Today's Sunday Telegraph contains this important extract from Joseph Stiglitz's book "Freefall: Free Markets and the Sinking of the Global Economy" (Allen Lane, 2010). The book is due to be published on 28 January. The extract appears under the heading "Why We Have To Change Capitalism".
Stiglitz presents a Keynesian-style case for international and governmental controls, regulations and interventions over the operations of capitalism, especially in relation to its speculative financial activities.
There is a danger that numbers of socialists will reject Stiglitz approach on the grounds that we need to replace capitalism rather than trying to help it survive by reforming its operations. Such a reaction to Stiglitz's proposals would be mistaken.
For those of us who believe that socialism and democracy reinforce each other, the proposals which Stiglitz advocates would help to open up a space in politics where democratic socialist ideas would once more be able to live and breathe. Such an objective should be our priority. Always remember that our own economic crisis of 1931 and the immediate electoral collapse of Labour was eventually followed by the election in 1945 of a Labour Government with a substantial majority who produced a mixed economy with a welfare state and full employment.
For socialists who remain in doubt, please check this out.