Has Western capitalism failed?
Twenty years ago, the fall of communism in Eastern Europe seemed to prove the triumph of capitalism. But was that an illusion? Constant shocks to the world's financial system over the past few years prompted the BBC World Service's Business Daily programme to ask leading figures whether they thought Western capitalism had failed.
Angel Gurria: Secretary General, Organisation for Economic Co-operation and Development (OECD)
My answer to this question would be no. But I also wonder whether capitalism should be answering to the prosecution.
We failed as regulators, we failed as supervisors, we failed as corporate governance managers, we failed as risk managers, and we also failed in the allocation of roles and responsibilities for international economic organisations.
Some international organisations saw the crisis coming. Some even managed to put out some warnings, but they did not co-ordinate their assessments, they did not speak with one strong voice.
It is very important to send clear signals of how we are going to address this debt problem without sacrificing growth and employment”
Thus, they were ignored in an atmosphere of great prosperity where everybody was making a lot of money and everybody thought that innovation was the name of the game - and by warning that something could go wrong, you would look like you were holding progress back.
There was also the philosophy that markets needed to function with the least possible government intervention. But that did not mean that they could work without any intervention at all, nor did it necessarily mean that the intervention could be such a light touch that you were not able to identify risks.
So the crisis left a dire legacy. A legacy of high unemployment, enormous fiscal deficits which we are still struggling to control, and an accumulated public debt which has already reached 100% of GDP on average in the OECD countries.
It is very important to send clear signals of how we are going to address this debt problem without sacrificing growth and employment.
Reforms to product and labour markets, education, innovation, green growth, competition, taxes, health - they are the things that should be the object of our primary focus in the context of a long-term strategy to restore sustained growth.
This will create jobs and help to tackle debt.
We also need to "go social" and focus on innovative policies to protect the most vulnerable.
Ken Ofori Atta: Executive chairman and co-founder of Databank Financial Services (Ghana)
The 20 years prior to the recent credit crisis could be described as capitalism as its best, with global wealth accelerating at ever increasing rates.
Since 1990, when we left Wall Street and founded Databank to offer the first investment banking services in Ghana, we were able to capitalise significantly on the boom years,
We have also observed and embraced how some of that capitalism-fuelled wealth has found its way into funding education, innovation and creativity, all in pursuit of a better life and hopefully a better world.
What went awry among the frenzy for growth in more mature markets was people losing sight of the fact that someone somewhere has to work hard”
All too recently this notion was challenged. The spark that ignited the crisis led to a conflagration of adverse effects. These spread like a virus across North America, Europe and right down into Asia.
While our counterparts dealing on the historically more developed markets were taking increasing amounts of risk, employing complicated financial instruments to make returns from increasingly complex derivatives, Ghana - and Africa as a whole - was focused largely on helping to fund a growth in enterprise.
We were not so widely exposed to toxic assets so we weathered the storm well. And we did so employing the techniques the Databank founders learnt on Wall Street: Western capitalism in its truest form.
From this Ghanaian's perspective, no talk of capitalism could be made without mentioning Dr JB Danquah, the father of this philosophy in the then Gold Coast. Danquah's vision was to create an environment in which individuals would be able to set up and run enterprises that would in turn create wealth for themselves and their households.
Citizens would therefore be in the position to acquire and own properties that could be used as collateral for credit to enhance their businesses and expand wealth to benefit more families.
This thesis not only allows many people to create wealth, but stimulates initiatives, making people more independent for their own good and also for the good of the nation.
What went awry among the frenzy for growth in more mature markets was people losing sight of the fact that someone somewhere has to work hard to make a market and build a business to create real enduring value that goes beyond the bottom line.
Chandran Nair: Founder of Hong-Kong based think tank Global Institute For Tomorrow (GIFT)
The extreme form of capitalism which has permeated the world, particularly in the last 30-40 years, is in deep trouble and we are in denial.
It is important to understand that fundamental principles of capitalism - that human beings are rational and markets behave rationally, and that markets will assign prices - are flawed.
It is also important to understand the roots of modern capitalism.
You could argue that slavery was the first attempt to under-price resources. When slavery came to an end there was colonisation, which was again an attempt by the capitalist model to use resources cheaply. With the end of colonies, we had the globalisation argument of economic growth and then the globalisation of finance.
