13. The US has become the ‘consumer of last resort’ while China became the new ‘workshop of the world’. Chinese surpluses were plowed back into American investments, both Treasury bonds (many purchased by the central bank) and asset backed securities. For China this kept its currency artificially low, enhancing exports, and ‘self-insured’ against future financial crises, such as that which swept East Asia in 1997.
14. Merkel is hamstrung by domestic politics; German taxpayers do not want to bail out their spendthrift Greek cousins.
15. One should temper the predictions of China’s rise with the recollection of all of those who confidently predicted that Japan would rule the twenty-first century just a few decades ago.
References
Autor, David (2010) ‘The Polarization of Job Opportunities in the US Labor Market: Implications for Employment and Earnings’, 30 April, Center for American Progress.
Blanchard, Olivier, and Gian Maria Milesi-Ferretti (2009) ‘Global Imbalances: In Midstream?’ IMF Staff Position Note, SPN/09/29, 22 December.
Bradbury, Katherine, and Jane Katz (2009) ‘Trends in US Family Income Mobility, 1967–2004’, Federal Reserve Bank of Boston Working Paper No. 90-7.
Bricker, Jesse, Brian Bucks, Arthur Kennickell, Traci Mach and Kevin Moore (2011) ‘Surveying the Aftermath of the Storm: Changes in Family Finances from 2007 to 2009’, Federal Reserve Board, Divisions of Research & Statistics and Monetary Affairs, 2011-17 (Washington, DC: Federal Reserve Board).
Caballero, Ricardo, and Arvind Krishnamurthy (2009) ‘Global Imbalances and Financial Fragility,’ American Economic Review, 99(2), 584–8.
Campos, Celia, Alistair Dent, Robert Fry and Alice Reid (2011) ‘Impact of the Recession’, Regional Trends, 43, 2010-11 (London: ONS).
Crouch, Colin (2009) ‘Privatized Keynesianism: An Unacknowledged Policy Regime’, British Journal of Politics and International Relations, 11(3), 382–99.
Fine, Ben (2009) ‘Neo-Liberalism in Retrospect? – It’s Financialisation, Stupid’. Paper presented at Developmental Politics in the Neo-Liberal Era and Beyond, 22–24 October, Center for Social Sciences, Seoul National University.
Fround, Julie, Sukhdev Johal, John Law, Adam Leaver and Karel Williams (2011) ‘Rebalancing the Economy (or Buyer’s Remorse)’, Centre for Research on Socio-Cultural Change (CRESC) Working Paper No. 87, Manchester University, January.
Gamble, Andrew (2009a) The Spectre at the Feast: Capitalist Crisis and the Politics of Recession (Basingstoke: Palgrave Macmillan).
Gamble, Andrew (2009b) ‘British Politics and the Financial Crisis’, British Politics, 4(4), 450–62.
Gamble, Andrew (2010) ‘The Political Consequences of the Crash’, Political Studies Review, 8(1), 3–14.
Hacker, Jacob (2006) The Great Risk Shift: The Assault on American Jobs, Families, Health Care, and Retirement and How You Can Fight Back (New York: Oxford University Press).
Hacker, Jacob, and Paul Pierson (2010) Winner-Take-All Politics: How Washington Made the Rich Richer and Turned its Back on the Middle Class (New York: Simon and Schuster).
Hay, Colin (2009) ‘Good Inflation, Bad Inflation: The Housing Boom, Economic Growth and the Disaggregation of Inflationary Preferences in the UK and Ireland’, British Journal of Politics and International Relations, 11(3), 461–78.
Hay, Colin (2010) ‘“Things can only get worse …”: The Political and Economic Significance of 2010’, British Politics, 5(4), 391–401.
Hay, Colin (2011) ‘Pathology Without Crisis? The Strange Demise of the Neoliberal Growth Model’, Government and Opposition, 46(1), 1–31.
Mykhnenko, Vlad, and Kean Birch (2010) ‘Conclusion: The End of an Economic Order?’, in Kean Birch and Vlad Mykhnenko (eds), The Rise and Fall of Neoliberalism: The Collapse of an Economic Order? (London: Zed Books).
Obstfeld, Maurice, and Kenneth Rogoff (2009), ‘Global Imbalances and the Financial Crisis: Products of Common Causes’, Federal Reserve Bank of San Francisco Asia Economic Policy Conference, 18–20 October.
Office of National Statistics (2010) ‘Press Release: Income Inequality Remains Stable’, 10 June.
Rajan, Raghuram (2005) ‘Has Financial Development Made the World Riskier?’ Paper presented at ‘The Greenspan Era: Lessons for the Future’, Symposium sponsored by the Federal Reserve Bank of Kansas City, Jackson Hole, Wyoming, 25–27 April.
