Thursday, October 9, 2008

Global Financial Meltdown: the West and the Rest

The debt-financed US-led global economy is crumbling. What lessons can the leaders of the South learn from the present meltdown of the Western capitalist system?

The first lesson, surely, is that contrary to mainstream thinking, the market does not have a self-corrective mechanism. In the present crisis the "market makers" are watching nervously from the sideline as the Congress and the politicians huddle together to see how to bail out the banks. The leaders of the South have been instructed in innumerable reports and policy recommendations by "experts" from the International Monetary Fund (IMF), the World Bank, and the World Trade Organisation (WTO) as well as Northern politicians that they should let their economies be ruled by the market.