It was not so long ago that Gordon Brown claimed to have abolished 'boom and bust'. As we enter what everyone now thinks will be a deep and prolonged recession this claim is looking - being as generous as possible - a little over optimistic.
The government is keen to stress that the current crisis was not 'made in the UK', and it is certainly true that this is now a global crisis that no country can insulate itself from completely.
Further to last week's post about credit card debt, here's an interesting nugget from the British Psychological Society's research digest.
Hundreds of participants were given a credit-card bill
with an outstanding balance of £435.76 and asked how much they could
afford to pay off, given their real-life finances. Crucially, half the
participants were shown what the minimum compulsory payment was and
In the name of "modernisation", the government has insisted on
competitive commissioning, a narrow focus on financial efficiency
savings, and investment through the private finance initiative (PFI)
that builds up long-term debts. It has shown a strong preference for
large, aggregated contracts. In other words, public services have been
subject to the same blind faith in market forces as the rest of the
As the financial crisis continues to unfold, one myth keeps getting repeated: the crisis was causedby poor people defaulting on sub-prime loans. In
short, if only they hadn't been so feckless then the great edifice of
sub-prime debt need not have brought the financial system crashing down
upon us. This isn't just wrong, it's dangerous and wrong.
Results may not have been as bad as expected but still made for dismal reading in last week's OECD report on inequality. At a time when the rewards of the rich are being called sharply into question, the UK still has one of the highest levels of income inequality in the developed world and social mobility is static. The rate at which inequality has widened is slowing, which is not the same as the gap narrowing. More
The predictable crisis in the global system is the most important sign yet that a new economics is emerging. The tragedy is that the crisis-ridden financial system has long since failed to do the basic job required - to underpin the productive economy, and the fundamental operating systems upon which we all depend. These have been variously neglected, taken for granted or cannibalised by finance. More
When copies of The Great Crash: 1929 by JK Galbraith were on their way back from the printer in 1955, its author was giving evidence to a Senate hearing - during which there was a sudden stockmarket crash. He was blamed for it.