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The more you look at this crash, the deeper the roots that appear. George Packer’s ‘inner history of the new America’, The Unwinding, demonstrates very clearly what sits beneath the current malaise: institutional decay, the rise of ‘organized money’, and the privatisation of values. We’ve stopped wanting better and, instead, we are happy to just grab what we can.

By telling the story of decline through the biographies of a series of people and places, Packer lends what is now becoming a familiar tale authenticity. A DC lobbyist features alongside a Youngstown factor worker. Alice Waters, a trailer park couple, Peter Thiel - the Silicon Valley venture capital billionaire, a Tea Party activist, Jay-Z, and Tampa are other ‘characters’ in this tragedy in three parts.

There is a simple fact at the heart of this book: America’s success after the war was not by chance. It was design. The right institutions such as regulation of Wall Street, union power, and investment in innovation and research matched with a value-set that underpinned them. Then America latched onto a series of political economic ideas – ‘neo-liberalism’ for want of a better phrase – that sustained the smash and grab exercise on American society. For America, read the UK.

Packer describes the 1970s to the present day thus:

"In effect, [the 1980s to the mid-2000s] were a kind of Indian Summer following the seventies, and it lasted such a long time - about a quarter century, if you started with the end of the Reagan recession in 1982 and ended with the housing collapse in 2007- that it would be almost impossible to go back to where things stood before it all began and try to reset. Throughout the Indian Summer, the same key institutions continued to erode, with a lot of recession years and financial panic along the way.”

This is precisely where we are. Institutional decay, a bubble burst, the next bubble being inflated as we speak as politicians have run out of ideas and little by way of serious thinking about long term deep seated structural issues: the silent decline of the middle class.

Packer alerts us to some spectacularly stupid decisions made by America’s local, state and national elites. A campaign in Tampa, a sprawl of a city with collapsing house prices and little public amenity, to stop a new light-rail system is successful. Then there was Proposition 13, a Californian plebiscite in 1978 which tightly limited taxes with the consequence of a collapsing education system and state finances.

Packer doesn’t venture how we might rebuild values and recreate institutions. He looks at Occupy, the crackpot ideas of Peter Thiel, the Tea Party and it’s clear none of them provide any sort of pathway out of the situation. He casts a more sympathetic eye towards Dean Price, a biodiesel entrepreneur in North Carolina who aims to create a ‘full circle’ energy enterprise from farm (crop) and back to farm (fuel) while sharing profits with schools (from turning used cooking oil into fuel). A community organiser in Youngstown gets a similarly sympathetic hearing, as does a former lobbyist who is shining a light on the political power of Wall Street. Through perseverance, civic commitment, integrity, and relationship building these individuals’ stories hint at the values a different way of society may need.

However, when you take a step back and consider the enormity of the collapse in values and institutions then it is difficult not to be profoundly disappointed with the political response thus far. The left combines a shrill moralism with Keynesian short-termism. The right targets groups with little voice to defend themselves while using the austerity mantra to hide that it is doing little to provoke beneficial structural change. The scale of the task is mirrored by the smallness of politics to comprehend and address it.

As Packer acknowledges, there is no going back, no reset button. However, the insight that you need not only the right values but the right institutions to sustain them is a powerful one. There are some hopeful signs. In the last week, the intervention of the Archbishop of Canterbury, Justin Welby, and his plan to use church spaces to support credit unions is a powerful example of smart practical thinking about institution building.

There is a desperate sadness that we are now likely to repeat the mistakes of the last few decades. The crisis appears to becoming less severe. The asset bubble - feel-good - crash cycle is beginning to be revved up again. The collective sigh of relief as growth starts to return will be audible. The lessons will soon be forgotten as things seem OK once again. We may start to increase public spending on services and start to redistribute more to compensate the losers from our de-institutionalised economy. And then it will all go pop and everyone but the strongest will be losers again. Populists on the left and right or a mainstream that is determined to make the same mistakes over and over again: take your pick. Packer’s The Unwinding chronicles the reality of such a world. It’s the world we’ve created.

Anthony Painter is Director, Independent review of the Police Federation. His new book 'Left without a future? Social Justice in Anxious Times' is now available.

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