The Socialist Program with Brian Becker How an AI Bubble Crash Could Be Worse Than the Great Depression w/ Prof. Wolff
6 snips
Nov 19, 2025 
Professor Richard Wolff, an economist and co-founder of Democracy at Work, dives into the ominous potential of the AI bubble bursting. He discusses capitalism's historical instability, connecting past crashes like those in 2000 and 2008 to today's heightened risk due to massive AI investments. Wolff critiques the notion that past technological recoveries can guarantee future prosperity, highlighting the threat of mass layoffs. He also advocates for a socialist approach to AI that prioritizes worker benefits and reduced work hours.
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Capitalism’s Regular Downturn Rhythm
- Capitalism is fundamentally unstable and experiences downturns every 4–7 years on average according to NBER.
- Bubbles like AI increase the likelihood that a routine downturn becomes a severe crash.
Market Gains Driven By Few Giants
- A tiny number of large firms (the "magnificent seven") have driven overall stock-market gains while broader performance lagged.
- This concentration raises systemic risk if those few firms correct or crash.
Stock Crashes Can Become Economic Depressions
- A stock-market downturn can spread into the real economy and create prolonged depressions, as in 1929.
- The private capitalist system may be unable to restore employment without extraordinary measures like war.
