In Capitalism Unleashed, Andrew Glyn presents a powerful history of the economic trajectory of the oecd economies—the rich Western countries plus Japan—from the early 1970s to the present. In comparison with the first 25 years after World War ii, this most recent and ongoing phase of Western capitalism has been dominated by slower economic growth, higher unemployment, more inequality, a far less stable financial system, and persistent downward pressure on the living standards of ordinary people.
What lies behind these dramatically unfavourable trends? The book’s very title provides a concise answer. Capitalism came ‘unleashed’ from the chains that were imposed on it over a 40-year period beginning in the depths of the 1930s Depression and continuing through to the early 1970s. Over the years 1945–70, the leashing of capitalism produced what is now commonly termed its ‘Golden Age’ of rapid economic growth, low unemployment, high productivity and moderate but still clearly discernable improvements in equality. Unleashed capitalism ushered in the neoliberal era of, as Glyn sums it, ‘austerity, privatization and deregulation’.
Andrew Glyn is extremely well qualified to tell the story of how and why capitalism came unleashed, and what the consequences have been for different countries and social classes. Glyn has previously co-authored two influential books that examined the rise and fall of the Golden Age, British Capitalism, Workers and the Profit Squeeze (1972, with Robert Sutcliffe) and Capitalism Since 1945 (1991, with Philip Armstrong and John Harrison). He has also written important accounts of specific features of the neoliberal era. These include discussions of the causes of persistent high unemployment in Europe; the operations of welfare state policies; and the global imbalances resulting from China’s emergence as an export-led juggernaut.
Capitalism Unleashed brings these and other aspects of the neoliberal era together in one place, in a compact 183 pages of text. The book is organized by themes, rather than a chronological narrative. Chapter 1 begins by considering how a series of challenges to us capitalist hegemony—from workers, the oil-producing countries, and competition among the oecd economies themselves—emerged during the long boom, leading to the demise of the Golden Age. Glyn then focuses on the central policy initiatives that have defined contemporary neoliberalism, including austere macroeconomic policies, privatization of nationalized industries and the deregulation of markets. This sets the stage for his discussion of the consequences of unleashed capitalism, in terms of financial markets, globalization and the weakening influence of labour movements throughout the oecd. Glyn then assesses the overall record of neoliberalism along two dimensions. First, the fact that it led to slower economic growth and greater instability, trends that capitalists themselves should find disturbing; and second, that it has produced widening inequalities and generally diminished levels of social welfare, matters of obvious concern for most people other than capitalists themselves.
The book does cover technical topics, and includes 14 tables and 39 figures. One cannot tell this story in a serious way by avoiding technical issues entirely. However, Glyn’s presentation of these matters is accessible and engaging. Indeed, one crucial measure of his skill as an economist is his ability to present the most important technical material in the simplest possible way without compromising substance. The late Robert Heilbroner once observed that modern orthodox economics is characterized by ‘rigour, but alas, also mortis’. Glyn delivers the rigour but avoids the mortis.
Why did capitalism get leashed in the first place? Glyn does not begin with this question as his point of departure, as I think he probably should have. In my view, there are two interrelated causes. The first is the 1930s Depression and the horrors of fascism and World War ii that resulted from the global economic collapse. The second is the concurrent rise of the Soviet Union and the challenge of communism.
Keynesianism and the idea of a mixed economy emerged out of this historical juncture. John Maynard Keynes himself was quite explicit in positioning his work as such, both in publishing his masterwork The General Theory of Employment, Interest and Money in 1936, and in his subsequent feverish activity to construct a viable postwar economic order.