Worker’s Wages & Leverage Are the Real Targets

Originally published at TheAnalysis.News

Transcript

Paul Jay

Hi, I’m Paul Jay. Welcome to theAnalysis.news. The Dems, the Democratic Party, has retaken the Senate as we are speaking. It’s still not clear whether they’re going to retake the House, although most of the pundits are predicting they won’t by a slim margin. What happened and why?

We’ll be back in just a few seconds with Thomas Ferguson to discuss the results of the election, some of the economics involved, and why so many people got it wrong.

One of the things that were most frustrating for me in watching the lead-up to the elections was the way the Democratic Party, of which I am– certainly, of corporate Democrats, everyone knows that watches theAnalysis, I am no fan, but yes, as opposed to [Donald] Trump, yes, I would hold my nose and vote Democrat if I lived in a state where a Republican might actually win. As it turned out, even though I’m not even living in the U.S. anymore, I’m still registered to vote in Maryland, but given that the Democrats were going to win everything there is to win in Maryland, I didn’t vote because my nose was sore that day. All that said, I was very frustrated with the way the Democrats couldn’t even defend their economic record, which was rather pitiful but still better than the Republicans.

The basic argument the Republicans were giving– and here I’m going to show you a little clip from the Stephanopoulos show on the Sunday just before the election where Chris Christie goes on and on about how the Democrats are going to lose because they couldn’t deal with inflation. Everybody knows inflation came from the stimulus spending that was pushed through by the Democrats.

Donna Brazile

“What drives inflation? It’s not just who is in Washington, DC. This inflation is being driven by huge demand at a time we had two years of economic lockdown.” [crosstalk 00:05:59]

Chris Christie

“I’ll take Larry Summer’s word for it, okay. Larry Summers, Clinton’s Treasury Secretary, told the Biden administration two years ago, “you go ahead with the spending you’re talking about, and you are going to create enormous inflation.” It’s exactly what happened. We can try to blame it on a whole bunch of other things, but when you put $5 trillion that you printed into the economy, after all the money that we put in during COVID, that’s why you have inflation. The fact is that it’s got to stop at some point, and the Democrats don’t want to talk about that because their constituencies are all about ‘pay me more’.”

“In the end, Sarah’s right that they ceded that this round to Republicans.”

Paul Jay

Well, there are various studies, and as we get into the interview, I’ll quote one of them that shows that, in fact, at the very most, that spending may have caused maybe 3% inflation. That’s at a time when inflation was practically zero. That inflationary effect, meaning stimulus spending, money that went into people’s pockets, well, that money’s long been spent. It has very little to do with today’s inflation, yet I didn’t see Democrats defending their record.

The San Francisco Fed paper I referred to actually said that even if there was 3% inflation caused by these policies, it was better than the alternative, which was a deep recession. I didn’t hear that being said by Democratic candidates. I’m going to ask Tom why he thinks the Dems couldn’t even defend their own record when they could have actually had something positive to say about it. Before we get into that, I’m going to ask him why did so many of these polls get it wrong? Why did so many of the predictions of the results get it wrong?

Now joining me is Tom Ferguson. Tom is the director of research at the Institute for New Economic Thinking. He’s also an emeritus professor at the University of Massachusetts. Thanks for joining me, Tom.

Thomas Ferguson

Boston, please. Let’s not–

Paul Jay

I have to say Boston. Boston. University of Boston, Massachusetts, sorry. Not Amherst. Okay, here we go. Alright, so, Tom, let’s start. This isn’t the first time polling has been wrong, but it was really wrong. Even the internal polls of the Democratic Party, nobody was really expecting the Republicans to do so badly. When I say nobody, I guess I should say almost nobody. What do you think?

