Global Poverty and Financial Crisis: Are We Trapped in an Obsolete Economic Order?

Abstract

The capitalist world order has many profound accomplishments to its credit.¹ Those accomplishments are not under discussion here. Rather, I am motivated by a concern that the triumphalism accompanying the current hegemonic world economic order will lead a number of influential political leaders and citizens to suppose that we have happily arrived at the end of economic history. Conservative polemicists wish us to believe this to be true (Fukuyama, 2006). Indeed when Margaret Thatcher gloated that ‘there is no alternative’ (now known as the ‘TINA doctrine’), she anticipated an entire generation of self-congratulatory excess that followed the shift to a ‘capitalist road’ by China, and the subsequent collapse of the Soviet Union in the early 1990s. Some want us to believe that these transformations — often characterized as ‘surrenders to the free market’ — offer definitive proof of the superiority of global capitalism. Even an average philosopher would ask: ‘Superior with respect to what?’

[W]hen we succeed in finding a definite causal relation between two phenomena, our problem is solved if the one which plays the “causal” role is non-economic. We have then accomplished what we, as economists, are capable of in the case in question and we must give place to other disciplines. If, on the other hand, the causal factor is itself economic in nature, we must continue our explanatory efforts until we ground upon a non-economic bottom. (Joseph A. Schumpeter, [1911] 1934, 4–5)