Bearing in mind that the 'cure' being offered for the Asian crisis is a move in the direction of market discipline for the Asian economies, it is well to recall that contemporary crises are often the product of solutions to earlier crises. "There was an old lady who swallowed a fly . . ." I try to get a bead on the trajectory of the crisis by reading the moment of re-entry (1997-98) against the background of the moment of launch (1979-81). The May-June, 1981 issue of Socialist Review carried an article by Thomas Weisskopf titled, "The Current Economic Crisis in Historical Perspective." The timing of Weisskopf's article, it's historical survey of the post-war boom and the sources of the then current crisis, and it's outline of alternative strategies to overcome the crisis make it a uniquely well- situated document for mapping the trajectory of what Weisskopf termed the market-based conservative strategy. I won't recap here Weisskopf's historical analysis other than to say that in its broad outline it stands up to the test of time. It is his assessment of the prospects of the conservative strategy that, in retrospect, has proven to be untenable. Nevertheless, even those "wrong" predictions stand as a remarkably accurate testament of left expectations at that time. Or, perhaps I should say more modestly, a testament to MY expectations at the time. In Weisskopf's view, "The market-based conservative strategy suffer[ed] from some potentially serious political and economic problems. First of all, it is questionable whether people who have struggled for decades to curb the operation of unfettered market capitalism, and thereby to achieve some degree of state-sponsored economic security, will accede to major economic setbacks in exchange for the promise of 'pie in the sky, by and by'. . . Second, even if the market-based conservative strategy could be implemented over a cowed political opposition, there are serious questions about its prospects for success on its own terms." Weisskopf's doubts about success on its own terms touched on 1. whether the regime of high profits would be enough to stimulate a new wave of productive capital investment and 2. whether the aggregate demand would be adequate given the limitation of workers' wages and government programs. In light of these shortcomings of the market-based strategy, Weisskopf deemed it more likely that a corporatist conservative strategy would be adopted, with direct government controls on wages, state coordination of investment and research, and an authoritarian political regime. In retrospect, it is possible to say that the conservative strategy involved a mix and match of the market-based and the corporatist approaches that Weisskopf outlined. In other words, Weisskopf may well have been right about the prospects for the 'thoroughbred' market-based strategy. The very success of capitalist restructuring over the past 20 years has relied on its ideological 'incoherence' (admirers might say 'flexibility', 'adaptability', 'pragmatism'). A salient aspect of this mixture of market-based and corporatist strategies has been its geographical distribution. Let's say for the sake of argument that the more corporatist approach adopted in Asia acted as a key buffer for the more market-based approach adopted in North America and Europe, acting to attenuate the problems of insufficient aggregate demand and inadequate investment. Given such a key role for the 'incoherence' of capitalist strategy, what are the prospects for a response to the current crisis (that is to say the current current crisis) that moves swiftly in the direction of greater 'harmonization'? All this should not be taken to suggest that it can't be done. Only that it can't be done with the flick of a switch and that the prospects of success are far from assured. We're more likely to face a protracted period of muddling through than an instant re-orientation (no pun intended) of Asian economies. During the protracted transition, the 'game plan' will no doubt be forgotten in the scramble to respond to emergencies. Regards, Tom Walker ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ Know Ware Communications Vancouver, B.C., CANADA [EMAIL PROTECTED] (604) 688-8296 ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ The TimeWork Web: http://www.vcn.bc.ca/timework/
