The Crisis Of Global Capitalism. - Review - book reviews

THE CRISIS OF GLOBAL CAPITALISM [Open Society Endangered]

George Soros. 1998; 245 PP. $26. Perseus Books Group/ PublicAffairs.

Market fundamentalism is Soros's preferred term for laissez-faire economics. He views it as a belief structure based on some wisdom and two crippling fallacies: that economic behavior seeks equilibrium, and that market values are sufficient for society. Furthermore, "a key feature of fundamentalist beliefs is that they rely on either/or judgements.... If state intervention is faulty, free markets must be perfect." Since about 1980, with Reagan and Thatcher, the world has increasingly been run on market fundamentalist doctrine. The current Asian financial crisis is one result.

The book is more diagnostic than prescriptive. It is theoretically original and astutely analytic of contemporary events, written with the authority of a major player who has tested his theories for decades and operates with close study of world events and strong participation in them. His moves in Russia and Indonesia, for example, affected those countries and the world economy.

In what kind of places is the book taken seriously? TIME magazine recently reported: "Clinton spent an afternoon stretched out on a White House couch with one eye on the TV and the other on George Soros' complex new book on the risks of capitalism. He finished it in a day and quickly passed the underlined, dog-eared copy to his aides as required reading."

"We need a global society to support our global economy. A global society does not mean a global state. To abolish the existence of states is neither feasible nor desirable; but insofar as there are collective interests that transcend state boundaries, the sovereignty of states must be subordinated to international law and international institutions. Interestingly, the greatest opposition to this idea is coming from the United States, which, as the sole remaining superpower, is unwilling to submit itself to any international authority. The United States faces a crisis of identity: Does it want to be a solitary superpower or the leader of the free world?

"The supreme challenge of our time is to establish a set of fundamental values that applies to a largely transactional, global society. Fundamental principles have traditionally been derived from some external authority such as religion or science. But at the present moment in history, no external authority remains undisputed. The only possible source is internal. A firm foundation on which we can build our principles is the recognition of our own fallibility.... It means accepting open society as a desirable form of social organization.

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