Saturday, December 10, 2011
This article by Ken Rogoff in a very short space addresses some of the pressing problems with contemporary capitalism. His first point, and one that bears remembering, is that we have no better alternative. To paraphrase Churchill, capitalism is the worst form of government except when compared to all of the others. Does Europe (certainly not!) or China (still young) have a better model of capitalism? No, not really; different, not without significant problems. Rogoff notes, in a very brief and succinct article, five areas where contemporary capitalism has problems: health care, finance, inequality, under valuation of common goods (air, water); under valuation of the future, and consumerism (we sell a lot of food ("good"), and we get fat. Very thoughtful. I think capitalism, with about every system, has a real agency problem, but I don't know the best cure.