Marxian crisis theory and the postwar US economy

[Anonymous]

http://home.mtholyoke.edu/~fmoseley/working%20papers/PWCRISIS.pdf

MARXIAN CRISIS THEORY AND THE POSTWAR U. S. ECONOMY by Fred Moseley

In the first thirty years after World War II, the United States economy performed remarkably well. The rate of growth averaged 4-5% a year, the rate of unemployment was seldom above 5%, inflation was almost non-existent (1-2% a year), and the living standards of workers improved substantially (the average real wage, or the purchasing power of wages, roughly doubled over this period). This was the “golden age” of US capitalism.

However, this “golden age” ended in the 1970s. Since then, the rate of growth has averaged 2-3%, the rate of unemployment and the rate of inflation have both been higher, and the average real wage has not increased at all (and by some measures has even declined 10%). It is in this sense that we refer to the “stagflation” of the US economy in recent decades.

During the late 1990s, the US economy improved significantly, with the highest rates of growth (3-4%), the lowest rates of unemployment and inflation since the 1960s, and real wages increased modestly. As a result, most economists concluded that the late 90s “boom” marked the end of the long period of stagflation and the beginning of a new prolonged period of sustained prosperity, similar to the early postwar “golden age”. However, this “boom” came to a sudden end this year (2001), and the US economy has fallen again into recession. Now there is widespread concern that this recession will be deep and long, and that it will be accompanied by the first worldwide recession since the 1930s.i

This chapter presents a Marxian explanation of the long period of stagflation in the US economy and will attempt to determine whether or not this period of stagflation is indeed over, or whether the US (and world) economy is instead headed for something even worse.

 

There is a PDF written by him on the internet known as” The Falling rate of profit  in the postwar of the US economy”

[Author]

Posts