Friday, October 10, 2008

Sweet Music from the Financial Times

I'm not a regular reader of the Financial Times; I only pick it up when there is a big international economic story. Lately, it has become something like my second read. I value the FT not just for its hard news--which shows that you can write a tight, intelligent story without jumping off the front page--but also for the keen sense of historical perspective that its columnists can bring to the news of the day. And two columns today are well worth noting.

Samuel Brittan's "Kenyes, thou shouldst be living..." opens with a splendid statement from John Maynard Keynes, about the value of government spending to revive a stagnant economy. It then goes on to make a solid point that eludes many American journalists, including those who regularly ask the candidates what austerity measures they will make to get through the present crisis: sometimes deficit spending is necessary to revive an economy. Writes Brittan, "Maxims about debt that might be prudent for families can be the height of folly for governments."

Equally illuminating is Philip Stephens' "The financial crisis marks out a new geopolitical order." "The erosion of the west's moral authority that began with the Iraq war has been greatly accelerated. The west's debtors cannot any longer expect their creditors to listen to their lectures."

He concludes,
I have no inhibitions about promoting the values of the wst--of preaching the virtues of the rule of law, pluralist politics and fundamental human rights. Nor of asserting that, for all the financial storms, a liberal market system is the worst option except for all the others. The case for global rules--that open markets need multilateral governance--could not have been made more forcefully than by the present crisis.

Government money to revive a stalled economy? International rules to tame capitalism? These ideas sound to me like the opening notes of a new New Deal. That's sweet music to my ears. And imagine: all from the pages of the Financial Times. Something is happening.

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