Dan Snow's History Hit - 2008 Financial Crash with Adam Tooze

Episode Date: January 9, 2021

Dan speaks to economic historian Adam Tooze for the tenth anniversary of Lehman Brothers' collapse in this special podcast.Subscribe to History Hit and you'll get access to hundreds of history documentaries, as well as every single episode of this podcast from the beginning (400 extra episodes). We're running live podcasts on Zoom, we've got weekly quizzes where you can win prizes, and exclusive subscriber only articles. It's the ultimate history package. Just go to historyhit.tv to subscribe. Use code 'pod1' at checkout for your first month free and the following month for just £/€/$1.

Douglas Adams, the genius behind The Hitchhiker's Guide to the Galaxy, was a master satirist who cloaked a sharp political edge beneath his absurdist wit. Douglas Adams' The Ends of the Earth explores the ideas of the man who foresaw the dangers of the digital age and our failing politics with astounding clarity. Hear the recordings that inspired a generation of futurists, entrepreneurs and politicians. Get Douglas Adams' The Ends of the Earth now at pushkin.fm slash audiobooks or wherever audiobooks are sold. Hi everybody, welcome to Dan Snow's History Hit. We were promised in 2008, 2009 that that great recession was a once in a lifetime

event. But here we are 10 years later, folks, 10 years later, with another catastrophic recession, potentially, in fact, the greatest slowdown of economic activity in Britain for 300 years, and very, very significant slowdowns everywhere else in the world. So I thought for this episode of the podcast, we'd get Adam Tooze back on the podcast. He is a brilliant British historian. He's a professor of history at Columbia University. He was the historian, really more than anyone else, I think, who placed the 2008 Great Recession in its historical context and helped all the rest of us understand it in a more profound way. This episode was recorded a couple of years ago. It's a repeat episode from our archive,

but it's such a good one. It's so timely. I wanted to give it another airing. If you want to listen to all the back episodes of this podcast, they are available only, only exclusively on historyhit.tv. It's like Netflix for history. We've got audio though, we've got video, we've got everything on there. You just use the code January because we're having a January sale. And you get a month for free, total free, and then you get your first three months 80% off. So it's super, super cheap. Go and get it, everybody. Go and get it and listen to wonderful podcasts like this one without the adverts, without the commercials on the front. They drive some people crazy, for which I apologize. But you're going to listen to

Adam Tooze without all the adverts on history.tv. In the meantime, everyone, please enjoy this eye-opening pod. Adam, thank you so much for coming on the podcast. What a treat. It's a pleasure to be on with you. Now, I mean, this is a difficult one for most of us historians are totally financially and economically illiterate, which is an oft lamented fact about us. But can you try and explain to us just how big was the crash of 08? Give us some sort of historical comparison. Well, the thing about it is that it threatened to be the biggest ever by some margin.

But precisely because it was recognised as such a massive threat, and the countermeasures taken were themselves unprecedented in scale. The damage, bad as it was, and it was very bad, was contained. So it's kind of like one of those historical near-miss crises. I mean, it's a little bit like, say, the Cuban Missile Crisis or something like that, where we can see the end of the world and we can really plausibly imagine the end of the world. And then we step back from the brink. But it really looked to be worse than the Great Depression, which would have been the only other thing it really could have been compared to. And is one of the reasons that they put in the countermeasures, am I right in thinking it's because the chairman of the Fed and other people actually had quite a good sense of historical literacy?

