After the explosion of the financial crisis, many analysts explained that, behind the breakdown of the financial rules and the huge speculation of the banks, there were the social imbalances and inequality of income accumulated over the past decades. The banks had speculated on indebtedness by building unreliable castles of derivatives and securities. For some analysts the private indebtedness was the effect of widespread irresponsibility, but for others the expression of an imbalanced economy, dominated by growing inequality, based precisely on growing indebtedness.

But even if the reasons of the crisis were complex and deep, to control it and not risk another Great Depression, it was first necessary to bar the crisis in financial markets by rescuing the banks. This was considered the essential previous measure to fix the real economy and tackle the major social consequences of the crisis. Massive resources were committed to the rescue of the banks. The bailout worked. Two large U.S. investment banks have disappeared, but the remaining five have become even larger, have made profits above expectations and announced the deployment of tens of billions of dollars in bonuses. The crisis was, from this point of view, declared overcome.

The new step therefore had to be the recovery of the real economy to tackle the growing unemployment, reaching  ten percent in both the United States, the highest level in the last quarter of century, and in the European Union. But here arises a question. Governments that have operated without hesitation  the big bank’s rescues are also ready to implement the action needed to revive the real economy and fight the new mass unemployment? The answer to this question is uncertain. And, indeed, in many ways negative.

Growth continues to languish, and in any case jobless. To return to old levels of employment, with growth rates expected, we should wait many years. To avoid the serious social consequences, related to long-term unemployment, would require a strong policy to stimulate growth in both supply side and demand while introducing measures to improve equality in income and wealth distribution. Among them is employment a first consistent measure. These are actions that had been announced by governments, and with particular force by the U.S. since the first phase of the crisis. But now that banks have been saved (even if a hidden part of debts remains threatening), conservative analysts and policy makers claim that a strengthened policy of economic stimulus can not be implemented. For two reasons. The first is the high budget  deficit; the second is the threat of turning on inflation.

We are thus confronted with a striking paradox. The budget deficits were, on one hand, the consequence of the recession arising from the financial meltdown and, on the other, of the huge expenditure of resources to save the banks that had caused the meltdown. Now, given the effects on government budget resulting from bank rescues, then considered the first step, we can not undertake the second one: that is the consistent programs aimed to the recovery of the real economy and the resumption of employment.

Barack Obama, in his State of the Union presentation, reiterated the need for public commitment to stimulating investments in different strategic areas of development , but in conflict with this goal, he engaged the administration in a policy of austerity and  budget restraint. The ECB, on the other side, looks forward to be able to put in place the exit strategy for return to a tighter monetary policy to counter inflation risks, although these seem quite remote. And the European Commission warns Member States on the need to reverse in a short period of time the budget deficit, in compliance with the Maastricht criteria. But that is not all. For the European Commission the resumption of growth is depending on a large increase in competitiveness. And that, in turn, implies a further dose of deregulation of labor markets, restrained wages and the containment of social expenditure.

So, are we in the presence of an inexorable return to orthodoxy of the past decades? At the beginning of the crisis, the massive intervention of the state has been invoked as necessary to save the financial markets. Today the state is considered a dangerous Leviathan. Health care reform in America, emblematic of a new model of social policy, appears deeply weakened, if not vanished at all. The financial reform meets formidable obstacles. The theme of inequality is back in the shadows.

But the severity of the crisis and its consequences can hardly be overcome without to dealing with the problems raised by the dominant economic, social and cultural paradigms of the past decades. And here it is worth emphasizing the question: What lessons can we draw from what has been considered the most serious crisis since the Great Depression?

The initiative of Insight is aimed to improve the analysis of the connection between the financial, economic and social features of the crisis, its origins and its prospects. Insight is not meant to indicate predetermined recipes. It wishes to be a new tool in his choice of plural languages. But with a common goal: to contribute to the analysis and comparison of proposals, beyond the conventional boundaries.
 
Articles and papers that are present in this issue of proof are a limited example, yet significant, of the ground on which Insight wishes to move. A large group of research institutions, economists, labor law jurists and trade unions representatives  - of whom in the bottom are some names - has expressed an interest in this initiative and contributed to its groundwork. Now we must consolidate and broaden the attention and the consensus achieved during the first construction phase to carry out the prefigured task of its birth. This will be possible only with the participation, the suggestions, the contribution of ideas and proposals of all those who think it important to raise a collective reflection on the uncertain future of the crisis, comparing  and improving the analysis and proposals which inhabit the variegated world of the liberal and progressive left in the new scenario shaped by the crisis.