Reich, Robert (2010) Aftershock: The Next Economy and America’s Future (New York: Alfred A. Knopf).
Reinhart, Carmen M., and Kenneth S. Rogoff (2009) This Time is Different: Eight Centuries of Financial Folly (Princeton: Princeton University Press).
Zakaria, Fareed (2009) The Post-American World (New York: W.W. Norton).
Index
9/11 terrorist attacks, see September 11 terrorist attacks
7 July 2007 London Underground bombings see war on terror
Affordable Care Act (ACA) 12, 112, 202–3, 207–11, 215–16, 219
Afghanistan 13, 110, 117, 228–9, 233–6, 238
additional US troops 228–9
Cameron government’s policy 233–4
congressional funding 229, 236
public opinion 232, 234
see also war on terror
‘aggrieved acquiescence’ 10, 181, 189–90
al Qaeda 228–9, 237, 250
Alexander, Danny 149
al-Haramain Islamic Foundation Inc. v. Bush (May 2009) 226
alt-A loans 42, 58
alternative vote (AV) 11, 153–4, 173
explained 16, 153
referendum 11, 115, 153–5, 173, 179, 189
American Civil Liberties Union (ACLU) 258, 260
‘American Dream’ 14, 267
American International Group (AIG) 4, 15, 46–7, 61–3, 69, 122
American National Election Study (ANES) 192
American Political Science Association 13, 159, 176
American Recovery and Reinvestment Act (ARRA) 16, 47, 63, 81–3, 86–8, 90–1, 93
Angle, Sharron 149
Anglo-Saxon capitalism 53
anti-terrorism policy 117, 223, 230, 245, 247, 249, 252
Appellate Committee of the House of Lords (see Supreme Court, UK) 247
Ashdown, Paddy 142
Asset Protection Scheme (APS) 65
Attlee, Clement 54, 160
austerity budget, UK 67, 71
Authorization for the Use of Military Force (AUMF) 246–8
auto industry bailout (US) 28, 32, 46–7, 55, 122, 171
see also Chrysler; General Motors;
GMAC automatic stabilizers 85
bank bailouts 7, 9, 63
see also American International Group (AIG); Bank of America; Bear Stearns; Bradford and Bingley; Lehman Brothers; Northern Rock; Troubled Asset Relief Program (TARP)
Bank of America 3–4, 46–7, 61, 79, 134
Bank of England 3, 15, 20, 24, 41, 47–8, 52, 64–6, 74, 77, 80, 83, 95, 123, 134, 264
monetary policy 20, 66, 89
quantitative easing 20, 48, 66, 70, 80, 123, 279
macro-prudential oversight 7, 40–1, 52–3, 63, 273
banker bonuses 66, 69, 76, 124, 129–30, 134
Banking Act of 2009 52
Barclay’s 3, 123
Basel Accords 43
Basel II 43
Basel III 53
Bear Stearns 3, 43, 45, 60–2, 79
Beck, Glenn 144
Beer, Samuel H. 155
Bernanke, Ben 15, 40, 48
‘Big Society’ 56, 112, 119
Bill of Rights, UK 233, 245, 257
bin Laden, Osama 13, 223, 228–9
Bingham, Thomas (Lord Justice) 249–51, 255, 258–9
‘black sites’ 223
Blair, Tony, 1997–2007 13, 31, 38, 104–5, 122, 142, 148, 153, 172, 205, 221, 275–6
‘sofa government’ style 234
Blair Government 45, 123, 221–2, 235, 245, 252
Boehner, John 51, 116, 150, 156, 208
Bogdanor, V
ernon 151
Boozman, John 149
Boumediene vs. Bush (2008) 224, 243, 246–7, 251–2, 254
Bradford and Bingley 47, 65
Brighton Revolution 27
British Medical Association 211
British National Party (BNP) 276, 281
Brown, Gordon 32, 41, 56, 107, 125–6, 142, 148, 180, 275, 277
New Labour 9, 30, 45, 122–3, 132, 172
see also Brown Government
Brown Government 3, 47, 65–6, 81–2, 179, 190
financial crisis 3, 8–9, 45–7, 65–7, 80, 111, 130
Brown, Scott 146, 171
Buchanan, Patrick 156
budget deficits, see fiscal crisis 19, 79, 84, 119
building societies 16, 67–8
Burnham, Walter Dean 140, 167
Bush, George Herbert Walker 46, 104
Bush, George W., President, 2001–2009 61, 104, 106, 221
Bush administration 42, 109–10, 127, 144, 156, 224, 235, 252
expansion of executive power 13, 221–2, 236, 245–6
