go to Pakistan today um 80% of households have free electricity and not even a connection with electricity grid. Um I have on good authority that dowies dowies um include two sonar panels and inverter and a Chinese battery. Um in Ethiopia uh because of the crisis in Iran they banned the importation of every vehicle from a bic from a motorcycle to a truck uh that uses um internal combustion engines. So there is a massive transition towards renewable energies that’s happening uh with Chinese technologies uh across the world because of uh the madness of Donald. So again, we need this guy. We we we need to build many statues for him. I’m joking. Okay. [laughter] What? Well, there’s no need. He he is very busy doing that himself. Both of you spoke about the rise of China. Um what if we ask a slightly different question namely that all the world’s data and algorithmic control still rests in the mega7 corporations in the United States. Um what if these mega7 corporations alongside the backing of the US state and policy can exclude China from the process of data collection and the AI the development of those large language models. Professor Valus, do you think that that’s a possibility that purely by excluding Chinese companies, for example, Deepak Seek and all the rest of it from the competition uh by not letting them operate in other territories and all the rest of it or banning access to goods, for example, Nvidia’s GPUs and all the rest of it, could that um in a way act as a counteracting tendency to the decline of Not at all. Not at all. Shahham, you you saw what happened with Nvidia chips. Biden banned them. The the CEO of Nvidia accommodated Donald Trump to Beijing, begging for them to to get some of his chips and Beijing saying, “No, we’re not interested. Bag her off. We are producing our own now.” So every attempt to impede the technological process of China is speeding it up. Uh and if they can ban deepseek, deepseek is going to um to continue to to function really very well. And in the end they’re going to have the reason why they didn’t ban Tik Tok and they in the end they they had to take it over was because Tik Tok was so terribly popular in the United States. similar deepseek uh it will be a known goal if they do that and even if they do it you know the in China AI is being used productively unlike in the west in the west we use it in order to cheat in order to write articles in order to write CVS in order to read CVS in order to for for students to produce essays that they never wrote and you know professors to mark them without reading them um so it’s it’s a cheating device in in Europe and in the United States In China, in China, they use AI to power drones in agriculture so that every drone goes and deposits one tiny drop of water or of fertilizer on each route in order to maximize production and reduce ecological damage. Uh, do we do this in Europe? Do we do this in the United States? No. All those valuations, they are all about BS. Let me add something else. It’s which you can interpret in a number of ways. It’s too late. The cat is out of the bag. The the horse left the barn and you’re busy closing the door because you don’t realize the horse is behind you, not in the barn. The Chinese economy when it grew over the last 40 years developed not just a great place for industry to come, it also put an awful lot of people to work who earned a decent income making the Chinese market the fastest growing market in the world. Now fast forward to every business school in the world teaching the young student of business. If you want to go to where you’re to successful then you want to go to where the wages are low and the market is growing. Don’t go to but that is an advice to go to China for the last 40 years because there the wages are relatively low and because of their success in outgrowing the west that’s what yeah the old market of the United States and Europe is a big market no question but you’re not taught in business school to go to the big market you are taught to go to the growing market for all kinds of good reasons The growing market is China and beyond China the bricks and they are the majority of the people of this planet by a lot. Therefore, you’re betting on the wrong horse if you think you’re going to constrain this in a naturalistic economic system as opposed to a global one. Can I ask you this question about universal basic income as an immediate demand of the global left especially given the onslaught of AI and the possibility that a lot of young people are going to end up losing their jobs and all the rest of it. So if we can produce the surplus through robots and all the rest of it, should the universal basic income uh at least in rich countries at the beginning be an immediate demand of the left and can we organize around that? Your opinion? Um look I in initially when I first read about basic basic income in the early 1980s I was against it as a good Marxist ought to be. Uh now I’ve changed my mind. I’ve changed my mind, but under conditions, uh, I seriously oppose the idea of a UBI that is funded through taxation, especially through middle- class taxation or working-class taxation. This is a a non-starter politically. Uh, the only way we can fund it, it is through the appropriation of the monetary system and of capital. In other words, um imagine you we create a monetary commons. Imagine that the the Fed issues um um you know a digital wallet exactly that which the Genius Act or Donald Trump banned and they know so they know their stuff. They know where they banned it. We should have it. But under what conditions? You know, if you take your if you shift your money from Bank of America to effectively what is a publiclyowned digital payment system, uh you should receive the interest rate of the of uh of the Fed, the overnight interest rate that you know no commercial bank can compete against. Um and you should have absolutely zero zero charges. Zero charges. Uh and think about that with every $1 that moves from a private bank account to this publicly owned digital dollar. Uh what happens is that because of the negative money multiplier, um a a substantially larger amount of dollars is lost to the money supply. The money supply which under capitalism today is being produced essentially by private bankers. Okay. So in order to keep the money supply constant, you need to create more dollars and to give them to people in their digital wallets. And that’s a UBI. I would call it a trust fund for everyone. Effectively, what you’re doing is you are nationalizing or socializing the collective capacity to produce money which now is in the private hands. So this is a you know this is a Marxist project of appropriating uh as you know property rights over the payment system and at the same time uh I would uh want to see um the socialization of capital that that is in in the first stage towards uh socialism you can say to large corporations you have to deposit 20% of your shares in a social equity fund if you want to operate in this jurisdiction and the dividends that come from that uh are also part of the funding of uh the UBI. And a third source for the UBI would be uh taxes on bads as opposed to goods. So carbon taxes for instance since we you know who’s going to receive the carbon taxes, let everyone receive them. So there in brief now all I would add is I we make it generalize beyond what what what Yiannis has said. I don’t like I’ve never liked the the UBI. I retain my distaste for it partly because it’s cut off from what I care about. For example, labor. I don’t want UBI to be understood as quote unquote freedom from labor. So in other words, you get the income regardless of what you do. No, no, no, no, no, no, no. We don’t give up and we ought not to our community, our interactions with one another. But the whole notion of what a young person thinks about when she or he looks into the future that is should should be opened up. There is no need to link the labor you do with the income you get. Your labor should be a response to your passion, to your intellect, to the people you love, to the community in which you develop. That’s that’s how you rethink how you’re going to spend by far your most precious possession, which is your life, your time as a living human being. If we can free you from the the labor activity that is held over you as a condition, you want income, you want any freedom at all, well, you have to put in your labor. We know how that works. We know what it means. I want the discussion of your income to be attached to the discussion of how you spend your life or what in Germany they call the work life balance. Well, there ought to be a work life income balance and these things should be either handled together or handled at the same time but not leave the whole question of how you organize your energy, your your love, your your brains, your muscles. Uh that should not be a separate issue from the income. It should not be dependent on the income. It It’s altogether different. That’s my sense of where that desire of a universal bet. That’s where it comes from. It’s the same as a desire of poor people everywhere who have horrible jobs that they’d like to have more free time. Exactly. If you go back to the early Marx, remember what he said? I want to spend the morning doing poetry. I want to spend the afternoon going for a walk. I want, you know, I want freedom to mean something as a critique of the system. I want that too. And and the conversations around universal basic in income lack that most of the time. Having said that, I don’t want to be misunderstood. That question is debated. There are different ways of interpreting and understanding basic income. I’m not claiming that my critique applies to all of them. It applies, however, to those I most often encounter. All right, guys. Thank you so much. Professor Jiannis Vuupakus, Professor Rick Wolf, thank you so much for that enlightening conversation. We really learned a lot. Um, folks, we should do this more often. Uh for everyone in the audience, I hope you got something out of it. As always, the philosophers have only interpreted the world. The point, however, is to change it. Take care, folks.