The global economic crisis of 2008--2009 seemed a crisis not just of economicperformance but also of the system's underlying political ideology and economic theory. But a secondGreat Depression was averted, and the radical shift to New Deal-like economic policies predicted bysome never took place. Perhaps the correct response to the crisis is simply careful management ofthe macroeconomic challenges as we recover, combined with reform of financial regulation to preventa recurrence. In Economics After the Crisis, Adair Turner offers a strongcounterargument to this somewhat complacent view. The crisis of 2008--2009, he writes, should prompta wide set of challenges to economic and political assumptions and to economic theory.
Turner argues that the faults of theory and policy that led to the crisis wereintegral elements within a broader set of simplistic beliefs about the objectives and means ofeconomic activity that dominated policy thinking for several decades. This dominant discourse casteconomic growth as the objective, markets as the universally applicable means of achieving it, andinequality as inevitable and necessary. Turner takes on these assumptions point by point, arguingthat more rapid growth should not be the overriding objective for rich developed countries, thatinequality should concern us, that the pre-crisis confidence in financial markets as the means ofpursuing objectives was profoundly misplaced, and that these conclusions have broad implications forthe case for economic freedom, for specific areas of public policy (including financial regulationand climate change), and for the discipline of economics itself.
