The financial market turmoil in 2007 and 2008 has led to the most severe financial crisis since the Great Depression and threatens to have large repercussions on the real economy The bursting of the housing bubble forced banks to write down several hundred billion dollars in bad loans caused by mortgage delinquencies At the same time, the stock market capitalization of the major banks declined by more than twice as much While the overall mortgage losses are large on an absolute scale, they are still relatively modest compared to the $8 trillion of US stock market wealth lost between October 2007, when the stock market reached an all-time high, and October 2008 This paper attempts to explain the economic mechanisms that caused losses in the mortgage market to amplify into such large dislocations and turmoil in the financial markets, and describes common economic threads that explain the plethora of market declines, liquidity dry-ups, defaults, and bailouts that occurred after the crisis broke in summer 2007 To understand these threads, it is useful to recall some key factors leading up to the housing bubble The US economy was experiencing a low interest rate environment, both because of large capital inflows from abroad, especially from Asian countries, and because the Federal Reserve had adopted a lax interest rate policy Asian countries bought US securities both to peg the exchange rates at an export-friendly level and to hedge against a depreciation of their own currencies against the dollar, a lesson learned from the Southeast Asian crisis of the late 1990s The Federal Reserve Bank feared a deflationary period after the bursting of the Internet bubble and thus did not counteract the buildup of the housing bubble At the same time, the banking system underwent an important transformation The

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Deciphering the Liquidity and Credit Crunch 2007-2008

The newest “new institutionalism,” discursive institutionalism, lends insight into the role of ideas and discourse in politics while providing a more dynamic approach to institutional change than the older three new institutionalisms. Ideas are the substantive content of discourse. They exist at three levels—policies, programs, and philosophies—and can be categorized into two types, cognitive and normative. Discourse is the interactive process of conveying ideas. It comes in two forms: the coordinative discourse among policy actors and the communicative discourse between political actors and the public. These forms differ in two formal institutional contexts; simple polities have a stronger communicative discourse and compound polities a stronger coordinative discourse. The institutions of discursive institutionalism, moreover, are not external-rule-following structures but rather are simultaneously structures and constructs internal to agents whose “background ideational abilities” within a given “meanin...

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Discursive Institutionalism: The Explanatory Power of Ideas and Discourse

The third way: the renewal of social democracy

Across the broad field of heterodox political economy, ‘neoliberalism’ appears to have become a rascal concept – promiscuously pervasive, yet inconsistently defined, empirically imprecise and frequently contested. Controversies regarding its precise meaning are more than merely semantic. They generally flow from underlying disagreements regarding the sources, expressions and implications of contemporary regulatory transformations. In this article, we consider the handling of ‘neoliberalism’ within three influential strands of heterodox political economy – the varieties of capitalism approach; historical materialist international political economy; and governmentality approaches. While each of these research traditions sheds light on contemporary processes of market-oriented regulatory restructuring, we argue that each also underplays and/or misreads the systemically uneven, or ‘variegated’, character of these processes. Enabled by a critical interrogation of how each approach interprets the geographies, modalities and pathways of neoliberalization processes, we argue that the problematic of variegation must be central to any adequate account of marketized forms of regulatory restructuring and their alternatives under post-1970s capitalism. Our approach emphasizes the cumulative impacts of successive ‘waves’ of neoliberalization upon uneven institutional landscapes, in particular: (a) their establishment of interconnected, mutually recursive policy relays within an increasingly transnational field of market-oriented regulatory transfer; and (b) their infiltration and reworking of the geoinstitutional frameworks, or ‘rule regimes’, within which regulatory experimentation unfolds. This mode of analysis has significant implications for interpreting the current global economic crisis.

Variegated neoliberalization: geographies, modalities, pathways

The concept of power is central to international relations. Yet disciplin- ary discussions tend to privilege only one, albeit important, form: an actor control- ling another to do what that other would not otherwise do. By showing conceptual favoritism, the discipline not only overlooks the different forms of power in inter- national politics, but also fails to develop sophisticated understandings of how global outcomes are produced and how actors are differentially enabled and constrained to determine their fates. We argue that scholars of international relations should employ multiple conceptions of power and develop a conceptual framework that encourages rigorous attention to power in its different forms. We first begin by producing a tax- onomy of power. Power is the production, in and through social relations, of effects that shape the capacities of actors to determine their circumstances and fate. This general concept entails two crucial, analytical dimensions: the kinds of social rela- tions through which power works (in relations of interaction or in social relations of constitution); and the specificity of social relations through which effects are pro- duced (specific/direct or diffuse/indirect). These distinctions generate our taxonomy and four concepts of power: compulsory, institutional, structural, and productive. We then illustrate how attention to the multiple forms of power matters for the analysis of global governance and American empire. We conclude by urging scholars to beware of the idea that the multiple concepts are competing, and instead to see connections between them in order to generate more robust understandings of how power works in international politics.

