Around the world, pockets and circles mark poverty–it’s structural many say, others blame corporations and workers (greed and laziness); or national leaders in dictatorships and new democracies (crony thief). But big wheels keep turning out the oil and currency that creates winners and losers–and growth and no growth. What makes this recession different (its political economy!) is that the winners have aligned with non-growth! They prefer to concentrate wealth rather than increase it. They consume more of the global pie rather than make more pies; they prefer to drain rather than feed.
Paul Krugman has demonstrated this behavior in economic numbers and charts, as basic principles, as a conservative and European pattern, and its effects on growth and wages (slow or non-existent!). Yet profits and wealth are increasing at the same time as economies and wages are stagnant. New wealth is being extracted from working wages and family net worth!
Beginning when businesses cut expenses to improve profits, increase by decrease became widely applied during and after the recession through government austerity, corporate trimming and wage tightening and unemployment. The strategy is in oil, as dropping prices run off competition and allow major players a larger share.
Political economy looks at the behavior that drives the numbers, looking for the widest cause, going beyond policy. The answer? The art of politics is lost; money is the main candidate. It is a bidder’s war. The price of the 2016 elections will be insane. So the answer is: It’s still greed. Otherwise, we would be doing fine.