This chapter discusses the implications of this research for our view of British economic policy in particular and the political economy and historical sociology of economic policymaking in general. A multidimensional approach to economic policymaking reveals heterogeneity and discontinuity in postwar economic policymaking that conventional paradigmatic explanations and epochalist categories overlook.

Chapter 3 looks at 1960s and early 1970s demand-management framers’ efforts to strengthening short-term stabilization policy by inscribing a demand-management frame in budgetary reporting. In discourse, demand management was widely deemed the most important aspect of annual budgetary cycles. In practice, however, public-facing symbolic fiscal practices were still structured around the need of balancing the budget. This created political and technocratic difficulties. A proper demand management policy device was needed. But government elites did not agree on which one. Key here were the contrasting imperatives of economic-policy and bureaucratic framing contests as Treasury-control framers privileged their bureaucratic-politics interests to the detriment of devoting more efforts to creating a demand management indicator that, while limited in its internal usefulness, could support government attempts at economic policy framing and help manage public economic policy debate.

How and why do economic policy regimes emerge and evolve over time? Chapter 1 lays out the book’s argument and analytical approach. The story of economic policy in Western democracies is commonly told in terms of the supersession of epoch-defining intellectual revolutions. The analytical and empirical shortcomings of this conventional argument indicate that we are in need of a different account. Using the United Kingdom as a case study, this book makes the case for a multi-layered understanding of policy regimes and illuminates processes of fragmented change before and after the 1970s. The book studies policymaking from the forward-looking perspective of government elites and theorizes the politics of economic policy as a series of overlapping economic-policy and bureaucratic framing contests. It shows how these framing contests drive policy decision-making, organizational hierarchies, symbolic state practices and, thereby, the evolution of policy languages. The book’s multidimensional analytical approach highlights how the politics of economic ideas, bureaucratic politics, and the evolving structural political-economic context drive the development of relatively (in)coherent policy regimes.

If anyone is worthy of the title of “Cold War liberal,” you think it would be the celebrity journalist and public philosopher Walter Lippmann. Lippmann coined the phrase “Cold War” in 1947 and had long been considered the guru of modern liberalism. Yet Lippmann was a harsh critic of containment and, by the time of the Vietnam War, considered himself a “neo-isolationist.” He was also self-identified as a conservative by the Cold War era and was an outspoken critic of New Deal “planning.” Lippmann’s career highlights the problem of talking about “Cold War liberalism” in the singular. At the same time, there were few greater champions than Lippmann of a large military establishment and an expansive welfare state that typified Cold War liberal orthodoxy.

This chapter focuses on the debates about development, human rights, and ‘basic needs’ that defined much of the push to craft a decolonized international law during the late 1970s and early 1980s. In particular, it considers the emergence of the international right to development, and the relation between international human rights and poverty-reduction strategies like the ‘basic needs’ approach in New International Economic Order-related discussions, against the background of the rise of neoliberalism and organized human rights movements during the 1970s and early 1980s. It does so partly through a close reading of the two reports produced by the ‘North-South Commission’ chaired by former West German Chancellor Willy Brandt. Despite its overarching commitment to a renewed form of ‘global Keynesianism’, the Brandt Commission expounded a broadly rights-friendly approach to development that absorbed many of the neoliberal assumptions then on the rise. When US President Ronald Reagan and British Prime Minister Margaret Thatcher dismissed the Brandt Commission’s recommendations at the ‘North-South Summit’, held in Cancún in October 1981, the moment signalled the end of the struggle to cultivate an international law of development that would live up to the ideal of an international law of decolonization.

Why are progressives often critical of US foreign policy and the national security state? What would a statecraft that pulls ideas from the American left look like? Grand Strategies of the Left brings the progressive worldview into conversation with security studies and foreign policy practice. It argues that American progressives think durable security will only come by prioritizing the interconnected conditions of peace, democracy, and equality. By conceiving of grand strategy as worldmaking, progressives see multiple ways of using foreign policy to make a more just and stable world. US statecraft – including defense policy – should be retooled not for primacy, endless power accumulation, or a political status quo that privileges elites, but rather to shape the context that gives rise to perpetual insecurity. Progressive worldmaking has its own risks and dilemmas but expands how we imagine what the world is and could be.