I mean, they realised where policymakers had gone wrong in 1929 and tried to act differently. I really do think this is a case of learning from history. I think you're absolutely right. And, you know, professions have histories which they treasure and they learn and they learn on soldiers do this famously the lawyers carry it along in the kind of collective memory of the common law and economists have history like that too and often famously generals refight the last you know

the last war but sometimes those kind of guidelines really are solid and in this case ben ben anki was a student of the great, and he was a monetarist. And the funny thing about this is that normally we associate monetarism with fighting inflation, say the 1970s, 1980s, that's the history of monetarism most people are familiar with, Margaret Thatcher, Ronald Reagan, Paul Volcker, and so on. But if you go back in time, the origin of monetarism is actually a counter deflationary economic doctrine. So the idea is not to stop money expanding too fast so doctrine so the idea is not to stop money expanding too fast so that you stop inflation but to stop money contracting too fast so that you

end up with a disastrous deflation and deflation isn't sounds technical it isn't it's like when house prices fall it's very very bad news for everyone with mortgages so what Bernanke was committed to doing at all costs was preventing that from happening. And as a first rule of crisis fighting, that was a pretty solid rule. So you talk about the end of the world. This is an interesting one. I mean, just how bad is it? Like we're living in a world with nuclear, with these sort of divine right nuclear autocrats like Donald Trump and Putin who could end the world at the click of a button. Are we also living in a world where our economic, this incredible wealth and high quality

of living standards that we enjoy also has in it the potential to take us back to the 5th century AD? I mean, when you say end of the world, what do you mean? Well, it is a metaphor, perhaps, you know, closer to somebody experiencing the end of their marriage or something like that. The world ends. Things would never have been the same again. And in a sense, it did end anyway. But what specifically they're talking about is a total freeze up of the entire banking system, not just in the United States, but on both sides of the Atlantic with probable consequences for East Asia. That's Japan, South Korea, Taiwan, Australia, obviously, as well. So basically, the entire center of what was then the heart of the cardiovascular system

of what was then the center of the world economy. This is a fatal heart attack that we're facing. The consequences would have been, and already were, these symptoms were showing in the autumn of 2008, that a business like GE, which is a bastion of American manufacturing, it's like the BAE systems or something of the United States, couldn't get short-term credit to buy raw materials or pay its wage bill. Harvard University, as blue-chip an entity as you could possibly imagine with a time horizon that stretches infinitely into the future, it would imagine found itself with a liquidity crunch uh in the last weeks of september so entities like that that you would think of as being very remote from the usual subprime story were facing the possibility of simply not getting

their basic financial lifeblood um in those weeks so that's as bad as we were talking about when that begins to happen you know g has to do layoffs, and then the ripple effect, you know, rides out to the entire rest of the American economy. And it was the single largest collapse in world trade ever recorded, bar none, including the Great Depression. Trade everywhere in all commodities between all country pairs is falling at the end of 2008, as far as we can measure it. And that's never, ever been seen before. You are one of the most distinguished economic historians in the world. Do you have Krugerrands and a rifle under your bed? No, because I'm a kind of modernist by heart. I mean, the same way as I believe in our capacity to

manage technological risks, so long as we take them as seriously as they need to be taken. Fundamentally, I'm not a catastrophist when it comes to the economy either. And ultimately, that is one of the lessons that we can draw, is that intelligent intervention is essential. The entire hubris of the market economy of the 80s and 90s, the early 2000s, which said that, you know, business people between themselves and markets by means of market-based insurance can take care of all of this, that was really reduced to dust in 2008. And what was demonstrated was that we need public institutions, we we need governments we need public entities like central banks to backstop the global economy and when they do basic precautionary things and clearly identify the essential risks

and act fast they're able to prevent the worst so well i'll ask i'll ask you about the trump administration dismantling much of that architecture in a second but uh let's let's keep on the crash for a bit what what do you identify in this in this absolutely enormous book it's very very impressive what what do you identify as the key uh the key the key challenges that the the 2008 crash presented in in the world in in the strategic and political sense well i think it's it's the it's the undeclared bit uh there is a there is it says to say it's secret or hidden um doesn't do justice to the sophistication of the people who operate these kind of systems right now they're there everyone in the know knows they're there it's just that no one else does um and so they're denied you know they're deniably secret they're there. It's just that no one else does. And so they're deniably secret.

