This isn't the Great Recession, it's the Great Uncertainty

There's power in a name. But we have to get the right one.

Labels matter in orienting our thinking about, characterising and constructing different eras in the global political economy. They are also invaluable shorthand and these days we all increasingly write, and possibly think, in shorthand.

It’s also striking that many such labels have come to acquire the declaratory claim of being the ‘great’ variant of whatever it is they announce. Some of these are now so widely used that we hardly recall their origins.

Think of the "Great War" or the "Great Depression" (although the latter is usually attributed to the book of that name by the economist Lionel Robbins first published in 1934). Keynes, by the way, preferred to talk of the ‘Great Slump, but for some reason that did not catch on in the same way.

Other eras lack an agreed label; and some even lack the epithet ‘great’. John Ruggie generated many citations by proposing the notion of "embedded liberalism" to capture the essence of the post-1945 era, but the phrase never spread beyond the academy. The French, of course, talked of "les trente glorieuses" to describe the period of steady growth up to the mid 1970s, but that too never infiltrated the global English vernacular. Nobody, however, tried out the "Great Growth", or the "Great Expansion", or the "Great Social Democracy"!

Coming closer to the present we have now lived through what some describe, in a rather odd way perhaps, as the "Great Moderation". This phrase was coined by two American economists, James Stock and Mark Watson, in a 2002 National Bureau of Economic Research publication and was then popularised by Ben Bernanke, then a member, now the chairman of the US Federal Reserve, in a speech he made in 2004.

The term is grounded in the claim that, starting in the mid-1980s, a series of institutional and structural changes in the economies of leading developed countries caused a reduction in the volatility of normal business cycle fluctuations, thereby diminishing the influence of traditional macroeconomic policy. Now wrecked by events, it was always a complacent take on reality and our colleagues in CRESC at the University of Manchester have fought back by dubbing this whole period of boom the "Great Complacence"!

So where do we sit now? At one level the answer is simple: we live – at least those of us in the West – amidst the "Great Recession". The New York Times journalist, Catherine Rampell, has recently provided a nice etymology of the use of this term. It’s spot on, of course, but it doesn’t catch the deeper elements of our current conjuncture.

For the honest answer is that we don’t really know – yet – where we are, not least because where we think we are will determine how we get out of this mess and we still seem a long way from that. Many suggest, or maybe just hope, that neoliberalism is over. But the neoliberals don’t think so and in any case new eras always take longer to emerge than people think. Thus far, neoliberal dispositions seem to have been reinforced by the crisis – for in a sense that is exactly what austerity is all about.

It is important, though, to remind ourselves that getting from the Wall Street crash of 1929 to the Bretton Woods conference of 1944 took fifteen years. The other great recent period of shift – the "long 1970s" – is even harder to date with precision. But, again, it took a lot of pounding by the neoliberal right to move us from the first signs of the crisis of "embedded liberalism" in the late 1960s to the hey-day of Reaganism and Thatcherism in the early 1980s. So perhaps fifteen years is about standard for these sorts of transitions …

In these circumstances many analysts fall back on Gramsci, reaching for The Prison Notebooks and quoting that bit where he writes that "the crisis consists precisely in the fact that the old is dying and the new cannot be born", adding that "in this interregnum a great variety of morbid symptoms appear". However, we have opted to take up the challenge implicitly laid down here by Gramsci by trying to think through the key elements of the confusion and contradiction that dominate so many attempts to chart our position.

We label the current era the Great Uncertainty and suggest, by deliberate use of this term, that the present conjuncture is being shaped by a remarkable, and hugely challenging, coalescence of three major processes of structural change occurring simultaneously and interacting in all manner of complicated ways. They can be distinguished analytically as follows:

  • Financial crisis: a largely Western crisis brought about by neoliberal excess and now rendering the resumption of economic growth a severe conundrum for the US, Japan and nearly all major European economies and a problem at least for the rest of the global economy;
  • Shifting economic power: the recent intensification of longstanding movements in the locus of economic power in the world characterised by the rise of countries like China, India, Brazil and several others too;
  • Environmental threat: the eventual realisation that climate change is both real and accelerating and is now asking the most serious questions about the ongoing viability of traditional notions of economic growth and indeed the good society itself.

The key point, though – and the reason that this all adds up to the Great Uncertainty – is that these processes of change are all taking place now and arguably will come to a head at broadly the same time. They also feed off each other in extraordinary and unexpected ways, with the politics flowing both through and between them in highly complex fashion.

This web of change is what SPERI was set up to research and help us understand. In subsequent blogs we will analyse further each of these three interlocking features of our uncertain times.

This is the first in a five-post series on the "Great Uncertainty".

Photograph: Getty Images

Professors Colin Hay and Tony Payne are Directors of the Sheffield Political Economy Research Institute at the University of Sheffield.

Photo: Getty
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Who will win the Copeland by-election?

Labour face a tricky task in holding onto the seat. 

What’s the Copeland by-election about? That’s the question that will decide who wins it.

The Conservatives want it to be about the nuclear industry, which is the seat’s biggest employer, and Jeremy Corbyn’s long history of opposition to nuclear power.

Labour want it to be about the difficulties of the NHS in Cumbria in general and the future of West Cumberland Hospital in particular.

Who’s winning? Neither party is confident of victory but both sides think it will be close. That Theresa May has visited is a sign of the confidence in Conservative headquarters that, win or lose, Labour will not increase its majority from the six-point lead it held over the Conservatives in May 2015. (It’s always more instructive to talk about vote share rather than raw numbers, in by-elections in particular.)

But her visit may have been counterproductive. Yes, she is the most popular politician in Britain according to all the polls, but in visiting she has added fuel to the fire of Labour’s message that the Conservatives are keeping an anxious eye on the outcome.

Labour strategists feared that “the oxygen” would come out of the campaign if May used her visit to offer a guarantee about West Cumberland Hospital. Instead, she refused to answer, merely hyping up the issue further.

The party is nervous that opposition to Corbyn is going to supress turnout among their voters, but on the Conservative side, there is considerable irritation that May’s visit has made their task harder, too.

Voters know the difference between a by-election and a general election and my hunch is that people will get they can have a free hit on the health question without risking the future of the nuclear factory. That Corbyn has U-Turned on nuclear power only helps.

I said last week that if I knew what the local paper would look like between now and then I would be able to call the outcome. Today the West Cumbria News & Star leads with Downing Street’s refusal to answer questions about West Cumberland Hospital. All the signs favour Labour. 

Stephen Bush is special correspondent at the New Statesman. His daily briefing, Morning Call, provides a quick and essential guide to British politics.