[OPE] Martin Wolf on the future

Courageously - compare this to the academic tripe coming out these days -
the sanguine Martin Wolf ventures some prognostications:

Unfortunately, there are at least three big things we cannot know. How far
will exceptional levels of indebtedness and falling net worth generate a
sustained increase in the desired household savings of erstwhile
high-spending consumers? How long can current fiscal deficits continue
before markets demand higher compensation for risk? Can central banks
engineer a non-inflationary exit from unconventional policies? (...) Last
but not least, what does the crisis mean for the global political order?
Here we know three important things. The first is that the belief that the
west, however widely disliked by the rest, at least knew how to manage a
sophisticated financial system has perished. The crisis has damaged the
prestige of the US, in particular, pretty badly, although the tone of the
new president has certainly helped. The second is that emerging countries
and, above all, China are now central players, as was shown in the decision
to have two seminal meetings of the Group of 20 leading nations at head of
government level. They are now vital elements in global policymaking. The
third is that efforts are being made to refurbish global governance, notably
in the increased resources being given to the International Monetary Fund
and discussion of changing country weights within it.
http://www.ft.com/cms/s/0/beb9b7e8-449f-11de-82d6-00144feabdc0.html

These sorts of questions are based on false theories of the economy as it
really is. http://en.wikipedia.org/wiki/Capital_formation

Point is, the rich almost always win, they know very well what they are
doing, for better or worse ("you win some, you lose some"). The only defence
the "wretched of the earth" have against that is:

(1) to kill them;
(2) to expropriate them;
(3) to beat them up when their ideas about world improvement get too absurd;
(4) ignore them;
(5) provide a better alternative.

The fifth alternative is obviously the best, it exercises the best minds.

It's not between the West and the rest, it's between the bourgeoisie and the
proletariat, with the windy middle classes in between. The basic problem of
the West is that it substituted gambling impressions for social science.
Gambling seems to be able to grab the wealth in the short run. But in the
long term, the sages of social science are triumphant. If they bar you and
me from universities, it's no problem. As long as we still have a brain,
there's still social science.

Jurriaan

I couldn't see when it started snowin'
Your voice was all that I heard
I couldn't see where we were goin'
But you said you knew and I took your word
And then you told me later as I apologized
That you were just kiddin' me, you weren't really from the farm
And I told you, as you clawed out my eyes
That I never really meant to do you any harm.
But sooner or later one of us must know
But you just did what you're supposed to do
Sooner or later one of us must know
That I really did try to get close to you.

- Bob Dylan, One of us must know

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Received on Tue May 19 18:07:01 2009