Top ten posts of 2022: Ukraine, profits and inflation

2022 was the 12^th year since I launched this blog. Over those years, I have posted over 1100 times with over 4.7 million viewings. There are currently 7027 regular followers of the blog up from 6100 last year; and now 13150 followers (up from 11500 last year) of the Michael Roberts Facebook site, which I started seven years ago.  On that Facebook site, I put short daily items of information or comment on economics and economic events. 

And at the beginning of 2020, I also launched the Michael Roberts You Tube channel, https://www.youtube.com/channel/UCYM7I0m-I9EVB-5gaBqiqbg/. This now has 2600 subscribers, up from 2100 last year. If you haven’t joined up yet, have a look at the channel, which includes presentations by me on a variety of economic subjects; interviews with other Marxist economists; and some zoom debates in which I participated.  My top three videos of 2022 were: USA vs China: whose economy is winning; ‘The Long Depression; and 21st Century socialist economies. 

As for the blog, 2022 has seen 587,000 views, up from 549,000 last year but still below the year of the COVID when many were locked down and forced to view my blog.  I did 77 posts, up from 73 last year. 

Where do my blog viewers come from?  From over 170 countries globally! Led by 147k yearly viewings in the US (or about 25%); 70k from UK (12%); then a whole range of Spanish-speaking countries led by Spain (30k); and 29k viewings from Brazil, fourth largest group.  Then came followers from Canada and Australia.  Right at the other end of the spectrum, I have had viewings from the Cook Islands, Rwanda, Madagascar, Guadaloupe and even the Vatican City!  Also, there were viewings from war-torn Yemen, Afghanistan, Haiti, Syria, and Kosovo. There were nearly 300 viewings from Cuba, over 1000 from Vietnam, but only 1800 from China.

So what were the top ten posts of 2022, as viewed.  Topping the list was the post on new evidence supporting Marx’s law of the tendency of the rate of profit to fall as applied to a ‘world rate of profit’.  https://thenextrecession.wordpress.com/?s=world+rate. That tells me that my blog readers are focused on new empirical studies to back Marxian economic analysis.  In this case, Marxist economists at the University of Massachusetts Amherst led by Deepankur Basu have delivered new evidence using data compiled by Brazilian Marxist economist Adalmir Marquetti. Marquetti has expanded and modified the Penn World Tables developed by the Groningen Growth and Development Centre into what he calls the Extended Penn World Tables (EPWT). Basu et al used the new EPWT data to construct a ‘world rate of profit’ as a weighted average of country-level profit rates, where a country’s share in the world capital stock is used as the weighting.  Basu et al conclude that: “The country-aggregated world profit rate series displays a strong negative linear trend for the period 1960-1980 and a weaker negative linear trend from 1980 to 2019.” 

So the Basu et al study has added yet more empirical support for Marx’s law on a world level. And the authors have left online a ‘profitability dashboard’ for the world rate and various countries, which anybody can view here. https://dbasu.shinyapps.io/World-Profitability/.

The next most popular posts were, not surprisingly, on the invasion of Ukraine by Russia.  Readers were interested in new weapon of war: economic sanctions; as imposed on the Russian economy and its government leaders. In that post, I argued that Putin’s invasion of Ukraine is a huge gamble which if it did not succeed in ‘neutralising’ Ukraine and forcing NATO into an international agreement, would seriously and permanently weaken the Russian economy. Russia is no super power, economically or politically. Its total wealth is way down the league compared to the US and the G7. Of course, much depends on how the war pans out. If Putin can gain control of sufficient parts of Ukraine, that opens up significant resources (and industry) to be exploited.

As a counterpart to the Russian part of the story, another post on Ukraine attracted attention, Ukraine: the invasion of capital.  I pointed out how the Ukraine government was preparing to privatise and hand over the vast agricultural resources of Ukraine to foreign multi-nationals. For several years now, a series of reports by the Oakland Institute economic observatory has documented the takeover of foreign capital. As part of that plan, the Ukraine government is wiping out all workers’ rights to secure jobs and conditions.  When and if the war is won, the takeover of Ukraine by capital (mainly foreign) will be completed and Ukraine can start paying back its debts and providing new profits for Western imperialism. Here is the so-called Ukraine Recovery Conference last July.

There was really only one other issue that dominated the remaining top posts: accelerating inflation and the sharp rise in the cost of living for much of the world’s population; partly as result of the sluggish economic recovery after the end of the pandemic; partly as a result of corporations hiking profit mark-up to take advantage of weak production; and partly because of the Russia-Ukraine war intensifying the energy crisis.

In one post, I explained the attempt of Guglielmo Carchedi and I to develop a Marxist theory of inflation that was a better explanation of rising inflation that the mainstream theories of monetarism and wage-push or ‘inflation expectations’.  We think we are getting close to offering a compelling and predictive model – but more on this in 2023.

And back last May, I wrote a post refuting the claim of governments and monetary authorities that it was rising wages that cause accelerating inflation.  Indeed, far from a wage-price spiral, we have a profits-price spiral.  The evidence presented in that post is now used often even in mainstream economic media.

Because mainstream economics has no explanation for inflation, central banks have simply carried on hiking interest rates, even though it will have little effect on curbing price rises, when they are driven by supply constraints, low productivity growth and profit mark-up.  Yet central banks continue to resort to ‘shock therapy’ on economies that will only ensure a deep recession in 2023.

It’s that developing slump in 2023, and the question of how deep and widespread, that will probably dominate my posts next year.