Thomas Ferguson

Well, okay, look, I have to tell you, first of all, we have just done Groundhog Day again, meaning in the sense of the movie, we’re rerunning what we did in 2020 with small changes. In that sense, I’m less censorious about the polls, and I would be more censorious of the pundits if you like. When you’re at this tight a set of races, it takes only a very small margin to blow you completely off. I mean, it doesn’t mean your polls are way off. It means if you’re 3% or 4% off, you got a lot of races miss-called, but it’s not that bad a deal.

On the other hand, what’s striking to me is the way you can see this– I’d be inclined to say ten-brained punditry that was just everywhere, and it’s still everywhere in telling you the meaning of the election that I am pretty sure they can’t actually discern. Mostly everybody agreed that the Democrats would get a drubbing, and they got a drubbing, actually. It’s not like things worked out wonderfully for them, but it worked out a lot better than everybody thought it was going to.

I am quite struck by the basic line, as far as I can tell, and I read this frankly, as coming from the White House, too. It is certainly reflected in things like the New York Times, particularly today, where there is no room for doubt. Just read what might be in the old days, the front page there. They’re all sitting around telling you it was a victory for middle-of-the-road candidates in this sort of happy and rosy scenario. It’s middle-of-the-road candidates in the Republican Party and middle-of-the-road candidates in the Democratic Party.

Now, a problem with this is that when you actually compare the major polls, Edison and AP-NORC, they actually differ by just enough in some key places that it’s actually hard to tell anything, particularly on the question of exactly how many women were thinking what and how they actually voted. I’m having trouble with that. I think we have to be cautious there. It seems to me a lot of people rushed to judgment.

Look, the first thing I think to be said about the economics of this election is something that, as far as I can tell, no election analyst has said, but which is obvious, which is, hey, opening the Strategic Petroleum Reserve pays. That is to say, there’s absolutely no question that inflation was heavily on the minds of voters. I’ve seen folks try to dispute that, too, using some poll data. I think that’s nonsensical.

It is clear, and I know very well from folks who were around who told me this, is that plenty of people gave [Joe] Biden the advice if they didn’t get oil prices down, he’d be toast. Well, they got them down. Now, some of that was just the fact that because of the Fed rate rises, the whole of the world now fears a recession. People stopped, the price fell, and then OPEC raised prices in response to keep its revenue up.

Still, the point is they opened the Strategic Petroleum Reserve; tell me that that’s not really important here. Before we hear all the stuff about the importance of culture and everything else, stick with that opening of the Strategic Petroleum Reserve.

The other point to notice is that a number of government programs in the farm belt are actually offering to buy crops at well above their existing futures prices in the market, which works out, too, for farmers. That’s not universal, but it covers a lot of crops. This type of stuff is running in the background if you like, and for sure, it’s important there.

Alright, first, one thing Biden did was defused the economic record and make it better by just turning on the pup briefly. Now, we’ll see how they rebuild that thing in the next few months. Why didn’t they defend it? Well, I think, look, the first thing to be said is it’s not easy to defend. There’s a lot of slippage on this, but the bottom line was that for most people, their wages just haven’t kept up with inflation. There are a lot of claims made about the lowest-paid workers. I think that’s a huge mistake. Not meaning that it didn’t rise, but what they were actually doing was adjusting. If they wanted any low-wage workers at all in dangerous occupations that had formerly been safe, they are now dangerous, and they have had to pay higher wages for that. I don’t think that was a general tilt, if you like, in favor of labor.

I note that in ’21, they actually lost ground in unionization. Once the Democrats came in, the rate of unionization fell back, not forward. That’s off of a BLS release I was just looking at. Anyway, the heart of the matter is, you want to understand that no matter what anybody else tells you, or the Americas is what we might call sumac moment in Pence, that’s after the new budget, that will be brought in in a few days by the Prime Minister and the Chancellor of the Exchequer in Britain. Put bluntly, they’re going to do big budget cuts.

