Episode
#303 – Steve Keen: Marxism, Capitalism, and Economics
3:36:45
Published: Sun Jul 17 2022
Description
Steve Keen is a heterodox economist and author. Please support this podcast by checking out our sponsors: - Weights & Biases: https://lexfridman.com/wnb - Skiff: https://skiff.org/lex - Indeed: https://indeed.com/lex to get $75 credit - NetSuite: http://netsuite.com/lex to get free product tour - InsideTracker: https://insidetracker.com/lex to get 20% off EPISODE LINKS: Steve's Twitter: https://twitter.com/profstevekeen The New Economics (book): https://amzn.to/3zb4eg4 PODCAST INFO: Podcast website: https://lexfridman.com/podcast Apple Podcasts: https://apple.co/2lwqZIr Spotify: https://spoti.fi/2nEwCF8 RSS: https://lexfridman.com/feed/podcast/ YouTube Full Episodes: https://youtube.com/lexfridman YouTube Clips: https://youtube.com/lexclips SUPPORT & CONNECT: - Check out the sponsors above, it's the best way to support this podcast - Support on Patreon: https://www.patreon.com/lexfridman - Twitter: https://twitter.com/lexfridman - Instagram: https://www.instagram.com/lexfridman - LinkedIn: https://www.linkedin.com/in/lexfridman - Facebook: https://www.facebook.com/lexfridman - Medium: https://medium.com/@lexfridman OUTLINE: Here's the timestamps for the episode. On some podcast players you should be able to click the timestamp to jump to that time. (00:00) - Introduction (07:26) - Defining economics (14:26) - Schools of economics (38:45) - Karl Marx (57:00) - Labor theory of value (1:16:45) - Socialism (1:31:48) - Soviet Union (1:45:08) - China (2:05:00) - Climate change (2:27:03) - Economics vs Politics (2:35:06) - Minsky's model (2:49:50) - Financial crisis (2:55:07) - Inflation (3:08:21) - Marxism (3:15:42) - Space and AI (3:21:47) - Advice for young people (3:25:38) - Depression (3:30:10) - Love (3:34:11) - Mortality
Chapters
The podcast mentions various sponsored products including Weights and Biases, Skiff, Indeed, NetSuite, and Insight Tracker, as well as an end-to-end encrypted email product called Skiff.
00:00 - 03:42 (03:42)
Summary
The podcast mentions various sponsored products including Weights and Biases, Skiff, Indeed, NetSuite, and Insight Tracker, as well as an end-to-end encrypted email product called Skiff.
Episode#303 – Steve Keen: Marxism, Capitalism, and Economics
PodcastLex Fridman Podcast
A company uses machine learning algorithms to provide personalized health and lifestyle recommendations based on a person's blood data, DNA data, and fitness tracker data.
03:42 - 11:22 (07:39)
Summary
A company uses machine learning algorithms to provide personalized health and lifestyle recommendations based on a person's blood data, DNA data, and fitness tracker data. This provides a more accurate and individualized picture of what's going on inside the body, rather than relying on population-based data.
Episode#303 – Steve Keen: Marxism, Capitalism, and Economics
PodcastLex Fridman Podcast
This podcast discusses the similarities between modeling water with differential equations and modeling economic systems by analyzing different schools of economics.
11:22 - 15:38 (04:16)
Summary
This podcast discusses the similarities between modeling water with differential equations and modeling economic systems by analyzing different schools of economics.
Episode#303 – Steve Keen: Marxism, Capitalism, and Economics
PodcastLex Fridman Podcast
The podcast discusses how classical and neoclassical schools of economics have shaped the way we view capitalism and the concept of marginal utility.
15:38 - 19:53 (04:14)
Summary
The podcast discusses how classical and neoclassical schools of economics have shaped the way we view capitalism and the concept of marginal utility.
Episode#303 – Steve Keen: Marxism, Capitalism, and Economics
PodcastLex Fridman Podcast
The neoclassical school's subjective theory of value and focus on equilibrium was disrupted by Keynes, who emphasized the dynamic and non-equilibrium nature of capitalism.
19:53 - 25:29 (05:36)
Summary
The neoclassical school's subjective theory of value and focus on equilibrium was disrupted by Keynes, who emphasized the dynamic and non-equilibrium nature of capitalism. Understanding the monetary creativity and violence of capitalism requires a departure from a non-monetary, barter-focused perspective.
