Middle-east Arab News Opinion | Asharq Al-awsat

Caught Between Two Septembers - ASHARQ AL-AWSAT English Archive
Select Page

The United States changed and changed the whole world with it after being subjected to the terrorist events on the eleventh of September 2001, while last September, symptoms of the catastrophic financial crisis appeared in the United States which would eventually lead to major changes in the world’s economic landscape.

In the 1960’s, US economist Milton Friedman won the Nobel prize for economics because of his theories about liberal economy which always demanded to leave the markets operate alone without any government intervention at all because the markets “have a secret hand” and the ability to correct themselves. Friedman established an important economic course that many followed to the point where 70 percent of those who won the Nobel Prize for economics after him adopted the same thinking. Ronald Reagan and Margaret Thatcher followed in his footsteps and carried out many of the economic liberation policies. But events of the current stage prove without any doubt that Friedman’s theories are the biggest loser and that capitalism “becomes a beast” if it is left without control and supervision.

The French and Swedish examples probably appear like a beacon in the present darkness. The United States is now officially suffering from the symptoms of “socialism” and “nationalization” and the way things proceeded before will not return. But is this a correct supposition?

What is happening now is similar to the big depression that hit the United States in 1929 when prosperity was great and loans were easy. Everyone borrowed until they sank in the quagmire of the interest. The depression happened and the administration of the time announced a number of rules and legislations which restructured the entire economy. But what saved the United States was the mobilization of all its strength toward a single aim, the war on Nazism in Europe and the Pacific Ocean, the war which was later called the “good war.”

Many conservatives in the United States today are deeply convinced that what the country really needs is another “good war”, especially with the failure of this idea in Iraq and Afghanistan due to the flimsy evidence provided for going into war and also due to the weak argument and lack of international support. The sight of financial officials in the world in general and the Arab world in particular trying to calm the ordinary people by misleading them that there is not a problem while the world’s markets are sinking like a ship which collided with an iceberg in the middle of the ocean is a sad and desperate one. This kind of denial does not treat the problem.

It is bold and painful measures that treat it, like stopping dealings and a direct “intervention” that is needed for protecting fragile and immature markets (if intervention was taken in mature markets, then why does it not happen in the poor markets?). The difference between the American and European handling of and dealing with the crisis was noticeable. The United States “let” some banks collapse and this aggravated the situation and made it deteriorate further but Europe “pledged” not to let any financial establishment collapse. This was a factor of definite support and stability. The world is watching the rebirth of the economic system and the end of the barbaric capitalist and stupid management era.

Hussein Shobokshi

Hussein Shobokshi

Hussein Shobokshi is a businessman and prominent columnist. Mr. Shobokshi hosts the weekly current affairs program Al-Takreer on Al-Arabiya, and in 1995 he was chosen as one of the "Global Leaders for Tomorrow" by the World Economic Forum. He received his BA in Political Science and Management from the University of Tulsa.

More Posts