Now, the bottom line on that is they got to do it to keep their costs down as interest rates rise. What’s happening to every country on earth now as interest rates rise, the cost of that debt that they’ve all run up rises a lot, not a little. The U.S. is in that boat too. You could see the Republicans were actually saying it. Interestingly, as a number of folks pointed out, the media wasn’t caring it in those last two weeks about the various Republican proposals for chopping Social Security, lowering the rate Medicare reimburses for doctors, and things like that. Now, this is close to inside baseball, which I actually despise, but it is perfectly obvious that Democrats in the White House are thinking about some of these too. Biden has a long history of talking out of both sides of his mouth on Social Security, to put it politely. The budget pressure is going to be very intense there.

I think it’s clear that, in general, the Democrats did not feel, the national Democrats didn’t feel like defending their economic record of helping people because they’re not thinking they can continue to do that. Way too quickly, they have pulled back on lots of expenditures to even measure the pandemic spread. It’s like today they’re running articles on how thousands of jobs are disappearing in public health that were temporarily funded by the CDC Foundation as part of the government there. You’ll notice– it’s quite striking the way the Biden people, and Biden himself, said the pandemic is over, but yesterday they extended the emergency rules on that which will allow them to keep spending. These folks have been cutting back for quite some time.

Paul, I’m sorry to throw raw meat to you, but I have to tell you, I agree completely with you. These folks were not defending their economic record on the spending side because most of them don’t believe it. They don’t believe it because they’re corporate Democrats.

Now here, I cannot help but observe one of those delicious ironies that it’s like this is too good to make up. Although a lot about what you’re about to read in some of these cases, the case of the crypto failure there– Samuel Bankman-Fried. This is a big centrist Democrat who– although he pretended to be a left-liberal Democrat– look where they spent the money. I’m in the process of doing that with my colleague Paul Jorgenson. And no, it’s not money. It’s mostly funded to sort of center and center-right Democrats, and it’s a lot of money. In that sense, one of the big financial props of the center did not hold there. Within days–

Paul Jay

Tom, let’s just stay on the economic thing for a second. You and I discussed this a little bit off-camera, but it seems to me that they did not want to push back on the argument that government spending was causing inflation, and the only alternative to that is austerity policies, cut back on government spending, and then supposedly higher interest rates are going to do something about inflation. Both of those things are not what’s causing inflation. If I understand it correctly, low-interest rates were not significant in this 8-9% of inflation. Government spending wasn’t significant. The two things they’re doing are going to cut back the government spending and continue raising higher interest rates. There’s another agenda going on here.

Thomas Ferguson

No, I don’t disagree that we are about to see an effort very carefully now because they’re in a much stronger position than they were. My reading is the White House thought they could blame a lot of this on the Republicans. Now they won’t be able to do that. It will be a much more difficult sell than it was all the Republicans, which the Republicans were clearly just raring to step into that role.

I have to say, in all honesty, that the other reason you would have some difficulty in pushing that line, though it’s not the controlling thing, is given the media worship of Summers and company, the people, the inflation hawks who were warning, in my view, utterly bogus claims about the role of the stimulus program. If all of your daily papers and all of the talking hats that you’re watching are saying the opposite, it’s tough for a candidate to just walk up to people and say different. In that sense, this is one of these deals where I’d like to blame– I’m not saying the system as a whole; it’s more specific than that. The major networks, the New York Times, they just all spend way too much time on Summers. They don’t look at serious counterarguments. They hardly print them, and it’s ridiculous. It’s also the case if you talk or listen to folks who have access to the White House and I occasionally bump into these people, they will say the influence of the conservative inflation hawks in the Democratic Party is quite strong, and they’re actively talking to the upper levels of the Biden White House.

Paul Jay

There was an interesting piece in the Economist, and it’s not only been there, but it kind of came out and said it. This is what I think the agenda is. It says that “we up until the pandemic…” we being the elites, “have been able to control…” quote-unquote, “core inflation.” If you read the whole article, it’s clear they mean wages. “We were able to control this because we had a reliable, cheap source of labor in China.” But two things have happened with the global supply chain. One, the pandemic has shown us that we can’t rely on this anymore the way we have. Two, the rivalry intentions with China are threatening those supply chains. Now American workers, and I should say I’ll add to that Canadian, are gaining some leverage. Is that what’s really– when I said there’s another agenda here, is that the real problem they’re trying to deal with is they don’t want the working class in North America to gain leverage here. They need to beat people down with higher interest rates and cut back social network spending, which also gives workers more confidence in terms of how they fight.

