Comparison of Buying Time by Wolfgang Streeck - Book Report/Review Example

Book reviews, Political Science Introduction The highly though-provoking book “Buying Time” authored by Wolfgang Streeck and published in 2014 draws expansively from his 2012 Adorno Lectures which were given in Frankfurt and places the noxious 2008 financial crisis in the perspective of the extensive neoliberal conversion of postwar capitalism that was instigated back in 1970s. In the explicitly political book, Wolfgang comprehensively analyses the tensions and conflicts involving capitalist interests, voters, governments and states; conflicts whose repercussions were expressed in rising unemployment, private indebtedness, public debt and inflation. ‘This Changes Everything: Capitalism vs. The Climate’ is a bookwritten by Naomi Klein in 2014. Naomi used her book to depict to us howcapitalism is to be blamedforcausingclimatecrisis in theworld, andthis has proventhatshe is a social activist whoanalyzes neoliberal economics. However, Naomi is not an expert in any of thesefieldsthuswe cannot concludethat Naomi’swork is scholarly,butwe can sayit is more of journalistic. This paper will review each book differently, noting interesting topics within the books, authors’ strengths and flaws, and later compare the books before ultimately drawing a conclusion. Wolfgang Streeck, Buying Time (2014) Since the end of WWII, capitalism is currently in its most critical condition. The end of post WWII propensity brought about a sequence of economic and political disorders that culminated in the 2008 crash, and for the first time came into the public limelight. Successive crises have been more spread, rapid and severe. Various interconnected factors contribute to the crisis and the author questions when this trend will ever come to an end, and what its culmination will bring to the contemporary society. According to Wolfgang, global inflation which was witnessed in the 1970s led to the rise in public debt in the 1980s. Similarly, the 1990s fiscal consolidation led to a rapid escalation of private-sector debts. For over 44years now, disequilibrium has been a normal condition in developing and developed world (Karl, 73). The postwar capitalism crisis is currently so pervasive that current generations have perceived it as economic in nature, prompting people to re-embrace the notion of capitalism as a way of life and social order, enormously reliant on the continuous progress of capital amassing by individuals. The author interestingly and profoundly expresses that the economic crisis comprised of four closely interrelated crises; banking crisis, state fiscal crisis, real economic crisis, and legitimation crisis. Deregulation benefited banks all over the world by allowing them to extend credit to many people, who later defaulted on loans and banks lacked the capacity to lend to each other and governments were forced to intervene through massive bailouts. Governments’ fiscal guarantees in infrastructure spending, social spending, tax cuts, and expenditure to plummet recession led to reduction in tax revenues and increased government borrowing. Considering O’Connor’s 1973 state fiscal policies, such a move will inevitably lead to mounting state debts and distress in financial markets. Wolfgang asserts that O’Connor’s hypothecation surely happened resulting into the crisis and governments could do little to control it. Apparently, Wolfgang makes it clear to readers that capitalists only invest in the investments that will generate the desired economic returns. In certain periods, investors avert investments premiering unemployment and economic crisis. Considering the aforementioned highly interconnected crises, Wolfgang’s main argument is that governments have never formulated and implemented permanent policies that can effectively circumvent full-scale economic crisis; they have simply been implementing policies that appear to be working and beneficial in the short-run, but in the long-run, their usefulness is outlived by high economic and political costs. “… since the 1970s, governments in the west have been 'buying time' for the existing social and political order … a timely corrective” (Karl, 68) Apparently, this is where the author draws the title of the book from and draws from various contemporary examples in Europe and America to prove the assertion. Among the most interesting and educative part of Wolfgang’s book, is the topic that discusses the connection between democratic politics and modern capitalism. According to Donald and Ken-Hou, democracy and capitalism are adversarial (pg. 539). However, Wolfgang goes ahead to clearly illustrate that this cannot be a reality after the 20th century since democracy and capitalism were fused. Economic progress empowered working-class majorities private property ownership and a free-market economy, thus making it ostensible that democratic freedom was totally dependent on profit-making and a free