Keynes, Steindl, and the Critique of Austerity Economics
Austerity is now ’in fashion,” as governments respond to the revenue shortfalls of the crisis through deficit reduction plans and fiscal stability pacts, and economists blame it on the profligate spending of households and countries. Consumers, they say, bought houses they could not afford and countries consumed more than they produced, while loose monetary policies made this spending possible. Governments ’got prices wrong,” keeping interest rates too low for too long, and while increases in government spending might alleviate current employment problems, this deficit spending is inflationary, and in any case will not help in the long run as budget deficits raise interest rates, ’crowding out” business and household spending. It is as if we have stepped back in time, to the depression years of the 1930s, when monetary theories of the cycle were dominant, the ’overinvestment” of the boom blamed for the downturn, and effective fiscal actions proposed by Keynes and others blocked by preoccupation with the public debt and its burdens.… The analysis here is concerned with the systematic rejection of Keynes’s and Kalecki’s revolution in economics and the resurrection of Say’s Law (supply creates its own demand) of pre-Keynesian economics in all but name—a view that underlies today’s austerity economics. | more…
Two Pauls
In 1957, when I was young and thought I knew everything, I was just about to go to graduate school in economics. Then I read Paul Baran’s The Political Economy of Growth. I immediately sent him an eight-page, single-spaced review of his book. I said that I liked it very much, but had some questions about it. Paul wrote back asking me to become his research assistant and study at Stanford. Unfortunately he could pay so little that it covered only half the tuition. I could not afford it.… [But] I did visit Paul about once every two weeks. He welcomed me because his colleagues had isolated him due to their fears of the witch hunt. The reason he had offered me so little was that Stanford would not give him more money for any purpose. Paul had tenure, but the alumni were angry that he was not fired for his outspoken opposition to U.S. imperialist aggression against Cuba. | more…
June 2012 (Volume 64, Number 2)
By any measure, Adrienne Rich lived an exemplary life. When she died last March 27, aged eighty-two, she was acknowledged by many critics as perhaps this country’s foremost poet.… Throughout her writing life, Adrienne Rich’s vision of a better world was clear. In her 2008 collection A Human Eye: Essays on Art in Society Rich claimed Che Guevara, Karl Marx, and Rosa Luxemburg as defining heroes. It did not matter if she was speaking to a room full of undergraduates or, having made the long painful climb up the hill to the Women’s Correctional Facility in Bedford Hills, New York, to teach poetry to its inmates, Adrienne’s voice was trenchant. So it was not surprising that when the commercial media ran obituaries of her, they sanitized her life and work, giving more emphasis to her awards than her work, characterizing her as angry rather than radical. At MR however, we preferred to hear her words: “Responsibility to yourself means refusing to let others do your thinking, talking, and naming for you; it means learning to respect and use your own brains and instincts; hence, grappling with hard work” (from “Claiming an Education,” 1977). | more…
Harmony and Ecological Civilization
When I consider the concept of harmony in the context of humans, their societies, and the environment I have a particular understanding of the concept. It refers to all people living together peacefully without exploitation of one person by another, each able to reach his or her full human potential, in a society in which everyone has their basic material and nonmaterial needs satisfied, feels secure, safe, happy, and fulfilled as human beings. In addition, the concept also implies harmony between people, the environment, and the other species we share the planet with.… [But] there is an overriding issue when considering harmony as I have briefly described it. Harmony in the world—among its people and between humans and the rest of the ecosystems—is not possible in the context of capitalism. Capitalism…has shown that it fosters interpersonal relations and metabolic interactions with the earth that are detrimental to achieving a harmonious existence. | more…
The Denialism of Progressive Environmentalists
In 2003 Ted Nordhaus and Michael Shellenberger, two prominent environmental lobbyists, founded the Breakthrough Institute, a think tank dedicated to modernizing what they call “liberal-progressive- green politics.” Its focus is on winning support from mainstream businesses, politicians, and consumers with an attractive message: by developing the right technologies and policy tools, tackling climate change and increasing wealth can go hand-in-hand…. In practice, the approach they have adopted to boost the influence of their message…is to characterize all opinion within the environmental movement that is redder or greener than theirs as marginal, unrealistic, immature, or elitist…. Their position is essentially the same as that of the New Democrat and New Labour camps regarding the environment; and their tactics of triangulation are precisely those pursued by the New Democrats and New Labour since the early 1990s. | more…
Passage to More Than India
While the recent growth in transnational campaigns and coalitions has been welcomed by many, critics have questioned whether they reproduce existing global inequalities in power and resources. This article, which details a struggle for hegemony in a transnational anti-corporate alliance between a core country non-governmental organization (Greenpeace International) and a peripheral country social movement (the movement for justice in Bhopal), shows that the power in such alliances does not only reside with the core country organization. | more…
Credo of a Passionate Skeptic
Our senses are currently whip-driven by a feverish new pace of technological change. The activities that mark us as human, though, don’t begin, exist in, or end by such a calculus. They pulse, fade out, and pulse again in human tissue, human nerves, and in the elemental humus of memory, dreams, and art, where there are no bygone eras. They are in us, they can speak to us, they can teach us if we desire it.… In fact, for Westerners to look back on 1900 is to come full face upon ourselves in 2000, still trying to grapple with the hectic power of capitalism and technology, the displacement of the social will into the accumulation of money and things. “Thus” (Karl Marx in 1844) “all physical and intellectual senses (are) replaced by the simple alienation of all these senses, the sense of having.” We have been here all along. | more…
Joan Acker’s Feminist Historical-Materialist Theory of Class
Marxism and feminism are usually seen as divorced from each other today, following the breakup of what Heidi Hartmann famously called their “unhappy marriage.” Yet, some theorists still show the influence of both. In my view, Joan Acker is both one of the leading analysts of gender and class associated with the second wave of feminism, and one of the great contributors to what has been called “feminist historical materialism.” In the latter respect, I would place her next to such important proponents of feminist standpoint theory as Nancy Hartsock, Dorothy Smith, and Sandra Harding. These thinkers, as Fredric Jameson has rightly said, represent the “most authentic” heirs of Lukács’s critical Marxist view articulating the proletarian standpoint—giving this dialectical insight added meaning by applying it to gender relations. | more…
Why Stagnation?
