Towards a new economic system for the 21st century | Business and economy

In his Prison Notebooks, the Italian revolutionary Antonio Gramsci wrote: “The crisis consists precisely in the fact that the old is dying and the new cannot be born; in this interregnum appear a great variety of morbid symptoms.

Today, it is the world economy, to be precise, which finds itself again in full interregnum. The post-war model of economic growth that produced the golden age of capitalism is long gone, but a new economic system has yet to emerge.

The morbid symptoms abound: intense and growing inequality, massive unemployment and extreme youth idleness in many parts of the world, rapidly declining living standards, dangerously high levels of public and corporate debt, a financial system that remains out of whack, and collapsing ecological.

Moreover, not only does the global economy continue to rely on fossil fuels to fuel growth, but it is actually increasing the consumption of primary energy sources – such as coal, oil and natural gas – despite the phenomenon of global warming which threatens to destroy humanity. civilization as we know it.

Indeed, the existing economic model is outdated: consider also that productivity growth in the world’s advanced economies since the outbreak of the 2008 financial crisis has been extremely slow both in absolute and relative terms. in previous decades. But the model remains mortally dangerous.

Why a new deal isn’t enough

In light of the above-mentioned reasons, many economists around the world, including Thomas Piketty, have proposed the implementation of a new global growth agreement in the mold of Franklin D. Roosevelt’s “New Deal” programs during the 1930s.

The call for a New Deal has also been embraced by several political movements in Europe and the United States, including Bernie Sanders and many of his supporters.

Capitalism is a rather new historical economic system that belongs to a certain era of mankind, which means that there is no suggestion that it will exist forever.


The problem with this approach is that a new global agreement is inevitably structured with the aim of saving the existing economic system, not of overcoming its ultimate contradictions and replacing it with a new socio-economic order, which is todays world really needs.

RooseveltThe New Deal, probably the greatest experiment in active state intervention under capitalism, saved many peoples lives on, but didn’t even end the Great Depression.

What really ended the Great Depression in the United States was the mobilization of all economic resources to support the war effort.

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Roosevelt’s New Deal did not advocate or promote economic democracy, nor did it seek to lay the groundwork for the emergence of a more rational socio-economic order.

Indeed, when worries about inflation and the federal deficit became widespread just a few years after the launch of the New Deal programs, the Roosevelt administration decided in 1937 to reduce its economic stimulus measures, which the US economy in recession.

We need a new economic system

Unless we are prepared to accept social disintegration, increasing conflict and even war as irreversible processes, and sit idly by while global warming caused by the logic of a fuel-based economy fossil fuels is destroying the planet, the existing system of neoliberal transnational corporate capitalism must be replaced with an economic order aligned with human interests and sustainable, balanced growth.

Concretely, this means radically moving away from the processes of constant capital accumulation, possessive individualism and economic globalization.

It also means ending the destructive practices of Western industrial extractive technologies and being respectful of the natural resources that sustain life.

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Economic globalization, which is at the heart of the current economic system, promotes a monoculture economy and has devastating effects on the well-being of most communities in the South and on the environment.

Putting an end to the current dynamics and contradictions of economic globalization does not mean eliminating international trade. But what is needed is the removal of neoliberal trade treaties, which have given global corporations and banks such immense wealth and power that they can advance their own interests regardless of democracy, the rights of workers and sustainability.

As such, we need to rethink terms such as development, growth and progress.

In this case, a consciousness revolution is mandatory for a great change to occur in the functioning of the global economy and in the future we want.

Capitalism is a rather new historical economic system that belongs to a certain era of mankind, which means that there is no suggestion that it will exist forever.

The new economic system should be based on localized forms of industry, finance, participatory democracy and the use of technologies in line with community needs for the production and distribution of food in order to eradicate poverty and hunger and provide sustainable livelihoods.

This consciousness revolution is already underway and has been embraced by millions across the developed and developing world, especially among urban youth, and may soon become the newest political and social movement to emerge as the old system is dying and a new one is struggling to be born.

CJ Polychroniou is a political economist/political scientist who has taught and worked for many years in universities and research centers in Europe and the United States.

The opinions expressed in this article are those of the author and do not necessarily reflect the editorial policy of Al Jazeera.

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