Category Archives: Wolff

Department Profiled in The Washington Post

In the wake of the Herndon paper, The Washington Post profiled the UMass Amherst Department of Economics, providing a detailed history of the department’s growth and development over the last 40-plus years. Interviewed for the piece were Professors Richard Wolff, Gerald Epstein, Nancy Folbre, Arindrajit Dube and Robert Pollin.

The Washington Post
Inside the offbeat economics department that debunked Reinhart-Rogoff
Posted by Dylan Matthews on April 24, 2013 at 4:00 pm

It was surprising to learn last week that Harvard professors Kenneth Rogoff and Carmen Reinhart’s argument for austerity is based in part on an Excel blooper. What’s not surprising is who found it out.

The rebuttal came in the form of a paper released by the Political Economy Research Institute, a group at the University of Massachusetts – Amherst with close ties to its economics department. Two of its authors, Michael Ash and Robert Pollin, are UMass professors, and the other, Thomas Herndon, is a grad student in the department. No one who knows the UMass department was surprised they’d trained their considerable analytical firepower on Reinhart and Rogoff. Amherst has, over the past 40 years, developed a reputation as perhaps the single most important heterodox economics department in the country.

It wasn’t always that way. In the 1960s, it was a fairly mainstream department, with a moderately conservative inclination, according to emeritus professor and influential Marxist economist Richard D. Wolff. It employed Vernon Smith, a noted libertarian who shared the 2002 Nobel, from 1968 to 1972, and Hugo Sonnenschein, who would go on to be president of the University of Chicago, from 1970 to 1973.

That was when things started to change. The tipping point, Wolff says, was the denial of tenure for Michael Best, a popular, left-leaning junior professor. “He had a lot of student support, and because it was the 1960s students were given to protest,” Wolff recalls. That, and unrelated personality tensions with the administration, inspired the mainstreamers to start leaving. Read more…

Wolff: Bonuses for bankers, bankruptcy for public services

Richard Wolff

Richard Wolff, UMass Amherst economics professor emeritus, writes about the growing divide between the wealthiest 10% of U.S. citizens and the rest of the country.  He cites Goldman Sachs’ bonus structure as an analogy to this larger problem. Out of the $15 billion that Goldman pays out in bonuses, those at the top will each receive millions in bonuses (and much more in stock options) leaving less and less to trickledown the hierarchy.  And while big banks are distributing bonuses, states like California are forced to make extreme cuts to their budgets including higher education and Medicare.  According to Wolff, “US capitalism continues to dole out wealth for a few and austerity for the masses.”

Bonuses for bankers, bankruptcy for public services
Richard Wolff
Friday, January 21, 2011

The new governor of California announced last week that he proposed to cut about $1.5bn from the largest and arguably the best state system of higher education in the country. Such a cut will further damage the quantity and quality of the skilled and hi-tech workforce on which the nation’s economic future depends. Governor Brown also proposed over $1bn in cuts to the Medicare program providing healthcare to hundreds of thousands of California’s poorest residents.

Meanwhile, Goldman Sachs pays out $15bn, alongside the other big banks’ comparable payouts. More than yet another glaring contribution to social division, these contrasts represent stages on the path to self-destructive social implosion.

Wolff: Estate Tax Nears Death

Richard Wolff

Richard Wolff, UMass Amherst economics professor emeritus, writes in a column for The Real News Network, that the tax bill just passed by Congress will further widen the gap between the rich and the poor in the United States.  He discusses changes the estate tax, noting that the first $10 million left to heirs will not be assessed an estate tax and anything over $10 million will be assessed at 35 percent- 10 percent less than the under the current law, passed in 2009.

Estate Tax Nears Death
Richard Wolff
December 19, 2010

Estate taxes have been justified and used in countless countries for centuries. Indeed, many of the 50 states in the US continue to impose estate taxes (and/or the slightly different “inheritance taxes”) using the same justification. Basically, the idea is that even the most minimal commitments to democracy and equality of opportunity require that all citizens begin with roughly equal resources and supports. Hard work, talent, and commitment should determine each individual’s successes rather than the wealth that one’s parents did or did not leave behind. So estate taxes were seen as ways to both support the government’s activities and help produce a more level playing field for each generation.

What Obama’s tax bill does is directly contradict all this. It reduces the support for state activities from estate taxes while enhancing the inequality of starting points among our citizens. At a time when the economic crisis and the government’s responses to it already discriminated for the rich and against everyone else, this new tax bill takes that social injustice some steps further.

Wolff: Why Americans are slow to mobilize

Rick Wolff

Richard Wolff, UMass Amherst economics professor emeritus, is interviewed by RT News.  He gives his view as to why the people of Europe are fighting to save their cultures from massive austerity being forced on them by private financial interests and their lackeys in government. He also discusses why Americans are not seeking the same relief as they face the same problems.  Watch the interview.

Wolff on NPR’s All Things Considered

Rick Wolff

Rick Wolff, UMass Amherst economics professor emeritus, discusses socialism on NPR’s All Things Considered.  Wolff explains that socialism has changed significantly in the last 50 years.  Socialists now believe that the government shouldn’t own everything and they advocate for employee-owned businesses that would function as a cooperative.  “Groups of workers make the decisions: what to produce, how to produce, where to produce, and what to do with the profits that are generated.”  Listen to the audio…

Is The U.S. Moving Toward Socialism? A Socialist Weighs In

The upcoming elections will be decided in large part based on what voters think about economics.  So Planet Money is looking into the economic thinking behind much of today’s politics.

