John Ralston Saul on Class, Debt, and the Pandemic's Unmasking of Systemic Inequality

John Ralston Saul, in conversation with Rob Johnson, dissects the profound societal turbulence exacerbated by the pandemic, arguing that it unmasks pre-existing systemic flaws rather than creating entirely new ones. A central theme is the dangerous tendency to seek blame in "the other" during crises, whether based on race, nationality, or class, a phenomenon observed from the alleged origins of the virus in Wuhan to the class divides within New York City. Saul emphasizes that this scapegoating diverts attention from the structural inequalities that render certain populations disproportionately vulnerable, echoing historical patterns where wartime unity is undermined by the exclusion of specific groups. Saul makes critical distinctions between superficial economic discussions and deeper societal structures. He posits that beneath the language of "plutocrats" lies the re-establishment of a "pre-modern class system," particularly evident in the United States through tax policy, private education, and public healthcare. This class system dictates not just wealth but also social placement, impacting housing quality and urban density, which have become catastrophic medical liabilities during the pandemic. He also critiques theories like Jane Jacobs' "return of the city-state," arguing that while admirable in intent, they can inadvertently justify policies that create inequality between urban centers and rural communities, fostering resentment and opening doors to extremism. Regarding the economic response, Saul draws on historical precedents, notably Solon of Athens and Henry IV of France, to advocate for debt cancellation as a legitimate and effective means of crisis resolution. He praises current leaders for printing money, defying conventional globalist economic theories, but warns against allowing the financial sector (banks, IMF, World Bank) to convert this necessary spending into moralized, interest-bearing debt, as happened after the 2008 crisis. He, along with Johnson, highlights the economic folly of bailing out financial institutions over directly supporting the populace, citing Mian and Sufi's work on the higher propensity to consume among those with mortgage debt. The practical insight is that economic recovery hinges on empowering the 90% of citizens who drive consumption, not the elite 10% who primarily save. The broader implications of this analysis point to a necessary "revolution through disaster" to re-evaluate fundamental economic realities. Saul argues that the post-1970s shift towards a service economy and "money as reality" has led to financialization that generates wealth from money itself, rather than value-added production, creating a form of uncounted inflation and isolated "gated communities" of elites. The pandemic, by forcing governments to act as if "money is not real," presents an opportunity to pivot towards an economy that prioritizes higher wages, a larger middle class, and genuine productivity. This requires profound political reform to overcome the "infeasibility" of equitable solutions, challenging the "Davos Man" mentality and fostering a more inclusive understanding of societal well-being beyond urban-centric perspectives.

That's right but you don't know how long it stays dark or how dark it gets before that dawn occurs.

Anybody that pretends to know what the future looks like is more likely a demagogue than an honest explorer.

It is classic in a wartime situation that everybody is told we must hang together but in that process of hanging together certain people will see an advantage in saying but not you you're not part of the together.

The United States is the most class-defined society in the West in the Western democracies.

Small apartments in dense urban centers may seem fun when everything's going well but as soon as something goes wrong that's a disaster.

History shows it's very clear we have thousands of years of economic history that shows what worked and what didn't work... the answer has always been... you cancelled the debt.

The polluters got paid.

The people who are underwater in mortgages have a very very high propensity to consume and absolutely stockholders and bondholders for major financial institutions have a very high propensity to save.

Money is now real it's no longer you know the grease that that keeps the wheels moving it is the wheels.

It's the 90 percent who keep the economy going.

This is an incredibly stable period in terms of the movements of peoples and so you're seeing an elite so cut off from reality that they actually think that what they do is what everyone does and it just isn't true.

Davos man.