Episode Transcript
[00:00:00] Speaker A: I'm Afshin Rifanti and you're watching New Order broadcasting all around the world, including to nearly one and a half billion on RT India. We on New Order will trace how India and its allies sit at the center of a transformation in world history.
After millions killed, wounded or displaced because of the Trump Netanyahu war in Iran and Lebanon, the so called ceasefire in West Asia broke down again and again this this week, Pakistan publicly thanked Donald Trump for de escalation efforts. It was rewarded for all its work by having its consulate shut down in Peshawar because the US considers it too dangerous a place in just days. Meanwhile, New Delhi is to host the BRICS foreign ministers meeting, a critical test for the global south. Iran is likely sending its deputy foreign minister. India as chair is balancing Gulf energy ties with a broader multi aligned strategy, positioning itself as the one actor able to keep competing sides in the same room. Last time BRICS failed to reach consensus. This time the stakes are higher, divisions sharper and billions hang on any deli decisions. So the question is now, can this emerging order hold together or find a way to reconcile lingering internal contradictions? At the end of the show we'll be joined by New Order Zahra Khan to answer questions from you, the viewers. But first, Whitby is one of America's greatest living economists. He might have been to Harvard and Stanford and have a Yale PhD but you won't see him on US propaganda networks like CNN or Fox. Professor Richard Wolff has taught at the University of Massachusetts Amherst and the Sorbonne. He's the co founder of Democracy at Work, the host of Economic Update and he's in New York. Professor Richard Wolff, welcome to New Order. So as I said, millions have paid with their lives through deaths, injuries and displacement. Americans are paying at the pump, billions paying for more prices, higher prices on food and medicine. Who's actually paying for the Trump Netanyahu war? We heard figures of around $12 billion in the first six days. The cost to the United States, but who's actually paying for it?
[00:02:07] Speaker B: Well, in the end it's a combination of the tax monies of the American people because we pay not only the costs of the United States, but to be honest, we pay the cost of Israel as well.
So it's a total bill that has to come due here because it is dangerous to tax the American people. If you want support, the government is resorting more to borrowed money than it is to tax money. The opposition in the United States, already a majority of people polled are against the war in Iran and the American participation in it if you actually tax them, if the president had to go to the people and say every one of your families is going to have to cough up 500 or 1,000 or $2,000 to pay for this war, then the opposition wouldn't be big, it would be enormous and there would be no war. He couldn't survive it. Political.
So the payment is being, you can kind of say postponed. We're borrowing it. And so the future generations will have to pay what the cost of this war is. And in the short run, the irony is that parts of the Global south are participant in sending the money, the loans, to the United States, which it uses to fight the war.
[00:03:36] Speaker A: It's being borrowed from Japan, China, Saudi Arabia, the uae, where I'm speaking to you, from Kuwait. It's Global south countries that are buying the bonds which are enabling the borrowing for the war and for say, 168 schoolgirls to be slaughtered in Minab in
[00:03:56] Speaker B: southern Iran, to be accurate, they are paying part of it. That's absolutely right. Part of it is part of the lending to the US Government comes from American individuals and American corporations. But part of it comes, as you correctly said, Japan is the largest creditor of the United States. The United States is the world's largest debtor country. And if you want irony, the People's Republic of China is the second biggest creditor after Japan for the United States. China, which is backing Iran on one side, lending money to the United States to pay for the war on the other side of that war.
[00:04:40] Speaker A: No wonder Xi Jinping is meeting Trump supposedly later in the week. And I know you've been talking about the fact or implying that Trump clearly has no comprehension of supply lines. It seemed to have come as a shock to the oligarchs in your country and the powerful in your country, where things come from in your country. Explain how people are beginning to understand supply lines a little better in the present strait of hormone's crisis.
[00:05:11] Speaker B: Well, I think the clue lies in the fact that their lack of comprehension is a very interested lack. It doesn't come out of innocence. It comes out of a very important political issue.
Americans are wondering about those long supply lines, and there's only one explanation for them. Starting in the 1970s, maybe a little earlier in a few cases, but as a mass phenomena, Starting in the 1970s, American corporations moved, particularly manufacturing, out of the United States.
No one held a gun to their heads. No one required it. Neither the American government nor the Chinese government. They went because it was profitable to go.
And the ones who Went earliest reaped enormous profits, forcing their competitors, who may have been more hesitant, to basically join and move to China or India or Brazil or a variety of other places, although China is still number one in that process.