Italy is not often featured as an important actor in the geopolitical map of the Cold War. And yet the country played an important role in breaking up a number of strictures that had kept the Soviets at bay from Western Europe. Italy’s fast growing businesses were often the first to reach out to the Soviets for large deals. Fiat very prominently sold a factory to the Soviets in the mid-1960s, representing that decade’s largest turnkey project. But this chapter argues that the more historically consequential initiative was ENI’s suggestion of a gas pipeline running from Ukrainian gas fields to the north of the Mediterranean country. This would have somewhat of a novel payment arrangement: the pipeline would be paid in gas. This arrangement effectively expanded repayment periods well beyond previous, Bretton Woods–era practices, which usually involved short-term loans that covered the time required for barter arrangements to transact. The Soviets saw an opportunity to change the temporal order of Bretton Woods, and suggested a much larger gas-for-pipes deal that would link their newly discovered gas reserves in Western Siberia to Western Europe. Italy balked initally for lack of industrial and capital resources, but others would literally capitalize on the new possibilities Italy had opened.

Italian state and business agents, having initiated the changes in East–West relations that this book follows, then proceeded to stall on the gas-for-pipe deal. This coda documents how it was only after West Germany jumped on the project that the Italians followed, as junior partners, through the door they themselves had opened many years before. As they did so, they entered a world of proliferating finance, debt creation, and market integrations. Closing the door behind them, they left behind the world of exchanges politicized in a Cold War key, a kind of politicization they had skillfully used throughout the 1950s and 1960s to negotiate better terms from the Soviets because of the risk to the American–Italian relationship that used to entail. What they entered was precisely the world the Soviets had fought for, one where market logic and discourse was overriding.

France offers a contrast to the ways in which finance and energy, and by extension economic life, was governed elsewhere in Europe. The French state, as keen as the Soviets to develop material exchanges beyond the hegemony of American stricture, sought to institutionalize these exchanges through a series of committees and working groups that would govern talks and practices. This was successful to a degree. But despite pressure from the Soviets to liberalize French trade and finance, the French state did not consider it urgent to get a hold of Soviet energy. Instituting working groups in the second half of the 1960s that would meet regularly to discuss trade and finance had been fruitful for the Soviets at the height of Bretton Woods and the technologies it purveyed, such as trade lists and long-term trade agreements. They were still, in many ways, the backbone of the economic relations the Soviet Union maintained with its Western neighbors. What they were not, however, was the future the Soviets envisaged. In Franco-Soviet relations, it was the Soviets that insistently pushed the temporal and material limits. And the French, reluctantly, followed.

This introduction develops some ideas for thinking about the compartmentalized nature of international political economy under Bretton Woods and the institutional settlements of energy and finance that made it possible. After initial institutional failures, this compartmentalized global architecture came to oversee a politics of growth that eventually incorporated the Soviet Union as an enthusiastic participant. The Soviets likewise participated in the dismantling of that architecture precisely by helping rearrange the relationships of energy and finance that had established it in the first place. This book shows that a history of the development of post–Bretton Woods capitalism requires the inclusion of the Soviet Union as one of its architects.

Chapter 6 traces the meaning of ‘modernisation’ in Labour’s economic policies. ‘Modernising the economy’ to achieve sustainable growth was a consistently crucial idea for Labour from Wilson to Blair. Notwithstanding the abandonment of nationalisation, the endurance of state-led ‘modernisation’ in Labour’s economic imaginary reveals a continuing strategic role for the state, even for New Labour. After establishing this continuity, the chapter highlights a crucial change. In the 1970s and 1980s, Labour policymakers assumed that manufacturing was the key sector to ‘modernise’. Yet, under the influence of deindustrialisation, ideas of ‘post-Fordism’, and New Keynesianism, by the early 2000s manufacturing had been usurped by ‘human capital’. For New Labour, education and training became the new ‘commanding heights’ and the foremost economic priority for the active state. These developments show the ongoing influence of technocratic, social-democratic thought worlds, and thus expose the inappropriateness of shoehorning New Labour into ‘Thatcherism’ and ‘neoliberalism’. But they also speak to important, and ambivalent, shifts in British political economy by the twenty-first century.

