We're not doomed. Discuss.
Instead of pontificating this morning on the banking meltdown I am in a mood to ask questions to see if Idle Scrawl's growing band of contributors have any answers.
1. Have we mistaken an essentially US financial crisis for a global one? Given the USA is the financial centre of the universe and the ultimate source of consumption for Chinese goods, Middle East oil etc, you can overdo this - but have any European banks gone bust? Even HBOS, the emerging thesis is, was so badly run (and the UK stock market so laxly regulated) that the shorting attack on it was bound to sink it - so it's an "outlier". Or to re-pose the question, having failed to convince myself: is this primarily a crisis of the Anglo-US banking system?
2. Taking for granted this is a Minsky Moment, shouldn't we stop talking about the "collapse of capitalism"? What is collapsing is a set of ideas, which to most people seemed perfectly rational: that deregulation and information technology, combined with more intelligent economic policymaking had created an unbustable boom. This, incidentally is the source of Gordon Brown's famous claim. As Hyman Minsky pointed out - and he's the only man simultaneously popular with hedgefund managers and anti-capitalists - financial crises are part of capitalism and indeed part of the business cycle.
3. What can come out of the "first crisis of globalisation"? To invoke another economist who crosses political boundaries, Nikolai Kondratieff, is this merely the first crisis of a long-wave of economic growth that began in 1989 and should continue out to 2040? If so it is not the "end" of the globalised economy but the end of the beginning. If we interpret Kondratieff's long-wave theory as an insight rather than a dogma, we can discern that once the first spurt of enthusiasm for a new kind of economy is over, a new way of regulating it emerges. Isn't that what we are at the very beginnings of with Paulson, Chris Dodd and co (or to pose it even more startlingly: could the Chinese way of regulating info-capitalism turn out to be the historic norm?). After all the child labour bosses of 19th century Manchester, before Peterloo, though it was the end of the dynamism of the system when the law intervened to stop them working children to death. On the contrary, the early regulation of the factory system, arguably, laid the basis for the whole 19th century expansion of capitalism.
In short I propose what could come out of this is a highly regulated and more stable info-capitalism. As I am writing this over my cornflakes, I will not endure the Galileo treatment for it. But it's a thought. Like I say. Discuss!