The Policies that Nobody Wants?

So far Latin America has been spared the worst of the crisis. Economists concur in thinking that for the region the crisis has been more a problem in trade than a financial stranglehold. However, the evolution of the global economy indicates that Latin American countries too should take rational prudential measures in the second decade of the century. This runs counter, of course, to the political needs of the moment that lead governments to spend more than they should in periods of elections. Moreover, at the global level itself-in the central economies-the rescue measures that were originally taken have been partial and shy. By leaving culprit institutions in place, they end up fostering a return to the dubious practice of speculation; they promote the further concentration of wealth and power; and they leave in the shadow of a weak recovery hundreds of millions of people who wish to work but can't. The appropriate slogan for this “recovery” should be “more of the same” or “let's fall forward.”

In this rather somber context of recovery with slow growth, big unemployment, and greater social inequality in two thirds of the world, we may anticipate an even worse crisis in the future. It is no longer just Japan that faces a “lost decade,” but the United States and Europe as well.