Capitalism has essentially hit a wall and a very different conversation needs to take place”
When I speak about this in Europe, they say there has been 30 years of over-leverage, but I say they should multiply that by 10 and look at 300 years of essentially exploited growth.
What we need to recognise now is that the world is a very different place from what it was 100 years ago when we had one billion people.
With a current population approaching seven billion, things will have to change.
A fundamental issue that the world will have to recognise, and which Western capitalism has conveniently ignored, is that the goods and services which companies and economies seem to thrive on are based on under-pricing resources and externalising costs.
That game is over and we need a fundamental restructuring - essentially about how people will live, and we need to move beyond simple notions about growth to more sophisticated, nuanced discussions about human progress.
That is not the same as suggesting that economic growth will be able to deliver i-toys and cars to everyone. This is not possible and that is where capitalism has essentially hit a wall and a very different conversation needs to take place.
Professor Tim Jackson: Author of Prosperity without Growth - economics for a finite planet
Every society clings to a myth by which it lives.
Ours is the myth of economic growth. For the last five decades, the pursuit of growth has been the single most important policy goal across the world. The global economy is five times the size it was half a century ago. If it continues to grow at the same rate it will be 80 times that size by the year 2100.
This extraordinary ramping up of global economic activity is without historical precedent. It is totally at odds with the finite resource base and the fragile ecology on which we depend for survival.
Most of the time, we avoid the stark reality of these numbers. Growth must go on, we insist.
The days of spending money we do not have on things we do not need to impress people we do not care about are over”
The reasons for this collective blindness are easy enough to find.
Western capitalism is structurally reliant on growth for its stability. When growth falters - as it has done recently - politicians panic. Businesses struggle to survive. People lose their jobs and sometimes their homes.
Questioning growth is deemed to be the act of lunatics, idealists and revolutionaries.
Yet question it we must. The myth of growth has failed us. It has failed the two billion people who still live on less than $2 a day. It has failed the fragile ecological systems on which we depend for survival.
But economic crisis presents us with a unique opportunity to invest in change. To sweep away the short-term thinking that has plagued society for decades. To engage, for instance, in a radical overhaul of dysfunctional capital markets.
Untrammelled speculation in commodities and financial derivatives brought the financial world to the brink of collapse just three years ago. It needs to be replaced by a longer, slower sense of capital.
Fixing the economy is only part of the battle. We also have to confront the convoluted logic of consumerism. The days of spending money we do not have on things we do not need to impress people we do not care about are over.
Living well is about good nutrition, decent homes, access to good quality services, stable communities, satisfying employment.
Prosperity, in any meaningful sense of the word, transcends material concerns. It resides in our love for our families, the support of our friends, the strength of our communities, our ability to participate fully in the life of society, a sense of meaning and purpose in our lives.
Lord Desai: Member of the House of Lords, emeritus professor at the London School of Economics
Capitalism is alive and well, but not in the Western countries - it has migrated eastwards.
Russian capitalism is somewhat old and in need of urgent repair, but the spirit of capitalism - risk-taking, saving, investing, hard work - all those virtues have now migrated and are happily ensconced in China, India, Indonesia, Korea and Japan - the countries which we never thought would ever get out of poverty.
Western capitalism probably had half a century of over-indulgence - continued prosperity, full employment, almost guaranteed growth - and that in its turn meant that our costs went up and manufacturing industry migrated abroad, while finance has proved to be a fickle friend.
We have to do something to get ourselves out this crisis but that will have to be in the spirit of capitalism, not against it”
We will have to rethink our model, our values, we will have to acquire old-fashioned virtues, because capitalism is not going to go any time fast.
If Asia has vigorous energetic capitalism and we have tired old capitalism, we will end up paying a huge price and we will trade our prosperity for their prosperity.
Socialism died 20 years ago - capitalism lives on.
It changes its form, it migrates, it is fully global. Now we at last understand what globalisation means - it means we are just as important as anyone else. If we don't work very hard, we will lose our importance.
That is the lesson of the contemporary world.
Capitalism lives through crisis. That is how it renews and invigorates itself.
For our bad luck, capitalism has renewed itself by migrating eastwards. We are left with the debris and we have to do something to get ourselves out this crisis but that will have to be in the spirit of capitalism, not against it.