U.S. capitalism has been evolving in quite fundamental ways during the past twenty years. One school of analysis has detected the emergence of a post-industrial, high-technology information economy, while another has emphasized the ascendancy of finance, real estate, and speculative capital. Several studies have pointed to the declining role of industrial capital, which no longer is the foundation upon which the economy stands. By the 1980s, the U.S. had lost its place as the leading maker of machine tools. It had become a net importer of manufactures and was rapidly losing its dominant position in advanced computers. The ramifications of this transformation were manifold. Industrial employment for working-class youth dried up, forcing many to choose between minimum-wage service industries and the "underground economy," i.e., the drug trade and other such sources of illicit income." Those writers who have argued the ascendancy of speculative and finance capital have also noted that a tolerably educated, housed, and healthy labor force is no longer necessary for capital. The reduction in state spending for education, housing, and health care is therefore entirely compatible with this new phase of capitalist development.
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