As the end of his MIT career approached, Kindleberger took on the challenge of explaining the catastrophic world depression that had been the context of his own intellectual formation. As against current Keynesian and monetarist orthodoxy, he wrote in defense of the conventional wisdom of his youth which, in his view, provided not only a viable explanation of events but even more a viable methodology for doing economics more generally. Comparative economic history would henceforth be his evangelical mission, explicitly so in his first postretirement book Manias, Panics, and Crashes, which became a best-seller.

This chapter discusses the currency union’s original set-up. It first discusses the history of European monetary integration, distinguishing between two sorts of motives: one economic, the other political. From the establishment of the European Economic Community up until the Treaty of Maastricht, both have been important drivers of monetary integration. The chapter subsequently turns to the original legal set-up of the euro, in particular its internal policy dimension. The economic and political forces behind the currency union’s creation also exercised great influence on its set-up, which came to institutionalise a stability paradigm. Characteristic of this paradigm was that it granted overriding importance to price stability as a policy goal and argued for a privileged position of the central bank in achieving this. The chapter shows how its influence was most notably evident at the level of aims and principles and in the constitutional position of the European Central Bank. Yet it also shaped the single currency’s economic foundations, in particular, the Union’s limited competences in this area and its focus on fiscal prudence. It even informed the rules governing accession.

Fiscal and monetary policy are among the most basic tools governments use to manage their economies. These tools have evolved in dramatic fashion during the twentieth and early twenty-first centuries. This chapter examines that evolution and its implications for socioeconomic performance. I begin by explaining what these tools are. Second, I discuss the basic debates about how they ought to be used and how the general approach to fiscal and monetary policy evolved from the Keynesian era beginning roughly in the 1930s to the neoliberal era beginning in the late 1970s. My intention is not to delve into the intricacies of economic theory or the minutiae of economic policy but rather to summarize these things with broad strokes.

McNamara’s appreciation of the military problems in Vietnam was intimately connected to economic developments in Washington. A continued balance of payments deficit and an unsettled domestic economic picture heightened the administration’s sense of vulnerability. The Senate Foreign Relations Committee (SFRC) exerted new pressure on the Military Assistance Program (MAP) that funded operations in Vietnam. With Dillon, McNamara worked on a Cabinet Committee on the Balance of Payments that recommended significant troop redeployments around the world. The JCS and State Department stymied their efforts. In this context, McNamara met with the famed economist John Kenneth Galbraith, who was especially critical of the growing commitment in Vietnam. McNamara chose a counterinsurgency strategy in Vietnam because it was cheaper as it relied on local forces. As Galbraith and others recommended, McNamara moved to downgrade the relative importance of South Vietnam to US security and to emphasize that the conflict was an internal insurgency. He used the pressures on the MAP to accelerate the phaseout of the US presence in South Vietnam.

President Lyndon B. Johnson was inclined to favor “tougher” military responses that promised victory. He understood the intricacies of the policy that he had inherited but changed it. He promoted Rusk to the detriment of other advisors who had supported a counterinsurgency program and who left, including Hilsman, Michael Forrestal and Ted Sorensen. McNamara initially resisted expanding the commitment in Vietnam. In a presidential election year, he was sent on two trips to South Vietnam, in March and May, that were designed to placate possible critics of Johnson’s policies, including the JCS, Ambassador Lodge, the Senate Armed Services Committee (SASC) and the SFRC. Johnson pressed his Secretary to give the Chiefs “something” militarily. In response, McNamara looked for “disavowable actions” and eventually moved to support a bombing program as a substitute for deploying ground troops.