It is almost incredible how the perfect storm is coming together from so many sources at the same time. The near-bankruptcy of the Italian economy could bring down the Eurozone. Yesterday’s official down-grading of growth in the EU to no more than 0.5% a year, and even of Germany to only 1% a year, heralds entry into a deep European recession over the next 2 years. The contagion from the Euro sovereign debt crisis plus the paralysis in the US economy with its still bombed-out housing and job markets signals the end of Western economic supremacy in the face of the continuing relentless rise of Asia. The likelihood of nil growth in this year’s 4th quarter in the UK will confirm again how counter-productive it is to reduce the budget deficit exclusively by expenditure and benefit cuts without regard for declining aggregate demand. And, though hardly anybody will give this adequate attention so immediately drastic are the current crises, the world is very near a tipping point where devastating climate change becomes irreversible. Yet it need not be like this.
It is possible to envisage short-term solutions to each of these crises. The ECB could be made lender of last resort for the bond markets of each of the Eurozone’s weaker economies. The Eurozone could split into a 2-tier framework with Germany, Austria, Netherlands and Finland dominating a high-speed inner group, and Italy, Greece, Portugal and Spain consigned to a slower-speed southern grouping. The transfer of economic power eastwards could be slowed and halted over time if there were a fundamental reconfiguration of Western economies away from consumption and imports complacency (illustrated by today’s UK trade deficit in goods the worst since records began) towards industry, investment and exports. And the looming climate change disaster could still be tackled if the turbo obsession with fossil fuel extraction were steadily shifted towards long-term reliance on renewables.
But all of these radical solutions to global fundamental problems are snagged on one underlying issue – the dominance of market fundamentalism. As long as the current power structure and culture of neoliberal capitalism remains as widespread and deeply entrenched as it is, there will be no more than a temporary short-term patchwork to a bust economic model. But what is most depressing is that the resistance to this broken model is coming, not from any political parties, but from the street across the world. Nothing could illustrate more starkly the disconnect of today’s politics from the reality out there.
You sum it up exactly Michael. The very real global threats are devastating climate change and the almost total dependence on fossil fuels.
Peak Oil flow is likely within the next few years (if it has not already happened) and that will create economic chaos which will be much more difficult to resolve, than the EU/US neoliberal governments’ obsessive determination to maintain the wealth of the bond holders and financial speculators.
And yet, the media and the left seem oblivious of these huge dangers .. or have been seduced by the $8 million of Exxon climate warming denying propaganda (FoE estimate 5% of this century’s CO2 emissions derive from Exxon alone). Just as the wealth created by workers is exploited by neoliberal capitalism, so too is the natural world upon which our very survival is dependent.
Green capitalism is not succeeding/not capable of creating the necessary ‘powering down’ of energy demand and ‘powering up’ of clean energy. The left must take on the arguments for public investment in mass insulation and microgeneration by renewables … both of which would also facilitate a new economy and job creation.
Some of the compelling scientific evidence which convinces 95% of climate change scientists:
http://think-left.org/2011/10/08/some-of-the-scientific-evidence-for-climate-change/
“But what is most depressing is that the resistance to this broken model is coming, not from any political parties, but from the street across the world.”
this is a real politics and the political parties are sleep! this proves that all political parties are wrapt up in their own agenda and paper work and are not able to come out and mobilise the masses sham on them.
Amir .. It is also amazing given how inadequate is the media reporting. There is little or no coverage of alternative views or information which could be said to be left of moderate centre. It is implicit for the tax-payer funded BBC that there is no alternative to the ‘free-market’/neoliberal/neo-feudalist ideologies (apart from the wonderful Paul Mason). It is depressing that resistance is not coming from the political parties but encouraging that in spite of the mainstream media message, people are on the streets.
http://think-left.org/2011/11/11/inadequacies-of-bbc-coverage-of-the-eu-financial-crisis/