Martin Wolf is the influential chief economics commentator at the Financial Times. His most recent column, titled Seeds of its own destruction, is a lengthy contemplation of the future of modern capitalism in the face of what appears to be systemic weakness. It begins, “Another ideological god has failed. The assumptions that ruled policy and politics over three decades suddenly look as outdated as revolutionary socialism.”
Wolf provides a brief history of key inflection points in capitalism over the past few decades, states that we are at another one, but admits that “it is impossible at such a turning point to know where we are going”. That being said, according to Wolf the most likely outcomes are discouraging over the short term. Wolf also reminds us that the way out of the Great Depression was via WWII.
Echoing my earlier post about the real roots of the current problem, Wolf asks “if the financial system has proved dysfunctional, how far can we rely on the maximisation of shareholder value as the way to guide business?” A very interesting question coming from the pages of the Financial Times.