Thomas Ferguson

Okay, what I’d say is this. You got to treat even the White House as a place where a set of parties fight out stuff. The arguments inside that, if you like, it’s not the Republican Party, where as far as I can tell, there’s very little disagreement with that strategy saved, curiously, on the Trump side, which likes to talk the MAGA line, about making America great again for workers, even though they do essentially nothing to make that happen and indeed do many things to make it work. There is that tension in the Republican Party, and a different kind of that version of tension is in the Democratic Party, where there is clearly a wing that is actually friendly to the workforce. The striking thing is that when you look at unionization rates after the Democrats have been in here now for almost two years, they haven’t hardly moved at all. They actually went retrograde last year. There were a lot of strikes. You hear the familiar line that “this is the friendliest president we’ve had in years for labor.” What that means is they get to come to the White House or something.

On the National Labor Relations Board that is restructured, I think, in a way that is friendly to labor. But the NLRB and elections are increasingly irrelevant to what’s happening to the bulk of the workforce, which never reaches the stage of even getting to mount a union election. You do see a raft of unsanctioned strikes from small strikes of all kinds.

You notice what the White House did. It kicked off the question of the railway contract settlement until after the election. This is going to be very interesting. I just saw where the Secretary of Labor was saying that “well, he told Biden to say there can’t be a strike.” They need to tell the employers there that sick leave and some controlled over time, especially on weekends for people, is an important issue and not just sit out there trying to quote “mediate that.” It’s obvious. Anybody who studies American railways or transportation, in general, can see just how crazily one side of these situations has been, particularly as they try to run very, very long trains with one or two people. I think you Canadians know something about that especially.

Paul Jay

I worked on the railroad for five years. I worked as a Carmen mechanic on the railroad for five years, and that was beginning when I was there. We were starting to wage– it was a big fight of whether you could or whether you needed a railroad worker in the van, in the caboose at the end of the train. They started getting rid of them, and they started having more accidents.

Thomas Ferguson

Yeah, well, the workers have been in the caboose for a generation or more now; that’s clear. So yeah, all right, I think we’re on the same wavelength here. Yes, I think we have this serious problem even in the Democratic White House, and I can’t wait to see how they negotiate this there. I mean, just watch the railway strike business since I think at least four of those unions have already turned down the contract, and probably some more will be coming along.

More generally, look, this problem of wages hasn’t been solved. In fact, there’s no doubt that, in general, wages have lagged well behind inflation, and that’s not going to change as a result of this election. You could say probably you’ll just continue with the policies you’ve got. I do not, myself, think that that can go on forever. Inflation does begin to start institutional changes happening because the results are so disastrous if you just stay put there. I don’t know where we go into the future here. I think it’s going to be very interesting.

Now, on the general question of inflation in the world, I would just comment this way. I don’t disagree with the Economist article, which I haven’t read, the one you just quoted. You can see that U.S. reliance, U.S. firm’s reliance on China is declining. The usual estimate is about half of the Chinese trade surplus with the United States is American firms selling back into here. It is clear to me that the combination of Taiwan’s high-tech subsidies in China and especially the COVID rules there for lockdowns included foreign firms. I mean, you know, some CEO flies into there to see how his firm is doing, and he’s going to spend ten days at a hotel that he didn’t bargain for. Well, that cooled him off. I think that has very clearly altered the top runs of American business attitude towards China. There are still guys cheering on, “let’s invest,” but it’s a lot lower than it was.

