Everything They Tell You About the Economy Is Wrong | Aaron Meets @garyseconomics (Explaining economic ideas in a simple way—without mentioning Socialism/Marxism, it is not “Eat the Rich!”)

This Gary Stevenson is pretty smart and I agree with him a lot. He does not say anything new for me and for people who read my posts since what he is explaining was explained a lot deeper in one of the videos which I posted and which in my opinion is the best economic video I saw.

Richard Wolff & Michael Hudson: Karl Marx and the Fall of the West (MUST WATCH!!! If you didn’t watched this you don’t understand real world)

Richard Wolff and Michael Hudson explain the economy very well. I especially recommend Michael Hudson. Here is a part of it:

“Marxism, as I said before, has two approaches: one is to start with the biography of Marx, work forward, and move quickly into Russia and why Stalinism failed, and the other is to look at Marx as the culmination of classical economics, including all of the critique of economic rent that went before him—the culmination of Adam Smith, Ricardo, John Stuart Mill, and all the other familiar names.”

That's a really in-depth explanation connecting Marx with thinkers like Adam Smith, Ricardo, and John Stuart Mill.

Meanwhile, Gary Stevenson discusses the same topics in a much simpler way, without mentioning Marx, Adam Smith, or more advanced concepts. He tries to explain it as simply as possible.

Before I share a fragment from his video, I’d like to highlight a similarity in the experiences and statements of Michael Hudson and Gary Stevenson:

“Wall Street had a freedom that I didn’t have in academia. In academia at the New School, all they cared about was what you believed. Are you one of us? At Wall Street, they didn’t care about my politics. They came to know that I was a Marxist, but all they cared about was whether my forecasts were right or wrong, whether I was telling them what was going to happen. And because of that, I became very successful. They didn’t care about the ideology. That’s the difference between at least Wall Street and the business community.” -Michael Hudson

“So the thing is, banks look at me and say, "This kid's predictions are right, get him in. How much do you want? Whatever—million pounds a year." You know, I asked for a kid to sit next to me and read the newspaper, and I got someone. They hired someone to sit next to me and read the news because they're like, "If Gary needs a kid to read the newspaper, get him a kid to read the newspaper," right? They know—this guy—it's not easy to find someone who continually makes good predictions.

Support this guy, support this guy, pay this guy whatever he needs. Turn up at Penguin—"You know, 20,000 words, this guy, he can write a great story, give him what he wants, give him a load of money, get him in," right? By the way, you got one of the biggest advances for a non-fiction first title. It was a decent advance, he's not exaggerating.

The private sector that's trying to make money is interested, but the government is not interested. That's a problem. I would work for the government for free. I would support, I would advise the government for free, but they don't call me.” -Gary Stevenson

So again, you have traders and people working in the financial system who understand Marx and use his teachings, while in financial academia, Marx is seen as the Antichrist.

Anyway, here is a fragment of a video. I hope this simplified version will help people better understand the truth about economics.

1:07:11

“Happen at the same time because you’ve got fewer resources. If you own your own house and then give it away, leaving you to rent it, you have no choice but to be poorer because now you have this extra $2,000 a month outgoing. That’s the situation the government is in. It’s about resources—it’s a naivety about resources. What we’re seeing here are the long-term consequences of that.

Wasn’t it Mandelson who said, “I’m intensely relaxed about the rich getting richer”? Well, what’s the rate at which a very wealthy person increases their wealth? Five percent? Six percent? It’s been a lot more in the last five years. In the first year of COVID, it was 22%—that’s from the Times rich list. Meanwhile, what’s the economic growth? One percent?

If the economy is growing at 1% and the wealth of the rich is growing at 5%, where is it coming from? This is why your kids can’t get a house. It’s not a coincidence that there’s been a massive increase in billionaire and millionaire wealth at the same time as government finances collapse, ordinary families can’t afford homes, mortgages blow up, and financial security crumbles. It’s a wealth transfer.

If you refuse to address this wealth transfer—and let’s be very clear about this—the winners here are not necessarily doctors, lawyers, or even bankers. These are families with enormous amounts of wealth and assets that just keep growing and growing. If you don’t deal with that, their wealth continues to grow, and eventually, everybody else gets squeezed out.

