After Shocks

Economic crisis and institutional choice

Source: Scientific Council for Government Policy
Wim van de Donk, Chairman of the Scientific Council for Government Policy

Preface:
“Is the current crisis simply too big to reflect upon? Do the sheer complexity and the dazzling dynamics of the financial and economic crisis impede the possibility of learning some lessons this early on? This book, I think, shows that the answer to these questions is negative. Indeed, some strategic lessons can and should be learned, even at this stage. Waiting until the crisis is over is simply not an option given ambition to prepare our societies for the world after the crisis.

Of course, as this book went to press, the severest economic crisis since the Great Depression was still underway. How to deal with the turmoil that it wrought, especially from a long-term perspective, remains an unanswered and highly debated question. Present and future economic stability is still highly un- certain. It is in this context that Anton Hemerijck, Ben Knapen (director and member of the Dutch Scientific Council for Government Policy, respectively) and Ellen van Doorne (member of the staff of the Prime Ministers’ Office) set themselves a daunting task: to try to shed some light on the causes and ramifica- tions of the crisis, even as the economic storm continued to rage.

The Scientific Council for Government Policy was not sure that it had a role to play at the front lines of combating the immediate consequences of that storm. Nor did it intend to publish a complete – let alone definitive – analysis of what went wrong and what exactly was going on. However, the council thought it would be important to encourage the editors of this special publication to seek expert opinions to explore the repertoire of policy choice and institutional de- sign, on the basis of informed academic analysis and experiential observations and judgments of front line observers, as a first attempt to sketch the contours of a socio-economic order that could emerge out of the ruins of the crisis. If this cri- sis is also a chance for change, in what directions could that reconstructuring take us?

Twenty-four experts were selected from a broad range of fields and disciplines, on the basis of both their expertise in their given subject area as well as their institutional imagination and ability to think beyond the present circumstances. Aggregating their cumulative knowledge and insights, the editors have attempted to document the intellectual ‘state of the art’ in the midst of the crisis before hindsight can be given an opportunity to work its amnesiac magic. Interviewees were given time to consider the questions, and their responses are exceptionally well prepared and thought out. However, their final revisions to their contribu- tions occurred in late September 2009. Thus, they were necessarily historically bound by the facts and information available to them at this time.

This book is therefore a special project, supported by the Dutch Scientific Council for Government Policy. The volume deviates from the kind of policy advice reports the council generally produces. The intellectual endeavour began as a series of workshops on the economic crisis, organised in conjunction with the network of the strategists of a number of Dutch ministries. At these events, it became apparent that there was a wide breadth of insight developing on this very new subject. As researching current events presents innumerable methodological and practical barriers, this somewhat unorthodox project of semi-structured interviews was proposed in order to explore and document the institutional features of these new debates. The volume covers a wide range of topics: from the need for a new European narrative that helps to position the European Union in a world order shaped by a new geopolitical and economic balance of power, to the need to reform the academic discipline of economics. All the topics invite further reflection with the intent to prepare a new agenda for the period following that of this current crisis. The volume clearly shows that we cannot and should not wish to return, either theoretically or institutionally, to the world that preceded the current crisis. There is a need for new paradigms, institutions, wis- dom, and ideas. Political courage is imperative to pursue institutional change to prepare for a new age, in which, more than ever before, the social, ecological and economical agendas have to be discussed in a more integrated manner.

Since the onset of the crisis, the political and academic debates have begun to shift. Initially, the aftermath of the crisis was primarily concerned with immedi- ate damage control and preventing a complete erosion of the economy’s founda- tions. Recently, however, the debate has shifted, as people have begun to contex- tualise the crisis and wonder what this will mean for the future. More specifically, they wonder, what does this crisis mean for my pension? For my children? For my country? For the world’s poor? For the structures of global institutions? To this end, this book is an attempt to illuminate – in real time – a cross-section of a vital debate.

The council is grateful to the editors who managed to involve some of the best brains of the world to come together in this book for what is, indeed, an interest- ing variety of some of the brightest economists, political scientists, historians and sociologists around today. On behalf of the Council, I would like to thank the editors (Anton Hemerijck, Ben Knapen and Ellen van Doorne) and the sup- porting editorial team for all the work they have done.”

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