The other side of it is the restructuring of Europe. You also see that basically strategic trade issues and decoupling are becoming much more important now. Those are going to create– they are already creating supply shocks of all types, and that’s not going to stop. It’s going to continue.

Paul Jay

Even if they move production to India, say, one, it’s going to take some time to get anywhere near what it was in China. Two, that wasn’t the biggest issue. The biggest issue is during the pandemic, they couldn’t get stuff here. The ports were so clogged up. We’re in the era of pandemics now. This ain’t going away. Every month there’s a new one coming by.

Thomas Ferguson

Yeah, that was one of the significant failures of the Biden administration. They should have generalized vaccines quickly. They should have told Pfizer and Moderna, “okay, look, you’re going to have to.” Given the amount of federal support for the background of these viruses, not necessarily to those companies at the time they had it, but the whole development of the vaccines. The whole development of the vaccine was certainly in the background. Large programs of federal support from DARPA, from the NIH, and other places there. They should have said, “ok, after you’ve made a couple billion now, give everybody access to the vaccine.” They haven’t done that. Most of everybody else’s vaccines, while they are around, they haven’t been disseminated on a wide scale. Some of them, I don’t think the Chinese or the Russian vaccines work that well.

Paul Jay

Yeah, they’re maybe 60% at best, whereas the American ones are up around 90%, if that’s all to be believed.

Thomas Ferguson

Yeah. So the result is that you’ve got a worldwide problem. In the latest round of vaccines, the take-up is not that high, even in the U.S. But it’s, of course, zero in countries with no access to it. You’ve just let this thing sit out there, and it will keep mutating. I entirely agree. This is now the biggest gambling operation in the world. It dwarfs from a cow in Las Vegas and everything else. It’s like, you bet the whole planet on this policy. This is stupid.

I would add the Gates Foundation has not helped here. Bill Gates has famously opposed this vaccine. Everybody says, “what’s he doing there?” My take is that what you’re actually looking at here is an effort to make American intellectual property essentially non-negotiable. That is to say that the fundamental story here is the U.S. government and its major companies think that the intellectual property issue is so important they’re not willing to compromise on it. That’s a big mistake. On issues like this, they should just give the stuff away. It’s not like–

Paul Jay

Just to be clear, because the coin just dropped for me, what you’re saying. You mean give it away on a worldwide basis because as long as most of the world’s not vaccinated, the thing keeps mutating. It’s impossible it doesn’t come back to the United States or to North America. Over and over again, you have completely broken global supply chains which was the whole basis of globalization which means you have to keep moving more and more production back to North America, which again is going to give workers here more leverage. So you better beat the shit out of them now.

Thomas Ferguson

Well, I was surprised when I was looking at some numbers on growth in manufacturing in the United States the other day out of the St. Louis Fed. There’s rather a lot of– there’s more than I would have thought. I’m not expecting to see lots of on-shoring, except in the case of our re-onshoring, I think, except in the case of goods with a defense component and sort of basic things you need. I suspect that you will see, and I trust we will see some continuous effort to keep masks and things like that available.

Paul Jay

I saw an article. A lot of the production that goes on in China, not all but a significant part meaning FOXCOM as the best example, is actually owned by Taiwan. It’s a Taiwanese corporation. I saw that Taiwan’s planning more investment in the United States, including trying to develop some semiconductor business there.

Thomas Ferguson

We are subsidizing our semiconductor folks, especially intel, to try to do more here. In the high-tech stuff with a defense or vital part aspect, you’ll see a good deal of that, but I think you’re going to find more and more people moving to places like Vietnam. What you’re going to do is– this will sort of be a kind of– well, it calls to mind the old empires of the late 19th century where the French, the British, and eventually the Americans, late joining, create its spheres of influence. Although the American position in China was famously, “everyone should have a right to get in.” Meaning the Americans should get in too. I’m not looking for a lot of that, but you’re right, and this is going to be continuously generating trouble. It does not help that the Biden administration and the CDC have just not– they haven’t got any monitoring system in place in real-time to find out what variants are around. I mean, they find out now by looking at hospital stuff that’s two weeks old. In the sense of what the vaccine is out there by the time you get sick enough to go to the hospital–

Paul Jay

Tom, just before we finish, if you’re watching mainstream media, there’s at least been discussions about high energy prices and what that means for inflation. There’s at least been a discussion about the supply chain. The thing that’s getting very little attention, something you mentioned just a bit to me off-camera, is how high margins and profits are simply higher than usual these days, and that doesn’t get talked about very much.