So the corporations, if they were honest, would be telling the American people, we have wrong supply lines because it profited us to do that, to move production from Chicago or St. Louis or New York or Boston to Shanghai or somewhere else in China. We're making out like bandits. And that makes a very long supply line because the stuff we produce in China has to be shipped all the way back to be sold where the market was. US, Western Europe, Japan.
They didn't want to have to say that because then the anger of the people in this country would have turned on the corporations. They had to come up, up with a different way. And the way they did it, which is a real lesson in propaganda, is by having the leading politicians, including Mr. Trump, but not only Mr. Trump, constantly talk as though the decision to go there was something done by China or by India or by Brazil. In other words, to remove the key decision maker from the story and to imagine that the world economy changed because of something done get ready by foreigners, not by Americans. That way, Mr. Trump can portray the United States as the victim of this process rather than the perpetrator. The victim has been the American working class, which lost its jobs and its incomes because cheaper workers for American capitalists were available in India, China, Brazil and so on. That story still cannot be told in the United States. It's considered taboo.
[00:08:17] Speaker A: So if the risk premium is going to be permanent, regardless of this short term war, the consequences, although of course, as I said, millions have been displaced, thousands have been killed in it.
What happens to future supply chains? Could there be a good side effect of this? Some renaissance of localized production within the United States and within BRICS countries.
India, I should say one of the biggest worker self directed enterprises, the amul Milk Dairy Cooperative, 3.6 million farmers. Can localized industries in your country and in BRICS countries be a have a renaissance after this war?
[00:09:01] Speaker B: I think so. I think even if it's not after this war, many large global factors are pushing in that direction. I mean, there's going to be all kinds of adjustments.
We haven't even begun to see all the adjustments that every corporation involved in global trade, which is most of the big one, they're having to rethink. Will we use the ocean in the future? Will we use railroad? Will we use trucking? Will we localize production? Those are all very big Decisions that weren't on the agenda before and have now been put on the agenda. What the Iran war is teaching many, many across the United States and globally, is what the Iranians did in the Strait of Hormuz can be done by Indonesia in the Strait of Malacca can be done in many different parts of the world. And when you let your imagination go, as these planners have to do, otherwise they waste billions in investment, you're going to see adjustments across the board. We're going to be talking, you and I, hopefully, in 20 years, if we're still here, about a very big change over that period of time in where production happens, where it's distributed, how the whole global economy is organized. And that's one of the reasons I stress in my talks to people to see this in historical perspective. This is not another war, even in the way that Vietnam, Afghanistan, Iraq or Ukraine might be considered. This one is rearranging the whole globe. And we will be talking about it no matter what the outcome is immediately, for a long time.
[00:11:01] Speaker A: So far, so possibly optimistic. Of course, though India said no when it was threatened by the United States over importing energy from Russia.
If these different brics countries start to rearrange their supply structures, let alone the dollar, which I know is talked about widely, the settling of bills in other currencies, what are the most powerful oligarchs in the United States going to do? And are they going to pursue increasingly kinetic ways of preventing a future which is better for workers and for bosses all around the world?
[00:11:45] Speaker B: I don't know the answer to that question. I don't think anyone does. And if you have someone who's very confident answering, my advice would be to go talk to somebody else. But that is being debated at the highest circles to this point. Let me put it to you this way. The political support for Mr. Trump has been shrinking and in recent months, shrinking by a great deal and very quickly.
Why is that important?
Because the single most important two supports for him that remain are a mass base of the extreme right wing of the political spectrum in the country. And I'm talking here maybe 10, 15, possibly 20%, not more.
The rest of his support is very iffy.
The other big supporter is the oligarch, the business class, because remember, for them so far, he's been wonderful. The first major legislation he passed in his first presidency was the tax cut of 2017.
The first legislation he passed in his second presidency was what he called the big beautiful tax bill of April of this year.
His priorities are obvious. He takes care of the People who fund his campaigns.
His refusal to break away from fossil fuels is a payoff to the fossil fuel companies in this country who have been very generous in supporting him. He will remain as president as long as the business community sees him as a net positive.
But if he cannot prevail in Iran, which it now looks from here, and I'm talking to you from New York, he can't, he cannot do. He has not, neither the military nor any other mechanism to defeat Iran at this point.
If that is the outcome or perceived to be the outcome, he risks losing the support of major parts of the oligarchy. And then he's gone.
Whether he goes in person or is replaced or fades away, he'll be gone because they will be looking for somebody else. And our government now, I must tell you, in all honesty, is, as we like to say when we've had a drink or two, the best government money can buy.
[00:14:33] Speaker A: Professor, we'll continue after the break. Keep watching New Order.
You're watching New Order.
