Slump, austerity and resistance

The Great Recession of 2008-9 represents a profound rupture in the neoliberal era, signalling the exhaustion of the accumulation regime that had emerged almost thirty years earlier. Rather than an ordinary recession, a short-lived downturn in the business cycle, it constituted a systemic crisis, a major contraction whose effects will be with us for many years to come. Among those effects are the extraordinary cuts to social programmes, and the resultant impoverishment, announced as part of the Age of Austerity inaugurated by all major states. But another effect, and for socialists ultimately the crucial one, is a new wave of mass working-class insurgency. Since the onset of the Great Recession, factory occupations, general strikes and street-based uprisings have burst forth from Greece to Guadeloupe and beyond. Whether this insurgent wave will be adequate to the task of overturning the ruling-class agenda is far from clear. What is clear is that the age of austerity has raised the bar for movements of resistance, obliging them to undertake much more militant and decisive oppositional practices or risk major defeats. Illuminating the context of these class struggles is a strategic necessity for any meaningful Left politics. To that end, this article explores the economic dynamics of the Great Recession, the bailout, and the abnormal ‘recovery’ that followed. It argues that while the recapitalization of banks did stop the financial collapse, monetary policy (‘quantitative easing’) can no more generate sustained growth today than it has in Japan over the past 15 years. As a result, we can expect a prolonged period of austerity, of food crises in the Global South, and of attacks on public services and working classes – all of which raise key political challenges for the Left