Martin Wolf has outdone himself. The FT’s chief economics commentator has written a book that not only explains the malaise in which we have been mired since 2008 but also – depressingly – provides a convincing analysis of why we are likely to remain so. Already, the crisis has spawned a plethora of titles examining what went wrong. The Shifts and the Shocks is among the first to address the absence of a robust recovery and it sets a high bar for those that will surely follow.

The data show how badly things have gone. Adjusted for inflation, UK and US median incomes are still below pre-crisis levels. There is an average unemployment rate of 12 per cent in Europe and youth unemployment of more than 50 per cent in two of the worst-afflicted countries, Spain and Greece. For the north Atlantic as a whole, there is a cumulative gap of trillions of dollars between what output would have been had it followed the pre-crisis trend and actual production. Wolf argues persuasively that these results were not inevitable but rather the predictable results of policy failures, and that they will have long-run consequences.

He rightly points out that, in a fundamental sense, the advanced industrial economies were not performing well before the crisis. In the US as well as many European countries, weaknesses in aggregate demand were disguised by the bubble that weak regulation and low interest rates helped create. Among the underlying problems are persistent global economic imbalances and growing inequality, the latter exacerbated by a financial sector that has become ever more dysfunctional since the mindless liberalisation that began in the 1980s. But one of the things that distinguishes Wolf’s analysis from so many others is that he sees the crisis as more than a financial crisis – an insight that is essential if we are to understand the failure to achieve a robust recovery.