On Wednesday, October 8th,2008, Sir Courtney N Blackman,former Governor of the Central Bank of Barbados and a graduate of Harvard Graduate School, delivered an important address in honour of Dr Trevor Farrell at the University of the West Indies,St Augustine.In this address , he outlined his own rationale for the global financial crisis and this was carried in the T+T Review of February 2, 2009.I owe Sir Courtney a great debt for his article.He says;
The current crisis is the most devastating in recent economic history.Iconic Wall Street institutions like Bear Stearns,
Lehman Brothers and Merrill Lynch have vanished;the world's largest mortgage insurers,Fannie Mae and Freddie Mac,
have been nationalized and the world's largest insurance company,AIG,with operations in 100 countries and with over
100 000 employees,survives only by the grace of the US Treasury...........
Sir Courtney further argues that the economic crisis is in itself ''a spectacular failure of Neo-Liberalism,and is therefore an occasion for its displacement by a new paradigm or, at least,its radical reconstruction.''In my next blog,I will make an attempt to introduce a new paradigm,that ,if implimented, might be able to bring stability to the world financial market,and consequently, pull America out of recession-a recession mind you,that has accounted for employers sending home more than 650 000 workers every month since December.
In explaining the intellectual construct upon which the term paradigm is based Sir Courtney invokes Kuhn's identification of two essential conditions for a successful paradigm change.Firstly,the existing paradigm must suffer an unacceptable technical breakdown,thus creating a crisis;and secondly,a novel and clearly superior paradigm must be available.[In my next article I will attempt to show why I disagree with Kuhn,at least with his second point.]In his postscript to the third edition of ''The Structure of Scientific Revolutions'' he therefore introduced the element of community into his concept of the paradigm............it stands for the the entire constellation of beliefs,values, techniques, and so on shared by the members of a given community''.In my next blog I will dwell a little more on this idea of ''community'' and what role it can play in a new paradigm.
Sir Courtney continues-
Neo-Liberalism is the direct descendant of the laissez-faire paradigm inaugurated by Adam Smith's''The Wealth of Nations'' in 1776 and elaborated by successive Classicaleconomists,culminating with Alfred Marshall's ''Principles of Economics'' in 1920.The Classical paradigm failed to deal effectively with the Great Depression of the 1930's and was superseded by the Keynesian paradigm.Throughout the cold war,there were two competing paradigms,the Keynesian in the West and Marxist-Leninist in the Eastern Bloc.While leaving the vast majority of economic decisions to the Private Sector,John Maynard Keynes,in 1936,had advocated contra-cyclical regulation of government spending through the use of monetary and fiscal policy towards the maintenance of economic stability with full employment.
The article continues to detail that when the Keynesian policies failed in the 1980's to resolve the problem of stagflation[ie the simultaneous occurrence of inflation and unemployment Ronald Reagan and Margaret Thatcher endorsed the thinking of the Chicago School of Economics under Milton Friedman and so Keynesianism was replaced by the Classical laissez-faire paradigm.
Causes enoch john Supports
freedom of thought and expression