The Failure of Capitalist Production

The Failure of Capitalist Production : Underlying Causes of the Great Recession

4.35 (57 ratings by Goodreads)
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Description

The recent financial crisis and Great Recession have been analysed endlessly in the mainstream and academia, but this is the first book to conclude, on the basis of in-depth analyses of official US data, that Marx's crisis theory can explain these events.Marx believed that the rate of profit has a tendency to fall, leading to economic crises and recessions. Many economists, Marxists among them, have dismissed this theory out of hand, but Andrew Kliman's careful data analysis shows that the rate of profit did indeed decline after the post-World War II boom and that free-market policies failed to reverse the decline. The fall in profitability led to sluggish investment and economic growth, mounting debt problems, desperate attempts of governments to fight these problems by piling up even more debt - and ultimately to the Great Recession.Kliman's conclusion is simple but shocking: short of socialist transformation, the only way to escape the 'new normal' of a stagnant, crisis-prone economy is to restore profitability through full-scale destruction of existing wealth, something not seen since the Depression of the 1930s.show more

Product details

  • Paperback | 256 pages
  • 136 x 214 x 18mm | 322.05g
  • PLUTO PRESS
  • London, United Kingdom
  • English
  • 59 graphs and 14 tables
  • 0745332390
  • 9780745332390
  • 287,165

About Andrew Kliman

Andrew Kliman is Professor of Economics at Pace University, New York. He is the author of Reclaiming Marx's 'Capital': A Refutation of the Myth of Inconsistency and many writings on crisis theory, value theory and other topics.show more

Table of contents

Acknowledgements List of Abbreviations List of Tables List of Figures 1. Introduction 2. Profitability, the Credit System, and the "Destruction of Capital" 3. Double, Double, Toil and Trouble: Dot-com boom and home-price bubble 4. The 1970s--Not the 1980s--as Turning Point 5. Falling Rates of Profit and Accumulation 6. The Current-cost "Rate of Profit" 7. Why the Rate of Profit Fell 8. The Underconsumptionist Alternative 9. What Is to Be Undone? Bibliography Indexshow more

Review quote

'Clear, rigorous and combative. Kliman demonstrates that the current economic crisis is a consequence of the fundamental dynamic of capitalism, unlike the vast bulk of superficial contemporary commentary that passes for economic analysis' -- Rick Kuhn, Deutscher Prize winner, Reader in Politics at the Australian National University and long-time activist. 'Among the myriad publications on the present day crisis, this work stands out as something unusual. Kliman is an excellent theorist, and an equally excellent analyst of empirical data' -- Paresh Chattopadhyay, Universite du Quebec a Montreal 'One of the very best of the rapidly growing series of works seeking to explain our economic crisis. ... The scholarship is exemplary and the writing is crystal clear' -- Professor Bertell Ollman, Department of Politics, NYU, author of Dance of the Dialectic 'Essential reading for all Marxists and lefts interested in what caused the Great Recession. It debunks the fads and fashionable arguments of neoliberalism, underconsumption and inequality with a battery of facts. It restores Marx's law of profitability to the centre of any explanation of capitalist crisis with compelling evidence and searching analysis. It must be read' -- Michael Robertsshow more

Rating details

57 ratings
4.35 out of 5 stars
5 51% (29)
4 35% (20)
3 12% (7)
2 2% (1)
1 0% (0)

Our customer reviews

This book is remarkably readable and hugely informative. What makes it different from the many other books on the crisis and recession is that instead of blaming "greed" (which is always present, so doesn't explain anything) or nasty political regimes ("neoliberalism"), it carefully examines profitability over the last 38 years. Most of the book is an empirical presentation. Kliman crunches the numbers without presuppositions, constructs easy-to-read graphs, and explains what he is doing to get a true picture of the causes of the Great Recession and its current aftermath--"The New Normal." His study reveals that the rate of corporate profitability never recovered after the oil crisis of the mid-1970s. The result of the low rate of profit, he shows, is low investment, low growth, and buildup of debt. These, he says, are what led to the Great Recession and today's continuing recession-like conditions and unemployment. It seems that unless profitability recovers, capitalism cannot substantially and sustainably raise wages, fund education and social services, etc., while still functioning as capitalism. We will merely have more, more frequent, and more severe crises. This book has enormous implications for the prevailing left and Democratic Party politics of trying to fix the system through regulation. In short, Kliman demonstrates, the problem lies not in the distribution of wealth, a failure of adequate consumption, or insufficient regulation, but in the operation of capitalism in ways that are inherent in the system itself. He concludes that capitalism cannot be successfully reformed so as to eliminate economic crises; at the end, he argues that capitalism needs to be replaced. My criticisms are that the book contains only a hint about an alternative economic system, and that Kliman is too polite concerning the failure of left economists to discuss the real problems, instead sending leftists in futile directions.show more
by John Smithee
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