The global financial crisis of 2008 was unprecedented in living memory. From the height of the very first wave of the crisis – the collapse of Lehman Brothers in the US – to the ongoing instability of the Eurozone, the economic and social impact has been world-changing (see Farnsworth and Irving, 2012). The period since 2008 has exposed the weaknesses of neoliberal economics and the role played by large-scale social policy interventions in mediating its effects. At the very least, the financial crises illustrated that markets were not infallible. Yet, nearly a decade on, it is the welfare state that is on the defensive. The transformation in global capitalism has paved the way for a new age in the global economy, but this new age – the age of austerity – presents perhaps the biggest challenge yet to the future of welfare states.

This book begins from the premise that the post-2008 global economic circumstance is best understood as a variety of crises proceeding in several waves, with differential impacts cross-nationally, world-regionally and internationally. Although there are differences in the journeys taken by nation states, the end result is transformed capitalisms and a fundamental resettlement of welfare. The idea that the world has entered a ‘new age of austerity’ is deeply embedded in both policy and popular discourse and is based on the assumption that there has been an irreversible change in the economic and political conditions that underpin systems of welfare. To say that the idea of ‘austerity’ has become ubiquitous in early twenty-first century social policy debate is, in fact, somewhat of an understatement, and although perhaps more explicitly so in Europe than in any other region, austerity is nevertheless the driving force in global welfare development. This is because it is shaping the welfare states in the most powerful economies and redrawing the terms of development in the less powerful ones.

Towards the end of the twentieth century, social policy debate attended to the emergence of the ‘middle’ or ‘third’ way in Europe, but ultimately the hegemonic ideas of neoliberalism since the 1980s have transcended all borders, infused policy discourse and influenced the development of welfare in all the major economies, albeit to different degrees of magnitude.