Discourse Analysis and Austerity

Critical Studies from Economics and Linguistics

Kate Power, Tanweer Ali, Eva Lebdušková, Kate Power, Tanweer Ali, Eva Lebdušková

• Publisher: Routledge
• Year: 2019
• ISBN:
  9781351802918
• Edition: 1
• Topic: Commerce
• Subtopic: Commerce Général

In the immediate aftermath of the global financial crisis of 2008, governments around the developed world coordinated policy moves to stimulate economic activity and avert a depression. In subsequent years, however, cuts to public expenditure, or austerity, have become the dominant narrative in public debate on economic policy.

This unique collaboration between economists and linguists examines manifestations of the discourses of austerity as these have played out in media, policy and academic settings across Europe and the Americas. Adopting a critical perspective, it seeks to elucidate the discursive and argumentation strategies used to consolidate austerity as the dominant economic policy narrative of the twenty-first century.

Part I

Approaching austerity through discourse

Together, the two chapters in this part set the scene for, and model, the interdisciplinary* approach promoted in this book. Each begins with basic questions about the crisis of 2008, and austerity as part of the response to that crisis; each then also draws on economic and discursive insights—highlighting both the discursive underpinnings of economics and the economic underpinnings of discourse—to explain key moments in the ascendance of austerity as the dominant policy response to the financial crisis of the early twenty-first century.

In Chapter 1, Bob Hodge revisits the question posed by Queen Elizabeth II in the immediate aftermath of the crisis: How was it that the economics profession, which included so many distinguished minds, failed to see it coming? Hodge shows, first, that at least a large part of this failure lies in an inability to view the economy as a whole system, susceptible to instability on a systemic level; and, second, that in order to view the economy as such, one must approach it armed with insights from multiple fields of study, in particular economics and semiotics. Analyzing several short texts related to austerity measures in Australia and the UK,

Hodge convincingly argues for—and clearly illustrates—the kind of critical literacy needed by ordinary citizens everywhere, to evaluate and counter unjust financial and economic policies.

In Chapter 2, Ellen D. Russell asks why the 2008 financial crisis did not lead to a more fundamental revision of the consensus view of economic policy, but instead to even more neoliberalism. Russell examines how Keynesian analytics were countered by the ‘Expansionary Fiscal Contraction’ hypothesis, whose theory about and narrative framing of crisis enabled the mainstream economics profession to resist not only views that threatened the neoliberal agenda (and, along with it, the perceived prestige of economics as a technical discipline), but also alternate analyses which would have exposed choices that were fundamentally political in nature.

Both chapters bring a critical and interdisciplinary* perspective to the consideration of austerity discourses, which is replicated throughout this volume and which we hope readers will consider taking up.

1Deep interdisciplinarity and responses to crisis

Bob Hodge

Among its many merits this book demonstrates the value, even the necessity, of interdisciplinarity in any adequate response to crises, of all kinds, of all scales, in all times. Its topic, Austerity and the Global Financial Crisis (GFC), affected everyone, but it is usually seen as the special province of economists. This book has a majority of chapters by authors from linguistic disciplines, but they all assume they have something valuable to say about economic issues. I believe they are right. The other authors use their economic expertise, but they also include the role that discourse played in shaping events. They are all interdisciplinary, and that benefits the book.

In this early framing chapter, I explain why this de facto interdisciplinarity is so essential, and how deeply it is grounded. According to Ashby’s (1956) cybernetic Law of Requisite Variety, control systems must include all factors in the systems to be controlled. In all financial crises, economic, discursive and political factors interweave so inseparably that, for those who would understand and control them—from politicians to effective citizens—interdisciplinarity is prerequisite. I also argue that links between the two major disciplines, economics and linguistics/semiotics, go deeper. In this chapter I emphasis this broader framework, as my main contribution to the project of the book.

I use an economist to set the scene for this discussion. Yanis Varoufakis’s (2011) beautifully written popular book The Global Minotaur presents a controversial case, as popular books do, but he argues it against a consensus account of the background. His first explanation of what happened comes from a response by the British Academy to a letter from the Queen: “Why had you not seen it happen?” Varoufakis paraphrases the answer: “Principally a failure of the collective imagination of many bright people… to understand the risks to the system as a whole” (Varoufakis, 2011, p. 4).

