Saturday 16 May, 1.45pm until 3.00pm, The Great Hall The Battle for the Economy
The G20 has affirmed that state action can indeed solve our economic problems. For the past 20 years we were told small government and the market were all we needed. Moving economic power from politicians to independent central bankers promised stable, growing, low-inflation economies, free from state interference. But now the market is widely viewed as unfair, having generated ‘unacceptable inequalities’; and inefficient, having diverted ‘massive resources into financial activities whose contribution to the economy is questioned’. As the crisis deepens, politicians are seizing back the reins, with direct government intervention. Commentators have declared the end of ‘neoliberalism’ and the return of the state. Chancellor of the Exchequer Alastair Darling has invoked John Maynard Keynes, while Nobel Prize-winner Paul Krugman calls today ‘The Keynesian Moment’.
Is state intervention the solution, or will it create new problems? The scale of the increase in public-sector debt could well be a heavy burden that drags on future growth. The FT’s Martin Wolf warns, ‘escaping from huge and prolonged deficits will be very hard’. Ross Walker of the Royal Bank of Scotland is concerned that the private sector’s contraction in contrast to the public realm means ‘we are likely to end up losing entrepreneurial spirit’. Are we really seeing a permanent shift to greater state control, or are these merely temporary measures? How new is today’s state intervention? Is it a new version of Roosevelt’s visionary New Deal, or is Keynes’ name invoked to give a veneer of economic respectability to panicky state interference?
Professor Furedi’s speech will be responded to by Dan Lewis and Professor Rainert before audience questions.
Listen to the session audio…
Other formats are available here
 | Frank Furedi professor of sociology, University of Kent, Canterbury; author, Wasted, Politics of Fear and On Tolerance: in defence of moral independence |
 | Dan Lewis Research Director, Economic Research Council; founder and Chief Executive, Future Energy Strategies |
 | Professor Erik Reinert professor of Technology Governance and Development Strategies, Tallinn University of Technology; Chairman, The Other Canon Foundation, Norway; author, How Rich Countries Got Rich ... and Why Poor Countries Stay Poor |
 | Simon Nixon European editor, Wall Street Journal’s Heard on the Street column; author, The Credit Crunch: how safe is your money? |
| Chair: | |
|
Geoff Kidder
director, membership and events, Institute of Ideas; convenor, IoI Book Club; IoI’s resident expert in all sporting matters |
“Capitalism isn’t working,” shouted the banners held aloft by protesters at last week’s London summit of world leaders. Had they prefaced this arresting slogan with “liberal” they might have found themselves not too distant from the presidents and prime ministers around the conference table.
Philip Stephens, Financial Times, 6 April 2009If, as appears quite likely, this spring turns out to be the low point of the deepest global recession of the postwar period, then history will doubtless record the G20 meeting last week as a triumph.
Anatole Kaletsky, The Times, 6 April 2009The state will play a bigger role in the economy for years to come as the recession fundamentally changes the relationship between government and business, Richard Lambert, director-general of the CBI, has said.
Andrew Bounds, Financial Times, 2 April 20092008 was a year of crises. First, we had a food crisis, particularly threatening to poor consumers, especially in Africa. Along with that came a record increase in oil prices, threatening all oil-importing countries. Finally, rather suddenly in the fall, came the global economic downturn, and it is now gathering speed at a frightening rate.
Amartya Sen, New York Review of Books, 26 March 2009
State-run banks won’t save Britain — or even Brown
There is seemingly no financial crisis so bad that it cannot be made potentially worse by the prime minister’s intervention.
Mick Hume, spiked, 24 February 2009
Now depression economics has come to America: when the great housing bubble of the mid-2000s burst, the U.S. financial system proved as vulnerable as those of developing countries caught up in earlier crises – and a replay of the 1930s seems all too possible.
Paul Krugman, Allen Lane, 4 December 2008
"The Battle of Ideas is a unique opportunity to learn from vigorous exchanges among some of the world's best-informed and most provocative people."
Martin Wolf, chief economics commentator, Financial Times