Episode#303 – Steve Keen: Marxism, Capitalism, and Economics
PodcastLex Fridman Podcast
This episode highlights the difference in perception between Austrians, gold bugs, and Bitcoin enthusiasts who perceive money as an object and Schumpeter who believed that the financial sector plays a significant role in empowering entrepreneurs by creating money.
25:29 - 31:19 (05:50)
Summary
This episode highlights the difference in perception between Austrians, gold bugs, and Bitcoin enthusiasts who perceive money as an object and Schumpeter who believed that the financial sector plays a significant role in empowering entrepreneurs by creating money. However, approaching the finance sector to get money also creates debt for the entrepreneur.
Episode#303 – Steve Keen: Marxism, Capitalism, and Economics
PodcastLex Fridman Podcast
Government money creation utilizes reserves as opposed to loans, and allows for money to be added to bank accounts through spending and welfare payments, leading to increased commerce.
31:19 - 35:31 (04:11)
Summary
Government money creation utilizes reserves as opposed to loans, and allows for money to be added to bank accounts through spending and welfare payments, leading to increased commerce.
Episode#303 – Steve Keen: Marxism, Capitalism, and Economics
PodcastLex Fridman Podcast
The process of buying and selling involves transferring bank liabilities and cash between parties, ultimately leading to a complex system of promises to pay.
35:31 - 38:33 (03:02)
Summary
The process of buying and selling involves transferring bank liabilities and cash between parties, ultimately leading to a complex system of promises to pay. Bank accounts and cash are both considered liabilities, with the former being a liability to the banking sector and the latter being a liability to the Federal Reserve.
Episode#303 – Steve Keen: Marxism, Capitalism, and Economics
PodcastLex Fridman Podcast
The philosophy strike at Sydney University in the 1970s led to the formation of the political economy movement, which pressured the university to establish a department of political economy alongside the existing department of economics.
38:33 - 43:11 (04:38)
Summary
The philosophy strike at Sydney University in the 1970s led to the formation of the political economy movement, which pressured the university to establish a department of political economy alongside the existing department of economics.
Episode#303 – Steve Keen: Marxism, Capitalism, and Economics
PodcastLex Fridman Podcast
The human tendencies in society are altered due to the complexity of capitalism, emphasizing certain aspects of individual personalities while de-emphasizing others.
43:11 - 48:23 (05:11)
Summary
The human tendencies in society are altered due to the complexity of capitalism, emphasizing certain aspects of individual personalities while de-emphasizing others.
Episode#303 – Steve Keen: Marxism, Capitalism, and Economics
PodcastLex Fridman Podcast
The neoclassical theory of exchange is based on the marginal utility and cost of commodities, while Karl Marx's theory focuses on the price ratio and the decline in utility with each exchange.
48:23 - 52:44 (04:20)
Summary
The neoclassical theory of exchange is based on the marginal utility and cost of commodities, while Karl Marx's theory focuses on the price ratio and the decline in utility with each exchange.
Episode#303 – Steve Keen: Marxism, Capitalism, and Economics
PodcastLex Fridman Podcast
The terms "use value" and "exchange value" are used in the Marxist theory of labor to distinguish between the inherent value of a commodity for its usefulness (use value) versus its ability to be traded in the market for other commodities (exchange value).
52:44 - 58:48 (06:04)
Summary
The terms "use value" and "exchange value" are used in the Marxist theory of labor to distinguish between the inherent value of a commodity for its usefulness (use value) versus its ability to be traded in the market for other commodities (exchange value).
Episode#303 – Steve Keen: Marxism, Capitalism, and Economics
PodcastLex Fridman Podcast
In this podcast episode, the labor theory of value is discussed and how it relates to Karl Marx's work.
58:48 - 1:03:44 (04:56)
Summary
In this podcast episode, the labor theory of value is discussed and how it relates to Karl Marx's work. The concept of commodity and commodity power associated with labor is also touched on.
Episode#303 – Steve Keen: Marxism, Capitalism, and Economics
PodcastLex Fridman Podcast
The speaker discusses how Marx's insights on the use value and exchange value argument can be applied to machines and how he discovered it while reading Marx for his master's degree.
1:03:44 - 1:06:45 (03:00)
Summary
The speaker discusses how Marx's insights on the use value and exchange value argument can be applied to machines and how he discovered it while reading Marx for his master's degree.
