{"id":40344,"date":"2018-01-22T09:15:47","date_gmt":"2018-01-22T09:15:47","guid":{"rendered":"http:\/\/www.taxresearch.org.uk\/Blog\/?p=40344"},"modified":"2018-01-22T09:15:47","modified_gmt":"2018-01-22T09:15:47","slug":"the-great-fragility","status":"publish","type":"post","link":"https:\/\/www.taxresearch.org.uk\/Blog\/2018\/01\/22\/the-great-fragility\/","title":{"rendered":"The Great Fragility"},"content":{"rendered":"

Might I recommend today's column<\/a> from my old friend and fellow Green New Deal member Larry Elliott in today's Guardian?<\/p>\n

\"\"<\/a><\/p>\n

As Larry argues:<\/p>\n

A synchronised upturn in the global economy has dispelled the pessimism that has been around ever since the financial crisis of a decade ago. Booming stock markets mean the billionaires who will spend the next few days emoting about inequality are considerably richer than they were a year ago.<\/p>\n

Last January, the fear was that the world would never shake off the 2008 banking meltdown blues. Now there is talk of a return to the Great Moderation, the period in the late 1990s and early 2000s when growth was robust and inflation was low.<\/p><\/blockquote>\n

Larry is right; this is the new mood. The FT is positively drooling over it<\/a>. 'Normalisation', otherwise known as the abusive form of bank led capitalism that was unconstrained pre 2008, is the aim of the wealthy elite now. But as Larry notes:<\/p>\n

Yet, the Great Moderation was always shakier than it looked at first glance, built as it was on foundations of debt, speculation, rising asset prices and a world divided between countries running trade surpluses and those deficits. As the\u00a0WEF noted in its Global Risks report<\/a>\u00a0last week: \u201cThe global economy faces a mix of long-standing vulnerabilities and newer threats that have emerged or evolved in the years since the crisis.\u201d Talk of a new Great Moderation looks premature. The Great Fragility would be closer to the truth.<\/p><\/blockquote>\n

I agree. Debt; inequality; the failure to address imbalanced economies; weak infrastructure; growing environmental threats; populist challenges to democracy; undermined public services, under-capitalised outsourcing: the threats to our economies are enormous. As Larry summarises it:<\/p>\n

So that\u2019s the Davos reality this year: economic fragility, environmental fragility, social fragility and political fragility. And it\u2019s worth remembering that when there\u2019s a threat of an avalanche, one rifle shot or even an untimely bellow can bring the whole mountain down.<\/p>\n

Why? Because Donald Trump comes to Davos on Friday.<\/p><\/blockquote>\n

He may be the tipping point. I am not sure though: at most he is emblematic of the deeper malaise I have already noted this morning<\/a>. But whatever might push neoliberalism off its perch its fall is inevitable. The only question is on what the consequences might be be.<\/p>\n","protected":false},"excerpt":{"rendered":"

Might I recommend today’s column from my old friend and fellow Green New Deal member Larry Elliott in today’s Guardian? As Larry argues: A synchronised
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