GDP etc. in a deep funk

By the way, here’s a graph of actual real U.S. GDP and its major components relative to their long-term (1970–2007) trendlines through the end of 2013. Note how things fell off a cliff in the recession. GDP, consumption, and government spending are all about 15% below where they’d be had they continued to grow in line with their long-term trend. (The hysteria over out-of-control government spending looks ludicrous in the light of this graph.) Investment is about 25% below where it “should” be. thanks largely to the housing collapse, though it’s staging… Read More

Consumption: a response to Michael Roberts

Michael Roberts writes in response to my piece on Marx: However, Henwood reckons the current crisis is the result of inequality and low wages reducing consumption and thus the answer is to raise wages and public spending. The problem with this view of Marx is that it does not match the facts: consumption did not slump at all prior to the Great Recession: it was the collapse of the housing market, profits and then investment, not consumption. Raising wages and reducing inequality will help the majority but lower profitability further and thus reignite the… Read More

Fresh audio product

Just uploaded to my radio archives: March 27, 2014 Philip Shelley on firing tenured faculty in Maine (for more search this Twitter hashtag) • César Ayala (UCLA) and Rafael Bernabe (University of Puerto Rico), authors of Puerto Rico in the American Century: A History since 1898, on the Puerto Rican economic mess

Who will defend The Market?

Speaking of Thomas Piketty’s Capital in the Twenty-First Century, Ryan Cooper points to anxiety on the right about its considerable splash, and its rigorous argument for the tendency of wealth to concentrate over time. He quotes James Pethokoukis of National Review, who worries that a New Marxism is afoot: John Maynard Keynes and Friedrich Hayek famously squared off in the 1930s, Left versus Right. But when Keynes published his revolutionary General Theory in 1936, Hayek went silent. It was a de facto retreat that helped give free rein to anti-market forces — even if that was not… Read More

I review Piketty

Bookforum has unleashed my review of Thomas Piketty’s Capital in the 21st Century. The opening: The core message of this enormous and enormously important book can be delivered in a few lines: Left to its own devices, wealth inevitably tends to concentrate in capitalist economies. There is no “natural” mechanism inherent in the structure of such economies for inhibiting, much less reversing, that tendency. Only crises like war and depression, or political interventions like taxation (which, to the upper classes, would be a crisis), can do the trick. And Thomas Piketty has two centuries… Read More

Fresh audio product

Just posted to my radio archives: March 20, 2014 Anatol Lieven on Ukraine • Micah Uetricht, author of Strike for America, on the Chicago Teachers Union

Fresh audio product

Just added to my radio archives: March 13, 2014 Andrew Ross, author of Creditocracy, on debt and resistance • Evelyn McDonnell, author of Queens of Noise, on The Runaways March 6, 2014 Greg Grandin, author of Empire of Necessity, on the real history behind Melville’s Benito Cereno • Melissa Gira Grant, author of Playing the Whore, on sex work as work