These two premises were used during the Masterclass session of March 23, 2012. This lecture was given by Bertjan Verbeek, professor in International relations at Radboud University. The crisis has two faces: objective and subjective. Both the objective and the subjective are difficult to catch in one term. This opens opportunities to actors to use the frame that fits their own interests. They can frame the crisis to their advantage. A long cherished wish could possibly be fulfilled, if this framing is successful.
A change in policies might be possible thanks to the crisis. Calling for more control and supervision of the baking system or a closer monetary or political union in the EU are items that suddenly appear on the agenda, because they are presented as being the logical way out.
Things, however, are not that simple. The current crisis is far more complicated. There are chances and threats. Which of these two is dominant depends on the agenda a politician has. In order to analyse the current crisis we have to go back more than just one year.
The 2007 banking crisis was the launch of a domino effect, which through its financial consequences spread to other spheres than just the banking sector, but also was not limited to the USA. Risks taken on the housing market proved to be too big and spread to the banking sector. The European analysis that the crisis was a purely American phenomenon also proved to be wrong: the ripple crossed the Atlantic and hit European shores.
The political reaction in the USA was varied. The Tea Party stated that Americans should not be responsible for paying their neighbours’ mortgage debt. This meant a divided Republican Party. The upcoming elections in the USA will certainly be an interesting period. Parties will have to be frank about what they suggest as a solution to the crisis. The Trade Unions will most likely be on the side of the common man, because they had to deal with Republican governors who have drastically cut budgets.
The Occupy movement has clearly tried to wake up everybody in the sense that they want to debunk the way the business world acts. They think another approach to world business should be part of the solution to the crisis. The crisis had great consequences for Iceland. The extreme liberal climate has ultimately, after the collapse of the Icelandic banks, lead to a change in government. A left oriented cabinet came to power and after consultation a new constitution was drafted and accepted.
Due to the financial problems pressure was put upon Iceland by the EU, The Netherlands, Great Britain and the IMF. Lessons learned were manifold. All Icelandic citizens were hit by the crisis, which caused a rebellion resulting in the aforementioned changes. The rebellion was not just in the financial/economic sector, but spread, to other sectors.
A similar shift can be seen in Greece. The main issue here is that the legitimacy of the government was questioned. In the mean time some other European countries seem to undergo the same development. This is apparent in the countries with the most financial problems. Change is the order of the day, but not just from left to right. It is more a change against the incumbent. The byproduct of all this is that the European feeling is not stimulated, since many perceive the current crisis as originating in Europe and that solutions are difficult to reach at the European level.
What will be the ultimate consequences of the crisis? Does the crisis cause a sharp decline in the hegemony of the USA? Will the EU become a more supranational or intergovernmental institute? The answer to this question is hard to give. What is sure, is that the crisis offers risks and chances.
Another sure thing is that politicians seek short time solutions and that technocracy is not always the only way out. Protests may lead to the downfall of governments and in the most extreme cases the collapse a the system. The framing of the crisis is manifold, but the dominant framing is that budget cuts are the way out.