Generational Dynamics Forum - New Site

He concedes that changes to economic and regulatory policies in the late 1970s and early 1980s brought benefits. “The `pro-market’ revolution must be credited for correcting earlier excesses perpetrated in policy making and in economic thinking,” he said, while the “the animal spirits it liberated accelerated growth and imparted renewed dynamism to Great Britain and the United States.”

But after those ideas became “conventional wisdom,” things went awry, he said.

“The Thatcher-Reagan ‘revolution’ conquered the minds and set a new policy paradigm only late in the 1980s; and the worse came after both quit power, sometimes from leaders of opposition parties converted to pro-market ideas (like Clinton or Blair),” Padoa-Schioppa said.

“The winning ideology - as happens - gradually remained without adversaries and lost the moderation, sophistication and sense of proportion that would have been necessary to avoid incidents and, eventually, disaster. When it came to dominate the intellectual and policy arena, it turned into a form of radicalism.”

rolivier79 wrote: > I really liked how Tommaso Padoa-Schioppa emphasizes that their
> policies didn't go awry until both Thatcher and Reagan quit power
> and the next generation radicalized their principles without
> opposition.

rolivier79 wrote:John,

Read this in the wsj this morning.

http://blogs.wsj.com/economics/2010/06/ ... under-fire

He concedes that changes to economic and regulatory policies in the late 1970s and early 1980s brought benefits. “The `pro-market’ revolution must be credited for correcting earlier excesses perpetrated in policy making and in economic thinking,” he said, while the “the animal spirits it liberated accelerated growth and imparted renewed dynamism to Great Britain and the United States.”

But after those ideas became “conventional wisdom,” things went awry, he said.

“The Thatcher-Reagan ‘revolution’ conquered the minds and set a new policy paradigm only late in the 1980s; and the worse came after both quit power, sometimes from leaders of opposition parties converted to pro-market ideas (like Clinton or Blair),” Padoa-Schioppa said.

“The winning ideology - as happens - gradually remained without adversaries and lost the moderation, sophistication and sense of proportion that would have been necessary to avoid incidents and, eventually, disaster. When it came to dominate the intellectual and policy arena, it turned into a form of radicalism.”

I really liked how Tommaso Padoa-Schioppa emphasizes that their policies didn't go awry until both Tatcher and Reagan quit power and the next generation radicalized their principles without opposition.

Robert