Nick Shaxson ■ SPERI: The Finance Curse as New Grand Narrative
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From Dr. Andrew Baker at Queen’s University, Belfast, writing for the Sheffield Political Economy Research Institute (SPERI):
“In a previous SPERI blog post, I lamented the complete absence of a co-ordinating discourse or grand political narrative about the financial crash of 2008. Instead, we have seen isolated and disjointed technical changes in policy thinking in relation to: global imbalances, tax and macroprudential regulation (MPR). In this contribution I address a question raised in that previous piece: what kind of common framework of thought, explanation and narrative could effectively link these seemingly disparate areas of change?
The most plausible contender for such a new grand narrative is the concept of a ‘finance curse’.”
That’s our work he’s talking about. And he makes some interesting points:
“Recent efforts by the G8, G20 and OECD to tackle the epidemic scale of corporate tax avoidance can therefore be conceived as partial, implicit and incomplete attempts to address one of the symptoms of the finance curse.”
And he draws attention to a nice turn of phrase, which we hadn’t picked up on:
“The Bank of England’s chief economist, Andy Haldane, refers to the vacuum cleaner effect of finance, sucking resources away from long-term growth enhancing R&D and infrastructure projects.”
Which is course is a key component of what we call the Finance Curse. He adds:
“The real potency of the finance curse concept lies not in its analytical purchase, but rather in its capacity to provide grand political narrative. It is essentially a big picture discourse that can become the connecting explanatory glue tying together the otherwise isolated technical policy learning we have witnessed since the crash.
What’s more, the finance curse has the advantage of being easy to understand and grasp, unlike the technical policy adjustments we have so far seen. Indeed, it is arguably the political counterpart of these more technical policy discourses. It is both a populist discourse and a conceptual apparatus – an unusually powerful combination capable of constructing a novel and inclusive coalition that could deploy detailed evidence and careful analysis with popular support.
It’s surely time for academics, journalists, policy-makers, politicians and members of civil society to start seriously exploring the narrative of the finance curse.”
We like it, and fully agree.
As we obviously would!
Via Twitter, we’ve just seen a wonderful visual illustration of the Finance Curse, which is worth sharing.