It is today all but taken for granted by critical political economists – and by political figures from Hillary Clinton to Bernie Sanders – that finance is parasitic on industry. Financialization, in this view, amounts to financial institutions capturing the state, hollowing out the “real” economy, and thereby hastening the decline of capitalism. But Stephen Maher and Scott Aquanno pose a bold challenge to this hypothesis in their new book, The Fall and Rise of American Finance: From J.P. Morgan to Blackrock. Surveying the last century of capitalist development, they insist that, despite the costs to workers and the middle class, financialization has boosted competitiveness and strengthened capital – all with the support of an ever stronger and more authoritarian state. This has culminated since the 2008 crisis in a new economic regime – “a new finance capital” – marked by unprecedented concentration and centralization in the hands of the “Big Three” asset management firms (BlackRock, Vanguard, Fidelity).
Stephen Maher is Assistant Professor of Economics at SUNY Cortland, and Associate Editor of the Socialist Register. He is also the author of Corporate Capitalism and the Integral State: General Electric and a Century of American Power (Palgrave, 2022).
Scott Aquanno is Assistant Professor of Political Science at Ontario Tech University, and a Visiting Associate at the Global Labour Research Centre at York University. He is the author of Crisis of Risk: Subprime Debt and US Financial Power from 1944 to Present (Edward Elgar, 2021).
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