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Apple’s Hollow $3T Valuation

Ralph welcomes econ professor William Lazonick, to let us know how Apple reached its record 3 trillion-dollar valuation and how what they and other large corporations are doing to enrich themselves is killing the middle class. Plus, Ralph answers more of your questions.

William Lazonick is Professor Emeritus of Economics at the University of Massachusetts Lowell. He’s written extensively on the perils of shareholder capitalism, criticism of stock buybacks, and sustainable prosperity. He is also co-author (with Jang-Sup Shin) of the recent book Predatory Value Extraction: How the Looting of the Business Corporation Became the US Norm and How Sustainable Prosperity Can Be Restored.


Buybacks should have a label on them: “This product kills the middle class.” Like you have on cigarettes.

William Lazonick Economics Professor Emeritus U of Mass/Lowell


The question is: who created all that wealth? It was the people working for Apple. It was government funding of all kinds of technology that Apple’s been able to use. It was not shareholders.

William Lazonick


Companies have really taken the accounting systems to try to show numbers that boost stock prices. [They] have taken the SEC and gotten the SEC to mandate things as normal in order to promote the stock market, and in order to become not a regulator of the stock market but a promoter of the stock market.

William Lazonick


[Stock buybacks are] nothing but a manipulation of the market.

William Lazonick


When a company like Apple buys back $86 billion in one year, they are not increasing wages, they are not bolstering their pension plan, they’re not engaged in research and development, they’re not spending enough to deal with the recycling of their billions of products after they’ve been cast away, which is an occupational and environmental hazard.

Ralph Nader


I think the basic problem with Apple is they have a new kind of technological monopoly. And they’re not being enforced under the antitrust laws. They have trapped their customers in all kinds of ways… They have trapped them to a point where they are now upgrading, upgrading, upgrading, upgrading.

Ralph Nader


[Not one of Apple’s] workers in China will ever earn enough money to buy one of the phones that they’re manufacturing. And, to show the level of corporate greed here– for about $3 billion, out of that $86 billion buyback, they could have doubled the wages of 1 million Chinese workers.

Ralph Nader


Apple is arguably one of the richest, stingiest companies in the history of the modern world.

Ralph Nader

Ralph Nader Radio Hour Ep 411 Transcript (Right click to download)


  1. Ben Leet says:

    Stock Buybacks Kill the Middle Class — a summary of interview. Between July 2020 and July 2021 total “household net worth” increased by $23.7 trillion. What does that mean? Total income, national income, to all who worked was $19.4 trillion, and total GDP, output, was $22.7 trillion. So wealth increased by more than all work and production. How is that possible? Savings was higher than normal, around 15% because of the Covid isolation, consumers restrained their spending. But saving 15% of $19 trillion equals around $3 trillion, not $23.7 trillion. The stock market is a gold mine, in other words. Stock values appreciate much faster than other values. This means that investing money in stocks and financial products will produce greater returns than an investment in productive activity! The Fed’s Flow of Funds, page 2 and 138, Table B. 101 is my source. That page shows that “Corporate Equities” increased by 50% in the 12 months I mentioned. The total “household net worth” increased from $118 trillion to $141 trillion, or $23 trillion, which also is about $182,000 per household. My household savings did not increase last year, by the way. Most American households had no where near that increase. But I’m retired. In fact the Credit Suisse Bank’s report Global Wealth, 2020 (Databook, page 138) shows that the lower-saving 40% of U.S. household own 0.2% of all wealth, which is about $3,000 per adult. The average wealth per adult was $505,000, even though the median household net worth was around $130,000. Per adult wealth is now about $576,000, per household it’s average is about $1.1 million.
    Not only do Stock Buybacks Kill the Middle Class, the entire system of rewards is corrupted, worldwide. The poor are more numerous. Only China is actually raising living standards appreciably.
    The ratio of GDP to Total Wealth is now 1 to 7.2, and in 1990 it was 1 to 4.4 (I looked at past Flow of Funds reports). As Lazonick says, about 92% of profits of the S&P 500 over a 10 year period go to dividends and stock buybacks — this was the gist of his award winning article at the Harvard Business Review. The Census says that 52% of workers are working at companies with more than 500 workers, often with publicly traded stocks. Wages were higher in 1966 than in 2020 — see the BLS web page “average weekly earnings of production and nonsupervisory workers” — — adjust the graph to show 1966. Some 80% of workers are “nonsupervisory” says the BLS. This is killing the middle class. Lazonick is a hero, to me.
    I looked at the Congressional Joint Committee on Taxation, Overview 2021, page 40, that showed the richest 0.4% earned 15.1% of all income, with an average income of $3,523,000 (all with incomes over $1,000,000), while the lower-earning 75% earned 12.3% with an average income of $23,650 (all with incomes below $50,000), thereabouts. Some 715,000 taxpayers earned much more than some 87,000,000. And if you look into wealth inequality it’s much much more out of balance.
    You know this is not good for the society, it’s unhealthy as many are struggling. The United Way report ALICE says that 42% of U.S. adults live in households that cannot afford seven basic necessities. Check it out — The Pandemic Divide. I write a blog, Economics Without Greed, Part Two. Thanks, Ralph and team.

  2. Ben Leet says:

    The sentence “while the lower-earning 75% earned 12.3% with an average income of $23,650 (all with incomes below $50,000),” should read “the lower 48.2% of taxpayers, all with incomes below $50,000, earned on average $24,117.” Still 715,000 earned 15.1%, and 87 million earned 12.3%.

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