Capitalism

In late 2008 some were in a bombastic mood. Great changes were on the horizon! Global financial problems were seen as the end of an era and as a starting point for something new.

This mood was wonderfully captured by The Guardian Weekly. Two quotes should suffice: “Ben Bernanke, chairman of the U.S. Federal Reserve, and Hank Paulson, the Goldman Sachs tycoon who became U.S. treasury secretary, had done more for socialism in seven days than anybody since Marx and Engels.” Here are people who are trying to save the system and TGW’s only reaction is to wheel out Marx and Engels. TGW also talked about “the capitulation of the prevailing economic model.” Would the collapse of the current system really bring milk and honey to the people? More likely it would open up Pandora ’s Box.

In August 2010 TGW had noticed that the much expected collapse did not come. The paper quoted Sir John Gieve, the former deputy governor of the Bank of England, giving his opinion on why the world did not change: “First, the speed of globalisation, the integration of the global economy, including finance, is continuing, and second, it is continuing around broadly a free-market model.”

Sir John’s opinions reflect those of Fareed Zakaria in Newsweek’s Special Edition – Issues 2010. According to Zakaria there are three reasons that have kept the world reasonably stable during the past twenty years and still keep it stable:

1. There are no serious conflicts between the major states.

2. On the whole the global economy is stable and it bounces back after problems.

3. Advances in technology have eased communication between different parts of the world. This has made expansion easier for businesses and allowed people to exchange information faster.

Zakaria argues that even though times are difficult for many people at the moment they are not willing to give up the possibilities of the current system for some unworkable “workers utopia”.

Sources:
The Guardian Weekly, 13.08.2010.
Newsweek, Special Edition - Issues 2010.
The Guardian Weekly, 26.09.2008.