Book Reviews John Bellamy Foster and Robert McChesney. 2013. The Endless Crisis: How Monopoly- Finance Capital Produces Stagnation and Upheaval from the USA to China. New York: Monthly Review Press. 224 pages, ISBN 978-1583673133 Cloth ($24.95). The economic crisis of 2007 has been the deepest and most enduring economic downturn of the past half-century. The immediate trigger for its onset seems to have been the very practices that mainstream economics endorsed, for years, as mechanisms that would ensure a further rationalization of the market. The new-fangled instruments like Collateralized Debt Obligations, Mortgage-Backed Securities, and the institutions that generated them, were all extolled by so many neoliberal economists who argued that they would further deepen financial markets and smooth out economic uncertainty. So, when the whole house came crashing down, one might have thought that it would trigger some churning within the economics profession - a criticism of the free-market fundamentalism of the past decades, and the blind faith in models based on fantastic assumptions. What did we see? Other than a momentary wringing of the hands by a few, in a very small number of media outlets, no such self-criticism occurred. Astoundingly, neoliberal economic theory is no less secure today than it was ten years ago. Given the blind intransigence of mainstream economics, people looking for sober and realistic analyses of the crisis would do well to pick up a copy of John Bellamy Foster and Robert McChesney's latest book, The Endless Crisis. Foster and McChesney present one of the most arresting accounts of how the global economy descended into collapse in 2007. But even more, they embed their story in an alternative economic theory, not just of the recent past but of twentieth century capitalism. Foster and McChesney have for years been associated with the venerable journal, Monthly Review, founded by Paul Sweezy and Leo Huberman, and later joined by Harry Magdoff Sweezy was one of the shining lights of the economics profession in the 1930s, who turned to Marxism after living through the Great Depression; Magdoff was an economist working in the New Deal administration. Working closely with Stanford economist Paul Baran, they developed a theory of the modern capitalist economy that departed sharply from mainstream assumptions. Foster and McChesney draw upon that theory, and argue that this crisis was no accident. It was, instead, a direct outgrowth of the systemic weaknesses of capitalist growth. Two claims about late capitalist development are at the heart of the argument in The Endless Crisis. First, and most importantly, the economy is dominated by monopolies and oligopolies, so that it systematically departs from the model of competition advertised by neoclassical economics. Second, this monopoly capitalism suffers from a chronic problem of overcapacity, and hence, a shortage of outlets for investment. The attenuated competitive drive, and the slowdown in investment naturally results in a slow choking off in growth rates, and hence in a long-term tendency for the economy to stagnate. But as economic growth settles into a lower-growth path, and firms cannot sink their funds into new plant and equipment, they turn increasingly to financial markets as a place to park their monies. This leads, in turn, to the phenomenon known as financialization, which has come to dominate the economic landscape over the last quarter century or so. Foster and McChesney are building here on arguments by Baran and Sweezy in Monopoly Capital. and the path-breaking analysis of Sweezy in the 1980s, which was one of the first to point to the emergence of finance as a pillar of investment at the fin de siecle. They are able to make a credible case that the mountain of increasingly baroque financial instruments, and the mountain of debt that was built up through them, was a direct outgrowth Copyright©2014 American Sociological Association, Volume 20, Number 1, Pages 140-157, ISSN 1076-156X 141 Journal of World-Systems Research of the growth model of late-century capitalism, which in turn was only the most recent mutation of monopoly capitalism. In this, they provide a very valuable antidote to economic orthodoxy. Even though the book is ostensibly a collection of previously published essays, they hang together very well. It begins with a clear summary of the main argument, so much so that readers in a hurry can get a very good idea of the core elements, just from a close reading of the Introduction. But there is a very definite benefit to be had from a leisurely perusal of the entire book. Perhaps the highlight is Chapter Five where Foster and McChesney offer a wonderful examination, and analysis, of the global reserve army of labor - the veritable ocean of the unemployed and semi-employed - who have flooded into cities across the world, sequestered into sprawling slums, living in unimaginably squalid conditions. Foster and McChesney focus on this phenomenon, pointing to it as a searing indictment of capitalism in its current guise. They surmise that when we add up the various categories of people who belong in some way to this category, it probably amounts to a staggering two and a half billion people. And there seems reason to doubt, they argue, that growth rates can ever reach the levels needed to absorb this army of labor into gainful employment - if we continue to stick to private profits as the motor for investment. As a criticism of mainstream economics, The Endless Crisis succeeds along several dimensions. But Foster and McChesney also wish to critique recent trends in heterodox economics. They note, correctly, that the framework developed at Monthly Review no longer has the influence it did in the 1960s and 70s. Much of the criticism directed at it has come from within the camp of heterodox and radical economics, particularly the claims for capitalism being dominated by monopolies. While the authors present a defense against these criticisms, they will probably fail to sway their critics on the Left. The arguments they mobilize are too short, the evidence too open to counter-arguments, for it to succeed. This is understandable, for the book is not intended to be a full-fledged defense of the argument for monopoly. It is more a brief introduction to that view, and a demonstration of how it presents a coherent framework for economic analysis. In this, it succeeds admirably. Readers wishing to understand the economic rhythms of our times would do well to start with this book. Vivek Chibber Department of Sociology New York University vivek.chibber@nyu.edu Jack S. Levy and William R. Thompson. 2011. The Arc of War: Origins, Escalation and Transformation. Chicago: University of Chicago Press. 280 pages, ISBN 978-0226476292 Paper ($27.00). Over the last few years a number of influential books and articles have been published focusing on the dramatic and continuous decline, or even obsolescence, of war. Whereas previously intellectuals were involved in daydreaming schemes for a world without violence, many contemporary academics aim to show that we actually live in the most peaceful era of human history. Thus Steven Pinker, John Mueller, John Horgan and Joshua Goldstein, among many others, have made a case that all forms of organized violence are in steep decline. They point out that civil wars have replaced inter-state wars and that both models of warfare have experienced significant decreases, with a substantial drop in human casualties over the last four decades. Moreover they argue that there are fewer outbreaks of all types of political BookReviews 142 violence (including revolutions, riots, genocides, terrorism, insurgencies etc.), and that most contemporary wars tend to be more localised, smaller and shorter than those fought in previous times. These findings are then used to speculate about the exceptional character of our era and about the war-free world of the near future. The main problem with this approach is that it tends to extrapolate on the basis of, historically speaking, a very short period of time. To fully understand the changing dynamics of warfare it is crucial to take a proper longue dur