Similar issues are in evidence elsewhere around the world. ‘Lost decade ’, previously used to describe anomalous economic conditions in countries like Italy and Japan, is increasingly applied to an ever-growing cluster of nations. Since the crisis of 2008, Greece and Spain have seen unemployment go beyond 25 per cent, with youth unemployment touching double that. Elsewhere, economies such as Hungary, Austria, Portugal and Latvia’s are no bigger now than they were in 2008 when measured on an output-per-person basis.
Even in the rising nations of the Global South, the trend is clear. The 10 per cent growth which characterised the Chinese and Indian economies during the early years of the twentyfirst century are now a thing of the past. Elsewhere the likes of Brazil and Russia have been mired in recession almost as severe as parts of Europe, the only diference being their economic malaise has kicked in at far lower levels of relative development. Such a shift has only served to strengthen the forces of autocracy.
So our world is one increasingly defined by low growth, low productivity and low wages. Before the crisis, most policymakers would have thought such events impossible, let alone speculated about an appropriate response. Alan Greenspan’s 2008 remarks to the US House of Representatives are illustrative: the banking crisis having left this former chairman of the Federal Reserve in a state of ‘shocked disbelief ’ and ‘distressed’ by events he previously viewed as impossible.
While neoliberalism, which emerged with the Thatcher and Reagan governments, led to higher unemployment and lower wage growth, for more than a generation this was mitigated by access to cheaper goods and services – by relocating production to countries with lower wages – as well as inflated asset prices, particularly housing, and access to cheap mortgage and consumer debt. As well as forming the foundation for a widely felt material improvement in living standards, this was the economic base for a world where there was no alternative. How could you really be angry at anything with your credit cards and ever-cheaper consumer gadgets? And even if you were, what choice did you have once you’d earned your stake in the system with a home of your own? Now, with these previous fixtures in retreat, elites have yet to make a positive ofer about what comes next. What we know for certain is that the status quo can’t hold. There is no consent for a system which, on nearly every measure, is going backwards.
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chaos under heaven