They're not actually making a secret out of them. And what I'm talking about is the liquidity provision to the global banking system. So the really tricky thing was that not only were the European and American banks coming down separately, but they were coming down together. And the European and Asian banks were coming down because they desperately needed dollars and that's a technical issue at one level but it's also fundamentally a political issue because it means that the one big dollar pump in the world economy the lender of last resort the Federal Reserve which is an American national institution answerable to the American Parliament Congress had to step in as the lender of last resort for the entire global banking system

now they will insist and will go to their graves insisting that this is an unpolitical technical business they did it strictly in the interest of the american economy this was not some kind of handout to foreign bankers they did it because otherwise those banks would have wrecked the american economy but nevertheless it involved a kind of transnational governance a transnational stabilization the likes of which we'd never seen before. And that is, to my mind, and I think in the mind of everyone who's actually looked into this hard, a deeply political question in the end. And it's a question which simply hasn't been addressed. It hasn't been surfaced.

It hasn't been put up for debate. In the end, I think it's unarguably that the world is dependent on the United States to deliver that support. is unarguably that the world is dependent on the United States to deliver that support. But the question, of course, is whether the American population, if asked, would really support the activities of their central bank in that way. We're talking about trillions of dollars here in liquidity. Huge chunks of the European bank balance sheets were temporarily floated by the Fed to prevent the European banks from just selling off all their bad American assets. You are talking to the wrong person here, but is the argument, though, that the Americans as the economically hegemonic power in the world, they had an enormous amount to lose

from a fatal heart attack of the World Bank system. So was that an entirely, like the Marshall Plan, is that an entirely sort of altruistic act or is it actually quite self-interested? Oh, it's profoundly self-interested. Like, you know, almost all the good, almost all the good deeds fundamentally are. I mean, that distinction, I think, between selfish and altruism may be important for moral theory, but it has very little bearing on politics. I mean, all the, you know, most of the things we convincingly do for other people have transparent personal motivations, and this is clearly true in this case as well. The real question going forward, if you like, now into the current moment, is whether or not that same logic would in fact bind the Fed into acting if we had a similar crisis, say, in Japan or in China. China. And if that mutual interdependence was not there, and so the Fed really couldn't justify supporting those banks, which are increasingly dollar dependent too, then we'd be in a real fix,

because then you would actually have to explicitly formulate some kind of American responsibility for global stability, as opposed to just, you know, saving the global banking system to save middle America to save Main Street US. and that's a bit of a reach uh currently especially so are you saying that it was actually quite convenient that the that was it was the mortgages crisis in the us that led to this global banking collapse because it could have it could have happened anywhere it could have been a sovereign debt default could have been anything and actually at least it made it look more palatable to the americans that it was a problem that looked like it had begun in their own backyard.

I don't think this could have happened anywhere, and it couldn't have happened with sovereign debt. Sovereign debt is not part of this story in a way that politicians subsequently made it. This is one of the great kind of instant rewritings of history that take place, and we just call them politics. But between 2008 and 2010 the shape of this crisis in political terms morphed from being one of the private sector and that matters because it's in the private sector that the really big volumes of debt can be built up quite quickly and unnoticed because it just looks like a bunch of individual transactions individual decisions households doing their thing businesses doing their thing that kind of huge ramp up of debt

was what produced the crisis not a crisis of public debt. But then subsequently, over the years that followed, it was translated into a story about public debt and feckless public spending. And that's then, as it were, the terrain of the austerity wars where you have the left and the right in politics squaring off over this question of how quickly to stabilize government budgets and what the economics and politics of that are so that was a process of translation you can watch it almost before your eyes one of the fascinating things about working on contemporary history is that these processes that we know go on over generations and centuries in the rewriting of history if you sharpen your historical intelligence and focusing it on the last 18 months, you can see it happening there. And that's what happened between 08 and 09. It got translated

from a banking crisis into a public debt crisis. But you're right with regard to 08. Absolutely, they were so entangled that the Americans really had no option but to act. As complicated as it might be politically, Europe was too big for America to allow it to fail. Let's look at some of, I mean, it's obviously impossible to do this, but can you identify some strains that have gone on in the last 10 years in terms of whether it's the Arab Spring, whether it is the civil war and indeed the civil war in syria and elsewhere or um rising nationalism in china ethno-nationalism in the us brexit whatever it might be stress on the european union what do you think are the consequences of the crash in 08 as we are all as school children

