Writing in 2013 on the financialization of the capitalist economy in his book Profiting Without Production, economist Costas Lapavitsas of the University of London observed that, “Close association of financialization with Marxism goes back at least to the insights advanced by the current of Monthly Review,” as exemplified by the work of MR editors Harry Magdoff and Paul M. Sweezy. Decades before the question of the explosive growth of finance in the capitalist economy was taken seriously by the economic establishment, Magdoff and Sweezy argued that the secular stagnation of production under monopoly capital and the financial explosion were connected in a symbiotic relationship from which there was no visible escape within the system. This was succinctly expressed in their 1983 MR article, “Production and Finance.”
In the present article, originally published as the October 1993 “Notes from the Editors” in MR, Magdoff and Sweezy argued that while both the long-term slowdown of the capitalist economy and the growth of finance relative to production were sometimes recognized in the economic and business literature, the connection between the two processes was largely ignored. Four years later, in “More (or Less) on Globalization” in the September 1997 issue of MR, Sweezy referred to “the financialization of the capital accumulation process.” Today, the stagnation-financialization problem remains the main economic contradiction in the capitalist core—a specter that continues to haunt Wall Street.