- 季刊経済理論 (ISSN:18825184)
- vol.52, no.3, pp.32-42, 2015-10-20 (Released:2017-09-19)
Following the financial crisis of 2008, a large number of economists have become interested in the financial instability hypothesis of Hyman P. Minsky. However, his theory of money manager capitalism is also important in thinking about the crisis. At the end of the 1980's, Minsky had already pointed out that American capitalism evolves from corporate capitalism to money manager capitalism. However, he regarded this evolution as retrogression, not progress. Money manager capitalism has been the largest cause of the poverty and the enormous inequality of income and wealth in the United States. He also pointed out that there was a possibility that a serious depression would occur in the future. The global financial crisis of 2008 can be called the realization of Minsky's prediction. Actually, we cannot regard the year 2008 as an exception, since the United States experienced a financial confusion every several years. It is the intervention of the Federal Reserve and government that have prevented this financial confusion from expanding into a financial crisis. However, today when several years have passed since the crisis, the U. S. economy seems to be recovering, as if there had been no crisis. However, current economic recovery means the revival of money manager capitalism. It is often said that the U. S. economy is recovering smoothly since the crisis. In fact, since the early 2000s, the U. S. long-term GDP growth per capita has not been different from that of Japan, whose economy is said to be stagnant due to deflation. It is true that the present U. S. unemployment rate has today been reduced to nearly 5% from its peak of 10%, but the main reason is that people who cannot find jobs have given up looking for jobs. The U. S. employment recovery is far behind that of Japan. In the era of the housing bubble, households in the U. S. borrowed money to consume and to purchase houses. But after the crisis, households have found it difficult to borrow further. The crisis ended the era of financial Keynesianism, and that delayed the U. S. economic recovery. Nevertheless, finance has shown a quick recovery. Profits or capital gains in the financial sector have already recovered and are now near the previous peak. The income and wealth of the super-rich have been restored, as finance is reinvigorated and stock prices are rising. Recovery from the current crisis is contrary to the recovery from the Great Depression in 1930s. The Great Depression and the New Deal ended the era of financial capitalism. The depression destroyed the income and wealth of the super-riches. On the other hand, the economic growth rates of the early New Deal period were very high. The unemployment rate rapidly decreased to 10% in 1936, from its peak of 23%. The U. S. economic policy, which regards the financial sector as most important, is the main cause of the revival of money manager capitalism. The framework of such an economic policy was made by the political and economic structure of the U. S. Today, the financial sector is a powerful player in U. S. politics and economic policy. The manufacturing industry has declined, and real wages are stagnant. In this situation, financial Keynesianism is almost the only model for economic growth. Sadly, the crisis ended the era of financial Keynesianism, but an alternative model has not yet founded.