John Naughton at Memex 1.1:
I’m reading Philip Mirowski’s Never Let A Serious Crisis Go to Waste: How Neoliberalism Survived the Financial Meltdown. In Chapter 1 he reflects on the curious fact that nothing much changed as a result. “The strangest thing”, he writes,
was that instead of leading to a collapse of the right-wing neoliberalism that had enabled the catastrophe to happen, the crisis actually seemed to strengthen the Right. It took a rare degree of self-confidence or fortitude not to gasp dumbfounded at the roaring resurgence of the right so soon after the most catastrophic global economic collapse after the Great Depression of the 1930s. “Incongruity” seems too polite a term to describe the unfolding of events; “contradiction” seems too outmoded. Austerity became the watchword in almost every country; governments everywhere became the scapegoats for dissatisfaction of every stripe, including that provoked by austerity. In the name of probity, the working class was attacked from all sides, even by nominal “socialist” parties… The pervasive dominance of neoliberal doctrines and right-wing parties worldwide from Europe to North America to Asia has flummoxed left parties that, just a few short years ago, had been confident they had been finally making headway after decades of neoliberal encroachment. Brazenly, in many cases parties on the left were unceremoniously voted out because they had struggled to contain the worst fallout from the crisis. By contrast, the financial institutions that had precipitated the crisis and had been rescued by governmental action were doing just fine — nay, prospering at pre-crisis rates — and in a bald display of uninflected ingratitude, were intently bankrolling the resurgent right. Indeed, the astounding recovery of corporate profits practically guaranteed the luxuriant post-crisis exfoliation of Think Tank Pontification. nationalist proto-fascist movements sprouted in the most unlikely places, and propounded arguments bereft of a scintilla of sense. “Nightmare” did not register as hyperbolic; it was the banjax of the vanities.
That’s just about the most succinct expression of the bewilderment that most of us felt — or certainly that I felt as I watched the UK post-crisis, Tory-led coalition government blaming the populace (or its Labour predecessor) for the debacle, and imposing ‘austerity’ as the punishment for popular irresponsibility rather than as the price of forcing the public to shoulder the costs of bankers’ greed and recklessness. And it’s why I always thought that, eventually, the penny would drop with electorates, and why the current ways of populist anger towards ‘elites’ comes as no surprise. In fact the only surprising thing about it is that it took so long to materialise.
This is the resort to ‘complexity’ as an epistemological or ideological device. It’s a way of saying that some things are beyond analysis or explanation. Sometimes this is true: complex systems exist and they are inherently unpredictable and sometimes intrinsically incomprehensible. But a banking system run as a racket does not fall into that category.