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The following article appeared in Left Business Observer #106, January 2004. It retains its copyright and may not be reprinted or redistributed in any form - print, electronic, facsimile, anything - without the permission of LBO.
The New Economy and after
This is an edited version of a talk given by LBO editor Doug Henwood at various places around the U.S. and in London in late 2003 and early 2004. It's drawn mainly from his new book, After the New Economy, published by the New Press, a book whose sales this text is intended to promote.
I started working on After the New Economy when the thing was alive and kicking - back when the Nasdaq was around 3,000, heading towards 5,000, and the air was thick with irrational exuberance. I finished the first draft at the end of February, with the Nasdaq at 1,340, 75% off its high. And now it's appearing with the Nasdaq over 2,000 - up 50% from the low. I must learn to write faster.
Remember the New Economy? It was one of the wonders of the world. Computers had unleashed a productivity miracle, recessions were relics of a transcended past, ideas had replaced things as the motors of economic life, the world had become unprecedentedly globalized, work had become deeply meaningful, and mutual funds had put an end to class conflict. Even to conventional minds, a lot of that sounds embarrassing now. But commentary on the era usually treats it as a mix of collective folly and outright criminality - never as something emerging from the innards of the American economic machinery itself, from our unregulated labor markets, our hypertrophied financial sector, and our national penchant for unreflective optimism. And now we're forgetting about it, our amnesia encouraged by the frequent rem