taught to learn about the consequences of 1929 well one thing that you can see is the splintering of the conventional political parties there's a lot of talk right now about the crisis of democracy i find that not a terribly helpful concept but what we can certainly point to is the crisis of political parties which are of course essential to democracy but they are as it were the link between the electorate the population society and government and we see crises in both the American parties from 2008 directly linked to the financial crisis. We see the Republican Party splintering in real time from the summer of 2008 as a Republican administration, President Bush's administration, is scrambling to rescue the

American mortgage system. They can't whip the congressional party into line, and they end up relying on the Democrats. So it's the Democrats that bail out the United States economy, even before Barack Obama comes into office, as they had done during the New Deal earlier in the 20th century. So that's one element. The Republican Party fractures over the issue of whether or not they should prioritize the sort of resentful uh resistance of their base to any kind of welfare quote unquote on the one hand or prioritize the functional needs of the banking system which their big business constituency was of course hugely invested in there's certain parallels of course with the tory party over brexit where likewise you see the party splitting

apart over the business driven european agenda on the one hand and the base, which has a more nationalist kind of program in mind. And, of course, that same split happens on the left as well, because it is the Democrats, insofar as we can call them a left-wing party, who carry the can for the bailout. And by the fall of 2011, they're facing the Occupy protests, which lead on directly to Bernie Sanders' remarkable run for the Democratic nomination in 1516. I mean, who would ever have

imagined that somebody who's a self-confessed socialist would make a go of it against Hillary Clinton, of all people, in 2015, 2016? A majority of young Americans now have more favorable views of socialism than they do of capitalism. Again, that's not exactly how we thought the 21st century would begin. And there are many different processes involved in that. Globalization and its pressures, the increasing resentment at big tech. But I don't think there's any doubt that the way in which the bailouts of 08 were handled and the extraordinary support extended to some of the richest and most highly paid people in the world who'd brought a disaster on themselves, that really sucked the legitimacy out of mainstream politics, both from the right and from the left.

Land a Viking longship on island shores, scramble over the dunes of ancient Egypt and avoid the Poisoner's Cup in Renaissance Florence. Each week on Echoes of History, we uncover the epic stories that inspire Assassin's Creed. We're stepping into feudal Japan in our special series Chasing Shadows, where samurai warlords and shinobi spies teach us the tactics and skills needed not only to survive, but to conquer. Whether you're preparing for Assassin's Creed Shadows or fascinated by history and great stories, listen to Echoes of History, a Ubisoft podcast brought to you by History Hits.

There are new episodes every week. Douglas Adams, the genius behind The Hitchhiker's Guide to the Galaxy, was a master satirist who cloaked a sharp political edge Douglas Adams, the genius behind The Hitchhiker's Guide to the Galaxy, was a master satirist who cloaked a sharp political edge beneath his absurdist wit. Douglas Adams, The Ends of the Earth, explores the ideas of the man who foresaw the dangers of the digital age and our failing politics with astounding clarity. Hear the recordings that inspired a generation of futurists, entrepreneurs and politicians. Get Douglas Adams' The Ends of the Earth

now at pushkin.fm slash audiobooks or wherever audiobooks are sold. What about, I mean, when we look at the great crashes, is it 1847, the railway-related crash, 1873-ish was a baddie, and then 1929. Do we, at the risk of sounding like an idiot, are we learning from history? Are examples of of because there's lots of lots of things are put in place after all those crashes and indeed was after 2008 and then do we see quite quickly attempts to dismantle them again or is there a sense of learning that goes on like that actually remains that endures after each one of these crashes i think the politics never stops the moves towards the institutionalization

of regimes that make capitalism a little bit safer, or at least address the last set of risks, which suddenly blindsided us, is never uncontested. But there's clearly a ratchet effect, and the most evident demonstration of this is the central banking system. America didn't have a Federal Reserve until 1913. The institution's barely more than 100 years old. And that came off the back of that series of 19th century crises you were talking about, 1857, the early 1870s crisis, 1893, 1907. The American economy was the most dynamic in the world in the 19th century, but it was also extremely unstable. And that sequence continues because the new central bank is really finding its feet, not doing a very good job, all the way through to the 1930s. So you really have a sequence there of about five or six epic crises in America.

