Download PDF The Endless Crisis How MonopolyFinance Capital Produces Stagnation and Upheaval from the USA to China John Bellamy Foster Robert W McChesney 9781583676790 Books
Download As PDF : The Endless Crisis How MonopolyFinance Capital Produces Stagnation and Upheaval from the USA to China John Bellamy Foster Robert W McChesney 9781583676790 Books
The days of boom and bubble are over, and the time has come to understand the long-term economic reality. Although the Great Recession officially ended in June 2009, hopes for a new phase of rapid economic expansion were quickly dashed. Instead, growth has been slow, unemployment has remained high, wages and benefits have seen little improvement, poverty has increased, and the trend toward more inequality of incomes and wealth has continued. It appears that the Great Recession has given way to a period of long-term anemic growth, which Foster and McChesney aptly term the Great Stagnation.
Download PDF The Endless Crisis How MonopolyFinance Capital Produces Stagnation and Upheaval from the USA to China John Bellamy Foster Robert W McChesney 9781583676790 Books
"If you don't want to be misled by vulgar economics-like explanations of the cause of the ongoing crisis, this is your book. A must read for all people who wish to go beyond mass-media bla bla bla about the crisis."
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Tags : The Endless Crisis How Monopoly-Finance Capital Produces Stagnation and Upheaval from the USA to China [John Bellamy Foster, Robert W. McChesney] on . <div>The days of boom and bubble are over, and the time has come to understand the long-term economic reality. Although the Great Recession officially ended in June 2009,John Bellamy Foster, Robert W. McChesney,The Endless Crisis How Monopoly-Finance Capital Produces Stagnation and Upheaval from the USA to China,Monthly Review Press,1583676791,Economics - Theory,BUSINESS ECONOMICS / Economics / Theory,Business Economics,Business Economics/Finance - General,Business/Economics,Non-Fiction,UNIVERSITY PRESS,United States
The Endless Crisis How MonopolyFinance Capital Produces Stagnation and Upheaval from the USA to China John Bellamy Foster Robert W McChesney 9781583676790 Books Reviews :
The Endless Crisis How MonopolyFinance Capital Produces Stagnation and Upheaval from the USA to China John Bellamy Foster Robert W McChesney 9781583676790 Books Reviews
- The American and world economies of today are starkly different from those of several decades ago. Declining real wages, massive unemployment, budget crises, growing inequality, cutbacks in social services... all of these factors can not be explained by traditional economic models that believe that full employment and rapid growth are intrinsic features of capitalism. Since "these crises and their consequences will likely be the defining events of the coming generation," (vii) it is essential to generate a reality-based economic model that can give insight into the nature of the current and future economy.
John Bellamy Foster and Robert W. McChesney articulate such a model in 2012's The Endless Crisis How Monopoly-Finance Capital Produces Stagnation from the USA to China. The authors pick up where Marxian economists Paul Sweezy and Paul Baran left off in their 1966 book Monopoly Capital and extend previous work done in The Great Financial Crisis Causes and Consequences. Quoting Sweezy and Baran, Foster and McChesney state that "The normal state of the monopoly capitalist economy is stagnation." (11)
Foster and McChesney argue that the intricately related aspects of "monopolization, stagnation, financialization and globalization have produced a new historical phase, which we refer to as `monopoly-finance capital.'" (16) Noting that growth rates in the Triad (Japan, Europe, USA) economies have been declining for decades, the authors posit that the economy finds itself in a "stagnation-financialization trap" in which the only way to stimulate growth is through the financialization process. This growth, of course, is unmoored from the real production economy (causing M-M' instead of M[oney]-C[ommodity]-M', in Marx's notation) and will eventually collapse, sending financial shocks throughout the world, as happened several years ago.
Nevertheless, economic policy makers are more than happy to lead the world off this cliff "Restoring the conditions for finance-led expansion has now become the immediate object of economic policy in the face of a persistently stagnation-prone real economy." (47) So it is difficult to see how this trap can be escaped, with no political will to trigger any kind of Keynesian stimulus nor any economy-altering technologies (such as the railroad) the horizon to produce growth. The authors add, "Not only have financial crises become endemic, they have also been growing in scale and global impact." (43)
Foster and McChesney define a monopoly as a firm with "sufficient market power to influence the price, output, and investment of an industry." (66) Under monopoly capital, the authors contend, price competition in a market is effectively banned, since each firm knows it has the reserves to survive a price cutting war. So monopolies implicitly collude and resort to less fratricidal means of winning market share, such as advertising, marketing and sales. "Advertising thus becomes central to monopoly capitalism," (38) Foster and McChesney conclude. Monopolization is continuing apace as firms consolidate and "[centralize] capital at rates in excess of the growth of world income." (75)
Along with financialization and monopolization, globalization is a feature of monopoly-finance capitalism, in which firms take advantage of the "global labor arbitrage" to maximize profits. Globalization has been facilitated by technological improvements as well as the "depesentization of a large portion of the global periphery" and "the integration of the workforce of the former `actually existing socialist' countries into the world capitalist economy." (127) Invoking examples of extreme exploitation by such monopolies as Apple and Nike, the authors, quoting another, reveal that "Capitalism has become increasingly nomadic, leaving a trail of social disruption in its wake." (120) All of this, according to Foster and McChesney, "drives home the key point that capital is internationally mobile, while labor is not." (151) Despite predictions of the earth "flattening" due to globalization, imperial power relationships between the developed and developing countries have essentially remained constant.
