By Ravi Philemon
“We are not out of the crisis yet”, said Dr Jacques Attali, a professor, writer and economist (named by the Foreign Policy magazine as one of the top 100 public intellectuals in the world), at the recently concluded public talk organised by the Asia-Europe Foundation (ASEF), and titled “Is the Global Economy Still in Crisis?”
In his talk filled with much research and delivered in the most irreverent manner, Dr Attali emphasised that the real problem of the economic crisis is still in America, and not just in the American government but also in the American financial institutions. He observed that “the economic situation in the US is worse than ever before, especially as the US debt is still 350% of the GDP, and with 650,000 Americans still homeless.”
“G20 is a meeting of alcoholic addicts”, said Dr Attali in emphasising why the G20 submit will be almost useless in mitigating the global economic crisis. “And the G7 is slowly being replaced by the G2 – the American and the Chinese”, he added. But China he feels would “never be a substitute for America for many decades”, as they are very inward looking.
Dr Attali believes that the real power in the world today is held by the financial institutions and they do not want to see any solution to the global economic crisis because “even in a crisis, they make money”.
“I believe we are going to see a crisis of mega size in the western world in a matter of months”, he reiterates and he trusts that only a “global rule of law” would be able to solve this crisis.
The crisis is exacerbated because of the inability of the private banking sector to respond adequately to the excessive demand for loans. Insolvent banks that have had their liabilities absorbed by the public sector have also caused a rise in public debts. There needs to be a system-wide overhaul he feels, but adds that “as long as people trust a system, the system will last”.
By noting that 80% of the economic growth in the last decade went to 1% of the population, Dr Attali asserts that “we must save humanity by creating a bit of equality”.
Dr Jacques Attali, a professor, writer and economist was named by the Foreign Policy magazine as one of the top 100 public intellectuals in the world. He was the founder and first President of the European Bank for Reconstruction and Development from 1991 to 1993. He was Special Adviser to the late French President François Mitterrand from 1981 to 1991. He was also appointed by French President Nicolas Sarkozy in August 2007 as head of the Commission for the promotion of French economic growth. Dr Attali has written 54 books with over six million copies sold internationally. His works include essays on a wide range of subjects such as mathematics, econometrics, music, biographies and plays.
This public talk was organised by ASEF in partnership with the Institute of Southeast Asian Studies (ISEAS).