Are we living in the End Times? The gossamer-threads of the global economic system appear to be unravelling faster than you can say "co-ordinated bail-out", while our leaders engage in hand-wringing and exhortation that if we all pull together everything is going to be fine and dandy. The myths of the unfettered capitalist system's innate superiority, peddled with extreme regularity and zealotry for forty-odd years as an excuse to dismantle and undermine the powers of the nation state, are exploding with monotonous regularity as the inability of a system founded on sand to right itself becomes clear.
Apologists for the market always argue that despite its manifest irrationality and tendency to over-react, in the long-run it always gets it right. The only suitable response to that is to remind them that Keynes's definition of the long-run is at least accurate if not particularly encouraging. The misreading of Adam Smith, perpetrated in the first instance by Hayek and increasingly by mainstream economists since the 1970s, and the veneration of the "invisible hand" is much closer to a masturbation fantasy than a harmless companion-in-delusion righting the wrongs of the state's inability to achieve omniscience.
My favourite joke about economists is that they will be able to tell you how the world functions, provided it is populated entirely by economists. The pseudo-science brigade have been given another fillip by the invention of the computer, which enables vast amounts of spurious conjecture to be modelled, peddled as some form of insight without the slightest reality check - the initial premise is often so skewed as to be risible. Yet because of the shamanic power of IT, coupled with a veneration for any algebra more complex than simple equations (a result of appalling teaching) and the desire not to be caught out by appearing not to understand things, managers and politicians alike get seduced by each blind alley of experimentation.
Economics is at best a social science - and therefore needs to be put into a much broader context with respect to other disciplines. For a start, there should be a requirement for all economists (employing their "skills" in exchange for gain) to have some form of knowledge of history. The current situation is frightening as it resembles a strange hybrid of the 1929 Wall Street Crash and subsequent depression, the efforts to impose a monetarist orthodoxy that were imposed on the UK and other countries in the late 1970s, and the wider Industrial Revolution where power shifted from those countries with agrarian surpluses to those capable of levering competitive advantage out of the system. Not understanding the parallels and differences with past crises, and the human and political factors tha go with them, makes economics blind to both its interpretive potential and to its obligations to have at least its little toe dipped in reality.
As someone whose political construct was formed in the early 1980s, it has been very disturbing to watch the unfolding of social breakdown in London this weekend. There are some parallels with the early Thatcher period, before Heseltine decided that a showy giveaway of North Sea Oil revenue would pacify the natives, as the divisions and skewed distibution of wealth increase. This has been leavened by thirty years of the myth-making around state impotence and the primacy of the individual - the flip-side, conveniently ignored by the Tories over the decades is that if the individual feels unable to achieve their aspirations then the castration of the state means that there is no outlet other than inchoate violence.
The reductionist theory of history will suggest that the rioting was triggered by one event, rather like the assassination of Franz Ferdinand. However, the real cause is much more the dismantling of social fabric and letting the economists, traders and ambulance-chasers loose in the national sweet shop. The peddling of the lies around the uselessness of state provision, the desire to cream off profits through further upward redistribution of economic welfare, and the apparent belief that the consumer society is in some way a better moral arbiter than a state founded on consent from the citizenry will all come home to roost eventually.
And as the financial system continues to buckle under the strain of its own illusions, it is hardly surprising that there is a mood of fear and anticipation around. If people's remaining stake in society is about to become worthless to bail out a failed, unfettered capitalism, then I would not be surprised to see discontent fanning out further. The architects of the neo-con lie will be secretly delighted with their legacy, I suspect.