financial crisis 4, 9, 46, 61–3, 122, 128, 130
lawsuits against 243, 248
war on terror 169, 222–3, 226, 228–9, 235, 245–6
Cable, Vince 33, 74, 149
Cameron, David 36, 101, 104, 233
Afghanistan 232–5
‘Big Society’ 56, 112, 119
Budget cuts 34, 55, 111, 115, 275
control orders 232–3, 246–7, 251, 255, 258, 260
leadership 10, 104, 107, 112, 114, 118–19, 126, 172
war on terror 13, 222, 229, 231–6
Cameron government 6, 19–20, 229, 235, 275
coalition with Liberal Democrats 114–15, 147–9, 154, 173
economic policy 19, 34, 53–5, 193
government finances 34, 55, 111, 115, 275, 268
policies 36, 233
National Health Service 201, 211–16
popularity
see also David Cameron; Liberal Democrats; Nick Clegg; George Osborne
Cameron, Prime Minister David 10, 54, 80, 101, 104, 107, 114, 126, 147–9, 172, 281
Campbell, Menzies (‘Ming’) 142–3
Caplan, Bryan 140
Carender, Keli 143–4
Carlile, Lord 233
Carter, Jimmy 103, 108, 169
Castle, Mike 149, 195
Central Intelligence Agency 223, 227–8
chemical industry 24
Cheney, Dick 223
China 2, 19, 73, 271–9
international surpluses 278–9
rising power 277–9
US Treasury bond purchases 279
Christian Democracy 160
Chrysler 28, 32, 46–7, 55, 122, 171
Churchill, Winston 101
Citigroup 46–7, 63
City of London 7, 9, 39–41, 45, 69, 75, 132, 136, 273
role in British economy 39, 41, 45, 74–5, 273
civil liberties 221, 225, 230–3, 236–7, 247, 257–8, 260
civil rights revolution, UK 168–70
Clarke, Kenneth 212
Clegg, Nick 11, 143, 146–9, 151, 173, 281
as coalition partner 10–11, 147–9, 173, 231, 281
as Liberal Democrat leader 143, 146–8, 151
Clinton, Bill 12, 38, 40, 104, 109–10, 169, 276
Clinton administration 42, 70, 93, 228
CNBC 143
Coakley, Martha 146
Coalition government 8, 11, 22, 33–4, 52, 55, 66–7, 71, 79, 115, 125, 140, 142, 143, 148, 151, 153–4, 173–4, 180, 202, 216, 222, 230, 233–7, 263, 268, 276
Cold War 2, 102, 109
combatant status review tribunals, see military commissions
communist parties 160, 162, 278
Community Reinvestment Act 42, 47, 63
Congress, US 4, 8, 15, 25, 42, 56, 70, 92, 109, 116–17, 127, 152, 163, 168–9, 191, 206, 210, 228, 237
2010 congressional elections 125, 180, 187–9
acquiescence in war on terror 13, 221–2, 225
budget 50–1, 55–6, 86–7, 89–90, 92, 107, 116–17, 210, 228, 268
financial crisis 46, 52, 67
ineffectiveness 13, 92, 225
oversight role 58, 128, 221–9, 248–9
relations with courts 204, 227, 236, 246, 248–9, 251–2
relations with presidency 108, 110, 144, 171–2, 222, 229, 236, 254
TARP 46, 52, 67, see also Troubled Asset Relief Program
use of force resolution, 2001 222, 246
Congressional Budget Office 15, 48, 55, 207, 209–10
Confederation of British Industry 19, 88
Conservative Party 1, 10, 88
AV campaign 154
leadership 104–6
ideology 1, 8, 11, 104–6, 117–18, 166, 172
electoral record 8, 54, 105, 111–12, 114, 126, 141, 191, 184–7, 275
relations with Republicans 102–7
see also Cameron government; David Cameron; elections, UK general election 2010
conservatorship 3, 62
Constitution, UK 245, 249, 251
Constitution, US 224–5, 254
executive power 13, 221–3, 235–7, 248, 260
separation of powers 50, 171, 175, 254
Consumer Financial Protection Bureau 52, 58
Consumer Protections and Markets Authority 53
control orders 230, 232, 236–7, 246–7, 251–3, 255, 260
Cook, Robin 211
counter-terrorism, see war on terror
Countrywide Financial 61
courts, UK see Supreme Court, UK
courts, US see Supreme Court, US
credit crunch 4, 6, 64, 70, 80
Credit-default swaps 41, 43, 51
Crimint 232
Crouch, Colin 271
‘privatized Keynesianism’ 271–2
