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

Ideas and the Construction of Interests

Although convincingly discredited academically, a crude 'business school' globalisation thesis of a single world market, with its attendant political 'logic of no alternative', continues to dominate the discourse of globalisation adopted by the British Labour Party. Here, we identify three separate, albeit reinforcing, articulations of the policy 'necessities' associated with global economic change. Labour's leaders are shown to have utilised a flexible synthesis of potentially contradictory ideas in constructing their chosen discourse of globalisation to guide the conduct of British economic policy following the Party's election victory in 1997. We conclude that Labour appealed to the image of globalisation as a non-negotiable external economic constraint in order to render contingent policy choices 'necessary' in the interests of electoral rejuvenation.

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The discourse of globalisation and the logic of no alternative : rendering the contingent necessary in the political economy of New Labour

Part 1 Stating the obvious: what is the state and do we need a theory of it? Part 2 Stating social and political change: war and social change - building the new Jerusalem the sense and nonsense of consensus - the state regime in post-war Britain citizenship - towards a patriarchal welfare state? Part 3 Re-stating crisis: theories of state crisis - legitimation crisis or political overload? from contradiction to crisis - the structural transformation of the British state Part 4 Re-stating social and political change: Thatcherism - authoritarian populism, hegemony and the state the state of the present - the consolidation of a post-Thatcher settlement.

Re-stating social and political change

This article seeks to gauge the nature, distinctiveness and significance of the ‘interpretivist turn’ in public administration and political science more broadly. It considers the various interpretations and, indeed, misinterpretations to which this new hermeneutics of public administration has given rise, its relationship to (genuinely and seemingly) cognate perspectives (notably constructivism, the new institutionalism and critical realism) and its strengths and weaknesses ‐ both as an analytical perspective and as a developing research programme. In the process it argues for a broadening of the interpretivist research agenda to accord a greater role to the institutional contexts in which the ideas and beliefs that actors hold acquire and retain resonance and for the value of exploring more thoroughly the synergies with constructivist variants of the new institutionalism. As the pages of this and other leading journals attest, the last decade has seen a very significant ‘interpretivist turn’ in the fields of public policy and public administration with ripple effects now radiating out through all parts of the discipline. At the centre of these concentric circles is the work of R. A. W. Rhodes and his long-standing co-author in matters of meaning and interpretation, Mark Bevir. It is primarily with their work that I engage in this article. In it I seek to gauge the nature, distinctiveness and significance of the interpretivist turn, considering in so doing the various interpretations and, indeed, misinterpretations to which it has given rise, its relationship to (genuinely and seemingly) cognateperspectives(suchasconstructivism,thenewinstitutionalismandcriticalrealism) and its strengths and weaknesses ‐ both as an analytical perspective and as a developing research programme (albeit one at a relatively early stage in its evolution). In the process I point to the potential value of a synthesis of interpretivist and constructivist institutionalist insights, suggesting that this might allow for a broadening of the interpretivist research agenda that has developed to date. In particular I suggest that this would allow interpretivism to turn its attentions more directly to the relationship between the ideas actors hold, the inter-subjective discourses and traditions on which they draw in developing such ideas, and, crucially, the institutional and extra-discursive context in which those ideas and traditions come to acquire and retain resonance. That, in turn, would allow it to dispel the view, typically put forward by its critics, that interpretivism is merely the latest incarnation of idealism (see, for example, Dowding 2004; McAnulla 2006a; Marsh 2008, 2009). While that charge is, I think, mistaken ‐ in that there is nothing innately idealist about interpretivism’s ontological assumptions ‐ it is made more credible by the operationalization of interpretivist insights in public administration to date. For, thus far at any rate, self-professed interpretivists have tended to restrict their empirical concerns to the mapping and interpretation of actors’ beliefs, the reconstruction of the meanings to actors of the practices in which they engage, and the location of such beliefs and meanings in the context of pre-existing yet dynamic

Interpreting interpretivism interpreting interpretations: the new hermeneutics of public administration

To what extent are new generations ‘Thatcherite’? Using British Social Attitudes data for 1985–2012 and applying age-period-cohort analysis and generalized additive models, this article investigates whether Thatcher’s Children hold more right-authoritarian political values compared to other political generations. The study further examines the extent to which the generation that came of age under New Labour – Blair’s Babies – shares these values. The findings for generation effects indicate that the later political generation is even more right-authoritarian, including with respect to attitudes to redistribution, welfare and crime. This view is supported by evidence of cohort effects. These results show that the legacy of Thatcherism for left-right and libertarian-authoritarian values is its long-term shaping of public opinion through political socialization.

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Colin Hay

Papers

Ideas and the Construction of Interests

The discourse of globalisation and the logic of no alternative : rendering the contingent necessary in the political economy of New Labour

Re-stating social and political change

Interpreting interpretivism interpreting interpretations: the new hermeneutics of public administration

Thatcher’s Children, Blair’s Babies, Political Socialization and Trickle-down Value Change: An Age, Period and Cohort Analysis