THE Great Depression of the 1930s was a clear demonstration of the contradictions of “laissez-faire capitalism”.  Some economists like John Maynard Keynes, had attributed it to the failure of markets. They thought markets could not distinguish between “speculation” and “enterprise”. They got dominated by the speculators to a point where “enterprise becomes the bubble on a whirlpool of speculation”. As a result, the level of employment and output in the economy, and hence the livelihoods of millions of people, came under serious threat. It became dependent on the whims and caprices of financial speculators and manipulators. A kind of casino economy.

These economists including Keynes recommended “socialisation of investment”, that is, state intervention to ensure that the level of investment in the economy was such to achieve “full employment”.  Public money was needed to bail out the bankrupt capitalists who have wrecked the economy and threatened the very livelihood of millions across continents. Poverty of markets is visible, yet the arguments like it is cyclical and it would end soon and better days are around the corner are heard every now and then. Why it is cyclical is not answered. Political leaders are under pressure from the bankrupt banks that have swallowed billions and speculative industrialists sharks to put billions of dollars into the pockets of these people. It is privatisation of profit and socialisation of loss.

That “laissez faire capitalism” is basically irrational and needs to be replaced by state intervention, has never been successfully refuted by neoliberalism.  In fact, neoliberalism has always been empty-headed. The unfettered operation of markets is unashamedly unreal. The emergence of international finance capital in its unbridled form that exploited deliberately left loopholes to enrich itself at the cost of industrial growth and equity has lead to this situation. It has been picking profit making companies for a song and then by taking away profits at fast speed, wrecking them. It was termed as turn around and miracle economy.

Now the answers in different forms are being sought from the same class that has wrecked. Solution is that public funds from the tax payers must bail out they system, make some temporary corrections, instill some confidence and everything should look normal. No basic change in the system is required. First the public was cheated and then the public must pay for being cheated. Robbers and thieves are being sought to suggest remedy for the ills of the economy. It won’t work as everyone knows.  The days of neo liberalism are over and those who seek refuge under it would suffer the same fate.

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