Doug Henwood speaks at the Brecht Forum

Doug Henwood speaks at the Brecht Forum

The economy’s been in the news recently. But most economic discussion is from the perspective of investors and other profit-makers, who generally assume that falling housing prices are universally bad, and that free markets are good. At the Brecht forum in Manhattan on Thursday night, February 21, a full house of 40-50 people heard a panel of speakers including Lewis Lapham, Doug Henwood, Nomi Prins and Noah Rosenblatt offer leftist analysis on the topic "The Big Bust: Is the Economy About to Crash?"

Henwood, editor of the Left Business Observer, broke down the mechanics of the housing and real estate market in relation to the economic downturn. He argued that the unwarranted but common assumption that housing is guaranteed to increase in value over time, combined with a predatory credit industry, is responsible for the current financial wreckage. Non-imperialist countries would have the IMF knocking on their door to make things more capitalist-friendly, but here in the US the job of corporate bail-outs and "structural adjustments" will be left to a potential Democratic administration.

Lewis Lapham, editor of Lapham's Quarterly, cited Thomas Beer's statement that "Money does not rule democracy. Money is democracy" to introduce his view that American history is a history of a long series of economic bubbles driven by a culture built on the worship of money. Prins, a former managing director at Goldman Sachs, described how the types of bubbles responsible for the current spate of foreclosures and debt do not happen on their own accord, but are created by players in the financial system, notably on Wall Street. Rosenblatt spoke mainly about the Manhattan real estate market, describing how it often appears to be exempt from nation-wide economic trends. Finding no takers in the room for his prescription that an unfettered free market is the way forward, Rosenblatt ended humorously, offering real estate investment advice to the audience.

In the discussion period, some audience members sought to sound a more optimistic note. This was not readily picked up by the panelists, however. Henwood remarked that Barack Obama, by all counts a conventional Democrat, will not deliver on the expactations many have of him. As for optimism, he could only hope that the "radicalizing power of disillusionment" could lead to better things.