Well, the book and the author stand point from the first few pages present clearer what they are, Neo-Randian (Ayn Rand) Conservatives, of free-market with perhaps ‘very light, very very light’ regulation (I am trying hard to look for another word other than this, regulation, as the other does, what ”partnership’ of Private-Government necessity to working together; the Capitalism 4.0 Model).
Anyway they are useful points and shortcomings that I would love to review briefly.
For example, the author writes and accept the ‘follies’ of a ‘truly free-market’, which he sees in the 2009 crisis to have ‘refuted all these market fundamentalists assumptions….in turn, implies that governments and central banks will have to take greater responsibility’ in managing economies (p.9). He looks at how this preposition might mean that, the governments rather being small will be growing enormously as a result of new responsibilities post-Reagan-Thatcher Model of Free-Market: absent government. But he notes unlikely as ”the opposite is likely to happen in Capitalism 4.0′, that ‘the size of government will have to shrink, even as its responsibilities and influence expands’ (pp. 9-10). From here, he sets forth argument and justification of contemporary western government policies of public cuts, extensive privatisation (of nhs and other public sector services) as unavoidable and necessary; ”In Britain”, he writes, prophetically (or not, to be seen), ‘healthcare will have to become more market-oriented, with more private financing and market competition’, but not US (p. 10).
The next theme, as expected, to be listened, one has to entice fear first, and Kalentsky entire foundation of his New Capitalism Model (4.0) is based and stands on this, that we either adopt it, accept its truth and model our economics on this New Model or we see the western free market capitalism DESTROYED by new socio-economic and political alternative from the ‘Authoritarian Chinese Model of Capitalism’, as he phrase it; The New Communism 2.0 (Cold War 2.0 but with China), he might as well said this. He writes;
”Finally, and perhaps most seriously, China’s growing confidence in its model of authoritarian, government-led economic development is creating inevitable frictions with Western geopolitical interest and offering emerging nations a genuine alternative to democratic market-led development” (Told You, the old Fear-nomics: p. 11).
He quotes at length perhaps the most insightful and rationally prophetic Model by any individual to have come in explaining the recent events and the crisis to come, that of Mohammed El-Erian New Normal Theory, which ‘describe the depressed economic conditions…to prevail for many years, perhaps even decades, after the crisis’, (p. 12) which what exactly our governments, economists and other leading figures and commentators are now accepting to be happening. This theory state that ‘The new economic environment would be marked by permanently weaker activity, employment and profits, as artificial stimulants for excessive borrowing was removed”, and to continue his fear-nomics, Kaletsky writes, ”If this prediction turns out to be right, it will raise serious questions about the long-term survival of a free-market capitalist system. Sort of ‘shut-down system”, if we dont command the global economy, we are finished.
The Single Question for Mr. Kaletsky is why cant the two-long-term parallel-systems continue to co-exist ‘Parallel-Wise’, rather stoop to fear-mongering of Cold War struggle for Democratic Capitalism of Authoritarian Capitalism.
Anyway I will stop here at the present and perhaps come later back to discuss more of this book and it relevance or not within the contemporary international political economics.