Economic History As It Happened (Vol III): The Deepening Crisis of U.S. Capitalism

This is the third book of essays on the United States and the world economy produced by the fruitful collaboration of Monthly Review editors Paul M. Sweezy and Harry Magdoff. In these essays, written between 1977 and 1981, the authors assess the results of efforts taken to stabilize the economy after the epochal changes of the early 1970s, the end of capitalism’s “golden age,” by attempts to counteract the effects of inflation, debt dependence, speculation, and financial instability.

The economic theories of the establishment economists on whose analysis the economic plans have been based are not neglected. They are taken to task for both failing to acknowledge the reality of stagnation and for creating a combination of myths and shibboleths which have served to deflect attention from the main causes of instability.

Not burdened by pro–capitalist bias, Sweezy and Magdoff were able to provide sharp insights into the workings and breakdowns of the system as well as analysis of causes. Such subjects as the instability of the dollar and its effects on the international monetary crisis, the growth of the mammoth debt structure, both nationally and internationally, problems of reindustrialization, low productivity, and low savings, as well as Reaganomics and “supply–side” theory, are all addressed.

The important introduction ties together the main threads running through the authors’ analyses. What emerges is a perception of a deepening sickness of the economic system that bears all the symptoms of a disease that will in time prove unresponsive to traditional cures.

Paul M. Sweezy (1910–2004) was born in New York City, educated at Exeter and Harvard, and after receiving his Ph.D. in 1937 went to the London School of Economics, to Vienna, and to other places on the Continent for graduate study. He taught economics at Harvard until 1946 and was visiting professor of economics at Cornell, Stanford, and the New School. He was a founding editor of Monthly Review and author of Monopoly Capital (with Paul Baran) and The Theory of Capitalist Development, among many other books and articles. Harry Magdoff (1913–2006) directed studies of productivity for the WPA in the 1930s. Towards the end of the Second World War, he became chief economist in charge of the Current Business Analysis Division at the Department of Commerce where he oversaw publication of the Survey of Current Business. Later, he worked as special assistant to Secretary of Commerce Henry Wallace. He is widely recognized for his economic analyses of imperialism and was co-editor of Monthly Review from 1969 until 2006.