Economic abyss awaits
Larry Buttrose - November 20, 2008
AS an exhausted world rides the downs and ups of the beast dubbed the global financial crisis, US President George W. Bush insists it does not represent the fundamental failure of the free market system.
“It would a terrible mistake to allow a few months of crisis to undermine 60 years of success,” he said before last weekend’s G20 meeting. “The crisis was not a failure of the free market system and the answer is not to try to reinvent that system.”
But if the crisis has not been caused by the failure of the system, what has caused it? Bush may have suggested “unsustainable lending practices”, but they are part and parcel of the system. He may have muttered “lack of proper regulatory oversight”, but he and his neo-con fellow travellers have pooh-poohed that since they were in their ideological nappies back at Skull and Bones, the elite secret society at Yale University. In their end-of-meeting communique, the G20 leaders did nominate causes, noting “market participants sought higher yields without an adequate appreciation of the risks and failed to exercise proper due diligence … weak underwriting standards, unsound risk management practices … Policymakers, regulators and supervisors, in some advanced countries, did not adequately appreciate and address the risks.”