Ethical Capitalism: What It Can Do for You

Argumento de Ethical Capitalism: What It Can Do for You

Developed economies are emerging from their most severe recession since World War II and the international financial system is overcoming its deepest crisis since the 1930s. Despite pumping more than 8.9 trillion dollars into the banking system and several trillion more to revive demand through stimulus packages, growth in the U.S. and most European countries is insufficient to cut high levels of unemployment. The use by many financial institutions of speculative instruments -- mortgage-backed securities, naked short selling, derivatives -- was the main cause of the Great Recession. The world economy was turned into a giant casino.Some people’s greed and ignorance also fed the bubble. On the extreme left, some are blaming free markets and demanding more government spending and barriers to trade and investment to shield our labor force from the supposed unfair playing field created by globalization and the rise of emerging and developing powers that now generate 45% of global GDPand have outsourced millions of manufacturing and service jobs. If Karl Marx were to mysteriously awaken, he would undoubtedly advocate more government takeovers and restrictions on political and economic freedoms. Professor Alexandre Muns, on the other hand, spars with a fictional Marx and analyses the causes ofthe Great Recession as well as the effective response by many governments and international institutions that averted a financial meltdown in the second half of 2008 and have financed social programs in advanced countries and helped save a generation in the poorest ones. Munschampions a more ethical, social and environmentally-sustainable international economic system that can again spawn prosperity and reduce inequality in developed countries, continue to foster growth in developing and emerging economies and correct global macroeconomic imbalances. We need markets to work for people and not the other way around. We should ban speculation ofagricultural and other commodities and curbspeculation incurrencies and sovereign debt. Fraudulent tax havens need to disappear. Hedge funds and derivatives need more regulation. Families, companies and governments need to live within their means, continue to work hard, save and invest wisely. We need to make free markets more ethical not only because it is the right and smart thing to do. But also because it will give us the moral authority to demand that emerging economies adopt stricter environmental and labor standards and crack down on corruption both in their own countries and in their investments abroad. Beyond the intellectual analysis and a policy framework for a more ethical capitalism, this is also the story of real people as they have struggled to cope with and even thrived during the crisis. Their insights, experiences and survival skills can empower and inspire us to continue to pursue realistic dreams and to help make capitalism work for all of us.0