Professor Wolff, you were talking about the huge significance of the war in West Asia for Trump and for all of us. I suppose I've got to ask whether the military of the United States, the military industrial complex, it's clearly using its force against the people in the United States. I understand that tens of millions cannot eat without food stamps in the United States. What is it? It's gone down a little. It's now what, 39 million, it was 43 million up until recently. Cannot eat without food stamps. But what if it decides to impose its military will when it can't use its economic will?
[00:15:34] Speaker B: Well, we're already, as you're suggesting, we are already in that position.
Let me give it to you as it's coming down on us now. President Trump has proposed an increase in the military budget for the coming year, fiscal 2027. And let me tell you what the size of it is.
It's to go from $900 billion, that's the current year budget outlay for defense, to 1.2 trillion. That's a $600 billion increase on a base of 900 billion. That would make it by far the largest annual increase in defense spending in our history as a nation, certainly in peacetime history.
What is going on at the same time are cutbacks in virtually every social world program, whether it's food stamps or education support or transport support or housing.
[00:16:40] Speaker A: How will the working classes cope with that if they really were to do that? Cuz these are cushions there, aren't they?
[00:16:47] Speaker B: Absolutely. And the working class is Already answering it. It's answering it by saying that the support for Mr. Trump among workers which was crucial to his getting elected is much, much less now.
The only way he will survive politically at this point in the elections coming up in November of this year is if he can develop mechanisms to deny people the vote. And that's the priority of the Republican Party. You are going to have but a
[00:17:22] Speaker A: different perspective for the global south, which sees a duopoly of power.
It doesn't really make any difference whether it's Democrats or Republicans. So how will the Global south have to cope with the United States in decline as it sees its supply chains disordered, as it sees more non dollar denomination deals being done? I mean, what is going to happen? Is it going to lash out? The United States against the Global south, against India, against Brazil?
Obviously it has. Against Russia?
[00:17:57] Speaker B: Yes, and it does.
Let me warn people, if they haven't paid attention for the last six months, the United States officially has killed, it's now about 200 people, mostly fishermen, in little boats in the Caribbean and the Pacific.
They are hit with missiles. They are immediately killed and the boats are sunk.
And they are accused by the President and our Minister of Defense, excuse me, he's changed his name, the Minister of War.
They are accused of being drug traffickers. Now, let me explain briefly.
We have drug traffickers in the United States. They get arrested all the time. When they're arrested, they get a lawyer and they have a right to a trial where they can confront their accuser.
Only if they are found guilty are they punished. And they are not punished by being killed. It is not a capital crime in the United States if you are found guilty. So we are killing people in international waters. No trial, no lawyer, no judge, and a death penalty without appeal.
Why would we be doing that? And the American navy used to board ships and inspect them, et cetera, et cetera. The answer is we are sending, we, the U.S.
a message to Latin America for sure, but to the global South. Yes. What is the message? That a part of our leadership will strike out in a way that befits a desperate hegemon when the empire they've presided over over the last century is in decline, as the American empire is.
But there is another perspective, and that's fighting inside the United States, including at higher levels of our government, that says no, we ought to face the decline and come to terms with it. Make a live and let live arrangement with India, China, Russia and so on so we don't destroy ourselves.
And the question is, which of these Two tendencies will prevail in the United States. If you ask my opinion at this point, I think it's the bad one, the one that is going to strike out, because I think that's what the Iran war really is, a desperate attempt, not well thought through and therefore unsuccessful, to do something to stop where the world seems to be going.
That's why it may be important. Not if the Democrats win. You're right, it isn't such a big difference. But among Democrats, there's a larger proportion of those who want to work something out and a smaller proportion of those who think they can bully or bull their way through this.
[00:21:08] Speaker A: Just finally, how carefully do Global south countries have to be when unwinding their faith or positions in the dollar then? And US Debt, clearly. China has been reducing its bond commitment.
India is still paying in dollars. And of course the region I'm speaking to you from is still part of the petrodollar. How carefully must it be unwound before the death of the dollar can be announced?
[00:21:41] Speaker B: It's still going to take a while. The dollar is definitely weaker. The direction of change is crystal clear. But the dollar remains an important currency, arguably the most important, albeit less so than it used to be. But I think we're getting to a point, if we're not already there, where this is happening pretty automatically. Country after country, more or less, is going to be reducing. You can see it. I'm talking to you from downtown Manhattan, New York City, where half the apartments on Fifth Avenue are owned by people from the Global south who invest and keep their money here.
I have friends who are realtors.