And really from the 1930s through to 2008, well, through to the savings and loans disaster of 1980s, you might say, America doesn't experience another major financial crisis of the type we're talking about. And 2008 is radically unprecedented, and as I was saying earlier, the really massive blowout that we might have seen, the show-stopping end of the world that Ben Bernanke was threatening, that didn't happen, and it didn't happen largely because that institution that was now more than 100 years old and now was an authoritative center of economic policymaking basically pressed the right buttons.

It didn't do it with any finesse. It was a little bit of a hammer-to-the-TV kind of solution, but they hit the TV with a properly big hammer, and the picture did kind of get straightened out. And we're still trying to figure out 10 years later what the internal wiring of this system is and how those different policies actually affected the economy. But they just flooded the system with dollars,

and that is apparently what it needed to prevent a meltdown. So yes, there is really a learning. There's an institutional ratchet here. That doesn't mean that you can't have regression, and that it doesn't mean that, as the Eurozone manifests, you can't have total policy failure. But the Eurozone, the ECB, is about as old as the Fed was in the 1930s. It's about 20 years old when the crisis hits. So, you know, it's an institution that's still learning with fundamental unresolved political issues in the background, which make determined, rapid crisis fighting action very difficult for the Europeans to implement.

who specialise in education, early years development, criminal justice, basically they know what to do. They just can't do it because of the politics and various obstacles. When you sit round in your economics department, do you know how to run a globally sophisticated, global capitalist economic system? And what needs to be put in place? not just bashing the TV with the hammer, like what should have been done if politics was no obstacle? Like how do we need to, what do we need to build and improve in order to create the system that delivers unprecedented

wealth historically, and yet this danger of catastrophic collapse every 10 years or so? Well, we don't, I mean, just as a correction, it's really kind of important to put this in perspective to emphasize we do not see the kind of threat we saw in 2008 every 10 years. We have literally never seen it before. Full stop. Never, ever seen it before. Even 1929 didn't threaten it. So but one thing we clearly have learned, and this is that it's a limited case that I'm making, is that it turns out we do appear to know what to do when that sort of crisis threatens. But to go to your bigger point about, if you like, reform, is it possible to fundamentally change the system? There, I think the economists and the economic policy advisors come up just as short as the criminal justice people do. people do um because you might think that in the wake of a crisis like this having you know hit the television you take it to the repair shop and have the thing maintained and get the tuning adjusted permanently and that's not what we did and there was no fundamental structural change to the global

banking system what we've done is tinker and we've tinkered a bit and we've tinkered quite consistently and there's been some changes that really do make a difference i think the risk of another 08 is appreciably lower um but uh so the really dangerous system that we built from the 80s onwards has now been de-risked in crucial ways doesn't mean that there aren't new risks on the horizon but anyway there has been some tinkering but there has not been a fundamental change for the system crucially we didn't deal with too big to fail like these banks are just enormous. And since they are enormous, we have a systemic interest in maintaining them at crucial moments. And we did not do very much,

or indeed anything substantial, to reduce the size of the banks, to make them less complex, and to make them more governable. In the United States, in fact, the banks have gotten bigger. In Europe, the banks, in fact, have deleveraged, they've become smaller, but not in the sense of a qualitative change, it was just commercially

better for them to shrink. And they were so massively extended before the crisis, much more than their American counterparts that they really did need to downsize. But we still have a big, privately dominated system that already in 2009, within months of the worst of the crisis, was paying out huge bonuses to its staff to go on doing risky things. So there's been no fundamental change at that level. And so to that extent, we have exactly the same problems as people in the criminal justice sector or any other area of frustrated technocratic expertise. And what stands in the way in this case is just massive social interests.

