Crisis and Stability: The Global Financial Crisis, British Broadsheet Press and the Politics of Ideational Reversion William John Vittery Doctor of Philosophy University of York Politics December 2015 Abstract By analysing UK media narrations surrounding the global financial crisis, this thesis presents a critical engagement with existing constructivist institutionalist literature. Through the application of a ‘dynamic tracing’ methodology to British broadsheet newspaper discourse from 2007-10, the thesis reveals three significant, and interconnected, dynamics. Firstly, it highlights the existence of ‘ideational reversion’, whereby after a short period of flux through late-2008 and early-2009, prominent discourses by and large returned to the pre-crisis status quo ante. By analysing the pre- crisis, crisis, and post-crisis discourse holistically, a notably higher degree of overall ideational stability is found than the existing literature suggests would be the case. Secondly, it is demonstrated that ideational disjuncture within media commentary was effectively ‘siloed’ in the financial sector, meaning that the perception of crisis did not challenge broader conceptualisations of the neo-liberal economy. Thirdly, the impact of such reversion and siloing was to provide a greater social source of legitimacy, or strategic advantage, to orthodox austerity narratives than to their Keynesian alternative. On the back of these observations, conceptual extensions are put forward that involve developing a greater focus on the ‘stickiness’ of pre-existing discourse through crisis periods. 2 Table of Contents Abstract ............................................................................................................................................................................ 2 Table of Contents .......................................................................................................................................................... 3 Acknowledgements ..................................................................................................................................................... 6 Author’s declaration .................................................................................................................................................... 8 Chapter 1: Introduction to the Thesis .................................................................................................................. 9 Chapter 2. Constructivism, the British Broadsheet Press, and the Global Financial Crisis: An Overview ....................................................................................................................................................................... 13 2.1 Introduction..................................................................................................................................................... 13 2.2 Constructivism and the Ontological Middle Ground ...................................................................... 14 2.3 Structure versus Agency for Constructivists ..................................................................................... 20 2.4 Strategically Selective Contexts, Strategic Actors, and the Financial Crisis .......................... 22 2.5 Crisis and Strategic-Relational Action .................................................................................................. 23 2.6 The ‘Realist Constructivist’ Agenda and crisis analysis................................................................. 26 2.7 The Relevance of Constructivism to Crisis ......................................................................................... 28 2.8 Conclusions ...................................................................................................................................................... 29 Chapter 3. Constructivism, the British Broadsheet Press, and the Global Financial Crisis: The Extensions .................................................................................................................................................................... 30 3.1 Introduction..................................................................................................................................................... 30 3.2 Setting the Scene: Constructivism and the New Institutional Turn ......................................... 31 3.3 Institutionalist Studies of Crisis .............................................................................................................. 34 3.4 The Constructivist Institutionalist Alternative: Prospects and Weaknesses ....................... 36 3.5 Constructivist Responses to the Global Financial Crisis ............................................................... 42 3.6 When is a crisis not a crisis? ..................................................................................................................... 44 3.7 Discursive Institutionalism and Media Narration ........................................................................... 46 3.8 Methodology .................................................................................................................................................... 48 3.9 Conclusions ...................................................................................................................................................... 53 Chapter 4: Contextualising the Global Financial Crisis .............................................................................. 55 4.1 Introduction..................................................................................................................................................... 55 4.2 Introducing the Keynesian and Orthodox Paradigms .................................................................... 56 4.3 The Great Moderation and the Events of the Financial Crisis .................................................... 60 4.31 The Leverage Economy ............................................................................................................................ 61 3 4.32 Current Account Imbalances ................................................................................................................. 62 4.33 Monetary Consensus ................................................................................................................................. 63 4.4 The Onset of Crisis and its Political Response .................................................................................. 64 4.5 The Economic Logic of Stimulus in the Current Context .............................................................. 66 4.6 The Economic Case for Austerity in the Current Context............................................................. 69 4.7 Ideal Types and Their Political Usage .................................................................................................. 71 4.71 The Role of Uncertainty ........................................................................................................................... 72 4.72 Stimulating Growth ................................................................................................................................... 73 4.73 Economic Priorities ................................................................................................................................... 74 4.74 A Case of Contestability ........................................................................................................................... 74 4.8 Conclusions...................................................................................................................................................... 75 Chapter 5: Charting the Pre-Crisis Economic Discourse ........................................................................... 76 5.1 Introduction .................................................................................................................................................... 76 5.2 The Size and Role of the State .................................................................................................................. 77 5.3 Fiscal Responsibility and State Capacity ............................................................................................. 81 5.4 Drivers of Economic Growth .................................................................................................................... 87 5.5 The Tax Regime ............................................................................................................................................. 89 5.6 Conclusions...................................................................................................................................................... 91 Chapter 6: Political Economic Discourses of the Crisis Period: August 2008 – January 2009 .. 94 6.1 Introduction .................................................................................................................................................... 94 6.2 A crisis of capitalism or a crisis of finance? ........................................................................................ 96 6.3 Corporate Capitalism in Crisis? ............................................................................................................... 99 6.4 ‘No room for manoeuvre’ and orthodoxy v stimulus ................................................................... 100 6.5 Medium term decisions ...........................................................................................................................