The apartments are being sold. People are not looking at the United States the way they did in the second half of the 20th century. It isn't a safe place for wealthy people to keep their money. It isn't the secure beacon of capitalism. It just isn't. And slowly and steadily, each family is working that out. I'm a professor. I used to have many more students from the Global south than I'm having now. And they're telling me why they're not coming back, or they're interrupting their vacation, or they're rethinking alternative places to get a degree.
That's why all of these things need to be contextualized as symptoms, as details in a declining empire. And you in India, if I may say so, because of your history with Britain, the empire that declined before the American one, in a way, you probably know better than most what is going on, how it will work, and the multiple layers and Levels at which this kind of a decline plays itself out. We here in the United States, people like me, born, lived and worked here all my life. My job is to undercut the denial that's going on, the refusal to face the reality and make people begin to think like that in the hopes that it'll lead to that better way of coping that we were talking about.
[00:24:06] Speaker A: Professor Richard Wolff. I'm not in India, but I suppose you were talking to the people of India who are watching this program. Professor Richard Wolff, thank you.
[00:24:15] Speaker B: My pleasure. And thank you for the invitation.
[00:24:23] Speaker A: And now, Sara Khan on her birthday with some questions. Professor Wolff, endless failure, not epic fury, is what he seemed to be saying as regards the Strait of Hormuz. We'll be remembering this war in West Asia forever.
[00:24:36] Speaker C: And I must say, as somebody who needed a tutor during economics in high school, having someone on who helps break down economics in a way that somebody like me could understand, commendable. But Gary Gonzalez has asked what would be the best and worst outcomes of the Quad meet in May. And I think that referencing the foreign ministers meeting that will happen at the end of May.
[00:24:54] Speaker A: Quad. Quadrilateral security dialogue. So who is in the quad? Australia, India, Japan and the United States. Australia, I mean, is that even a country? It's part of the British Commonwealth. Gough Whitlam tried to lead his country after being democratically elected, was overthrown by the Queen. I think if people try and look it up, it has Pine Gap, a US occupying surveillance base, which Julian Assange and Edward Snowden highlight as a way to surveil people in South Asia. There's Japan with Okinawa. So many criminal trials because of their US occupying base in Okinawa. In Japan, people can look up what happened on those criminal cases. There's the USA and Marco Rubio, who, let's face it, is part of what Professor Wolf is talking about as to the slaughter of all those fishermen in the Caribbean. And then there's Jaishankar of India. There's one man order, one country. That's the odd country out here. India should get out of the Quad, I think, rather than be in a sort of grouping with these satellite vassal states of the United States.
[00:25:55] Speaker C: Is that the best outcome, you think that would be?
[00:25:57] Speaker A: The best outcome, I think.
[00:25:58] Speaker C: And worst is for India to stay in.
[00:26:00] Speaker A: No, Obviously. So the best outcome would be that. Worst outcome would be India listening to Marco Rubio, who's associated right around the Global south with, I don't know, the war here in West Asia, the war in Cuba, the kidnapping of leaders like Maduro in Venezuela.
[00:26:20] Speaker C: And speaking of all the countries that are meeting, not just the Quad, Sylvia Ninurjan has asked we keep talking about BRICS but overlook ASEAN's power. Where have they been in this war?
[00:26:29] Speaker A: ASEAN, that's another grouping that one always wonders about. So who's in asean? Cambodia, Vietnam, Indonesia, Laos, Malaysia, Malaysia, yeah, but let's just look at Cambodia, Vietnam, laos for instance, 15 to 20 million killed, wounded or displaced by the wars of the United States. On those countries, of course you mentioned Indonesia. They overthrew Sukarno, famously killed a million people there. People holiday in Bali, don't they? They don't think about the 20% of the population of Bali slaughtered by US backed troops. And then there's the Philippines. How many have been killed in the wars on the Philippines? Malaysia I suppose is one outlier. Mahath famously. And then Singapore and Thailand. ASEAN is another vassal state grouping with some honorable exceptions and some honorable exceptional leaders. But I think ASEAN power versus BRICS power.
I think it's clear who wins potentially and well, it'll be up to New Delhi. It'll up to Delhi to prove that it's better than what happens in the Philippines.
[00:27:36] Speaker C: Thank you for answering those options. I'll see you again next week.
[00:27:38] Speaker A: Happy birthday again, Zahra. Zahra Klein. And that's it for me. Afshin returns here on the Order. Remember to follow us on social media. And here's a question for you. If the US can't raise taxes and can't borrow cheaply, how does it afford a long war? Send us your answer on xewordertv. Join us every Sunday as we continue to track shifting global power and where India sits in this new order.