I mean, messing with Wall Street or the Cityondon is an extremely difficult thing to do and you need political you need a political movement of a really substantial kind and ironically it's in massive crisis when the reels really come off that those movements tend to mobilize and that's of course not what happened because we were successful at stopping the crisis so barry eichengreen has this great book which he calls the hall of mirrors we live forever in this sort of netherworld where we did just enough to get us through but we're never really fundamentally improved or changed so but it sounds to me like you're not a somebody who kind of agrees with the kind of marxist text in the 19th century because this is inherent within capitalism eventually it will destroy us all you you would say that actually the system that we had in the late 70s for example what was

on its way towards becoming a sustainable and safe system it's actually the gigantic deregulation and some of the technological changes of the 80s onwards that's that's made us it's put us in a slightly more precarious position i think it's the it's the utter you know the final crisis on which i fundamentally diverge with the Marxists. I don't see why either of us really can make any kind of big claim about that kind of putative, show-stopping, end-of-the-world type crisis and its inevitability. 2008 showed us what a show-stopping crisis would look like, but it isn't actually a Marxist type of crisis. It's a bank run on an absolutely massive scale.

So I have a kind of open-ended, you know, what the French call bricolage, kind of make it up as you go along. You have to put the pieces together. And that's, after all, what markets do too. So markets, you know, when the people who celebrate them tell you that there's endless systems

for generation of unpredictable innovation and what they call creative destruction. Now, if that's what is at the heart of the social system we inhabit, the idea that, that you know we can predict its long-run development seems a little bit over optimistic on the other hand the idea that we can you know provide some terminal solution to all problems and create a kind of garden of eden which is permanently stable is also naive so the best we can hope for and this after all is what historians describe is an endless series of improvisations and fixes and you know we after all have about 200 years history of this

and that's why we do modern history and what we do is we explain phase by phase how this thing was put together and made to go work again um that doesn't require us to take us you know a position one way or another on whether or not this system will work 50 or 100 years from now what it does is to require us to look in detail phase phase by phase, at how at that given moment it was and wasn't working, and what did make it work again and whatnot. The kind of temporality, the kind of history that I'm thinking of is like the modern environmental historians and the Anthropocene. That's kind of, and that is after all a story directly related to capitalism. That's the roller coaster we're on.

That's that incredible, you know, what they call the hockey stick, this extraordinary discontinuity in the modern period. And we're on that rushing upward section that goes, well, who knows where. But we're going to have to take it year at a time, decade at a time. And we, everything is going to be a very large scale and very large speed and very large complexity. And historians can help, if you like, by focusing our attention on past episodes that we've worked our way through. And of course, the most recent ones are in some sense the most relevant to that kind of discussion. Speaking of historians helping, there's a point that I'm sure many people have made, but it's just occurring to me now.

I'm a bit behind the curve on this. You've got the too-big-to-fail model in finance. You've also got these giant monopolies in the tech world. Do you think we are seeing the beginnings of movements similar to that of over 100 years ago in America, where the government went trust-busting, started breaking up giant monopolies. And is that period particularly relevant for us to study now, both in terms of the big tech monopolies and of these enormous banks? Because I believe in this hockey stick discontinuity vision of modern history, I'm sceptical in general about, you know,

harking back deep into the past and drawing inspiration from there, because I think just so many variables change so rapidly. But yes, if you've got to pick an earlier period over the last 150 years to think with as a kind of mental gym, then that's the Gilded Age, the period of the late 19th century and early 20th century is far more interesting and indeed promising politically than the kind of grim invocation of the 1930s, which is popular in some circles. And that seems to me that earlier period in ways, far more interesting. And you're absolutely right, that was the period out of which the Federal Reserve emerged, the American Central

Bank, because it was about providing some governance to one of the big trusts, the money trust. But you're also right that American progressives have now discovered that period with regard to tech. But one should also think of the fossil fuel economy, which of course has a very similar logic, and then the giant manufacturing productive system which dominates all our lives in terms of the manufactured goods we consume and is spread all out across the entire world now as we're discovering with the trade wards debates with donald trump one of the useful things that does is to expose quite how integrated we are so yes in all of those dimensions and i think of them as interrelated but separate facets of this thing that we lump together under the name capitalism.

