Lars P. Syll — Wynne Godley — the man who saw through the euro

My comment there:

While the EZ certainly should scrap the euro as a failed experiment, which was really an attempt to impose neoliberalism, elite control and corporate totalitarianism on Europe, doing so will not solve the problem, since it is only part of the problem.

The underlying problem is capitalism in the sense that "capitalism" means favoring capital formation and accumulation over the other factors of production — labor (people) and land (environment) — because "growth" and "efficiency."

Capitalism has morphed into monopoly capitalism for a variety of reasons. Economies of scale allow some firms to dominate markets, for example, and the larger the firm, the more political power it can wield in capturing government. Market prices do not reflect true price in terms of actual cost owing to socialization of externalities. Rising asymmetry stifles competition and destroys the foundation of economic liberalism that is used to justify capitalism on the basis of marginalism (just deserts and all that).

In addition, social, political and economic liberalism are incompatible based on the current assumptions and institutional arrangements. Transnational corporate totalitarianism, which is the goal of neoliberalism, is incompatible with democracy, for example.

This system is no longer working and this is becoming more and more obvious. First, the great leveling as capital flows across borders and the developed world sinks while the emerging word rises, but with the elites taking the major share. Secondly, climate change is forcing a reconsideration of both unlimited growth and socializing the costs of externalities.

Marx famously observed that a mode of production that determines the relations of production doesn't change until its potential has been reached. Well, it seems that the world is getting close to that point. As Olivier Blanchard recently tweeted, what comes after capitalism?

Lars P. Syll’s Blog
Wynne Godley — the man who saw through the euro
Lars P. Syll | Professor, Malmo University

See also

Resillience
Stability without Growth: Keynes in an Age of Climate Breakdown

Jason Hickel