"Consider the big picture: an east Asia of toppling currencies and bank
insolvency: rising unemployment in Latin America’s largest economy
(Brazil) and falling real wages throughout the region: stagnation and
unemployment in Europe: a rapidly approaching limit to the capacity of
US consumers to take on more...
THE US, the most powerful economy in the world, responsible for a third
of world output, is reeling with shock. This time there are no foreign
terrorists who can be held responsible for disaster striking. It is
capitalism itself that is responsible.
THE BOOMS of the 1980s and 1990s were both driven by frenzied
international financial speculation. They have left deep problems for
capitalism, and now form a massive barrier to a new, sustained economic
upswing in the world economy.
"The credit system appears as the main lever of overproduction and over
speculation in commerce solely because the process of reproduction,
which is elastic in its nature, is here forced to its extreme limits.
Summer is usually a period when "not much happens", at least in Europe.
But this Summer is like the calm before the storm. The mass
demonstration in Genoa and the last general strike in Argentina are
indications of the tumultuous years ahead.
The world economy is on the edge of a prolonged period of stagnation.
Before the war on Iraq began, its approach had already made a negative
impact. A United Nations statement in January this year forecast: "An
escalation into military action would have even more profound negative
economic consequences". The...