Every form of political or economic system tends to perish or
push itself to the verge of collapse by an excess of its own basic
principle. Socialism as a political and economic system committed hara-kiri
in Europe in the late 1980s, with Gorbachev's twin initiatives
of `glasnost' and `perestroika' triggering the inevitable. And, for its part,
capitalism pushed itself to the precipice, yet again, when the US credit bubble
burst in 2007, following a fundamental change in the way mortgages
were funded, setting off a train of events that led to a precipitous fall in the
property prices, a slowdown in the US economy that soon morphed into recession,
billions in losses by banking and financial institutions and the resultant
collapse of some of the biggest names in the marquee, and a chain reaction of
intercontinental downturns, which all but wiped out the gains that many economies
had achieved in the run up to the crisis.
The hordes of analysts and critics who have commented on the causes
of the current crisis have come up with their own list of villains. The cast
invariably includes crafty financiers, unscrupulous chiefs of institutions,
complacent central bankers, napping regulators, rent-a-quote financial
pundits, wily politicians, and gullible yet greedy investors. However, some
commentators have traced the origin of the latest global meltdown to the
intellectual foundations of capitalism itself. |