No one argues with this judgement by these expert economists on their own discipline. There are some notable exceptions amongst economists, including Varoufakis himself. No one doubts their brightness. They were the ‘smartest guys in the room’ to quote a best-selling account of the Enron scandal (McLean & Elkind, 2003). That shifts attention to the basis of their expertise, their disciplinary formation. The GFC in Varoufakis’s diagnosis demonstrates the failure of a discipline, whose fatal flaw is that it does not understand systems as wholes.

In this chapter, I argue that this is the crucial problem for the experts who should have flagged warnings long before they did. It is not disciplinarity as such that is the problem so much as tightly-framed disciplinarity. Varoufakis for instance is an economist but he takes a broader view. He includes novelists and philosophers in his bibliography, and takes a long view on the origins of the crisis. He includes the politics of the system over time, because he understands the problem as systemic. In my terms, he is interdisciplinary without having to emphasize the fact.

This book focuses especially on neoliberal austerity as an inadequate and damaging response to the GFC. I use ‘neoliberal’ to cover the ideological framework associated with policies often described as the ‘Washington consensus,’ which I unpack and discuss below.

Varoufakis is fully aware of how damaging these policies were in Greece, the nation he was born in and whose finance minister he was for six months in 2015:

In a never-ending circle, the imposed austerity worsens the recession afflicting these deficit states.

(2011, p. 208)

Economic analysis alone is enough to show that these policies do not work. But more important questions remain, demanding a more complex interdisciplinary response. How is neoliberal austerity part of the larger system which includes the factors leading to the GFC? Why did the proponents of austerity think it would work, and why did they persist when it didn’t? What could or did opponents do as they talked and reasoned about events, and why could they not prevent or mitigate it?

Our object of analysis is constituted by discursive and economic forces which link the two moments, crisis and austerity, into a minimal object, needing analysts minimally to combine linguistic and economic analysis. That analysis is not only interdisciplinary. It must reframe these disciplines to deal with hybrid facts normally seen as outside their scope: economic processes as linguistic forms, linguistic processes as economic facts.

Systems

A core integrating idea for this process of interdisciplinification is ‘system.’ Varoufakis (2011) diagnosed its absence as a fundamental flaw he saw in academic economists. This concept appears in different forms in both fields, so the idea is itself interdisciplinary. The idea becomes richer and more explanatory when enriched by many perspectives, including economics and linguistics. A system is an arrangement of parts which has outcomes other than the products of those parts. It is a whole which is other than the sum of its parts, and those parts have other effects and meanings in a system than when they are alone.

I draw on the two disciplines to examine an instance apparently so minor and undramatic it would usually be ignored by both disciplines. I am motivated by an idea from social semiotics (Hodge, 2017), multiscalar analysis. In terms of this concept social reality is not made up of two distinct levels, micro- and macro-. It consists of many levels, each of equivalent complexity. Even a smaller-scale analysis can include the inherent complexity found at every level. In this case, it can allow hypotheses about the interaction of economic and discursive facts in empirical reality.

In early 2017, a small scandal briefly erupted in Australia. The Government Department of Human Services used a computer system to generate letters to some welfare recipients claiming that they had a debt arising from discrepancies found between their welfare claims and the tax returns. One article on the scandal was headlined:

Centrelink debt letter scandal worsens.

(Kachor, 2017)

I selected this text because of a political economy interest, but the sentence also illustrates the complex way linguistic systems work, in general and in this instance. Each word is an element in a five-term structure whose meaning is greater than the sum of its parts. The same is true of every sentence in every language.

In this case, four words make up the complex subject of the sentence. Each word corresponds to a different social and semantic system. Centrelink is the trademark name of the Human Services, part of the system of government. ‘Debt’ belongs to the financial system. ‘Letter’ refers to systems of communication, in this case a printed letter generated by a computer system.

‘Scandal’ comes last but not least. This is the subject of the verb, the reason the item has become news. It belongs to the media system, the system the author of the article belongs to, which gives her power, and which governments respect and try to control. Government ‘scandals’ are sites where the agenda has escaped their control, where what has happened and how it is reported have political effects

A political analysis of this incident could come up with the analysis that the incident is driven by the intersection of these four systems. Analysis of the headline not only comes up with this analysis, it provides evidence that the author of the article is conscious of this analysis, and frames the story in its terms.

