The collapse of neoliberal capitalism: Causes and cures: a review article

The two books reviewed in this article are very different in style, quite different in content, but completely united in their purpose and major conclusions. Both books analyse the events from 2007 to 2010 to ascertain why the disaster happened and what must be done to put the United States economy (on which both books focus) on a more secure footing and prevent any recurrence of the extended crisis of those years. Both target the increasing influence of market liberalism over the last thirty years, and the institutions of capitalist economies which they have encouraged. Taylor focusses more on the participants in, and those responsible for, regulating the international financial sector, while Palley places more blame on the shoulders of those responsible for labour market policy. Both agree that each of these played a part in precipitating the events of 2007 to 2010 and need to be dealt with if the United States economy is to be restored to health. Both argue strongly that the growing income inequality in the United States must be reversed before the US economy can significantly improve. Finally, they stress the interrelationship between political ideology and economic explanation, and argue that value free positive economics is a myth.