The world at present is going through a severe existential crisis. It is all about struggle in one form or the other; whether it is the struggle of the peasant against the feudal, or the struggle of an assault victim against the perpetrator, or the struggle of a corporation versus labour, or of economies against debt. All around us, it is this constant tug-of-war for the accumulation of resources. I remember doing the concept of scarcity and unlimited wants on the first day of my economics class. Little did I know that this concept was like societies very own self destruct button. Unlimited wants and limited resources meant that the lust of wants needed to be managed in an equitable manner for the creation of an egalitarian society.
Corporatisation and marketing worked towards the creation of wants. This lead to a rise in consumerism. A rise in consumerism fed the debt monster. The debt monster was sold off to a debt financing company who further sold it to another company. What mankind saw was a gutless display of cowardice. As long as you could live in your own happy little bubble, everything was okay. Or so they believed. Until it all came crashing down, like a very big wedding cake that too on wedding day.
Analysts had long believed that this day would never come. That the cake was infallible, that mankind had perfected the art of predicting their future and economic theory had become the epitome of perfection. Not only did the collapsed cake leave everyone disillusioned at the vulnerability of their economies but in its aftermath it splattered sour cream over the faces of all those that got sucked into the big bad mess of stockpiled debt.
Some say if the total debt is stacked on top of each other in New York, it would create a skyscraper even taller than the Empire State building. Some say, the figure fudging debacle in Greece was so fudged up that even the word fudge cringed with shame. Others pointed to the lack of spine in the EU to bail these economies out. What we are witnessing today is a financial mess unparalleled in history. The ropes are so badly jumbled into one another that not even Houdini could untie this particular knot. And it keeps getting worse by the day.
All this points out towards a vacuum of leadership, where the leaders failed to take the right decisions at the right time. State intervention is sometimes a necessity to aid economies into avoiding an economic debacle, even at the risk of overcoming popular western paranoia regarding posturing increasingly towards the left since the debacle of ’08. When consumers step down their spending, the government needs to step them up. Instead of letting bubbles inflate till they burst, governments should intervene to let some air out every now and then.
Leaders now need to take big decisions; decisions that entail short-term costs but long-term benefits. If governments fail to think out of the box to bail out their fast eroding economies, then the aftermath would be disastrous.
I read somewhere a quote about the economic debacle that has hit the world today, and it could not be truer, “This recession is the deepest in our lifetimes, the deepest since 1929. If you take the people thrown out of work in the 1982 recession, the 1991 recession, the 2001 recession, not only is this bigger, this is bigger than all of those combined”.
Stakeholders need to find solutions in times of conflict, boldness in the face of adversity and foresight in decision making. If this is somehow achieved it would provide the failing economies with the necessary impetus to revive themselves, otherwise my prediction for these economies would be an inevitable road to calamity.
The writer is an economic researcher
and freelance journalist
