Thomas I. Palley — From Financial Crisis to Stagnation: The Destruction of Shared Prosperity and the Role of Economics

Broadly speaking, there exist three different perspectives on the crisis. Perspective 1 is the hard-core neoliberal position, which can be labelled the “government failure hypothesis”. In the U.S. it is identified with the Republican Party and the Chicago school of economics. Perspective 2 is the soft-core neoliberal position, which can be labelled the “market failure hypothesis”. It is identified with the Obama administration, half of the Democratic Party, and the MIT economics departments. In Europe it is identified with Third Way politics. Perspective 3 is the progressive position which can be labelled the“destruction of shared prosperity hypothesis”. It is identified with the other half of the Democratic Party and the labour movement, but it has no standing within major economics departments owing to their suppression of alternatives to orthodox theory.

Read it at Global Labour University
From Financial Crisis to Stagnation: The Destruction of Shared Prosperity and the Role of Economics

by Thomas I. Palley

(h/t Matias Vernengo at Naked Keynesianism)