Tom Pepinsky

Author: tompepinsky

  • Financial Crises and the Politics of Adjustment and Reform

    Over the past couple of months, I have been working on an essay entitled “Financial Crises and the Politics of Adjustment and Reform.” It is slated to appear in the forthcoming Research Handbook for International Monetary Relations, edited by two members of the IPE@UNC team. The working draft is now available (PDF).

    In lieu of the abstract, which is just descriptive, here an excerpt from the conclusion which characterizes the main lessons that I have drawn from this exercise.

    There just are not enough country-year observations available for cross-national regressions that investigate the complex, conditional, and endogenous relationships that characterize financial crisis politics. It is striking, in this regard, to observe that most of the standard references on financial crises and post-crisis politics and policy—in economics as well as in political science—are primarily qualitative in orientation (e.g. Gourevitch 1986; Eichengreen 1992; Haggard 2000b; Kindleberger 2000). The same is true of the most important new contributions to understanding the Global Financial Crisis and its political consequences (e.g. Bermeo and Pontusson 2012; Kahler and Lake 2013; Streeck and Schafer 2013). These are works which cannot, by design, test causal claims across time and space. They do, however, combine theory, history, contextual understanding, and frequently statistical data as well to make bounded inferences about the political effects of financial crises, recognizing the inherent complexity and indeterminacy of crisis situations. The result is less a comprehensive and progressive research program where findings build upon one another, and more an increasingly rich understanding of how and when financial crises affect politics.

  • Egypt, the Coup, and the Problem of Founding

    As the world watches Egypt in the wake of last night’s coup—on the anniversary of American independence—most of the immediate analysis has focused on the likely responses of the Muslim Brotherhood to Morsi’s removal, and in turn for the trajectory of Egypt in the post-Mubarak era. As I write this, I hear Shadi Hamid on NPR saying “the Arab Spring has taken a dark turn.” But it is worth remembering that coups, and especially coups like this one, which were surrounded by massive popular mobilizations, raise fundamental questions about founding political orders.

    The “problem of founding” is the essential question of politics, one that implicates normative political theory equally with the science of politics. (It is also a topic in which American independence and the founding of the Republic have long been central.) Here is Bonnie Honig on Hannah Arendt on the “problem of politics in modernity”:

    Can we conceive of institutions possessed of authority without deriving that authority from some law of laws, from some extrapolitical source? In short, is it possible to have a politics of foundation in a world devoid of traditional (foundational) guarantees of stability, legitimacy, and authority?

    This is the problem that Egypt has faced since 2011, and one that it will continue to face. It has two components.

    First is the politics of constitution-writing. This essay by Nathan Brown gives an excellent overview of the last constitution. As he writes,

    It is thus important to view the new Egyptian constitution as a political document — a product of specific circumstances that will not merely shape a future set of circumstances but also function within them

    Constitutions are written by people who understand that they are writing constitutions. The politics of constitution writing therefore inherits the problem of founding. Who gets to write the laws that define the shape of the political order? On what principle do they decide what to write? How are disagreements settled? On what basis does a constitution written by people become legitimate? (Note here Morsi’s repeated insistence of the legitimacy of his government.)

    In the Egyptian case these questions will loom large. However nice it sounds, when observers plea for a “true dialog among equals” they obscure that the problem is how to define the parameters of the dialog, or who the equals empowered to speak are. Here is Marc Lynch:

    Egypt’s transition has been profoundly handicapped by the absence of any settled, legitimate rules of the game or institutional channels to settle political arguments. The procedural and substantive legitimacy of every step in the transition has been deeply contested

    The second instance of the problem of founding is still deeper: the possibility of conceiving a “world devoid of traditional guarantees of authority” in Egypt. If the coup pessimists are right, then the Muslim Brotherhood’s short experience with electoral democracy will not be interpreted well. The lesson learned from the coup experience is that Arendt’s problem of founding in modernity has no solution; that only traditional guarantees of authority—in this case, through Islam—are legitimate. My friend and former classmate Tarek Masoud tweeted the following yesterday:

    Tarek’s point might not be exactly that the Muslim Brotherhood on the whole will reject democratic politics. But that is now a possibility, and as Egypt moves on to its next moment of founding, it is one that may come to haunt Egypt’s undemocratic liberals and others who cheered the coup last night.