Economic Crisis a Global Political Problem
Earlier this month as a reaction to the global collapse of the financial sector, the members of Parliament made BBC Business Editor Robert Peston defend his reporting on Northern Rock last year. Peston outlined that he was acting on his duties as a reporter and was not responsible for creating a panic by highlighting the deficiencies of Northern Rock and Bradford & Bingley. He’s quite right. How can a conscientious investigator cause a panic when in fact the system in which we work has such glaring deficiencies?
It is absolutely right that the press and the media should bring to the surface the social issues that we face, particularly one as worrying as the collapse of the financial system. I can see why MPs would wish to take the line of blaming greedy and selfish bankers and an insensitive press and media. The reason we have such problems is that both corporation and government had a powerful and implicit understanding to continue taking a derivative position in the market that would ultimately lead to the collapse that we are now experiencing.
Heads of State meeting at Davos still seem to believe that we can go back to the way we were before, if only we could get rid of the right wing neoliberal influence that stimulated the current phase of greed. However, we can no longer afford to have liberal economics as the basis for our global way of working. Our concern is to have a much more sensitive social democracy that allows for cosmopolitanism, sustainability and investing for a long term future. Why for example should be continue with quarterly reporting? Why do we not have a much closer relationship between citizen, corporation and state, ensuring that the wealth creation process does not focus on shareholder value but on stakeholder benefit?
On this basis we need a balance of power whereby smaller countries can better represent themselves on a global stage. The only way forward is for a region to become a country. If we take Europe as an example, Europe becomes a country and the former countries of Europe become states of Europe. By having a European Parliament where emphasis will be placed on the lower house, the forum of the citizen, social policies can be created which will prevent the old Anglo American boom and bust cycles and allow for long term growth and investment.
The recent reporting on what we need to do to get ourselves out of this global downturn has largely concentrated on the economic levers that we need to pull in order to dig ourselves out of the present crisis. What needs to be understood is that we face a global political problem and not just an economic problem. Europe in particular needs to politically reposition and allow a mass market of 480 million consumers to influence the world in very different ways from the Anglo Americans of the last century.
