Chapter 3: Finance industry prominence: causes and consequences
In 2005, the British Prime Minister Gordon Brown declared in his budget statement before the parliament that he expected the growth of the economy to be between 3 and 3.5 percent during the year, and in 2006 the figure was estimated to be between 2.5 and 3 percent, figures twice or three times as high as what was calculated in the euro area and in Japan. As an effect of this growth, Brown remarked, Britain and North America have “over the last eight years grown at twice the rate of most G7 competitors, our living standard also rising twice as fast” (Prime Minister Gordon Brown’s Budget Statement in 2005, cited in Erturk et al., 2012: 7). In hindsight, this statement was indicative of the “misplaced optimism before 2008” (Erturk et al., 2012: 10) regarding economic growth and employment in the financialized Anglo-American economies. On 15 September, 2008, Lehman Brothers, one of the “Big Five” on Wall Street, filed for bankruptcy. This event had repercussions throughout the entire global financial system and during a few dramatic weeks the financial market ended up in a stalemate when it became clear that the finance industry would be unable to stabilize itself without the support and primarily the capital provided by national states (Blinder, 2013; Barofsky, 2012; Friedman and Kraus, 2012; Stiglitz, 2010; Sorkin, 2009).
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