Episode#303 – Steve Keen: Marxism, Capitalism, and Economics
PodcastLex Fridman Podcast
A discussion on the concept of incommensurability between exchange value and use value and how it relates to the unity of the commodity, as explained through the lens of Hegel.
1:06:46 - 1:14:59 (08:12)
Summary
A discussion on the concept of incommensurability between exchange value and use value and how it relates to the unity of the commodity, as explained through the lens of Hegel.
Episode#303 – Steve Keen: Marxism, Capitalism, and Economics
PodcastLex Fridman Podcast
Karl Marx believed that the public ownership of means of production would lead to socialism.
1:14:59 - 1:22:25 (07:25)
Summary
Karl Marx believed that the public ownership of means of production would lead to socialism. He saw it as a solution to the tendency for the rate of profit to fall and as a way to create a utopian future society.
Episode#303 – Steve Keen: Marxism, Capitalism, and Economics
PodcastLex Fridman Podcast
This podcast explores the concept of industrialization, as exemplified through the Soviet era, which involved taking unemployed peasants and workers and placing them in factories that produced consumer goods, capital goods, and luxury items for capitalists.
1:22:25 - 1:26:51 (04:26)
Summary
This podcast explores the concept of industrialization, as exemplified through the Soviet era, which involved taking unemployed peasants and workers and placing them in factories that produced consumer goods, capital goods, and luxury items for capitalists. The discussion references Feldman's equations as a driving force behind this approach.
Episode#303 – Steve Keen: Marxism, Capitalism, and Economics
PodcastLex Fridman Podcast
The podcast explores the question of whether human civilization on Earth will live out Marx's utopian vision or hit a wall with capitalism.
1:26:51 - 1:32:19 (05:27)
Summary
The podcast explores the question of whether human civilization on Earth will live out Marx's utopian vision or hit a wall with capitalism. The speaker challenges the neoclassical interpretation of scarcity, discussing how it has been perverted to fit the needs of the ruling class.
Episode#303 – Steve Keen: Marxism, Capitalism, and Economics
PodcastLex Fridman Podcast
The speaker shares his thoughts on how the British accent can sound brilliant and sophisticated, reference a friend who brought someone to Australia, and mentions a TikTok video about the irony of the Australian language.
1:32:19 - 1:39:25 (07:05)
Summary
The speaker shares his thoughts on how the British accent can sound brilliant and sophisticated, reference a friend who brought someone to Australia, and mentions a TikTok video about the irony of the Australian language. He also discusses how the bodies of athletes can indicate the nature of the sport.
Episode#303 – Steve Keen: Marxism, Capitalism, and Economics
PodcastLex Fridman Podcast
The problems in Cuba's economy cannot be solely attributed to American embargoes, but are a result of the central ownership and control of distribution and investment, leading to a fundamental shortage economy.
1:39:25 - 1:44:07 (04:42)
Summary
The problems in Cuba's economy cannot be solely attributed to American embargoes, but are a result of the central ownership and control of distribution and investment, leading to a fundamental shortage economy. Cubans who are disillusioned become controlled through suppression and it may take years for simple consumer items like refrigerators to arrive due to production constraints.
Episode#303 – Steve Keen: Marxism, Capitalism, and Economics
PodcastLex Fridman Podcast
The discussion revolves around the centralized political control in China, the consequences of stifling free speech, and the impact of censorship and surveillance on the country's populace.
1:44:07 - 1:51:01 (06:53)
Summary
The discussion revolves around the centralized political control in China, the consequences of stifling free speech, and the impact of censorship and surveillance on the country's populace.
Episode#303 – Steve Keen: Marxism, Capitalism, and Economics
PodcastLex Fridman Podcast
China's output of light industry grew by 17%, while heavy industry fell by 7% in the previous year.
1:51:01 - 1:54:53 (03:52)
Summary
China's output of light industry grew by 17%, while heavy industry fell by 7% in the previous year. This trend is partially due to the conversion of heavy industry factories into light industry.
Episode#303 – Steve Keen: Marxism, Capitalism, and Economics
PodcastLex Fridman Podcast
The speaker contrasts decision-making processes in China with those in other countries, stressing the role of engineers in making intelligent decisions as opposed to other countries wherein the decision making is influenced by non-engineers.
1:54:53 - 2:00:04 (05:10)
Summary
The speaker contrasts decision-making processes in China with those in other countries, stressing the role of engineers in making intelligent decisions as opposed to other countries wherein the decision making is influenced by non-engineers.