Thomas Ferguson

The Biden administration has been very late on antitrust. They’re making some moves now, but they’ve been slow, and it’s probably– well, we’ll see. I wish them the best on that. There are people in charge that are serious about that, but it’s not nearly broad enough to do anything. It’s not going to constrain most companies. They were slow on that. They haven’t done anything on commodities regulations; this crypto thing that just happened. That was money mostly going to Democrats. It just blocked it.

Bill Clinton and others were all walking around saying, “how we really had to have a light touch on regulation.” No, we didn’t. A lot of people are out of vast sums of cash. It is said that relatively more blacks than whites were actually invested in cryptocurrency. I don’t know if that’s true. I don’t mean that most blacks– I’m not saying that all, just that the proportion compared is a little higher there. I think for younger folks of all types, everybody found it irresistible. I was doing my best to persuade members of the family not to do that. Look, fleming and flim-flam here are just– stock markets lend themselves to that, particularly at low rates of interest. Bubbles are the basic heart of low-interest rate policies and bad regulation. That’s just the long and the short of it. It’s now mostly the short of it.

Anyway, I think we should come back to one point, though, on this, which is the weirdness of all this. I would accept the fact that the Trump folks running in the states, if they were running fresh, usually did not do well in Secretaries of State office and things like that. Election deniers, though, in the House because their incumbents did very well. The insanity of the whole business is that, yeah, on the whole, I don’t think it was so great for Trump. I doubt that even Trump will try to claim that. You look inside the Republican Party, and it’s fairly striking. You have a serious challenge to Mitch McConnell, who was certainly the main bull walk in that party against Trump in the Senate. You’ve got even Kevin McCarthy, who is under severe threat from people who think he wasn’t friendly enough to Trump, even though we all know between this enormous gap between what he actually thought and what he did, he’s talked like a Trump person for a long time now. You may see this amazing– this development is really worth watching. In fact, inside the Republican Party, the Trump folks may, in fact, come out somewhat stronger in the congressional delegations than anybody would have guessed on election night.

Paul Jay

There’s one other factor that I think certainly mainstream media has not even touched, but I think it’s significant, which is there has been over the past eight years, nine or ten years, progressive organizations– I know better the situation in Pennsylvania, who have been bypassing the media monopolies and just knocking on doors. They’ve been knocking on doors now in Pennsylvania for close to a decade. There are three organizations that have been doing it, and there are similar or some of the same organizations across the country. To some extent, it’s really going under the radar. I think we saw some of that effect, at least in Pennsylvania and maybe in Michigan, where they recaptured the state legislature. Knocking on doors may be the new technology of the future, which is sort of funny.

Thomas Ferguson

Yeah, I’m having a hard time reading what’s going on in those. I am quite struck, for example, by the difference in the outcomes in Pennsylvania and New York. I’ve heard all kinds of noise made about this, but it is a fact that [John] Fetterman, but also the candidate for governor there, [John] Shapiro–

Paul Jay

Yeah, Shapiro.

