Global Unbridled Excess: Consequences and Options

Global unbridled excess generates highly disruptive explosions and drives our countries’ development away from organic economic growth. Some recommend strengthening regulations, while others, impacting on the course and systemic way of functioning. Rather than taming a crisis, we should avoid it by taking care of the environment and abating the inequalities prevailing among and within countries. If the pre-existing dynamics is merely reconstructed, those who have been worst hit by the crisis will be the ones worst hit by the “reconstruction”.Global unbridled excess drives our countries’ development away from organic economic growth; indeed, the unbridled excess we have plunged into generates highly disruptive explosions; some of them are evident, such as the great crisis of recent years, while others are ignored or repressed, such as the dramatic ruptures in the social fabric and the ensuing increase in social unrest, the destructive power of which has not yet fully manifested.

Until the outbreak of the global crisis, the prevailing ideology relied on the markets’ self-regulation capacity: in the face of functional disruptions, the host of decisions that shape markets would react until difficulties were overcome and the economic flow was brought back to normal. This conception of systemic functioning was not the product of deranged minds or an exacerbated liberal fundamentalism since, on many occasions, markets have been, and are, really capable of overcoming difficulties and resetting a certain course and economic order. Yet, when the crisis burst in late 2007, there were gross errors of judgment. To begin with, the systemic scope of the disruption failed to be anticipated because of the interrelation of formerly relatively independent markets as well as the impact upon expectations of living a real-time crisis due to the phenomenal technological development in terms of communications and spread of information. Markets may indeed react and self-regulate when minor disruptions occur; yet, when markets burst their banks affecting the very systemic viability, what is required is the involvement of not just their regulators but, instead, of their warrantors of last resort: governments, society, our leaders, ourselves.

Consequences

In the presence of an ever more concentrated and concentration-oriented type of growth, few understood and managed to anticipate that the taken path was becoming unsustainable: environmental deterioration and increasing income inequality among and within countries undermined the foundations of organic growth, generating an ever wider gap between a demand that was being artificially sustained through borrowing and assistance rather than through the expansion of genuine income, and a dynamic production supply that, driven by technological innovations that were unprecedented in the history of mankind, was hardly respectful of the environment.

In this global crisis, the assets and income concentration-oriented systemic functioning, with its backside of inequity and poverty, skidded and faced a situation it was unable to prevent. Conventional strategic think tanks believed that this type of accelerated concentration-oriented growth could be indefinitely perpetuated and that the social, economic and environmental disruptions it could produce would be limited to specific sectors and territories. Thus, international economy was left unprotected to address disruptions of a systemic nature.

Few warned about this possibility. The central countries grew complacent with the prevailing international order – from which they profited greatly – and unfoundedly trusted that the self-corrective mechanisms would work every time an alarm set them in motion. But something different happened: when the financial tsunami was triggered, the self-regulation systems were exceeded, and proved ineffective.

Options

Today, some are of the opinion that the only thing that needs to be done is to strengthen regulations, while others think that no self-regulation system will be powerful enough to address a systemic crisis, and that what needs to be done is to cause political decision and public resources to play a role that may ensure organic growth so that corrective intervention may only be necessary in extreme cases. The heart of the matter is not to figure out how to tame a crisis but, instead, how to avoid triggering it; that is, adjust the prevailing course and the systemic way of functioning in order to correct the gross imbalances that keep us from an organic growth that is capable of safeguarding the environment and abating the inequalities that are commonplace among and within countries.

From the pinpointed perspective, one of the most pressing contemporary challenges is to decide which type of crisis exit to adopt. The “emergency” solutions that propose -with suspicious hurry- to rebuild what existed in the pre-crisis order are only one of the possible options; they are carriers of a complex network of interests, some legitimate and others illegitimate, which are structured in such a way that they enable to camouflage those interests that could not possibly be openly defended. If the pre-existing dynamics is merely reconstructed, those who have been worst hit by the crisis will be the ones worst hit by the “reconstruction”.

Within countries, those who become unemployed, those who live in poverty or indigence, vulnerable businesses, solidarity and the sense in making efforts are sacrificed. Inequality and environmental neglect are accentuated; concentration-oriented growth is enshrined.

Similarly, on an international level, the most vulnerable and backward countries, as the non-emerging countries of the Southern Hemisphere and even some of the Northern Hemisphere, i.e. Island, Greece, Ireland, Spain, among others, are sacrificed. However, in the European case the most affluent countries will ultimately bail out the countries that are in trouble in order to protect their own security and interests; yet they will impose sacrifices, once again, on the population segments of the pyramid’s base. For the rest of the world, big brother will not exist.

If we set our sights on transforming the pre-existing dynamics, a good portion of those effects might be avoided or reversed. Other more promising choices may preserve the environment and transform what divides and confronts us, close the income and knowledge gap, give way to a culture of efficient, caring and meaningful work, eliminating privileges and placing ourselves on equal footing to meet the opportunities available for personal and collective effort. This, translated into feasible measures and decisions, is what is at stake when today we choose from very different crisis exits.

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