Abstract
Kristoffer Smemo provides a historical overview of flawed economic policies that led up to the Great Recession. The Great Recession is presented as an economic regime on the verge of collapse. For Smemo “Privatized Keynesianism,” that is, private sector advocacy of monetary and fiscal policies to increase employment and spending, led to the meltdown of the economy. His analysis brings together the nexus of business and political party politics. He questions the leadership of Obama during the Great Recession. Instead of trying to reform the system, Obama policies assisted Wall Street, banks, and automobile makers to embolden past economic policies. This chapter links President Obama’s to his predecessors’ economic policies.
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Notes
- 1.
Peter Beinart, “The New Liberal Order,” Time (November 13, 2008).
- 2.
Eric Rauchway, “Neither a Depression nor a New Deal: Bailout, Stimulus, and the Economy,” The Presidency of Barack Obama: A First Historical Assessment, ed. Julian E. Zelizer (Princeton, NJ: Princeton University Press, 2018), 30–44.
- 3.
“57% of Public Favors Wall Street Bailout,” Pew Research Center, September 23, 2008; “Support for Stimulus Plan Slips, Poll Finds,” CNN Politics, March 17, 2009; “Polling Shows Americans Wary of Bailouts,” CBS News, September 14, 2009.
- 4.
David Harvey, A Brief History of Neoliberalism (New York: Oxford University Press, 2010), 2.
- 5.
Stephanie L. Mudge, “What is Neo-liberalism?” Socio-Economic Review, 6 (October 2008), 703–31.
- 6.
Daniel Stedman Jones, Masters of the Universe: Hayek, Friedman, and the Birth of Neoliberal Politics (Princeton, NJ: Princeton University Press, 2012).
- 7.
Bob Jessop, The Future of the Capitalist State (Cambridge, UK: Polity, 2002), 55–93.
- 8.
David Plotke, Building a Democratic Political Order: Reshaping American Liberalism in the 1930s and 1940s (Cambridge: Cambridge University Press, 1996).
- 9.
John Maynard Keynes, General Theory of Employment, Interest and Money (New Delhi: Atlantic Publishers: 2008 [1936]), 347.
- 10.
Michael Kalecki, “Political Aspects of Full Employment,” Political Quarterly, 14 (October 1943), 322–30.
- 11.
Ira Katznelson, Kim Geiger, and Daniel Kryder, “Limiting Liberalism: The Southern Veto in Congress, 1933–1950,” Political Science Quarterly, 108 (Summer 1993), 283–306.
- 12.
Greta Krippner, Capitalizing on Crisis: The Political Origins of the Rise of Finance (Cambridge, MA: Harvard University Press, 2011).
- 13.
Wolfgang Streeck, Buying Time: The Delayed Crisis of Democratic Capitalism (London: Verso, 2014).
- 14.
Colin Crouch, “Privatised Keynesianism: An Unacknowledged Policy Regime,” British Journal of Politics & International Relations, 11 (July 2009), 390.
- 15.
Bob Jessop, The State: Past, Present, Future (London: Wiley, 2015), 82–83.
- 16.
Stephanie L. Mudge, “What’s Left of Leftism?: Neoliberal Politics in Western Party Systems, 1945–2004,” Social Science History, 35 (Fall 2011), 337–80.
- 17.
Adam Hilton, “Searching for a New Politics: The New Politics Movement and the Struggle to Democratize the Democratic Party, 1968–1978,” New Political Science 38 (June 2016), 141–159.
- 18.
For the economic politics of the Carter administration, see Judith Stein, Pivotal Decade: How the United States Traded Factories for Finance in the Seventies (New Haven, CT: Yale University Press, 2010).
- 19.
For an excellent case study of the politics of the suburban liberals as social bloc, see Lily Geismer, Don’t Blame Us: Suburban Liberals and the Transformation of the Democratic Party (Princeton, NJ: Princeton University Press, 2015).
- 20.
Stephen Skowronek, The Politics Presidents Makes: Leadership from John Adam to Bill Clinton (Cambridge, MA: Harvard Belknap, 1997), 409–446.
- 21.
Crouch, “Privatised Keynesianism,” 392.
- 22.
Philip A. Wallach, To the Edge: Legality, Legitimacy, and the Responses to the 2008 Financial Crisis (Washington, DC: Brookings Institute, 2015), 17.
- 23.
Lawrence R. Jacobs and Desmond S. King, “Varieties of Obamaism: Structure, Agency, and the Obama Presidency,” Perspectives on Politics, 8 (September 2010), 793–802.
- 24.
Timothy F. Geithner Stress Test (New York: Crown Publishing 2014), 301.
- 25.
Wallach, To the Edge, 153.
- 26.
Quoted in Sheryl Gay Stolberg and Edmund L. Andrews, “$275 Billion Plan Seeks to Address Crisis in Housing,” New York Times, February 19, 2009, p. A1.
- 27.
Ibid.
- 28.
Wallach, To the Edge, 150.
- 29.
Robert W. Lake, “The Financialization of Urban Policy in the Age of Obama,” Journal of Urban Affairs, 37 (February 2015), 75–78.
- 30.
Cedric Herring, Loren Henderson, and Hayward Derrick Horton, “Race, the Great Recession, and the Foreclosure Crisis,” in Repositioning Race: Prophetic Research in a Postracial Obama Age, ed. Sandra L. Barnes, Zandria F. Robinson, and Earl Wright II (Albany: State University of New York Press, 2014), 101.
- 31.
Michael Grunwald, The New New Deal: The Hidden Story of Change in the Obama Era (New York: Simon and Schuster, 2012).
- 32.
Ben S. Bernanke, The Courage to Act: A Memoir of a Crisis and its Aftermath (New York: Norton, 2015), 388.
- 33.
Ibid., 389.
- 34.
Kim Phillips-Fein, Invisible Hands: The Businessmen’s Crusade Against the New Deal (New York: Norton, 2009), 190.
- 35.
Stein, Pivotal Decade.
- 36.
Krippner, Capitalizing on Crisis, 28–29.
- 37.
Wallach, To the Edge, 125–28.
- 38.
Ben S. Bernanke, The Federal Reserve and the Financial Crisis: Lectures by Ben S. Bernanke (Princeton, NJ: Princeton University Press, 2013), 118.
- 39.
Wallach, To the Edge, 199.
- 40.
Bernanke, Federal Reserve and the Financial Crisis, 120.
- 41.
Nancy Fraser, “Legitimation Crisis? On the Political Contradictions of Financialized Capitalism,” Critical Historical Studies, 2 (Fall 2015), 179.
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Smemo, K. (2019). Managing a Regime in Crisis: The Twilight of Neoliberalism and the Politics of Economic Recovery During the First Year of the Obama Administration. In: Rich, W. (eds) Looking Back on President Barack Obama’s Legacy. Palgrave Macmillan, Cham. https://doi.org/10.1007/978-3-030-01545-9_3
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