My latest post at Forbes endorses Raghuram Rajan's call for there to be permanent co-operation between the central banks of the G20. Business is global: financial markets operate across borders. Countries no longer have genuinely independent monetary policy. Monetary policy needs to be co-ordinated internationally, with the Fed as "first among equals". Whether intentionally or not, the Fed has become the de facto central bank of the world. It is time it behaved like it.Coppola Comment
Why the Fed should not taper alone
It would say rather we need to address the issue of central banking and global organizations like the IMF and World Bank, not to mention the BIS as the central banks's bank, as instruments of global policy based on neoliberalism, which is antithetical to democracy.
The idea of central banks at the head of a global command economy under the rubric of "free markets, free trade, and free capital flows" is an oxymoron. It is the antithesis not only of democracy but also capitalism.
In fact, I regard this as one of the greatest dangers facing humanity as we enter the global age. It is recipe for greater centralization and crystallization of a power structure based on class structure, opening the door to a totalitarianism of capital aka fascism.
I am all for international cooperation but not on the basis of technocracy that supersedes democracy. The devil is in the details.
The first thing that needs to be done is to ditch the unrealistic assumptions that underlie the neoliberal view of the world and the socio-economic models that are used to justify it, such as free markets, free trade and free capital flow leading automatically to optimal social, political and economic outcome because it is assumed that they are based on laws of nature. That has no basis in reality.