Wednesday, December 03, 2008

Give me Two-Handed Economists Any Day

Dragos Cabat writes in (‘all about insurance’), Roumania, HERE:

Corporate Capitalism on the edge”

“The aim is that, through the state's intervention into these companies' operations and ownership, the corporations situation to recover and investors to calm down (the depositors too, in the banks' case), but there are no guarantees for the management process improvement. That is why the market has no positive reactions towards the government's interference into the economy, accepting them only for a short period of time. For the economic climate betterment it is necessary to reform the corporative capitalist system through "breaking" the big companies and giving the owners the real control over their activities (a trend started in the '80's, but abandoned because of the globalization). A fact is for certain: we are living through interesting changes and the future capitalism will probably look more as the one that was theoretically described by Adam SMITH over 200 years ago

This makes a change. Almost everything I read about the current financial turmoil (or is more like treacle?) suggests that corporate capitalism is over, but few regard it as going back to the small corporate entities of Adam Smith’s day.

Most seem to predict (few with regrets) that Adam Smith is to be rejected too, especially with the myths that have adorned mentions of him, laissez-faire, invisible hands, and all such guff (of which, for the record, he was wholly innocent).

Dragos Cabat does not say much about how this ‘new’ world is about to be drawn up, agreed and created. Probably just as well. Predictions about the future, especially those radically different to an existing present, usually prove embarrassing to those who make them.

Like Adam Smith, I think it best not to make predictions. It’s always a trade off and in this sense the ‘two-handed economist’ is positively saintly compared to the kind who gives definite answers to complex problems, especially those involving human beings.



Post a Comment

<< Home