Episode#303 – Steve Keen: Marxism, Capitalism, and Economics
PodcastLex Fridman Podcast
The possibility of imposing dramatic controls on the consumption of the rich to reduce our ecological burden and deal with global catastrophic events may require a centralized system where citizens accept political control, such as during the pandemic.
2:00:04 - 2:04:41 (04:37)
Summary
The possibility of imposing dramatic controls on the consumption of the rich to reduce our ecological burden and deal with global catastrophic events may require a centralized system where citizens accept political control, such as during the pandemic. However, this conflicts with the American ideal of small, efficient government and freedom.
Episode#303 – Steve Keen: Marxism, Capitalism, and Economics
PodcastLex Fridman Podcast
The stability of our climate is being threatened by the increase in energy in the atmosphere caused by climate change, leading to unpredictable temperature changes.
2:04:41 - 2:11:48 (07:06)
Summary
The stability of our climate is being threatened by the increase in energy in the atmosphere caused by climate change, leading to unpredictable temperature changes. Losing the Atlantic Meridional Overturning Circulation, as shown by global climate models, could cause a seesaw effect in temperatures between 1 degree warmer than today and 6 degrees cooler over the last million years.
Episode#303 – Steve Keen: Marxism, Capitalism, and Economics
PodcastLex Fridman Podcast
The economic system cannot deal with crises like the loss of the Gulf Stream, which economist Richard Tolf has predicted would only increase global GDP by 1.1%.
2:11:48 - 2:21:19 (09:31)
Summary
The economic system cannot deal with crises like the loss of the Gulf Stream, which economist Richard Tolf has predicted would only increase global GDP by 1.1%. Rather, interdisciplinary research is essential to understanding the complex systems of climate change and the biosphere.
Episode#303 – Steve Keen: Marxism, Capitalism, and Economics
PodcastLex Fridman Podcast
The speaker doubts that engineering could replace current systems at a production level fast enough to prevent the damage caused by climate change.
2:21:19 - 2:27:09 (05:49)
Summary
The speaker doubts that engineering could replace current systems at a production level fast enough to prevent the damage caused by climate change. They also mention the lack of consideration of precipitation in economic models and the possible consequences of an approaching ice age.
Episode#303 – Steve Keen: Marxism, Capitalism, and Economics
PodcastLex Fridman Podcast
The exploitation of free energy in the universe depends on our ability to not put too much waste back into the system and undermine the "free lunch."
2:27:09 - 2:30:51 (03:42)
Summary
The exploitation of free energy in the universe depends on our ability to not put too much waste back into the system and undermine the "free lunch." The survival of our biosphere is crucial in valuing life and ensuring our own survival.
Episode#303 – Steve Keen: Marxism, Capitalism, and Economics
PodcastLex Fridman Podcast
The only way to continue expanding our knowledge of the universe is to move our civilization off the planet, says Frank Wilczek.
2:30:51 - 2:36:14 (05:22)
Summary
The only way to continue expanding our knowledge of the universe is to move our civilization off the planet, says Frank Wilczek. We need to have a vision of the cycle of life and appreciate that the world is a complex system.
Episode#303 – Steve Keen: Marxism, Capitalism, and Economics
PodcastLex Fridman Podcast
The speaker shares insights on the development of software to model the dynamics of complex interactive systems, such as the economy, which can involve multiple actors and generate cycles of interactions.
2:36:14 - 2:41:04 (04:50)
Summary
The speaker shares insights on the development of software to model the dynamics of complex interactive systems, such as the economy, which can involve multiple actors and generate cycles of interactions.
Episode#303 – Steve Keen: Marxism, Capitalism, and Economics
PodcastLex Fridman Podcast
In this episode, the speaker discusses Richard Goodwin's Predator-Prey Model, which explains the relationship between profit rates and business cycles, resulting in booms and slumps.
2:41:04 - 2:45:35 (04:30)
Summary
In this episode, the speaker discusses Richard Goodwin's Predator-Prey Model, which explains the relationship between profit rates and business cycles, resulting in booms and slumps.
Episode#303 – Steve Keen: Marxism, Capitalism, and Economics
PodcastLex Fridman Podcast
Private debt levels have been rising exponentially, leading to a stagnation in capitalist economies.
