The days of boom and bubble are over, and the time has come to
understand the long-term economic reality. Although the Great Recession
officially ended in June 2009, hopes for a new phase of rapid economic
expansion were quickly dashed. Instead, growth has been slow,
unemployment has remained high, wages and benefits have seen little
improvement, poverty has increased, and the trend toward more inequality
of incomes and wealth has continued. It appears that the Great Recession
has given way to a period of long-term anemic growth, which Foster and
McChesney aptly term the Great Stagnation.
This incisive and timely book traces the origins of economic stagnation
and explains what it means for a clear understanding of our current
situation. The authors point out that increasing monopolization of the
economy--when a handful of large firms dominate one or several
industries--leads to an over-abundance of capital and too few profitable
investment opportunities, with economic stagnation as the result. Absent
powerful stimuli to investment, such as historic innovations like the
automobile or major government spending, modern capitalist economies
have become increasingly dependent on the financial sector to realize
profits. And while financialization may have provided a temporary
respite from stagnation, it is a solution that cannot last indefinitely,
as instability in financial markets over the last half-decade has made
clear.
