[Marxism] Walden Bello: Primer on Wall Street Meltdown

[Walter Lippmann <walterlx@xxxxxxxxxxxxx>]

JUVENTUD REBELDE
Primer on Wall Street Meltdown

The Wall Street meltdown is not only due to greed and 
to the lack of government regulation of a hyperactive 
sector. It stems from the crisis of overproduction that 
has plagued global capitalism since the mid-seventies, 
argues Walden Bello

[excerpt, from the conclusion]

What's going to happen now?

We can safely say then that there will be more bankruptcies and
government takeovers, with foreign banks and institutions joining
their US counterparts, that Wall Street's collapse will deepen and
prolong the US recession, and that in Asia and elsewhere, a US
recession will translate into a recession, if not worse. The reason
for the last point is that China's main foreign market is the US and
China in turn imports raw materials and intermediate goods that it
uses for its exports to the US from Japan, Korea, and Southeast Asia.
Globalization has made "decoupling" impossible. The US, China, and
East Asia are like three prisoners bound together in a chain-gang.

In a nutshell...?

The Wall Street meltdown is not only due to greed and to the lack of
government regulation of a hyperactive sector. The Wall Street
collapse stems ultimately from the crisis of overproduction that has
plagued global capitalism since the mid-seventies.

Financialization of investment activity has been one of the escape
routes from stagnation, the other two being neoliberal restructuring
and globalization. With neoliberal restructuring and globalization
providing limited relief, financialization became attractive as a
mechanism to shore up profitability. But financialization has proven
to be a dangerous road, leading to speculative bubbles that lead to
the temporary prosperity of a few but which ultimately end up in
corporate collapse and in recession in the real economy.

The key questions now are: How deep and long will this recession be?
Does the US economy need another speculative bubble to drag itself
out of this recession. And if it does, where will the next bubble
form? Some people say the military-industrial complex or the
"disaster capitalism complex" that Naomi Klein writes about is the
next one, but that's another story.

Walden Bello, is professor of sociology at the University of the 
Philippines, president of the Freedom from Debt Coalition and s
enior analyst at Focus on the Global South.

FULL: 
http://www.juventudrebelde.co.cu/international/2008-10-10/primer-on-wall-street-meltdown/













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=========================================
     WALTER LIPPMANN
     Los Angeles, California
     Editor-in-Chief, CubaNews
     http://groups.yahoo.com/group/CubaNews/
     "Cuba - Un ParaÃso bajo el bloqueo"
=========================================

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