Will Hutton: Global Economy Effectively In Proto-Depression
The Work Foundation CEO Will Hutton pointed out in an interview Tuesday with CNBC Europe that just using official forecast guidance and presently available economic data, the UK is set to experience a much sharper contraction than even endured during the severe global recession of the 1930s, and that the UK and much of the rest of the world has effectively entered a proto-depression.
I'll upload a video link if and as soon as one becomes available.
In the meantime, here is a fascinating exchange between Will Hutton and Tory leader David Cameron:
Guardian UK: Recession Britain: the great debate
Will Hutton, Observer columnist and one of the country's foremost commentators on the global recession, this weekend engaged in an extraordinary email exchange with David Cameron, in the wake of his path-breaking speech at the Davos summit. In it he challenged the Tory leader to explain how he would bring about 'capitalism with a conscience'
Dear David
The Conservative party under your leadership has moved a long way - in both rhetoric and stated ends - and last Friday's speech in Davos, where you outlined your concept of capitalism with a conscience, is another landmark. I know you will say that Lady Thatcher was operating in different times with different needs, but I still don't think she would ever have wanted to say that markets must not trample over values that society holds dear, or to question the need for the profit motive always to triumph. You said: "If markets, and capitalism, and the activities of individual businesses, conflict with our vision of the good society and the good life ... you must speak out." Amen to that.
But "speaking out" is not enough. 2009 is going to be the toughest economic year since the war, and if Britain's GDP falls by more than 5% from its peak in 2007 by 2010 - now virtually certain - we move from the realms of recession to near depression. I recall Tony Blair when in opposition calling for stakeholder capitalism, in rather the same vein as you are calling for capitalism with a conscience, but in practice very little happened. The financial markets were allowed their freedoms, executive pay became more grotesque, society grew more unfair and the dynamics that have created the current mess were unleashed. Actions have to accompany words.
Obviously in the current crash actions are being forced on everybody that, as you acknowledge, would have been inconceivable 12 months ago. But although some of your suggestions - such as the £50bn National Loan Guarantee Scheme - have been innovative and ahead of the curve in addressing the vital necessity of getting credit moving again, I feel that you lack an organising theory to explain what happened and how it underpins your aim to put society before markets and repopularise capitalism...
I'll upload a video link if and as soon as one becomes available.
In the meantime, here is a fascinating exchange between Will Hutton and Tory leader David Cameron:
Guardian UK: Recession Britain: the great debate
Will Hutton, Observer columnist and one of the country's foremost commentators on the global recession, this weekend engaged in an extraordinary email exchange with David Cameron, in the wake of his path-breaking speech at the Davos summit. In it he challenged the Tory leader to explain how he would bring about 'capitalism with a conscience'
Dear David
The Conservative party under your leadership has moved a long way - in both rhetoric and stated ends - and last Friday's speech in Davos, where you outlined your concept of capitalism with a conscience, is another landmark. I know you will say that Lady Thatcher was operating in different times with different needs, but I still don't think she would ever have wanted to say that markets must not trample over values that society holds dear, or to question the need for the profit motive always to triumph. You said: "If markets, and capitalism, and the activities of individual businesses, conflict with our vision of the good society and the good life ... you must speak out." Amen to that.
But "speaking out" is not enough. 2009 is going to be the toughest economic year since the war, and if Britain's GDP falls by more than 5% from its peak in 2007 by 2010 - now virtually certain - we move from the realms of recession to near depression. I recall Tony Blair when in opposition calling for stakeholder capitalism, in rather the same vein as you are calling for capitalism with a conscience, but in practice very little happened. The financial markets were allowed their freedoms, executive pay became more grotesque, society grew more unfair and the dynamics that have created the current mess were unleashed. Actions have to accompany words.
Obviously in the current crash actions are being forced on everybody that, as you acknowledge, would have been inconceivable 12 months ago. But although some of your suggestions - such as the £50bn National Loan Guarantee Scheme - have been innovative and ahead of the curve in addressing the vital necessity of getting credit moving again, I feel that you lack an organising theory to explain what happened and how it underpins your aim to put society before markets and repopularise capitalism...