Capitalism 4.0: The Birth of a New Economy in the Aftermath of Crisis
PublicAffairs, 2011 (2011)
Read an Excerpt
Reviewed by Bob Walch
natole Kaletsky in this provocative book puts a new spin on the recent financial crisis. According to the columnist and editor-at-large for
The Times of London
, the recession we are slowly emerging from is part of an evolutionary process inherent to the nature of democratic capitalism.
aletsky sets forth his belief that what collapsed in September of 2008 was not a bank or a financial system but rather an entire political philosophy. And, more importantly, the writer says that the breakdown was necessary for a rebirth of the capitalist system. He shows that this was the fourth such episode in the cycle of capitalism.
he first (
) was the classical laissez-faire capitalism that lasted from 1776 until 1930. Next (
New Deal Keynesian
social capitalism created in the 1930s and extinguished in the 1970s. Following that, (
) the next mutation, Reagan-Thatcher market fundamentalism, culminated in the financially-dominated globalization of the past decade and triggered the recession of 2009-10.
hat, then, leaves the door open for the next phase of capitalism's evolution,
. Gazing into his crystal ball, Kaletsky sees something quite different from the totally deregulated market.
hat will this new capitalism look like and how will it work? That's what this book is all about. The author foresees a strong export-led recovery with a strengthening dollar. All the major economies will keep interest rates near zero to create jobs and control debts.
e also suggests that democratic capitalism will be the model of emerging nations like India and Brazil. As governments extend into finance, energy and healthcare, they will have to retreat from other areas, ranging from postal services and water supply to education and retirement.
o avoid national bankruptcy and the resulting financial chaos, the U.S. will have to cut medical costs and Social Security entitlements or dramatically increase taxes. Corporate America will also realize that collaboration with the government makes more sense and, in the long run, is more profitable than opposition.
hese and a number of projected outcomes discussed in this book may not set well with all readers and, of course, they might not actually occur but there is plenty of food for thought here.
bviously, we have entered a new era which will bring with it some major economic changes. Whether this will be good or bad remains to be seen, but the more thought given to the direction we will move in as the new decade unfolds, the better for everyone.
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