I chose the story to analyze because it illustrated neoliberal austerity and its consequences, in a small scale. The Government had announced in its budget that it intended to claw back $A350m in excess payments from the welfare budget, in order to deliver on their claim to move the budget into surplus. They blamed the previous Government for creating this debt, and in a typical example of austerity discourses they made budget rectitude a primary goal.

A later story used budget documents that had been available for six months to reveal that the government planned to extend this policy to more welfare recipients. ‘Elderly, disabled next on Centrelink hit list’ said one headline. It used tables published by the Government to say the government

Has booked savings of $A1.1billion from clawing back overpayments of the aged pension, and another $A400million from the disability support pension.

(Towell, 2017, p. 1)

‘Hit list’ comes from another discourse, this time fictional, referring to criminals. Its basis is in economics, a set of figures that had been hiding in plain sight, buried under the masses of figures in the document. It needed a well-motivated expert in finances to bring it out, but the journalist used discourse to give it the impact it had.

But the austerity policies on their own would not have made a news story. They were compounded by the ‘debt letter.’ Defending the policy, Minister Alan Tudge objected to the term ‘debt.’ He showed his concern for semantic precision, or betrayed the point of his discomfort, by insisting that the letter only pointed out the discrepancy between Centrelink applications and Tax Information. Tudge drew on his Harvard MBA to design the policy, but became a discourse analyst to implement it. His response to criticism was not to withdraw the letter, but to rephrase it.

Behind this error was a problem he refused to acknowledge with the information system he relied on. It came up with a high number of false positives, cases sent letters as a result of computer error. Those letters had the force of commodities, demanding payment for a product generated only by a computer. In effect, the faulty computer program was printing money.

Tudge’s defence continued that, although the system was working, people who objected to the calculation could contact Centrelink staff. When told that the waiting time for calls was impossibly long, he merely appealed for ‘patience’ (McIlroy, 2017). This added to the impression that he lacked empathy, a minister presiding over a dysfunctional system, in denial over its defects.

The long waiting times, and indeed the whole fiasco, came from the consequences of another systemic plank of austerity policies. The government had slashed numbers of public servants in that and other welfare-related departments in order to make budget savings. Those no longer employed would have checked the calculations before they were sent out and corrected egregious errors.

The role of IT systems in this scandal is no accident. Part of the claim that cuts can be made with no reduction of service relies on a widespread collective delusion that IT systems can do everything their salespersons say. In a concurrent news item, one journalist reported on the development of a software program called ‘Roxy.’

Roxy supplies answers that used to be given by public servants who have now been freed up to handle very complex problems that still require a human touch.

(Towell, 2017, p. 4)

This comes in a media report, but to a discourse analyst it has unmistakable signs of a department media release. It contains the two parts of the dominant ideology, that these systems can be given a slightly cheeky name and feminine voice and perform most of the complex decisions and responsibilities of expert humans. Meanwhile, no one loses his or her job. They are merely ‘freed up’ to operate at an even higher level. Win-win, as the favorite management term says. A clear case of discursive inflation, discourse analysts might reply.

As other commentators noted, the effect of this scandal was compounded by a concurrent scandal. A government minister had had to resign over a controversy over excessive entitlements she claimed. This controversy threw a spotlight on excessive claims by many Members of Parliament, including the opposition.

The minister’s defence was that the rules for this system were so vague that no one knew what they were or how to interpret them. The government had admitted this a year before, promising to clarify the rules. They still had not done so, moving much slower on these lax entitlements than on the sums involved in the welfare system. But the minister resigned rather than the government.

One headline captured the connection:

...

Table of contents

• Cover
• Half Title
• Series Information
• Title Page
• Copyright Page
• Contents
• List of figures
• List of tables
• List of contributors
• Foreword by Ann Pettifor
• Foreword by Darren Kelsey
• Acknowledgements
• Introduction: Interdisciplinary* approaches to austerity discourses: A case study in why and how economists and discourse analysts should work together
• Part I Approaching austerity through discourse
• Part II Historical perspective
• Part III The notion of ‘crisis’
• Part IV Metaphors
• Part V Argumentation
• Part VI Responses to ‘crisis’
• Conclusion
• Index