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Power in international politics

* Preface and Acknowledgements * Chapter 1 Political Disenchantment * Chapter 2 Politics, Participation and Politicisation * Chapter 3 The Domestic Sources of Depoliticisation * Chapter 4 The Global Sources of Depoliticisation * Chapter 5 Conclusion: Why Do We Hate Politics? * Bibliography * Index

Why We Hate Politics

Conclusion the limits of political science and the ethics of political analysis --3 Beyond Structure versus Agency, Context versus Conduct -- What is - and what is not - at stake in the structure- agency debate? -- Conceptualising structure and agency -- Operationalising structure and agency: the rise of fascism in Germany in the 1930s -- Positions in the structure-agency debate -- The centrality of structure and agency to political explanation -- Beyond structure versus agency --4 Continuity and Discontinuity in the Analysis of Political Change -- Time for change? -- Analytical strategies for conceptualising change -- Time, timing and temporality -- Conclusion: structural, agential and ideational factors in the analysis of political change --5 Divided by a Common Language? -- Conceptualising Power -- The 'faces of power' controversy -- Power: analytical and critical perspectives -- Foucault and the 'microphysics of power' --6 The Discursive and the Ideational in Contemporary --^

Political Analysis: A Critical Introduction

As be®ts two if its principal exponents, Hall and Taylor's recent article `Political science and the three new institutionalisms' provides a meticulous and provocative review of the many faces of the `new institutionalism' and a distinctive contribution to the growing literature in this area in its own right.* It provides an important opportunity to consider again the strengths and weaknesses of contemporary institutionalism and to raise the question of how its many insights might be more fully incorporated within the British political science mainstream. While careful to distance themselves from the idea that a `crude synthesis' of rational choice, sociological and historical institutionalism is `immediately practical or even necessarily desirable' (p. 957), they suggest that a dialogue between them is both necessary and crucial. We argue that the prospects for such a dialogue are more limited than Hall and Taylor suggest. For, rational choice and sociological institutionalisms are based on mutually incompatible premises or `social ontologies'. Moreover, in identifying two social ontologies ± the calculus and cultural approaches ± within the historical institutionalist canon (and hence in reconstructing historical institutionalism in rational choice and sociological terms), we argue that Hall and Taylor do a considerable disservice to this distinctive approach to institutional analysis. While this view of historical institutionalism makes it appear `pivotal' to future dialogue between institutionalisms, such a reading neglects the potentially distinctive social ontology of this approach. This may leave historical institutionalism prone to precisely the tendential structuralism characteristic of much institutionalist analysis, while giving a super®cial impression that the approach has already overcome this problem. We argue that if institutionalism is to develop to its full potential, it must consider the relationship between structure and agency, on which Hall and Taylor merely touch, as a central analytic concern.

Structure, Agency and Historical Institutionalism

While studies of globalization proliferate, we remain relatively under-informed about discourses of globalization and associated issues of power and knowledge. These issues come to the fore in the light of the intensive deployment of particular rhetorics of globalization and European integration within policy-making, journalistic and corporate communities. This paper seeks to contribute to the development of an institutionalist and yet social constructivist understanding of the appeal to external economic constraints (such as globalization and European integration) within contemporary European public policy and political economy. Through an attempt first to map the range of discourses of globalization and European integration in contemporary Europe and then to chart the (frequently) strategic deployment of such discourses in Britain, France, Germany and Italy, the paper attempts to move beyond an understanding of globalization discourse as the linguistic expression of exogenous interests. It shows how ide...

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Globalization, European integration and the discursive construction of economic imperatives

The winter of discontent continues to exert a powerful hold over the British political imaginary. It acts as a discursive key to a collective mythology seemingly appealed to, and conjured, in each wave of industrial unrest, in each hint of political turmoil and, until recently, whenever the election of a Labour Government looked credible. In this paper I consider the rhetorical strategies and linguistic devices deployed by the tabloid media in the narration of the events of the winter of 1978-79. I argue for an interpretation of the winter of discontent as a moment of state crisis. By crisis however I do not refer to the mere accumulation of contradictions but rather to a moment of transition, a moment of decisive intervention. Within such a framework, the winter of discontent emerges as a strategic moment in the transformation of the British state, and perhaps the key moment in the pre-history of Thatcherism. For, as I hope to demonstrate, the initial appeal of the New Right was premised upon its ability to offer a convincing construction of the winter of discontent as symptomatic of a more fundamental crisis of the state. In such a moment of crisis, a particular type of decisive intervention was called for. In this discursive construction of crisis the New Right proved itself capable of changing, if not the hearts and minds of the electorate, then certainly the predominant perceptions of the political context. It recruited subjects to its vision of the necessary response to the crisis of a monolithic state besieged by the trade unions. This was perhaps the only truly hegemonic moment of Thatcherism. It occurred well before Mrs Thatcher entered Number 10. It is thus not surprising that one of the most enduring and distinctive legacies of Thatcherism has been the new political lexicon of crisis, siege and subterfuge born of the winter of discontent. Language: en

Colin Hay

Papers

Why We Hate Politics

Political Analysis: A Critical Introduction

Structure, Agency and Historical Institutionalism

Globalization, European integration and the discursive construction of economic imperatives

Narrating Crisis: The Discursive Construction of the `Winter of Discontent'