Rethinking the ideational shaping of structural power: the case of Trussonomics

The demise of the Truss administration at the hands of the financial markets presents a puzzle for constructivist analyses of structural power that have emphasised the agency of policymakers to ‘shape’ its operation. Why did an avowedly pro-capital administration possess such limited agency to contest the seemingly automatic operation of capital flight? Addressing this question, this paper shows how economic ideas were fundamental to mediating structural power in the case of Trussonomics, but not predominantly the ideas of policymakers or business associations foregrounded in existing literature. Rather, ideas embedded in the forecasting practices of key institutions were vital to informing market participants’ judgements about the macroeconomic implications of Trussonomics. This finding suggests the need to investigate how institutionalised models mediate the ideational formation of investor sentiment, while pointing to a constructivist analysis of structural power that avoids exaggerated claims about policymaker agency. The Trussonomics case illustrates how political actors are often highly constrained by institutionalised ideas, that shape the operation of capital flight by supplying the epistemic infrastructures through which macroeconomic policies are interpreted by capital markets.