The U.S. Economic Crisis

Fred Moseley
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Fred Moseley: Mount Holyoke College, South Hadley, MA, USA

Review of Radical Political Economics, 2013, vol. 45, issue 4, 472-477

Abstract: This paper argues that the fundamental cause of the current economic crisis in the U.S. economy was a significant long-term decline in the rate of profit from the 1950s to the 1970s. Capitalists responded to this profitability crisis by attempting to restore their rate of profit by a variety of strategies, including: wages and benefit cuts, inflation, “speed-up†on the job, and globalization. These strategies have largely restored the rate of profit, but have resulted in stagnant real wages for workers for decades. As a result, household indebtedness has increased to unprecedented levels and must be substantially reduced in order to make possible a sustainable recovery.

Keywords: current crisis; falling rate of profit; household indebtedness; debt reduction (search for similar items in EconPapers)
JEL-codes: E3 (search for similar items in EconPapers)
Date: 2013
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Persistent link: https://EconPapers.repec.org/RePEc:sae:reorpe:v:45:y:2013:i:4:p:472-477

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