Darling, Alistair 66, 81–2
debates, prime ministers 11, 146, 150–1
Democratic Party 11, 103, 107, 141, 144–5, 148, 150–2, 163, 169, 187–9, 192, 195
deregulation 5, 38, 40–2, 68–9, 131
derivative trading 4, 51, 63, 271, 273
detainees see war on terror
devolution 166, 212–13
dirigisme 6, 22–3, 28, 30, 35
Disraeli, Benjamin 161
Dixiecrats 141, 150
doctors 202, 204, 206, 210, 211–12, 216
Dodd, Christopher 134
Dodd-Frank Act see Dodd-Frank Wall Street Reform and Consumer Protection Act
Dodd-Frank Wall Street Reform and Consumer Protection Act 51, 134
Duverger, Maurice 160, 163
economic conditioning 181, 184
economic voting 179–86, 188–9, 191–3
economic-minded partisan 181, 183–5, 191, 193–4
Edwards, Nigel 216
Elections
UK general election, 2010 8, 11, 56, 105, 113–15, 125–6, 141, 147, 172–3, 184–7, 202, 213, 230, 232, 281
UK local and regional, 2011 115, 173
US Presidential, 2008 8, 56, 73, 83, 222, 275
US Congressional, 2010 55, 110, 113, 120, 125, 147, 149, 187–9, 191
Electoral reform 11, 148, 151, 154 alternative vote (AV) system see alternative vote (AV)
Emergency Economic Stabilization Act see Troubled Asset Relief Program
Enthoven, Alain 212
Epstein, Leon 139, 159, 163
Euro zone 75–6, 89, 267
sovereign debt crisis 267
European Convention on Human Rights (ECHR) 245, 249, 251–2, 255, 257
European Court of Human Rights (ECtHR) 231, 233, 249, 251, 257–8, 260
European Union 6, 22, 29–30, 34, 36, 67, 73, 75, 154–6, 166–7, 205, 232, 281
extraordinary rendition, see war on terror
Fannie Mae (Federal National
Mortgage Association) 3, 42–3, 45, 52, 62–3, 68, 80, 267
Federal Deposit Insurance Corporation (FDIC) 41, 51
F
ederal Home Loan Mortgage Corporation see Freddie Mac
Federal Housing Authority 41, 52
Federal National Mortgage
Association, see Fannie Mae
Federal Reserve 2–3, 15, 40, 48, 51–2, 61–2, 65, 272, 279
quantitative easing 20, 48, 63, 80, 123, 279
systemic monitoring 51, 134
Feingold, Russ 149
Fiat 32, 47, 122
Financial Crisis Inquiry Commission (FCIC) 5, 40, 43, 77, 122, 128, 134
Financial Services Authority (FSA) 41, 52–3, 66, 70, 74, 77
Financial Stability Committee 52
Financial Stability Oversight Council (US) 51, 63
financialization 266
public debt 14, 20, 45, 49–50, 84, 88–9, 268–9
private debt 6, 14, 45, 64, 67, 72, 76–7, 86, 267, 269, 271–2, 281
fiscal crisis
budget plans 50–1, 58, 84–114, 117, 150, 268–9
stimulus packages 6–8, 15, 46–8, 54, 56–7, 63, 66–7, 79–83, 86, 88, 91, 93, 171, 271, 275
structural budget deficits 19, 33, 49, 55, 84, 95
Fitch’s, see ratings agencies
Fixed-term Parliaments Bill 235
Ford Motor Company 33, 207
Foreclosure crisis 46, 60–2, 76, 265
Foreign Intelligence Surveillance Act (FISA) 226–7
FOX News Network 128, 144–5
France 22, 27, 30, 32, 89, 205, 270, 281
Frank, Barney 42, 134
Dodd-Frank Act, see Dodd-Frank
Wall Street Reform and Consumer Protection Act 51
Freddie Mac (Federal Home Loan Mortgage Corporation) 3, 42–3, 45, 52, 62–3, 80, 267
full employment policy 1, 25, 29
Gallup Poll 12, 113
Gamble, Andrew 20, 279
General election, 2010 see elections General Motors 32, 122, 133, 171
see also auto bailouts; GMAC
General Practitioners (GPs) 203–5, 211, 214–16
Glass-Steagall Act 52 40, 72
Globalization 1, 21, 135–7, 270, 279
GMAC 46, 63
Goldfarb, Michael 117
Goldwater, Barry 169
Gore, Al 104
Government Sponsored Enterprises (GSEs) 42, 62
see also Fannie Mae, Freddie Mac
Graham, Lindsey 225
Great Depression 6, 14, 40, 42, 54, 95, 107, 122, 124, 274, 280
‘Great Moderation’ 1, 3, 5
The Legacy of the Crash Page 39