We’re going to start today with socialism.

Now, with the notable exception of Vermont Senator Bernie Sanders, no major figure in American political life identifies as socialist. Certainly no serious contender for national office this November does.

But socialism has become a large part of the discussion, with many conservative activists arguing that the nation may be “on the road toward a more socialist agenda,” as Sarah Palin said this summer.

There is no evidence that President Obama or any leading Democrat is an avowed socialist.  But we did think it would be worth digging a bit deeper into socialism and finding out what a socialist government in the U.S. might look like.

Right now, the governments of Spain, Portugal, Greece, are headed by socialists.  In the recent past, the UK, France, Canada have all been led by socialists.  Most countries have an active socialist party; socialism is just one more mainstream way of thinking — on talk shows, on political debates, in the papers.

I talked to Richard Wolff, a real life American socialist — a Marxist Socialist, even — who is professor emeritus of economics at University of Massachusetts.

He says that in the 1950s, the U.S. banned socialism from polite discourse.

“That meant we have now about two generations worth of people who never really engaged that topic,” he says. “It produces both an inability to understand what socialism [and] a gut level rejection and hostility to it.”

And, he says, it produces ignorance of what socialists think these days.  Most Americans, he says, think that socialism died alongside the Soviet Union and the shift towards capitalism in China.

“They don’t know that, of course, the experience of Russia and China has also affected socialists,” Wolff says. “Over the past 50 years, socialism has changed, dramatically, in every way.”

For example, he says, socialists now say the government shouldn’t own everything. You can own your house, your car, even your own business.

But, he says, socialism is not capitalism.

Take how companies work. In capitalism, large companies are typically owned by shareholders, directed by a board, and run by a small number of managers.

Most workers simply work in exchange for a paycheck.  Under socialism, many companies would be owned by the workers and would function as a cooperative.

“Groups of workers make the decisions: what to produce, how to produce, where to produce, and what to do with the profits that are generated,” Wolff says.

The Democrats’ health-care reform and stimulus spending came nowhere near the socialist vision, Wolff says.

A truly socialist government would instantly provide free health care to everyone and government jobs programs to employ every single out of work American — along with a host of other government programs that, these days, it’s hard to imagine the U.S. government being able to afford.

Strangely (or, maybe, not so strangely) Wolff says he loves it every time he hears the word socialism in the media, even if it’s out of the mouth of an angry and possibly poorly informed critic.

He says that for the first time in a long time, socialism is — sort of — back in the public discourse.

For more: See Wolff’s web site.

Wolff to speak on the economic crisis in New Haven, CT

Rick Wolff

Rick Wolff, UMass Amherst economics professor emeritus, will give a talk titled, “The Continuing Economic Crisis: Why Bailouts Failed, What Needs to be Done” and sponsored by the New Haven Green Party.  This event will be at the Unitarian Society of New Haven and is scheduled for Thursday, September 23rd.  Doors will open at 6:30 pm.  For more information, please visit:

Wolff analyzes financial reform bill on Russia Today interview

Richard Wolff, UMass Amherst economics professor emeritus, appeared on Russia Today earlier this month.  During the interview, he analyzes the financial reform bill that was recently signed into law by President Obama. Wolff feels strongly that this is not sweeping reform and it will not put an end to “too big to fail” or prevent another financial crisis.  (Russia Today, 7/21/10)

Wolff questions austerity measures and proposes alternatives

Richard Wolff

In his article, “Austerity:  Why and for Whom?” Richard Woff, UMass Amherst economics professor emeritus, analyzes austerity measures that are likely to be imposed as a result of extreme governement borrowing. 

Austerity, Wolff defines, is the guarantee demanded by lenders.  “Lenders want governments to raise taxes or cut government spending or both. Governments will then have more money available to pay interest on loans and to repay those loans. Governments that fail to impose austerity will face higher interest on new and renewed loans or will be denied loans which would cripple those governments’ usual operations.”

The weight of these typical measures (raising taxes and cutting government spending) generally falls on the workers.  Wolff proposes alternatives including levying a tax on assets over $100,000, exiting the wars in Iraq and Afghanistan and ending tax exemptions for super-rich private educational institutions. (In These Times, 7/15/10)

Wolff interviewed for Avgi, a Greek daily paper

Richard Wolff

Richard Wolff, UMass Amherst emeritus economics professor, was recently interviewed by Harry Konstantinidis, UMass Amherst economics doctoral candidate, for the Greek newspaper, Avgi.  During the interview Wolff addresses questions about the economic recovery in the United States, noting that the U.S. should take advantage of the opportunity to form communist class-structured enterprises.  He also discusses the ongoing financial crisis in Greece and points out that part of the reason Greece has had a hard time securing additional loans, and the reason they are paying such a higher interest rate for the loans they do secure, is because lenders put much of their money in the U.S. 

Interview with Athens, Greece, daily newspaper, Avgi
Richard Wolff
June 6, 2010

The US government borrowed trillions of dollars to rescue US capitalism. Suddenly, private lenders around the world realized that they could put all of  the money they wanted to lend to governments in the one safest country, the US. There was suddenly no need and no willingness to lend to other countries that were riskier borrowers than the mighty US. It was not that Greece or Portugal or Spain had become that much riskier than they had been last year. It was rather that the capitalist crisis in the US had changed the global credit system in ways that brought loanable funds to the US and made them much, much costlier for those other countries. Credit markets were working to shift the costs of the crisis from the US to Europe.