Economic and political crisis
- Muirhead Main Lecture Theatre (G15), Muirhead Tower
- Research, Social Sciences, Teaching
An inaugural lecture from Professor Peter Burnham, Professor of Political Science and International Studies in the School of Government and Society.
For the last 150 years both policymakers and social scientists have been deeply divided over the issue of the role of state in the management of economic crisis. Underlying the popular debate between advocates of liberal market theory (night watchman state) and social democracy (state as benign planner) lies a set of more fundamental assumptions concerning the relationship between state, capital and crisis. Not all orthodox economists have shared the popular neo-classical view that crisis can arise only as the result of external shocks.
Both Keynes and Schumpeter toyed with the `hidden assumption’ that there is no self-equilibrating balancing mechanism within the capitalist economy. For these writers crisis in one form or another is to be understood as an intrinsic element of the economic cycle – in Keynes’s view crisis could at least in principle be regulated and subsumed whilst for Schumpeter crisis when properly managed was seen as potentially progressive for capital. However, if the insights of Keynes and Schumpeter look promising as alternatives to the orthodoxy that `markets tend to equilibrium’, Marx, in his critique of the classical tradition, arguably provides the fullest account of the relationship between economic development and crisis suggesting, in brief, that crisis is both the mode and the specific function of capital’s process of production – and it is totally necessary.
In this lecture I will draw on this latter tradition to analyse the political management of economic crisis in Britain since 1945. It will be argued that both the prevalence and the severity of crisis facing British state managers in the post-war period has led to the development of a form of management which seeks not to resolve economic crisis but to prevent economic crisis becoming a crisis of the state itself. This process is understood in terms of the strategy of depoliticisation – placing at one remove the political character of decision making (thereby placing decision making beyond political contestation). As a form of management it is often justified by policymakers in terms of enhancing efficiency in light of the increasing complexity of social and economic policy. However the outcome is profoundly undemocratic leading to the centralisation of power often in the guise of increasing accountability, credibility and transparency. Not all such strategies succeed of course and the lecture will illustrate some of the spectacular failures and the limits of this form of political management.