Thursday, October 13, 2011

Roubini on the perils of inequality

Any economic model that does not properly address inequality will eventually face a crisis of legitimacy. Unless the relative economic roles of the market and the state are rebalanced, the protests of 2011 will become more severe, with social and political instability eventually harming long-term economic growth and welfare.
This is the conclusion of Nouriel Roubini's post at Project Syndicate on The Instability of Inequality. It's a good short read. Roubini even quotes Marx, who is appearing more and more in the mainstream these days.

1 comment:

Anthony said...

It is a good read except in what he says about the European welfare state. He seems to buy into the argument that the public sector "can't afford it." Perhaps as presently configured it can't, but it could if it took full advantage of the properties of modern money and chose to allocate real resources in that manner. Yet in his penultimate paragraph, he describes the welfare state as being as obsolete as neoliberalism.