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April 2004 (Volume 55, Number 11)

Notes from the Editors

This is the fourth in a continuing series of special issues on the economy to which we have devoted the magazine each April since 2001. In the first of these, written shortly before the 2001 recession began, we took on the then prevalent myth of the “New Economy,” arguing that it was more myth than reality, and dispelling the notion that high tech and rising productivity gains had somehow tamed the business cycle. In April 2002 we dedicated the Review of the Month to examining the core economic contradictions of the system in terms of “Slow Growth, Excess Capital, and a Mountain of Debt.” Last April we asked the question, “What Recovery?” and focused on the fact that the recovery had failed to spread to employment, and on the whole problem of labor underutilization—inquiring into how the economy managed to keep going at all under these circumstances.

The present issue, like earlier April special issues, begins essentially where the previous one left off. In this issue it is notable that all three of the lead articles are focused in different ways on the problem of the jobless recovery. Three years after the recession began, employment in the U.S. economy is still well below its pre-recession level—something that has not occurred since the Great Depression when Herbert Hoover was president. Our almost exclusive emphasis on the jobs problem in this issue is a sign of just how central we think this is to an understanding of the long-term, structural crisis of the U.S. economy.

These four issues on the economy, written over as many years, thus constitute a set—and we hope they will be looked upon in that way. They represent a running commentary on the U.S. economy. But more than that, they are intended to provide a coherent and consistent analysis of the evolution of the capitalist economy and the development of its historic contradictions. This analysis is to be judged by its strength in revealing the main economic trends. With this in mind, MR readers might find it helpful to read all four April special issues on the economy back to back ending with the present issue.

We believe that Monthly Review has been unique in emphasizing for more than half a century that the real problem to explain in the capitalist economy is periods of rapid growth, and not slow growth or stagnation, which should be seen as its normal tendency. Much of this argument is owed to Paul Sweezy, who wrote as early as 1942 in The Theory of Capitalist Development: “Stagnation of production, in the sense of less-than-capacity utilization of productive resources, is to be regarded as the normal state of affairs under capitalist conditions….If this view is adopted, the whole crisis problem appears in a new light. Emphasis shifts from the question: ‘What brings on crisis and depression?’ to its opposite: ‘What brings on expansion?’” It is this whole altering of the question, as usually considered by economists, that more than anything else has guided MR’s economic investigations over the years. Hence, we have long explored the specific factors, such as the financial explosion, military spending, and the sales effort, that have served to prop up the U.S. economy, which otherwise would have faltered completely, and the inherent contradictions associated with maintaining growth by such means. For those wishing a deeper understanding of this perspective and how it has treated the instability of the system since the 1960s we recommend Paul Baran and Paul Sweezy’s Monopoly Capital (1966), and also the five collections of economic essays from Monthly Review written by Harry Magdoff and Paul Sweezy from the 1960s to the 1980s and cited in this issue’s Review of the Month.

We refer you to these writings, some of which might now be considered quite old, not because they have or had all the answers—for historical materialists concerned with understanding changing conditions that is an impossibility not worth contemplating—but because they all raised in differing historical circumstances what we think has been and continues to be the fundamental question regarding the course of accumulation under monopoly capitalism: By what extraordinary means and with what ultimate social consequences is growth secured in an economic order in which stagnation has become the normal tendency? All the other large developments of capitalism in our era—such as financialization, globalization, and marketization—can only be understood, we believe, by relating them to this underlying question.

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