November 1, 2009
Today the capitalist economies of the world are in deep trouble. Some economists have theorized that the linkages between the United States and the rest of the world had been weakened as other nations gained more economic autonomy. A decoupling thesis was presented claiming that a crisis in one part of the system (say, North America) would not affect other major parts (say, Europe and Asia). We now know this is not true. Toxic assets were sold around the world, and banks in Europe, Asia, and Japan are in trouble too. Housing bubbles have burst in Ireland, Spain, and many other countries. In Eastern Europe, homes were bought with loans from Swiss, Austrian, and other European banks, payable in European currencies. As the economies of Hungary and other nations in the region, which financed their explosive growth with heavy borrowing from Western banks, have gone into recession, their currencies have suffered a sharp deterioration in exchange rates. This means that mortgage payments have risen sharply, as it now takes many more units of local currency to buy the Swiss francs or euros needed to pay the loans. In some cases, mortgage payments have doubled.
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November 1, 2009
We recently received a very thoughtful letter from Ted Trainer, an Australian ecological socialist (author of Abandon Affluence! and Saving the Environment) who teaches at the University of New South Wales, asking us about the "surplus problem" and its relation to borrowing in the present economic crisis. We wrote a short reply with our answers. —Eds.
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October 1, 2009
This month marks the eightieth anniversary of the 1929 Stock Market Crash that precipitated the Great Depression of the 1930s. Ironically, this comes at the very moment that the capitalist system is celebrating having narrowly escaped falling into a similar abyss. The financial crash and the decline in output a year ago, following the collapse of Lehman Brothers, was as steep as at the beginning of the Great Depression. "For a while," Paul Krugman wrote in the New York Times in August, "key economic indicators — world trade, world industrial production, even stock prices—were falling as fast or faster than they did in 1929-30. But in the 1930s the trend lines kept heading down. This time, the plunge appears to be ending after just one terrible year." Big government, through the federal bailout and stimulus, as well as the shock-absorber effects of the continued payouts of unemployment and Social Security benefits, Medicare, etc., slowed the descent and helped the economy to level off, albeit at a point well below previous output.
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September 1, 2009
The current period is marked by three overlapping developments: the failure of neoliberalism, the crisis of the East Asian export-led growth model, and South American efforts to advance an alternative regional development strategy. The combination has created a political environment offering important opportunities for those committed to the international struggle to supplant capitalism.
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July 1, 2009
In 2006–08, food shortages became a global reality, with the prices of commodities spiraling beyond the reach of vast numbers of people. International agencies were caught flatfooted, with the World Food Program warning that its rapidly diminishing food stocks might not be able to deal with the emergency.
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July 1, 2009
The push for "free trade" in agriculture first took hold in the 1980s. It was part of a package of policies and investments that moved food and agriculture systems away from government control (too often centralized and unresponsive) toward private ownership. Ironically, private ownership has led to an even more centralized and tightly controlled food system. Local communities have been left more disempowered than they were before, and, increasingly, developing country national governments have found themselves disempowered, too. This essay considers what advocates of free trade promised developing countries, what actually happened, and what some alternatives might look like.
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June 1, 2009
The grim state of the U.S. economy in early 2009 was brought into sharp relief by economic data released at the end of April. Industrial production in the first quarter of this year dropped by an annual rate of 20 percent, while manufacturing capacity utilization (the operating rate of manufacturing plant and equipment) sank to 65.8 percent in March, the lowest level since the Federal Reserve Board series was introduced in 1948 (industrial capacity utilization as a whole is currently at 69.3 percent, its lowest point since that measurement began in 1967).
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June 1, 2009
As a rule, crime and social protest rise in periods of economic crisis in capitalist society. During times of economic and social instability, the well-to-do become increasingly fearful of the general population, more disposed to adopt harsh measures to safeguard their positions at the apex of the social pyramid. The slowdown in the economic growth rate of U.S. capitalism beginning in the late 1960s and early 1970s—converging with the emergence of radical social protest around the same period—was accompanied by a rapid rise in public safety spending as a share of civilian government expenditures. So significant was this shift that we can speak of a crowding out of welfare state spending (health, education, social services) by penal state spending (law enforcement, courts, and prisons) in the United States during the last third of a century.
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June 1, 2009
David Bacon, Illegal People: How Globalization Creates Migration and Criminalizes Immigrants (Boston: Beacon Press, 2008), 261 pages, $25.95, hardcover.
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In this compelling and useful book, David Bacon lays to rest the anti-immigration arguments of the xenophobes and racists who bombard us every day in the press, on television, and on radio talk shows with the vicious assertion that immigrants, mainly those from Latin America, are the cause of all our economic and social problems.
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May 1, 2009
This issue of Monthly Review marks the sixtieth anniversary of the magazine. We are reprinting here Albert Einstein’s classic article “Why Socialism?,” written for volume 1, no. 1, of Monthly Review (May 1949). On Thursday, September 17, we will meet together at the Ethical Culture Society in Manhattan to celebrate and to promote a global socialism for the twenty-first century. We invite all our subscribers and friends.
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