Brenner on Current Economic Crisis

The economic historian Robert Brenner has recently written an article, “What is Good for Goldman Sachs is Good for America: The Origins of the Current Crisis”, updating his analysis of the world economy and using his analysis to explain the current economic crisis.  The article is available here.  Hat tip to ZNet which reposted an article by R. Taggart Murphy from Japan Focus which summarizes Brenner’s article.

In 1998, the journal New Left Review published “The Economic of Global Turbulence” as a lengthy stand-alone article (subscription required) occupying an entire issue of the journal.  In the book-length article, Brenner demonstrates that starting in the early 1970s and continuing up to the present the world economy has experienced a period of slower economic growth.  He calls this period the long downturn.  Brenner argues that the long downturn is rooted in a decline in the rate of profit in manufacturing, itself caused by persistent overcapacity in that sector.  And, he proposed a specific mechanism by which such overcapacity can persist over time.  Brenner also presents a detailed history of the economies of the United States, Germany, and Japan during the long downturn period to illustrate his analysis and to show how various developments in the world economy are explainable using his analysis.

In 2002, Brenner published The Boom and the Bubble (Verso, 2002) updating his analysis and addressing criticisms that the minor revival of growth and profits in the United States during the later half of the 1990s meant that his analysis was no longer valid.  Brenner argues that the revival was limited to the United States and was based on an expansion of debt and unsustainable.  In 2004, New Left Review published an article by Brenner, “New Boom or New Bubble” (subscription required), which summarizes this analysis.

Then in 2006, a hard cover edition of The Economics of Global Turbulence was published.  The new Brenner article, “What is Good for Goldman Sachs is Good for America: The Origins of the Current Crisis”, was added as the new introduction to the Spanish edition.