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The Return of the State?

Published online by Cambridge University Press:  01 February 2011

Jacobus Delwaide
Jacobus Delwaide*
Affiliation:
Faculty of Economic, Political and Social Sciences and Solvay Business School, Vrije Universiteit Brussel, Pleinlaan 2, 1050 Brussels, Belgium. E-mail: jacobus.delwaide@vub.ac.be
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Abstract

Massive government-financed rescue operations for banking and insurance industries in the United States and in Europe, seeking to contain the financial crisis that culminated in 2008, amounted to ‘the biggest, broadest and fastest government response in history.’1 This ‘great stabilisation,’ as The Economist called it, resulting in ‘quasi’ or ‘shadow nationalization,’2 cast doubt on the notion, fashionable at the height of the neoliberal wave, that the state was essentially on its way out, as many of its tasks and responsibilities were oozing steadily and irreversibly toward the market. The state and, by the same token, the political seemed back – with a vengeance, triggering solemn announcements of ‘the return of the state’ and ‘the end of the ideology of public powerlessness.’3 Observers concurred. ‘Free-market capitalism, globalization, and deregulation’ had been ‘rising across the globe for 30 years,’ yet that era now had ended: ‘Global economic and financial integration are reversing. The role of the state, together with financial and trade protectionism, is ascending.’4 Triggering a perceived ‘paradigm shift towards a more European, a more social state,’ even in the United States and in China, the crisis was seen to herald a move ‘back towards a mixed economy.’5 The question, meanwhile, remained: had the state indeed withdrawn as much during the neoliberal era as is often assumed?

Type
Focus: Globalization
Information
European Review , Volume 19 , Issue 1 , February 2011 , pp. 69 - 91
Copyright
Copyright © Academia Europaea 2011

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