Because wealth taxes are off the table, both the Conservatives and Labour are left with no choice but to manage decline. When the Conservatives are in charge, they will dismantle the welfare state quickly. When Labour is in charge, they will raise taxes and dismantle the welfare state more slowly. But this is what happens when you give up your resources.

You need to protect your resources, and that means taxation. But since we’re not doing that, it’s like playing chess after losing all your pieces—you’re just moving the king around the board, delaying the inevitable checkmate.

If you’ve lost your resources, you have two choices: fix the tax system and reclaim the resources, or accept being poorer. If we choose the latter, the future will look like Mumbai, São Paulo, or Charles Dickens’ London. That’s what happens when you fail to protect your resources and refuse to fix taxation policy.”

What he is saying is true, but now we are being told that taxes are the problem. They want to reduce taxes even further, which will only make wealth transfer even more extreme. Again, this is something that needs to be addressed.

He is talking about taxes on profits — not from work, but from assets. So even if you are an extremely wealthy working person, it’s not so much about taxing you, since a working person can move away. What he is talking about is taxing assets — passive income — in other words, capital, as Marx saw it. Right now, labor is taxed more than wealth gained from assets. Yet, you still have people who own assets, earn passive income — literally getting paid for doing nothing — and complain about having to pay taxes on it.

I’m not talking about small business owners. It makes me laugh when I hear people talk about this so-called “communism” in Europe. Europe, like the entire West, is more aligned with fascism. Huge corporations pay less tax than their smaller competitors, which helps create monopolies. How can a state — or a structure like the EU — that supports big capital and massive privately owned corporations be called socialism or even communism?

This is fascism, the final stage of capitalism, where wealth accumulation — driven by a lack of taxes and measures to prevent excessive concentration of capital — has allowed private capital to grow so powerful that it has overtaken the state. Some people call this “corporatism” because they don’t like calling it fascism, but I will call it fascism because, in my opinion, that’s exactly what it is.

In any case, this so-called “communism” is entirely imaginary. People invent illogical concepts just to avoid accepting the truth. Communism opposed private property and primitive capital, yet now, people call the EU — which operates in service of big private capital — "communist." That makes no sense at all.

Anyway, back to Gary:

48:59

“Want something new, people just want something different, and that is correct. They are correct in the assessment that if we don't change anything, we're going to be, and our kids and grandkids are going to be, in trouble. Then they look around and say, "Who's next? Who's got an alternative idea? Who's got an alternative vision?" It's pretty clear who the biggest and loudest group of people with another idea about how to run the economy is.

This is why, when you ask me if I feel pressure, I do feel pressure. It's obvious what's going to happen here. People will lose faith in labor and reform if they don't win the next election. They may win the following election because the center has nothing new to offer. But what happens after that? The economic problem of growing inequality isn't going away—it's not even stabilizing. Inequality will keep growing.

You'll get reform coming into power, and we've already seen Trump come into power. They'll say, "We're going to stop immigration." But they won't reduce inequality, so people will still face worsening living conditions. Then what? Trump or someone like him will say, "I'm being blocked from taking the actions I need to take on immigration. I'm not being allowed to be strong enough." Even if they do stop immigration (which is doubtful), they'll say, "We haven't done enough; we need to go further. We need to start kicking people out."

It's clear this will escalate because they can't address inequality. They'll be forced further to the right on immigration, engaging in a narrative battle. Unless we offer an alternative—something that actually deals with wealth inequality and improves living standards—they'll keep winning. And because of their failure on the economy, they'll keep moving further and further to the right. You don't need to be a student of history to see where that leads.

So, do they really want to reduce immigration? Well, yes and no. The immigration debate is interesting. For a long time, I avoided talking about it, but now it's critical. We've seen Elon Musk heavily fund anti-immigration parties across Europe.

When I see that, I'm not surprised. If Musk can see what we see—that the economy is worsening and will continue to worsen—and if he's smart enough to realize that politics will become fractured, then it makes sense for him to act. People won’t accept that their kids and grandkids will live poorer lives. They’ll demand something new.

For Musk, a super-wealthy man, the stakes are high. He doesn’t want this to turn out badly, especially with growing voices like mine saying the problem is the super-rich and calling for higher taxes. Musk doesn’t want to pay higher taxes. So what does he do? He funds figures like Nigel Farage. It's an obvious move.

If you’re Musk, and you know the center will fail, the two main alternatives are "tax the rich" or "blame the immigrants." Naturally, Musk wants the latter. He wants anti-immigrant sentiment to dominate. But, interestingly, it’s not actually in his interest to stop immigration entirely.