You see precisely these kind of pressures bigging up. And historically, you know, it's really worth remembering that the iPhone and the social network boom starts immediately at the same time as the financial crisis. So the big breakthrough in smartphones and social networks is 2007, 2008. If you look at sales figures for iPhones and stuff, it's that moment. And in terms of legitimating American capitalism, there's no doubt that the success story in Silicon Valley, which looks as though it's satisfying a really basic human need to chat, to interrelate, and opens up this incredible new world for us all, the fact that that came along at the same time as finance was covering itself in shame was no doubt a little helpful. There was at least one good news story, if you like, in American business.

And if you watch the stock exchange day by day all the way down to the present day, it's the tech stocks which make people feel good about American capitalism. So those things do interact with each other. And you can see the tipping point historically is 2013. In 2013, some of the anger, some of the hostility that had up to that point, especially at Occupy and that encampment in the fall of 2011, been focused on Wall Street, began to generalize and spread out and define new targets. And tech was one of the first targets that really came into view, not surprisingly, in 2013. What does the Gilded Age

briefly tell us about what is required? You mentioned a sort of union political movement. What does it tell us about busting change in the U.S., it was that moment between the late 19th century and the 1930s. That was a moment when there was, in fact, socialism in the United States, quite considerable movement, in fact. Again and again repressed, constantly struggling for a place in the workplace by way of organized labor, but it was a presence. And if you talk to leftists in the United States right now, they're not, fact pessimistic about Trump because they actually see this as a moment of revival of pluralism in American politics because the monolithic grip of the Democratic Party and the centrists there has been broken. So the crucial thing that you learn from that period is that it can't simply be technocratic solutions. It has to be some kind of grassroots mobilization,

the same sort of grassroots mobilization that produced votes for women, that in due course, of course, also produced civil rights in the United States. And of course, this has, and we're talking about the US here, but this has analogs all over the world in Britain and Germany, indeed even in places like Japan. This was the backdrop to the last book I did, The Deluge on the Struggles of Liberal Politics all over the world in the last book I did, The Deluge on the struggles of liberal politics all over the world in the wake of World War One. So indeed, that's, I think, why it's

inspiring, because it points to the need for active populist, for popular mobilization. Some people will even call it a left populism. And that, you know, if you look historically, the term populist was appropriated and used by precisely this kind of movement in the United States in the 1890s. Adam, thank you so much for spending half an hour talking about that. It is such a privilege talking to you and hearing your insights. Tell everyone the name of your book again. The name is The Book Has Crashed, How a Decade of Financial Crises Changed the World. Adam, thank you so much for coming on the podcast. Thank you, Adam. Hi everybody, just a quick message at the end of this podcast. I'm currently sheltering in a small windswept building on a piece of rock in the Bristol Channel called Lundy.

windswept building on a piece of rock in the Bristol Channel called Lundy. I'm here to make a podcast. I'm here enduring weather that frankly is apocalyptic because I want to get some great podcast material for you guys. In return, I've got a little tiny favour to ask. If you could go to wherever you get your podcasts, if you could give it a five-star rating, if you could share it, if you could give it a review, I really appreciate that. Then from the comfort of your own homes, you'll be doing me a massive favour. Then more people will listen to the podcast. We can do more and more ambitious things. And I can spend more of my time getting pummeled. Thank you.

Douglas Adams, the genius behind The Hitchhiker's Guide to the Galaxy, was a master satirist who cloaked a sharp political edge beneath his absurdist wit. Douglas Adams' The Ends of the Earth explores the ideas of the man who foresaw the dangers of the digital age and our failing politics with astounding clarity. Hear the recordings that inspired a generation of futurists, entrepreneurs and politicians. Get Douglas Adams' The Ends of the Earth now at pushkin.fm slash audiobooks or wherever audiobooks are sold.