One persistent protest at hearing the above arguments is that developing nations, especially China, will bring the world economy out of its slump. Not so, contend Foster and McChesney "Not only might China not bail out global capitalism at present; an argument can be made that it constitutes the single weakest link for the global capitalist chain." (158) China is ripe with overinvestment in infrastructure; its largest export markets are in a state of depression; an unregulated shadow banking system provides more credit than the formal banking institutions do; social spending is declining; inequality is increasing; large amounts of corruption exist in the Communist Party; there are tens of thousands of mass labor incidents taking place every year; environmental problems loom... even Paul Krugman calls China a "new [potential] epicenter of crisis." (181)
Foster and McChesney excoriate mainstream economists and social scientists for "[abandoning] any meaningful historical analysis" (5) in their work, comparing unreasonably optimistic economists to weathermen who forecast sunny skies in perpetuity. Continuing financial crises are not "black swan" events that are fundamentally unpredictable; instead, they are inevitable in a monopoly-finance capitalist economy caught in a stagnation-financialization trap. The Endless Crisis is a welcome and essential corrective to these ignorant and misleading economic voices. - Where does analysis end and ideology begin?
There are many ways to interpret the world, the language you chose to use to do so will not only reflect your belief system but may heavily influence the conclusions you are able to arrive at - self fulfilling prophesies. Bellamy and McChesney's Endless Crisis puts that dichotomy to a test.
They set out to describe where many of the world's economies has arrived using Marxian analysis and certainly Marxian terminology, including not only the developed economies of America, Europe and Japan, but developing economy of Communist China as well.
China makes the list not only because it now stands in position two but also because many analyses have wished to assign it the task of lifting the stagnating Three as it continues its development. It will not spoil the story if it is stated that the authors do not see that as a possibility, but because of its links to the global Monopoly Capitalist system and resulting problems simply also arriving at Capitalism Endless Crisis.
This reviewer does not sit in judgment of Marxian analysis as not arriving at a factual set of conclusions; on the contrary Marx was a genius in knowing where 19th capitalism was headed, and also in predicting how the societies would be politically captured by the wealthy along the way creating the conditions for social tensions he projected into proletariat revolution. But curiously, to date, the revolutions forecast occurred one after other in overwhelmingly peasant societies with strident class conflict based on feudal structures rather than the alienation generated by capitalist industrial production. Such is certainly the case in China and it is in China's development where the authors seem most to be having a conflict between their Marxian analysis and unfolding events.
Communist China under its recently `selected' leaders of Xi Jinping and Li Keqiang is confronting many of the issues raised in Chapter 6, The Great Stagnation of China. The authors stress the lack of consumption as a percent of GDP and the incredible redundancy of construction as investments surged creating the handmaids for China's pending collapse.
They do admit that China's high saving rate is one cause of low consumption due to China's lack of a safety net, not just the low per capita income, and that the rash of investment was the country's remarkable response to the drop in demand for exports during the financial crisis, a multiple of that seen in the USA stimulus plan comparing GDP's; Keynes would have smiled. The growth rate had fallen to 7% climbed back to 10% shortly after. Likewise, government has recognized the housing bubble and inefficient investment problem and is tightening the standards for what are primarily state owned banks; an easier process to manage that in the west. So is China ready to go down? The authors are forecasting 2014 or soon after.
As recently reported in western media, the country is intending to urbanize 250 million people by 2020 streamlining the hukou systems encouraging and easing transfers to urban settings with the basic intention of using the enormous potential Internal Market of China as the replacement for the export driven motor of recent time. Those empty building may fill and employment of various types should lift income and consumption. Will they succeed or will these settlements turn in to the ghettoization of China's new towns with unskilled workers unable to find sustainable employment?
Who knows? But this approach does not fit as well into the language of surplus labor, exploitation, reserve army of the unemployed and such as it does into the historical rise of other developing systems at other times with a multiplier.
Time will tell. China may be another model of a very controlled market driven economy like other Asian successes, with a socialist bend hard to push into Marx's predictions, or more accurately, neo-Marxian predictions.
And there is the paradox of the Chinese cadres thinking of themselves as "the Sinocization of Marxism... opening up the path of socialism with Chinese characteristics" never mind that China now ranks only second to the U.S. A. in the number of billionaires (.0001% of population). Ideology can be a free-floating thing; many of them are wearing hammer and sickle lap pins,but not when they travel westward. The Xi- Li CCP wants to survive and seems to know it will have to make concessions in that attempt; will be interesting to watch, hard to label.
I'm walking with a Chinese lady who wished to practice her long ago learned high school English. "Germany, they speak German?" Yes. What do you know of Germany? "Karl Marx was born there."
Three stars - five for their research, wisdom and insights -- minus two for dragging out the tale as ideologically pure; taking a very mixed state controlled system as yet one more Capitalist failure. General Motors has a massive factory in Shanghai, producing more vehicles than Detroit's GM; it 51% state owned as are other joint ventures in China. Interesting. - If you don't want to be misled by vulgar economics-like explanations of the cause of the ongoing crisis, this is your book. A must read for all people who wish to go beyond mass-media bla bla bla about the crisis.
