Neoliberalism has worsened economic problems: Analyst
Press TV has interviewed Paolo Raffone, Brussels-based secretary general at CIPI Foundation, to discuss Organization for Economic Cooperation and Development (OECD)’s warnings, raising the alarm for the economic costs of rising inequity in developed countries.
What follows is a rough transcription.
Press TV: Why is it that inequality is increased? Is it because too much attention was given to economic growth and the trickledown effect?
Raffone: Well, in fact we know that when anti-austerity measures and quantitative easing are coupled, the result is that of polarizing the society and it is what is happening in the United States and Europe. Because the flow of money that is poured into the system doesn’t go to the people and is not given in credits, so it is concentrated in those who already have the capacity to do so. And the result of what we see is a well-known effect in the economic theories but it seems that our governments do not take this into account.
Press TV: Right, but now the OECD is recommending a wide range of government measures, wouldn’t that go against these government policies of neoliberalism though?
Raffone: That is very correct and it is very surprising that the OECD is coming out with such a proposal as for the past 25 to 30 years they have been insisting on neoliberalism and on monetarism. So it is very strange that now they do not seem to recognize the failure of the neo-liberal approach but they suggest that there should be government spending. But how can there be government spending if there is an anti-austerity measure? So it is just speaking to the wind; this is not correct. There should be done an assessment on the failure of the neoliberal approach, which has not solved the problems which were known since the 70s in the capitalist system; on the opposite, it has even worsen them. So now a new pact should be started but if this political assessment for recognizing the mistake is not done I do not see how this can be achieved.
MTM/KA
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