Munich Personal RePEc Archive

Investing In Civilization

Freeman, Alan (2009): Investing In Civilization. Published in: Bailouts and Bankruptcies (15. February 2009)

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Abstract

This paper asks whether, and how, the state can solve the present crisis. The method of enquiry is to analyze what it did in the two comparable crises of 1893 and 1929. In each case, a prolonged and structural slowdown in the world economy was followed by financial crisis, a period of turmoil marked by strong and active state intervention, then a period of prolonged exceptional growth which can be considered, at least economically, a solution to a crisis.

I draw two immediate conclusions. First, the state needs to intervene on a greater scale than previously (or currently) supposed. Second, its role cannot be conceptualized as purely economic.

The sustained recoveries of past crises were the result of what I term civilisational change, facilitated by the state. It did not merely spend money, organize production, or offer credit but established far-reaching new cultural and social conditions that shaped the entire following epoch and with which we still live. The key therefore is to frame correctly the relation between the state’s economic role, and its political and social role.

This in turn requires us to understand, and correctly state, those achievements of the present time which can and should be made universal – converted into general rights which, whilst not actually and practically generalized as a result of the inequalities introduced by expansive phases of social production, become defining of ‘being human’ – as were, for example, food, shelter, clothing, education, or literacy during previous prolonged expansions. Society has reached a stage of material sufficiency. Its produce, if distributed equally throughout the world, could provide the above for every citizen. The reason these benefits are not universal is therefore social and political, and no longer natural.

At the same time society has reached a stage of cultural expansion in which the fastest expanding sources of demand and production, though confined to a minority, are to be found in the sphere of design, aesthetics, performance, and human self-expression and enjoyment.

This last fact means that sustainable growth, centered on the enhancement and extension of the human spirit instead of the material depletion of the planet, is a real social and economic possibility for the first time in the history of modern civilization. Moral necessity and historic possibility coincide: what is lacking is the social and political will to achieve what is within our grasp.

The task is therefore, first, to finish the unfinished business of the last phase of expansion, and provide a guaranteed level of material wellbeing below which no citizen of the world can fall, which implies ending once for all the gross inequalities characterizing the present crisis; but, second, to initiate a new process of growth in which the self-realization of human potential is set above all other goals. The defining universal human rights which the next phase of expansion must therefore aspire to are the right to create, the right to sustain, and the right to care.

This was first published in February 2009 as a chapter of the book Bankruptcies and Bailouts, edited by Wayne Anthony and Julie Guard and published by Fernwood Press, Winnipeg, MB

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