Austerity from the Left: Social Democratic Parties in the Shadow of the Great Recession

Austerity became the dominant fiscal policy response to the Great Recession in Europe, driven by electoral and ideational pressures. This book argues that social democratic parties endorsed austerity to increase their perceived economic competence and fiscal credibility, legitimized by supply-side economics. However, powerful feedback effects of the Third Way trapped and divided the centre-left, undermining their ability to oppose austerity and contributing to their electoral crisis.

Format: Hardback
Length: 304 pages
Publication date: 16 May 2023
Publisher: Oxford University Press

The response to the Great Recession in Europe was marked by a significant shift towards austerity as the dominant fiscal policy approach. Following a brief period of emergency Keynesianism from 2008 to 2010, even the center-left abandoned plans for deficit spending and embraced austerity as the prevailing dogma. In his book, Björn Bremer delves into the origins and political implications of this shift, employing a combination of qualitative and quantitative methods and drawing on a diverse range of empirical evidence to examine both the demand- and supply-side of politics.

Based on the evidence presented in the book, the author argues that a complex interplay of electoral and ideational pressures drove social democratic parties towards orthodox fiscal policies. As government debt became a contentious issue following the Greek sovereign debt crisis, social democratic parties endorsed austerity as a means to enhance their perceived economic competence and fiscal credibility. This decision was justified by economic ideas influenced by supply-side economics, which had gained popularity among social democrats towards the end of the 20th century.

While the book demonstrates that social democratic austerity was not inevitable, powerful feedback effects of the Third Way ultimately confined and divided the center-left during the crisis. This weakened the ability of social democratic parties to oppose austerity and ultimately contributed to their electoral crisis in the aftermath of the Great Recession.

Weight: 616g
Dimension: 163 x 242 x 28 (mm)
ISBN-13: 9780192872210