What matters to Musk is that immigrants take the blame instead of billionaires. If immigration is stopped and the economy doesn’t improve, people might start looking at the billionaires. So the ideal move for him is to aggressively promote anti-immigrant sentiment while maintaining high levels of immigration.

This is essentially what the Conservatives did when they were in power. They aggressively targeted a small percentage of total migration—illegal refugees on small boats—while massively increasing legal migration from outside the EU. Politically, it was quite a smart strategy.

By stoking anti-immigrant hatred and fear, they deflect attention from the real economic issues, like wealth inequality. For billionaires, it’s perfect: anti-immigrant hatred prevents the push for higher taxes on the rich. Anti-immigrant sentiment becomes the shield for extreme wealth.”

This is what I was talking about, but I take it even further: the entire EU and US immigration issue was deliberately designed to create structural change — more neoliberalism — ultimately bringing Reaganism and Thatcherism to the EU. The goal is to dismantle the last remnants of social welfare in Europe that still provide average people with decent lives.

Because this remaining welfare system reduces profits for oligarchs, they claim Europe is "not competitive" — simply because we don’t allow ourselves to be exploited. They want to push for even more free markets to turn Europe into the US—and the hellhole it has become. People who praise the US often know nothing about it; they’ve only seen it on TV.

Back to Gary:

1:13:05

“Ordinary families weren’t able to run a balanced budget even when they had assets, which meant they were forced to dissave their assets. Now, without those assets, it’s a much worse situation. If you couldn’t run a balanced budget when you owned your home, hospitals, and schools, how can you do so when you’re massively in debt and have no assets? This is, again, about naivety around resources. You need to look at who has the resources.

The problem is that the economists and the people shaping the economic conversation are, overwhelmingly, from wealthy families. These are the very people who benefit from the system as it is, and they don’t care to challenge it.

So, are the people tasked with accurately predicting the future of our economic system invested in making it work for ordinary people? Or do they have a vested interest in its failure for the majority? There was an article in the Financial Times recently by John Burn-Murdoch, who often does good work with data analytics. He was writing about inequality and described the situation for the poorest as being “unambiguously good.”

Let’s pause on that statement. How can any economist, with a straight face, say the economic situation for the poorest has been “unambiguously good” over the last five to ten years? These are people who can’t afford to heat their homes or feed their kids. How is he able to say that? Likely because he comes from a comfortable background.

Of course, he would argue that the data says so. And yes, the data might show something on paper, but it doesn’t match reality. I have two economics degrees—I could sit with Burn-Murdoch and talk about the data all day. But is the situation for the poorest truly “unambiguously good”? No. It’s clearly gotten worse, especially since the cost-of-living crisis. That’s why we call it a crisis.

This disconnect exists because we now have a bifurcation in society. Someone like Burn-Murdoch, with an elite degree, working at the Financial Times, produces content for an audience of people with similar elite backgrounds and high incomes. For them, the situation is fine. For the people reading their work, the situation is fine. But for those outside that bubble, it’s a completely different story.

As someone from a poor background who has navigated these elite economic spaces—universities, trading floors, media, government—I see how disconnected these conversations are. Economics as a field is dominated by people who are, at the very least, financially comfortable. It’s the least socially representative PhD discipline in the country.

Why? Because if you’re like me, from a poor background, and have good grades from a top university, you have a choice. Do you use your economics skills to help society by going into politics, academia, or media? If you do, you’ll need a master’s, a PhD, and years of low-paying work, leaving you £100,000 in debt by the time you’re 30. Maybe by your late 30s, you’ll earn £70-80k a year.

Or, you could work in the City and become a multimillionaire by 25.

How many young economists from poor backgrounds are going to choose the first option? If you’re from a rich background, it’s different. You can afford to make the high-status choice—maybe one sibling goes into finance, and another becomes a university professor. But if you’re not wealthy, those doors aren’t open.

This isn’t just about personal finances. That money I made in the City doesn’t just buy me security; it allows me to help my family. When my brother needed a house, I had to help him. Now my sister needs a house, and I’ll have to help her. If my parents need money for end-of-life care, I’ll have to step in. People like me can’t afford to work in academia or public service.

The result? The best economists, especially those from poor backgrounds, end up in the City, where they can’t speak publicly. Public-facing economics becomes a “posh boys’ club.”

