Introduction

What should governments do to protect their citizens in a global economic crisis? National economies are interdependent and economic risk is systemic on a global scale, but economic policy remains pervasively national in scope. Fiscal policy is one tool that some economists advocate to counteract economic downturns. Fiscal policy, however, has not been the subject of collective action at the global level, and if it has, states accomplish it in ad hoc political (as opposed to legal) arrangements in response to particular crises. More generally, states retain primary responsibilities for structuring institutions to promote economic justice for their citizens. Despite moves towards conceptualizing justice as a global concern, justice remains primarily a concern for domestic constitutional orders. Fiscal policy and economic justice are widely understood as the domain of the political orders of states, national in their reach, tied to notions of statehood. These features of the state are in tension with the increasingly complex interdependencies of states and with the dense web of treaty commitments they have undertaken, particularly in economic matters.

To put this tension in more concrete terms, consider the expenditure of approximately US $181.7 billion in today's dollars by the US government's Works Progress Administration (WPA) in the mid-1930s, intended to stimulate the US economy during the Great Depression. In the 1930s, efficiencies associated with contracting out by government were not well understood. The WPA engaged in direct government provision of construction and other services. It employed up to 3.3 million in 1938.