I view manipulatives as a substitute for real life and real life experiences. The best way to learn math is through real life experiences. I was brought up in an abundance of experience to help me learn math which in turn gave me the background to learn the abstract representation of math that we call 'Algebra'.
I think that kids today don't have the kind of experiences that gives them the background needed to learn Algebra. I believe that is why manipulatives are so popular-manipulatives are a way of trying to fill in for that missing real life experience.
Labs are another way of filling in those holes in experience. In my opinion, a better way. (I know, they're not always feasible.)
Parents providing experiences is the best way!
Manipulatives are not new, as nothing in education is new. They are a passing fad as most things in education are. A smart teacher will keep the good parts that work for him/her and his/her students and use them whenever appropriate.
Now to attempt to open a can of worms. I also think that the current emphasis on graphing is a fad. The availability of cheap and powerful graphing calculators is a driving force behind this fad. I don't use graphs as a major way of learning or visualizing. I very seldom draw a graph to help me see what is going on. I think there are a lot of learners out there who don't need graphs to help them learn. Graphs and graphing calculators are another tool for learning that a wise teacher will keep and use when appropriate.