Crashed: How a Decade of Financial Crises Changed the World by Adam Tooze

Published date01 June 2019
Date01 June 2019
DOIhttp://doi.org/10.1177/0020702019853229
Subject MatterBook Reviews
Adam Tooze
Crashed: How a Decade of Financial Crises Changed the World
Viking: New York, 2018; 706 pp. $41.00 (hbk)
ISBN: 978-0-67002-493-3
Reviewed by: Eric Helleiner (ehellein@uwaterloo.ca), University of Waterloo, Ontario,
Canada
In the past, international f‌inancial crises have often been catalysts for the unravel-
ling of a dominant global political and economic order. Recall, for example, what
quickly followed the momentous f‌inancial crisis of 1931. For the f‌irst half decade
after the 2008 crisis, however, many scholars (including this reviewer) suggested
that the legacies of this crisis were less transformative. In this excellent and extre-
mely readable book, Adam Tooze highlights how dif‌ferent the situation looks at
the 10-year anniversary.
A key change has involved the domestic politics of the country at the epicentre
of the 2008 crisis: the United States. In the 2016 election, the ‘‘centrist liberalism’’
of the Obama administration was forcefully rejected not only by Trump supporters
but also by many on the left (20). This American political upheaval, Tooze argues,
was, in part, a reaction to the 2008 f‌inancial crisis and its management, which
reinforced pre-crisis trends of growing inequality: ‘‘People on welfare scraped by
while bankers carried on their well-upholstered lives’’ (15). Tooze suggests that the
legitimacy of the political mainstream was particularly undermined by the enor-
mous government support provided during the crisis to big banks: ‘‘After the
events of 2008–2009 and the spectacularly lopsided bailouts, could anyone ser-
iously doubt whom government was for?’’ (460).
Tooze argues that the transformative political legacies of the crisis have been
even more signif‌icant in the European Union. Although Europeans initially saw the
2008 crisis as an American problem, they were soon forced to recognize how deeply
implicated their over-leveraged f‌inancial institutions were in the f‌inancial mess. In
Britain, the resulting bailouts, austerity, and growing inequality generated a polit-
ical environment that contributed, Tooze argues, to the dramatic outcome of the
2016 Brexit referendum. In the eurozone, political disillusionment and polarization
also resulted from policy choices that turned the initial f‌inancial turmoil into
mismanaged sovereign debt crises, driving ‘‘tens of millions of its citizens into
the depths of a 1930s-style depression’’ (15). In addition to generating unnecessary
suf‌fering, Tooze concludes, the European mismanagement of the crisis has shaken
‘‘Europe’s politics to its foundations’’ and undermined its role in the global econ-
omy: ‘‘Rather than an autonomous actor, Europe risks becoming the object of
other people’s capitalist corporatism. ...In the wake of the double crisis, Europe is
out of the race’’ (317, 17).
A great virtue of Tooze’s analysis is that he also highlights the links between
the crisis and changing geopolitics. He argues that the crisis accelerated a shift in
balance of economic power to East Asia—particularly China, which responded to
the crisis decisively in the economic realm as well as by assuming a higher
Book Reviews 329

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