Magazine article Monthly Review

Notes from the Editors

Magazine article Monthly Review

Notes from the Editors

Article excerpt

Please note that Monthly Review has moved to a new office. We are still on 29th Street, but at a different address: 134 West 29th Street, Suite 706, New York, NY 10001. Our phone number remains the same (212-691-2555), as does all our other contact information.

Commenting in the January 1973 issue of Monthly Review on the declining condition of the U.S. economy, Paul Sweezy brought back the question of "secular stagnation," first advanced by Keynes's leading follower Alvin Hansen in the late 1930s. "The U.S. economy," Sweezy wrote, in an article entitled "Notes on the U.S. Situation at the End of1972," "is experiencing at one and the same time a cyclical boom and secular stagnation." The resurfacing of stagnation, he suggested, was the product in part of the U.S. attempt to unwind from the Vietnam War, which had previously been lifting the economy. This was a time of widespread student antiwar protests and the growing influence of radical and anti-capitalist thought, particularly among the younger generation of economists for whom Baran and Sweezy's Monopoly Capital (1966), which had declared that "the normal state of the monopoly capitalist economy is stagnation," was a major inspiration (108).

A couple of months after the publication of Sweezy's article, in March 1973, the New York Times, seeking to quiet the widening anti-capitalist protests, ran a series of articles on its op-ed page under the general heading of "Capitalism, for Better or Worse." The series concentrated on the two phenomena of the weakening of economic prosperity and the decline of military spending resulting from the drawing down of the Vietnam War. One of these articles, misleadingly entitled "Taking Stock of War," appearing on March 14, was written by Paul Samuelson, then considered to be the leading neoclassical economist in the United States. Sweezy was twice singled out for criticism in Samuelson's articlefirst, as a "revolutionary critic" of an extinct "Victorian capitalism," now completely surpassed in the Keynesian era, and, second, for refusing to acknowledge that Keynesianism had solved the problems of the business cycle and unemployment. As Samuelson wrote.

We are almost forty years into the Age of Keynes. I believe that Luxemburg and Lenin (and Hobson and Alvin Hansen) were right to worry about the sustainability of full employment in William McKinley's balanced-budget laissez-faire. However, not a single mixed economy has had any problem these last thirty years with chronic insufficiency of purchasing power. (Go down the list: the United States, Britain, France, Japan, Germany, little Belgium).

Nor in the century to come-1973-2073-will the ancient scourge of intermittent-shortage-of-purchasing power reoccur in the old form.

("What about recession and stagflation, professor? Don't deny they still happen!" Of course they do. And in 1983 or 2013 they may still occur to plague the mixed economy. But Sweezy and Bowles know what Lenin and Luxemburg couldn't know-that the disease of cost-push inflation which is involved in stagflation has nought to do with insufficiency of domestic markets, and cold- or hot-war escapades can do nothing to make it better).

Samuelson went on to argue that military spending and wars were no longer needed to stimulate the economy, as Keynesian economists knew how to manage it on a peacetime basis, virtually guaranteeing rapid economic growth.

Sweezy soon after wrote a letter to Herbert Mitgang, a member of the editorial board of the New York Times, asking to be allowed to write an op-ed in response to Samuelson, in which he would present his own views, since they had been misrepresented in Samuelson's piece-including Samuelson's statement that Sweezy would agree that economic problems no longer had anything to do with a shortage of effective demand. Mitgang refused to offer Sweezy the requested space in which to reply, telling him he could write a letter to the editor instead, which Sweezy declined to do (Paul M. …

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