2:45:35 - 2:52:49 (07:14)
Summary
Private debt levels have been rising exponentially, leading to a stagnation in capitalist economies. While capitalists borrow, it's the workers who pay for the high level of private debt.
Episode#303 – Steve Keen: Marxism, Capitalism, and Economics
PodcastLex Fridman Podcast
The value of money increases when prices are falling and therefore serves as a good store of value.
2:52:50 - 2:57:37 (04:47)
Summary
The value of money increases when prices are falling and therefore serves as a good store of value. Credit, on the other hand, is volatile and can go from positive to negative, making it risky for investment purposes.
Episode#303 – Steve Keen: Marxism, Capitalism, and Economics
PodcastLex Fridman Podcast
A moderate level of inflation can encourage the usage of money, but it can also undermine its value.
2:57:38 - 3:02:13 (04:35)
Summary
A moderate level of inflation can encourage the usage of money, but it can also undermine its value. While it's important to limit government money creation, private bank money creation can lead to unintended consequences.
Episode#303 – Steve Keen: Marxism, Capitalism, and Economics
PodcastLex Fridman Podcast
The excessive use of margin debt creates a positive feedback loop that can lead to a slump when the demand for it disappears.
3:02:13 - 3:08:49 (06:35)
Summary
The excessive use of margin debt creates a positive feedback loop that can lead to a slump when the demand for it disappears. If we stop speculative lending and focus on lending for innovation, investment, and essential consumption items, we can avoid a slump on the other side.
Episode#303 – Steve Keen: Marxism, Capitalism, and Economics
PodcastLex Fridman Podcast
The speaker believes that humanity's role in extending life on the planet and potentially seeding it elsewhere is what makes us creative and confines the worst elements of our capacities to share beliefs.
3:08:49 - 3:16:39 (07:50)
Summary
The speaker believes that humanity's role in extending life on the planet and potentially seeding it elsewhere is what makes us creative and confines the worst elements of our capacities to share beliefs. The discussion touches on the nuance and wisdom of Karl Marx, as well as the distorted use of Marxism in popular discourse.
Episode#303 – Steve Keen: Marxism, Capitalism, and Economics
PodcastLex Fridman Podcast
The potential for creating AI with feelings and a desire to survive could be the key to advancing human technology and ensuring longevity beyond Earth's lifespan.
3:16:39 - 3:20:20 (03:40)
Summary
The potential for creating AI with feelings and a desire to survive could be the key to advancing human technology and ensuring longevity beyond Earth's lifespan. It may also require a reconsideration of standards for machine-human interaction.
Episode#303 – Steve Keen: Marxism, Capitalism, and Economics
PodcastLex Fridman Podcast
In this episode, the guest suggests taking a course in system dynamics that can be applied in any field, including economics, and discusses how human consciousness and mortality can be relevant in the development of AI systems.
3:20:20 - 3:24:06 (03:45)
Summary
In this episode, the guest suggests taking a course in system dynamics that can be applied in any field, including economics, and discusses how human consciousness and mortality can be relevant in the development of AI systems.
Episode#303 – Steve Keen: Marxism, Capitalism, and Economics
PodcastLex Fridman Podcast
The podcast discusses ways of measuring the relationship between GDP and climate change over time, including assumptions based on spatial correlation and economic activity, as well as potential complications.
3:24:06 - 3:27:51 (03:45)
Summary
The podcast discusses ways of measuring the relationship between GDP and climate change over time, including assumptions based on spatial correlation and economic activity, as well as potential complications.
Episode#303 – Steve Keen: Marxism, Capitalism, and Economics
PodcastLex Fridman Podcast
The guest reflects on the arrogance and stupidity of economists, the enjoyment of riots, and how nature remains a humble force.
3:27:51 - 3:35:58 (08:07)
Summary
The guest reflects on the arrogance and stupidity of economists, the enjoyment of riots, and how nature remains a humble force. They also discuss the role of love in the human condition.
Episode#303 – Steve Keen: Marxism, Capitalism, and Economics
PodcastLex Fridman Podcast
In this podcast, Lex Fridman and Steve Kean engage in a discussion about the state of economics, from the fundamental flaws of mainstream macroeconomics to the potential of modern ecological economics.
3:35:58 - 3:37:11 (01:13)
Summary
In this podcast, Lex Fridman and Steve Kean engage in a discussion about the state of economics, from the fundamental flaws of mainstream macroeconomics to the potential of modern ecological economics.