The question “Why Stagnation?” has a rather special significance for me. I started my graduate work in economics exactly fifty years ago this year. The cyclical downturn which began in 1929 was nearing the bottom. Unemployment in that year, according to government figures, was 23.6 percent of the labor force, and it reached its high point in 1933 at 24.9 percent. It remained in the double-digit range throughout the decade. Still, a recovery began in 1933, and it turned out to be the longest on record up to that time. Even at the top in 1937, however, the unemployment rate was still 14.3 percent, and it jumped up by the end of the year. That also happens to be the year I got my Ph.D. Can you imagine a set of circumstances better calculated to impress upon a young economist the idea that the fundamental economic problem was not cyclical ups and downs but secular stagnation? | more…
An Important Time Recalled
Robert Bone and Richard Courage, The Muse in Bronzeville: African American Creative Expression in Chicago, 1932–1950 (New Brunswick, NJ: Rutgers University Press, 2011), 336 pages, $29.95, paperback.
The late Robert Bone had a socialist background which impelled him to study African-American history and literature long before those subjects became fashionable. From the 1950s on his pioneering work in this field included The Negro Novel in America (1959) and Down Home: Origins of the Afro-American Short Story (1975). He had planned, and partially researched and written, a study of the Chicago African-American Renaissance of the 1930s and later. When his health began to fail, he gave his notes to Richard A. Courage, author of many articles on African-American narrative and visual arts. Courage completed Bone’s research, and the result is a compelling book which will be a standard in its field for many years to come. | more…
May 2012 (Volume 64, Number 1)
University of Nevada, Las Vegas physicist John W. Farley’s very important review essay on James Lawrence Powell’s new book, The Inquisition of Climate Science, in this month’s issue of MR raises critical questions with respect to science, corporate propaganda, and the future of humanity.… To understand the serious propaganda challenge that has confronted capitalist interests intent on denying climate change and the devious means used to get around this, one needs to recognize that the scientific consensus on climate change is an extremely strong one. Science, which generally encourages controversy, is in this case speaking with one voice. Naomi Oreskes, a professor of history and science studies at the University of California, San Diego…published an article in Science in 2005 studying global climate change articles in peer-reviewed scientific journals between 1993 and 2003. She found a total of 928 peer-reviewed scientific articles on global climate change. Of these 928 pointed to human-caused climate change, while on the “other side” there were exactly zero denying this. | more…
The Endless Crisis
The Great Financial Crisis and the Great Recession began in the United States in 2007 and quickly spread across the globe, marking what appears to be a turning point in world history. Although this was followed within two years by a recovery phase, the world economy five years after the onset of the crisis is still in the doldrums…. The one bright spot in the world economy, from a growth standpoint, has been the seemingly unstoppable expansion of a handful of emerging economies, particularly China. Yet, the continuing stability of China is now also in question. Hence, the general consensus among informed economic observers is that the world capitalist economy is facing the threat of long-run economic stagnation (complicated by the prospect of further financial deleveraging)…. It is this issue of the stagnation of the capitalist economy, even more than that of financial crisis or recession that has now emerged as the big question worldwide. | more…
The poor are no longer with us; These bills are long unpaid
Two poems by , author of eighteen poetry books, most recently The Hunger Moon: New & Selected Poems, 1980–2010 from Knopf. Her most recent novel is Sex Wars (Harper Perennial) and PM Press has just republished Vida and Dance the Eagle to Sleep with new introductions. | more…