Thomas Ferguson

— both ran well to the Left of most of the congressional delegation in New York. Not all of them, obviously, you got AOC [Alexandria Ocasio-Cortez] and people like that too. That was pretty strange. The other thing that I think people need to think about here is to look at the outcome. Compare Ohio and Michigan, where Ryan [Kelley] was said to be a strong hope for Senate. He didn’t even win his own county, which I think is Mahoning down there near Youngstown and things like that. If you look at voter turnout– these are all Senate race states. We’re comparing apples with apples, not states that didn’t have center faces or something. Compare the Senate races in Pennsylvania and the turnout in Orion, Ohio, it’s quite different. It’s also in Michigan. The Michigan turnout is eight or nine percentage points higher than the turnout in Ohio. The turnout variations here are quite marked. What is up? That may be–

Paul Jay

Well, I got to dig more into this, but I have a hunch that it’s these organizations that are not part of the Democratic Party. They’re progressive. They came into being to support progressive local candidates and were not always successful early on. I know they exist in Michigan. I know they exist in Pennsylvania. They’re funded and operating without almost no support from the Democratic Party itself at all. Maybe they didn’t exist in New York State. Maybe it was just assumed Dems would do well.

Thomas Ferguson

I know that they did to some extent in some places because I talked to some. One of them made a very interesting point to me. It might be appropriate to close on this one. At the time, the person there had actually gone down to Georgia in the runoff in 2020. Really, I guess that was 2021, just the turn of the new year that boosted the Democrats into the 50/50 tie there. He said, at the time, they were all campaigning. They were telling people, “look, if you vote for Biden, you’ll get a rise in the minimum wage.”

Now, of course, the White House never got around to that. Now, it’s fine to say that, yeah, they had a 50/50 situation, which was really 48/52, with two senators, maybe reluctant. My sense was they didn’t try very hard, and they could have done a much better job of that early on. Biden has plenty of authority to do that inside federal government contracts, and he didn’t do it. This is a problem. Now the minimum wage, the meaning of that is changing with inflation. It’s going to make the problem even more urgent in the next few years.

Paul Jay

Sorry, go ahead.

Thomas Ferguson

My reading of this is unemployment is going to go back up, and also, there are vast numbers of people out of the labor market that could be brought in with intelligent policies, especially on public health.

Paul Jay

Hang on, isn’t that the point of high-interest rates is to create more unemployment?

Thomas Ferguson

Well, we have Jerome Powell’s authority for that, right. He was pretty clear about it. Yeah, I mean, it’s just the worst form of rationing.

Paul Jay

Yeah, I just think if you want to understand both Democratic, corporate Democratic Party, and Republican Party economics, it seems to me it comes down to a very simple proposition. All of them depend on corporate money. Not just campaign money but the whole way the system works in terms of where you’re going to work when you’re out of the office and so on. If you run a business, it doesn’t matter if it’s a small, medium, or big business; you wake up in the morning with three things on your mind. How do I increase my market share? How do I produce with less workers? How do I produce with cheaper workers? Then you can worry about everything else. The whole elite is concerned about the fact that they may have to pay more money for workers, and that’s what the policies are aimed at. Am I wrong about that?

Thomas Ferguson

No, I’m, of course, shocked, shocked, shocked that you could possibly think this, especially the fact that–

Paul Jay

Yeah, really, me too. [crosstalk 00:41:01]

Thomas Ferguson

Now, my reading is fundamentally that the stuff you’re reading in the New York Times now is quite constant with what the White House thinks. They think that the combination of abortion and democracy is enough to break enough votes off to beat the Republicans in this Groundhog Day situation. They are already reaching out to mount their corporate campaigns for the next general election. There’s already talk of bringing in a senior business Democrat. The White House is full of senior business Democrats, and that’s just all there is to it. No, this is just–

Paul Jay

If, as many people, economists and business pundits, and so on are predicting, if these high-interest rate policies are pushing us into a deep recession, and that’s where we are in 2024, good luck with cultural issues.

Thomas Ferguson

No, this is a longer discussion, but yes, that is a serious problem. I think the Fed will relent a bit, but not quickly.

Paul Jay

Alright, we can talk about that next time we talk. Also, when you’ve got some more data because you’re a data cruncher. Thanks very much for joining me, Tom.

Thomas Ferguson

Alright, thank you.

Paul Jay

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