Miserable numbers

Even non-connoisseurs are reeling from the miserable second quarter GDP numbers released this morning. Between the first and second quarters of this year, GDP was off 33% after adjustment for inflation. That’s by far the biggest decline since quarterly numbers begin in 1947. That 33% figure is at an annualized rate, meaning GDP would be off by a third if it declined at the second-quarter rate for a full year. The US is unusual in annualizing the data; most other countries report the quarter-to-quarter change without annualizing it. If we did that,… Read More

Reflections on the current disorder

[This is the edited text of a talk I gave via Zoom, like everything else these days, sponsored by the North Brooklyn chapter of the Democratic Socialists of America. It reprises and updates several things I’ve written recently, but it’s hard to be original these days. Video will be posted, but who wants to look at me? The Q&A was quite good though.] Before I get into the body of my talk, I want to celebrate our electoral victories and say how proud I am to be a member of DSA. If… Read More

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

Radio commentary, January 15, 2009

Audio: January 15, 2009 Re: the economic news, not only does the news remain bad, I’m tempted to say that it will continue to get worse. Some listeners have heard me say this already, but the home audience on WBAI hasn’t yet. The U.S. employment report for December was a horror. Total employment fell by 524,000, with almost every sector showing losses. Almost half the loss came in goods production, mainly construction and manufacturing. But it wasn’t just the goods sector either. Private services got hammered too. The losses in services are among… Read More

Radio commentary, November 6, 2008

Economy takes turn for worse; making excuses for the president-elect.