Robert Brenner on the Long Downturn
Robert Brenner, a UCLA professor of history and author of, most recently, "The Economics of Global Turbulence," shares his long- and short-run analyses of the post-WWII world economy.
Published: Wednesday, February 07, 2007
Although former Federal Reserve Chairman Alan Greenspan "never announced it," he tried twice to shake the U.S. economy out of a decades-long slump, UCLA historian Robert Brenner told an audience of about 60 people at UCLA on Jan. 11, 2007. Even while deriding the "irrational exuberance" that produced the stock market bubble of the second half of the 1990s, Greenspan encouraged it with monetary policy. He "exploited the wealth effect of asset prices" in an attempt to get firms to invest and households to consume, putting downward pressure on interest rates whenever "the stock market seemed jittery." This was Stock Market Keynesianism, according to Brenner, and a "new macroeconomic method of management" for priming various economic pumps.
Brenner saw a similarly Keynesian motive in Greenspan's encouragement, with still easier credit, of the housing bubble of the last several years. However, he finds little evidence that the successive interventions accomplished anything of durable value, against a forbidding backdrop of global economic stagnation since 1973. The talk, one in a series of book discussions, was sponsored by the UCLA Center for European and Eurasian Studies. UC-Berkeley Professor of Geography Richard Walker served as discussant, offering a detailed consideration of Brenner's long-term analysis. Walker's remarks are not included in this podcast.