US crisis response was economically left-wing while Europe’s was conservative, inverting ideology

Evidence

When the crisis hit the United States in 2007 and 2008, it was a Republican administration with an ex-CEO of Goldman Sachs at its fiscal helm that invented the $700 billion Troubled Asset Relief Program (TARP) and engineered the bailout of the US financial system. Putatively Keynesian economists, such as Larry Summers, who were part of the Obama economic team in 2008, merely continued the work of their Republican predecessors. The new team may have been intellectually more attuned to a compensatory logic by virtue of being Democrats, but it was, we should remember, the Democratic administration of Bill Clinton that had balanced the US budget and “ended welfare as we know it.” When the crisis hit, the United States may have been on the right ideologically, but it was very much on the left in terms of economic policy. — Mark Blyth, Austerity, 167

Categorization

• XREF: This ideological inversion theme dovetails with the broad critique literature on how party labels misalign with actual economic policy positions.