At the time of this writing (late August), the business news in the United States is full of discussions of “recovery” from the worst economic crisis since the Great Depression. Yet, while the economy appears to have bottomed out and a recovery of sorts may be in the works, this is in many ways misleading. Although a technical or formal recovery seems quite likely by the end of the year—with a small increase in economic growth mainly due to inventory restocking—it is unlikely to feel like a recovery to most individuals in the society. This is because official unemployment is projected to rise to the low double-digits by the end of this year or the beginning of next year—with the numbers of those dropping out of the labor market due to discouragement, or seeking part-time work because they are unable to obtain a full-time job, also growing. All of this points to a “jobless” and “wageless” recovery. As New York University economist Nouriel Roubini wrote in an August 13 column for Forbes.com, “It is very difficult to argue that the U.S. economy is not still in a recession while the labor market is still weak.” Indeed, what is really at issue is not simply recession and recovery but the longer-term structural crisis of capitalism. This is the subject of the Review of the Month, which seeks to place the current crisis in the context of the long-term development of capital accumulation and crisis.
Since the sharp financial downturn a year ago, Monthly Review Press has brought out a series of books related to the crisis and labor conditions, beginning with John Bellamy Foster and Fred Magdoff’s Great Financial Crisis. Among our spring and fall 2009 books are new editions of Nancy Rose’s Put to Work: The WPA and Public Employment in the Great Depression (an excerpt from which is included in this issue), and Michael Yates’s Why Unions Matter; Istvan Mészáros’s new book, The Structural Crisis of Capital; and Steve Early’s important Embedded with Organized Labor: Journalistic Reflections on the Class War at Home. But the most direct analysis of the present economic crisis in the United States and its implications for working people is to be found in Fred Magdoff and Michael Yates’s just published Monthly Review Press book, The ABC’s of the Economic Crisis: What Working People Need to Know.
Magdoff and Yates lay out in this short, accessible book both the causes and consequences of the most severe economic crisis since the Great Depression. They show that the causes are embedded in the nature of mature capitalist economies, which generate enormous profits but not enough demand for the output that this surplus makes possible. (See also the Review of the Month.) To compensate for the inability of production to grow rapidly on its own, those who controlled the surplus shifted it into financial markets, creating the conditions for the bubbles in stock and real estate markets, bubbles that have now burst with devastating and long-term results. Although the financial system nearly collapsed—and would have had it not been for massive, debt-funded government bailouts—the most important consequence of the crisis has been the economic catastrophe heaped upon working people and their communities. Nearly seven million jobs have been lost since the Great Recession began almost two years ago. For workers, this crisis will drag on for years, with the prospects of stagnant and even falling wages and limited job opportunities. But the underlying contradiction is endless.
Magdoff and Yates argue that only an organized working class can successfully fight to reverse these ominous trends. But their book also stands out in asking what it is that we (that is, the great majority of the population) should be fighting for. A return to the status quo ante—the recipe of the Obama administration and the financial powers—it is argued, is a recipe for continued misery for a huge number of people. Instead of this, what we should be struggling for is a society in which everyone is assured of, at the very least: adequate housing, healthy food, essential health care, worthwhile, gainful employment, necessary retirement income, and a clean environment. If these things are not achievable in this economic system, we should begin to envision and fight for a new one.
The book has an attractively low price of $11.95, making it especially suitable for classroom adoption, study groups, and activists. Those interested in purchasing The ABCs of the Economic Crisis or any of the other books mentioned above should go to the Monthly Review Press home page.
From time to time we receive bequests from readers who want to contribute to the continuance of Monthly Review, Monthly Review Press, or the Monthly Review Foundation. Those who wish to do the same may simply state in their wills that the bequest is to “The Monthly Review Foundation, 146 West 29th Street, #6W, New York, NY 10001.” For additional information contact Martin Paddio at (212) 691-2555 or use our contact page.