Economic Rebalancing Acts
A phrase often heard, especially in leftist circles, is that the 2008 crisis has given us an opportunity to “rebalance the economy,” with production for profit yielding to production for “well-being.” But the world is currently moving overwhelmingly in the opposite direction, toward austerity and shrinking the size of the state.
LONDON – We all know how the global economic crisis began. The banks over-lent to the housing market. The subsequent burst of the housing bubble in the United States caused banks to fail, because banking had gone global and the big banks held one another’s bad loans. Banking failure caused a credit crunch. Lending dried up and economies started shrinking.