Overview

In the fall of 2008, the United States was plunged into a financial crisis more severe than any since the Great Depression. As banks collapsed and the state scrambled to organize one of the largest transfers of wealth in history, many--including economists and financial experts--were shocked by the speed at which events unfolded. In this new book, John Bellamy Foster and Fred Magdoff offer a bold analysis of the financial meltdown, how it developed, and the implications for the future. They examine the specifics of the housing bubble and the credit crunch as well as situate current events within a broader crisis of monopoly-finance capitalism--one that has been gestating for several decades. It is the ""real"" productive economy's tendency toward stagnation, they argue, that creates a need for capital to find ways to profitably invest its surplus. But rather than invest in socially useful projects that would benefit the vast majority, capital has constructed a financialized ""casino"" economy that neglects social needs and, as has become increasingly clear, is fatally unstable. Written over a two-year period immediately prior to the onset of the crisis, this timely and illuminating book is necessary reading for all those who wish to understand the current situation, how we got here, and where we are heading.

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9781583671849

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aThose of us who are dissatisfied with the analyses of the financial-economic meltdown of 2008 that attribute it to easily remediable amistakesa on the part of financial institutions, regulators, or policy-makers can learn a lot from John Bellamy Foster and Fred Magdoffas The Great Financial Crisis: Causes and Consequences. Foster and Magdoff follow up the theses of Paul Sweezy, Paul Baran, and Harry Magdoff that diagnose the structural problems of U.S. capitalism in its chronic tendency toward stagnation rooted in inadequate business investment and leading to slow growth, unemployment of labor, and low utilization of capital. This book makes the case that the excesses of financialization and the widening inequality of income distribution are themselves indirect effects of stagnation in the real economy, and explains with sobering clarity why the roots of this crisis may turn out to be deep and difficult to address with conventional policy measures.a <br>aDUNCAN K. FOLEY, Leo Model Professor of Economics, New School for Social Research <br>

A must read! Here is an excellent guide to understanding the role debt overload and the stagnation of the real economy played in the recent crisis, in the tradition of Sweezy and Magdoff. - Michael Perelman, California State University, Chico, and author of Railroading Economics, The Invention of Capitalism, and The Confiscation of American Prosperity

<p> A must read! Here is an excellent guide to understanding the role debt overload and the stagnation of the real economy played in the recent crisis, in the tradition of Sweezy and Magdoff. <br>---Michael Perelman, California State University, Chico, and author of Railroading Economics , The Invention of Capitalism , and The Confiscation of American Prosperity

Those of us who are dissatisfied with the analyses of the financial-economic meltdown of 2008 that attribute it to easily remediable 'mistakes' on the part of financial institutions, regulators, or policy-makers can learn a lot from John Bellamy Foster and Fred Magdoff's The Great Financial Crisis: Causes and Consequences. Foster and Magdoff follow up the theses of Paul Sweezy, Paul Baran, and Harry Magdoff that diagnose the structural problems of U.S. capitalism in its chronic tendency toward stagnation rooted in inadequate business investment and leading to slow growth, unemployment of labor, and low utilization of capital. This book makes the case that the excesses of financialization and the widening inequality of income distribution are themselves indirect effects of stagnation in the real economy, and explains with sobering clarity why the roots of this crisis may turn out to be deep and difficult to address with conventional policy measures. <br>--DUNCAN K. FOLEY, Leo Model

Author Information

John Bellamy Foster is editor of Monthly Review. He is professor of sociology at the University of Oregon and author of The Ecological Revolution, The Great Financial Crisis (with Fred Magdoff), Critique of Intelligent Design (with Brett Clark and Richard York), Ecology Against Capitalism, Marx's Ecology, and The Vulnerable Planet.

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