The 2008 crisis cost $13 trillion and raised state debt up to 50 percent

Evidence

But what mattered fundamentally was the failure of a set of ideas that justified finance doing whatever it liked because whatever it did was by definition the most efficient thing that could be done. These ideas were supposed to be “the way the world works.” So when it turned out that the world didn’t work that way, it was hardly a surprise that the rest of the edifice based on them came crashing down. Not to put too fine a point on it, these ideas were battered by a single event that to date has cost, once lost output is included, as much as $13 trillion and, on average, a 40 percent to 50 percent increase in the debt of the states hit by the crisis. That seems to be a very large price to pay to save something that was too big to fail and that wasn’t meant to fail in the first place, especially when you and I are expected to pay for it. — Mark Blyth, Austerity, 136

Categorization

• SEED: The final sentence is a sharp pivot for an essay: the ‘too big to fail’ bailout debt was then converted into the justification for austerity — the public paying for private failure. Strong angle connecting crisis to austerity causation.
• XREF: The $13 trillion figure and debt rises are the empirical anchor for the austerity narrative — the very debt austerity claims to pay down was caused by bailing out finance. — connects to: The 2008 crisis pushed whole nations toward bankruptcy and austerity; The 2008 crisis originated in private-sector practices, not state spending — Mark Blyth, Austerity: The History of a Dangerous…, 76

Broader Connections

• The 2008 crisis originated in private-sector practices, not state spending #responds-to (0.90) — Mark Blyth, Austerity, 76
• The 2008 crisis pushed whole nations toward bankruptcy and austerity #expands (0.82)