Oct 23, 2012
BBC Newsnight economics editor Paul Mason discusses the current global economic crisis from a journalist’s perspective, asking – “When and how will the crisis end?” Writing in the International Journal of Management Concepts and Philosophy, Mason argues that the global economic crisis needs to be seen as “an attempt to return to stability after the great disruption of the decade before the 2008 crunch.” He reported on the crisis of 2008 as it happened from the US and in his book Meltdown was apparently one of the first to describe publicly what went wrong. His hypothesis is that the strain of preventing a major slump as was experienced by the industrialised nations in the 1930s Great Depression has introduced significant “systemic tensions” in global financial and commercial systems that are yet to be released.
“The long-term choice involved in recovery is between rethinking the nature of the global economic and financial architecture and some type of competitive solution to the crisis,” Mason suggests. Unfortunately, we are to put it figuratively, stuck between a rock and a hard place, between the Devil and the deep blue sea, caught between Scylla and Charybdis because as he adds, “Both of these have unpredictable outcomes.”
In his paper, Mason concedes that he is not an economist, he does not even have a high-school qualification in economics. But, he says that has not hindered his understanding of the bigger issues. Indeed, there is one school of thought that an “outsider” attempting to grasp the intricacies of a specialist subject either gains a clearer understanding than many of those on the inside or else becomes a specialist through their research endeavours. Of course, as a journalist, Mason does have access to endless financial reports that the lay public simply never sees, including those published by Goldman Sachs, Standard Chartered, the World Bank, the OECD and many other organisations.
From Mason’s perspective he sees two extreme outcomes of the releasing of those inherent tensions across global economics. On the one hand, there might be a competitive race, currency walls, runaway inflation resulting from quantitative easing (banks printing money) in which China perhaps emerges victorious and stronger, Japan and perhaps peripheral Europe lose, and the US is left in a kind of limbo. At the other extreme, a reinvention of globalisation in which the state takes a serious belly blow to allow the global economy to re-emerge. Unfortunately, no state could survive a second such injury. “This is the problem of the crisis,” Mason concludes.
Mason, P. (2012). When and how will the crisis end? An economic journalist’s perspective, International Journal of Management Concepts and Philosophy, 6 (3) DOI: 10.1504/IJMCP.2012.049945