It’s frustrating. Take the phrase that was popular last year: “The vibes are off.” In the U.S., financial media couldn’t understand why people were unhappy with the economy when all the numbers looked good. That’s what happens in a crisis of inequality: it’s great for people at the top, while those at the bottom struggle. Rich, elite economists say, “I can’t understand why people are unhappy,” because they’re completely disconnected from reality.

That’s why I stopped writing for places like The Guardian and shifted to YouTube. Most mainstream economic commentators don’t understand what normal financial life looks like. The only working-class people they interact with are their cleaners.

That’s the truth of it. My sister can’t afford rent. I don’t do what I do just for her, but I know what’s happening. I’m connected to it because I’m from it.

When you have a world with little social mobility, it shows. In spaces of economics, politics, and media, you’re constantly surrounded by comfortable, protected people. They come from families with money, live in big houses in the Home Counties, and know they’ll be fine.

And they say, “I don’t understand why people are unhappy.”

It drives me insane.”

Instead of leftist movements working to fix the economy, the information people receive is controlled by oligarchs, creating a false narrative about some imaginary communism in Europe. This narrative hides the fact that Europe is actually a right-wing, fascist organization.

They manufacture a migrant crisis and then ensure that only right-wing parties acknowledge it. This pushes people toward right-wing economic views, which ultimately bring about the structural changes that oligarchs want. People say they want less regulation and more free markets, but just look at America — it’s the perfect example of where that leads.

I love when advocates of free markets either ignore the example of America or engage in mental gymnastics to explain that America is "better" because of free markets — while also trying to explain that living in America is worse than in Europe for other reasons.

In Europe, we failed to control capital and allowed it to accumulate unchecked, eventually giving it control over the state. All that so-called “stupid regulation” is actually the influence of capital. Yes, I agree we should reduce regulation, but let me give you one example:

Trump ally Elon Musk calls to 'delete' US consumer protection bureau

Musk, a confidant of the president-elect, is set to co-lead Trump's newly created Department of Government Efficiency.

They don’t want to remove regulations that protect big capital — they want to eliminate regulations that protect consumers and small businesses. These oligarchs are pushing for easier accumulation of private wealth and the creation of monopolies.

AFD and other right-wing parties are supported by people like Elon Musk because he wants to use them to dismantle consumer protection agencies, allowing big capital to exploit people even more under the guise of free markets.

So, to all the right-wingers in Europe — those who support AFD and similar parties — keep believing in this imaginary "communism" in Europe and keep voting for your right-wing leaders. Soon, they will strip you of all your consumer rights and labor protections, and you’ll finally be "free" — free to work two jobs just to survive, like your wonderfully free Americans do.

“All conservative ideologies justify existing inequities as the natural order of things, inevitable outcomes of human nature. If the very rich are naturally so much more capable than the rest of us, why must they be provided with so many artificial privileges under the law, so many bailouts, subsidies and other special considerations - at our expense? Their "naturally superior talents" include unprincipled and illegal subterfuge such as price-fixing, stock manipulation, insider training, fraud, tax evasion, the legal enforcement of unfair competition, ecological spoliation, harmful products and unsafe work conditions. One might expect naturally superior people not to act in such rapacious and venal ways. Differences in talent and capacity as might exist between individuals do not excuse the crimes and injustices that are endemic to the corporate business system.”

― Michael Parenti, Blackshirts and Reds: Rational Fascism and the Overthrow of Communism

“Every line of serious work that I have written since 1936 has been written, directly or indirectly, against totalitarianism and for democratic socialism, as I understand it. It seems to me nonsense, in a period like our own, to think that one can avoid writing of such subjects. Everyone writes of them in one guise or another. It is simply a question of which side one takes and what approach one follows. And the more one is conscious of one's political bias, the more chance one has of acting politically without sacrificing one's aesthetic and intellectual integrity.”

― George Orwell, Facing Unpleasant Facts: Narrative Essays

"In practice nobody cares if work is useful or useless, productive or parasitic; the sole thing demanded is that it shall be profitable. In all the modern talk about energy, efficiency, social service and the rest of it, what meaning is there except " Get money, get it legally, and get a lot of it"? Money has become the grand test of virtue. By this test beggars fail, and for this they are despised."

— George Orwell (Down and Out in Paris and London)