First published: Prospectmagazine.co.uk, 19/12/2016
In keeping with the time of year, here are nine lessons (but no carols) we’ve learned about the economy over the past 12 month
- Financial crises have deep, long-lasting effects
Had there been no financial crisis in 2007/08 with all the consequences that came with it, the economic outcomes—and, therefore, political history—of the last eight years would have been markedly different. We can talk about globalisation and income inequality until we are blue in the face, but these issues alone don’t explain what’s happening, and anyway, they pre-date the Lehman bust. This year, I think the financial crisis, which upended the world system, has gotten off lightly. The only real surprise was that it took so long for the political backlash to erupt as it has. There’s been no attempt to help people understand the systemic causes of the financial crisis or how we really might act to mitigate the possibility of a repetition. Many people, well off and not, have been left with a perception about collusion between bankers, captains of industry, politicians and other members of the “elite.” It’s not well defined, but nonetheless real.
There’s still time to change the way our economics and economic systems work for society but the politics of those with less benign intentions are knocking on the door….Read more: