Capitalist Crises, Austerity, and Neo-Fascism
Paper Session
Friday, Jan. 5, 2024 12:30 PM - 2:15 PM (CST)
- Chair: José Tapia, Drexel University
Macroprudential Polices and Economic Growth
Abstract
Is there a relationship between macroprudential policies and economic growth? Macroprudential policies are regulatory and supervisory arrangements applied to financial institutions, that target systemic risk and address the build-up of vulnerabilities during business cycles. Particularly since the Great Financial Crisis, these policies have become a widely used tool to tackle the instability of financial systems and reduce the probability of a banking crisis. By mitigating bankers and businessman’s risk-taking, macroeconomic policies can ensure a healthier macro-financial relation and thus stimulate the economy. Empirical literature, however, has emphasized the role of macroprudential policies in depressing economic growth. By adopting a local projections approach, this paper’s evidence suggests that, between 2000 and 2017 and for a sample of advanced market economies, a tightening of these policies can in fact boost GDP growth.From the 1970s to the 2020 Pandemic: Six Crises of the World Economy
Abstract
This paper makes the case that there were six crises of the world economy in the past half century. Crises are defined as periods in which the accumulation of capital slows down generating spikes in business failures and mass unemployment, as well as downturns in CO2 emissions. Using the world economy as the unit of analysis and data from the World Bank, crises can be defined using annual declines in gross capital formation or annual declines in gross fixed capital formation. Using gross capital formation crises ocurred in (i) 1975, (ii) 1980-1982, (iii) 1991-1993, (iv) 2001-2002, (v) 2008-2009, and (vi) 2020. Using declines in gross fixed capital formation, crises occurred in (i) 1974-1975, (ii) 1982, (iii) 1991-1993, (iv) 2002, (v) 2009, and (vi) 2020. Thus, both procedures produce a very similar chronology: crises of the world economy occurred in the mid-1970s, in the early years of the next three decades, at the end of the first decade of the 21st century, and in 2020. As discrete, countable phenomena, distinct states of an entity that can be properly called global or world economy, or world capitalism, crises are periods of substantial slowdown in global economic activity which appears as a global decline of economic output and industrial activity, almost always associated with financial turmoil. To pose the existence of these crises implies that the world economy is a proper construct which has conceptual substance, and also that the view that takes national economies as units of economic analysis has major limitations.Is Neo-Fascism Inevitable?
Abstract
There has been a growing discourse over the last few years about the rise of neo-fascist political movements and governments throughout the globe. Some believe that neo-fascism is an offshoot of neoliberalism or the latest phase of monopoly capitalism. At the same time, there are scholarly writings on how austerity by central governments can lead to neo-fascist movements and regimes. This paper examines a general theory of fascism and neo-fascism and analyzes the economic history of the US (and to some degree, world economy) using the concept of long waves and then looks at trends among different nations regarding their economic surplus, investment levels, debt levels, and attempts at economic austerity. The analysis supports notions that the economic slowdown of various nations along with a slowdown in substantive investment levels, rising government debt levels, and austerity measures or proposed austerity measures could be associated with increasing neo-fascist political activity. Given capitalism’s reluctance to engage in sufficient levels of productive investment or surplus absorption and its reliance on central governments to remedy the problems of poverty, unemployment, etc. through increasingly higher levels of debt and/or greater austerity by higher taxes on workers or by cuts to government welfare programs, neo-fascism probably has arisen in response to current capitalistic shortcomings and contradictions and as a means to protect capitalism. As these problems continue, the inevitability of movements in favor of neo-fascism needs to be explored.JEL Classifications
- P1 - Capitalist Economies
- B5 - Current Heterodox Approaches