masterwordsmith-unplugged

Recently, my FB friend JWCW tagged me in a note for an article titled “The Global Economy Won’t Recover, Now Or Ever” written by Immanuel Wallerstein, a senior research scholar at Yale University.



Excerpt from the article:

Virtually everyone everywhere-economists, politicians, pundits -- agrees that the world has been in some kind of economic trouble since at least 2008. And virtually everyone seems to believe that in the next few years the world will somehow "recover" from these difficulties. After all, upturns always occur after downturns. The remedies recommended vary considerably, but the idea that the system shall continue in its essential features is a deeply rooted faith.

But it is wrong. All systems have lives. When their processes move too far from equilibrium, they fluctuate chaotically and bifurcate. Our existing system, what I call a capitalist world-economy, has been in existence for some 500 years and has for at least a century encompassed the entire globe. It has functioned remarkably well. But like all systems, it has moved steadily further and further from equilibrium. For a while now, it has moved too far from equilibrium, such that it is today in structural crisis.

The problem is that the basic costs of all production have risen remarkably. There are the personnel expenses of all kinds -- for unskilled workers, for cadres, for top-level management. There are the costs incurred as producers pass on the costs of their production to the rest of us -- for detoxification, for renewal of resources, for infrastructure. And the democratization of the world has led to demands for more and more education, more and more health provisions, and more and more guarantees of lifetime income. To meet these demands, there has been a significant increase in taxation of all kinds. Together, these costs have risen beyond the point that permits serious capital accumulation. Why not then simply raise prices? Because there are limits beyond which one cannot push their level. It is called the elasticity of demand. The result is a growing profit squeeze, which is reaching a point where the game is not worth the candle.

CLICK HERE to read the rest of this excellent article.


Following thatm JWCW and I shared some ideas and I'd like to repost (with his permission) his response to my comment:

My Comment:

This is really an excellent article! He has no qualms about speaking the truth without sugar-coating his observations or predictions and I really agree with him. So much acting and pussy-footing that we see around us by those who have a gala time behind the pathetic smokescreens they put up to confuse us but with the net, more and more have a clearer vision of reality and the future. Wish I could write like him. Will repost this in my other blog..Thanks again! Have a great day!

JWCW's response to my comment:

Some background on Immanuel Wallerstein. Noticed his influences? Just learned a new way to look at the world - 'world-systems analysis' (or "knowledge movement"), of which the author of the article is a proponent. Which goes to prove that one is never too old to learn something new, as long as we're not six-feet under. An interesting primer: THIS LINK. Dividing the economy into 'core', 'periphery' and 'semi-periphery' countries makes much better sense than the current 'first-world', third-word' (or 'developed', and 'under-developed' or 'emerging economies'). Nations are just like people (and why not - they're made up of people), divided into classes too. There is always a sense of control involved which is not implied in the current definition. And we wonder why poverty exists for so many. We have not thought up a better system. Or maybe many people already have an idea of it but are 'prevented' from making it a reality. The rear-view mirror has become so much clearer. Just my two-cents ya. There's one question that ask: "to what degree, if any, does the core need the periphery to be underdeveloped?" If one thinks about it, it sounds a little like conspiracy theory, with the powers that be of rich nations keeping a check on the rest. Does make one question the things we learned in school and its 'usefulness' in our life? I don't really know if more people are having a 'clearer vision of reality and the future', but i do agree more people are now aware of what's going on around them due to the internet. Please feel free to re-post it on your blog.

Thanks to Joshua for the article and for his interesting input.

I would love to hear the responses and thoughts of other readers. Do you think the global economy will EVER recover? Are we heading for the worst times? Please leave a comment to share your views. Thanks! Have a nice day.