Transnational corporations, socio-economic change and recurrent crisis

This Special Issue of critical perspectives on international businesses addresses a question of fundamental concern to both scholars of international business and citizens around the world: what has changed in the composition and functioning of national economies and the international economic system in order to plunge the global economy into a lengthy and, to date, irresolvable crisis? Early efforts to paper-over the initial financial crisis (usually judged to have begun in late 2007), by bailing out financial institutions and embarking in some tentative, Keynesian-inspired tax cuts and deficit spending to underpin demand, may have averted the risk of total collapse, but growing concern about the risk of ballooning deficits in government borrowing quickly engendered a return to the deflationary policies that had been the main response of government and business elites to the Great Depression of the 1930s. This policy reversal reflects the stranglehold of neoliberal ideology on economic and political thinking almost everywhere: the crisis, no matter how it might have been caused, apparently must be resolved through the sacrifices of ordinary citizens. In Europe, right wing governments which controlled all the major states (until Francois Hollande’s victory in France in May 2012) responded to the ‘demands of the markets’ by imposing austerity measures both externally (and particularly on the countries on the fringes of Europe with weaker economies) and internally, where individual taxpayers and curbs on government spending are the primary source of debt repayments.