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ABOUTGlobes, Israel Business Arena – 21 Aug 2011
www.globes.co.il/serveen/globes/docview.asp?did=1000675191&fid=1725
“Recent popular demonstrations, from the Middle East to Israel to the UK, are all driven by the same issues and tensions.”
“Recent popular demonstrations, from the Middle East to Israel to the UK, and rising popular anger in China – and soon enough in other advanced economies and emerging markets – are all driven by the same issues and tensions: growing inequality, poverty, unemployment, and hopelessness,” says Dr. Nouriel Roubini. “Even the world’s middle classes are feeling the squeeze of falling incomes and opportunities.”
Roubini, a professor of economics at New York University’s School of Business, was one of the few economists to predict the 2008 global financial crisis, and he insists that recent social unrest sweeping the world, will strengthen and spread.
Roubini says that the current global economic system – capitalism – will remain in a crisis – a crisis economist Karl Marx predicted more than a century ago – until major systemic reforms are implemented. He says that social unrest and demonstrations are all being driven by the same thing, capitalism’s most serious crisis since the Great Depression of the 1930s. It stems from globalization, financial intermediation run amok, and a destructive redistribution of income and wealth from labor to capital.
Roubini’s answer is to strike the correct balance by creating work partly through more stimulus whose goal is “productive” infrastructure investment, progressive taxation, debt reduction, “lender of last resort” support from central banks, greater supervision of the financial system, and breaking up banks deemed too big to fail. “That means moving away from both the Anglo-Saxon model of laissez-faire and voodoo economics and the continental European model of deficit-driven welfare states. Both are broken,” he says.
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{ 1 comment }
I agree with everything predicted in this article, but the only issue he leaves out is that the ‘right’ who own most of the wealth, will never willingly allow any redistribution which involves them having a lesser share. Bill Gates and Warren Buffet can appear with smiling faces talking about giving it all away, but I am not impressed or convinced one little bit. The plutocrats control virtually all the popular media, have the most influence in politics, and the most influence with those at the top of the military hierarchy , plus a fanaticism about greed which makes Joe Stalin look like a parish priest. If the current economic system, foisted upon us by Thatcher and Reagan, doesn’t recover, and until the American elections are out of the way I don’t see how we can predict either way, then as I see it we have to wait and probably watch the slum cities go up in flames, but only when the ‘right’ have completely got hold of America again, and I have no doubt they will, can we see whether the system is capable of re-inventing itself sufficiently to create more jobs and take people’s attention off the massive inequalities which have come about since 1979. If this doesn’t happen, and unemployment and inequality continue, then it is my belief that popular protest by ‘legitimate’ means looking for real political and economic change change will be met with violent resistance from those who ‘have’.
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