economy. However, Wolfgang seems to fail in his explication of the interconnectedness between democracy and capitalism by failing to indicate how market freedom is developed and maintained. Moreover, Wolfgang suggests that contraction of democratic rights leads to growth of capitalism (markets), and this is purely what the EU strategy has been pursuing. “The EU thus became a machine for the liberalization of European capitalism, enabling (and sometimes compelling) governments to impose any manner of pro-market reforms against the resistance of their citizens” (p.105). Capitalism, therefore, expects governments to eliminate social democracy from the markets since it is only through this way that capitalists will be able to reap from their investments, a rather sad assertion that puts into doubt the ethicality of current governments and corporations (Wolfgang 159). Towards the end of his book Wolfgang seems to be making some proposals which appear very vague to me. Among these proposals are currency devaluation, restoration of European Bretton Woods, and additional democracy in Europe. Considering currency devaluation, Wolfgang seems to suggest that Eurozone countries should abandon the use of the euro and adopt a currency that will fit the interests and needs of all states within the region. While I agree that devaluation of the euro will be an alternative to internal austerity, I believe that it is not the best move since it will bring more risks such as increase in cross-national trade costs. Similarly, restoration of European Bretton Woods means that the exchange rates will be fixed and variable even without the support of the U.S dollar. This will give countries the freedom to change their currencies in harmony with their needs. However, this might compromise monetary independence, a condition that will further destabilize world economy and constrain activities of businesses (Donald & Ken-Hou, 553). The idea of more democracy in Europe is rather too ambiguous. What Wolfgang seems to propose is that nations be given freedom to select and implement the type of economic policy that best serves their needs and interests. This might create extra controversy in the EU. Wolfgang needs to provide alternative solutions that will be more practical and applicable to many countries. Naomi Klein, Capitalism vs the Climate (2014) Theauthorintroduces her book through analyzingtheproblemswe are facingsuch as climatechange, unethicaltrade, inequality, fossilsfuel, renewable energy, extractivismand their stronglink to illiberalism. Beside this, Naomi also offers somesuggestionsandsolution to thecurrentproblemswe are facing. For instance, Naomiis suggestingthatdevelopedcountries must avert their ravenousness of building their economy with fossilfuel as this will not be a sustainable development (Klein, 265).Therefore, I would like to chooseanddiscuss deregulated capitalism in relationship to fossilsfueland renewable energy. I havepreferablychosenthistopic as it will help me expound on how ‘unethicaltrade’ has promotedclimatecrisis. Naomi has confidentlydrawntheconnection between capitalismandclimatecrisis, andshesuggest“we are all in thesacrificezonenow” (pg.155). Naomi depictsclearlythatmanycountries in theworldhave not takenanyconsiderablemeasures to loweremissionof gas due to theexistences of deregulated capitalism. Naomiproclaimsthattheworld is stuck in theclimatecrisisbecausethenecessaryaction opted to be taken to avertthe climatic catastrophe will be bigloss to a vastmajority of developedcountries. Additionally, Naomi explainsthattheexistence of deregulated capitalism iscausingmoreharm to humanbeings than itsreputation, assheclaimsthatlack of deregulated capitalism in an economicsystem is dangerous as state's tradeandindustries are beingcontrolled by privateproprietorswhodo not considerthe environmental impacts, but their interestin searching forprofit.Moreover, Naomi explainsthatthepoliticiansandgovernmentshaveformedpartnership with theprivateproprietorswhoownfossilfuelscompanies to promotewhat Naomi refersto“trading in pollution” (pg. 218). Most of theprivateproprietorsformpartnership with governmentsandpoliticianshencehelping them to deliver their short-term agenda without consideringthe long-term utilization of naturalresourcesforsustainable development (Wheeler 281). Naomi explainsthatprivateproprietorsandthegovernmentswhoownbigfossilfuelcorporationsunderstandthat, if renewable energyisaccepted to dominatethemarketthis will meanthatmanypeople will becomecompetitors with them. Thus, theprivateproprietorsandthegovernments are not ready to lose their market share, andthishasmade them to lend a deafear to thefacts thescientists are advocating. Subsequently, Naomielucidates to us thatmostworldgovernments including U.S.understandthatthescientist are rightwhenthey are advocatingthatthedevelopcountriesmustreduce their emission. However, what is interesting to note,according to Naomi, is thesheerfactthatcutting of emission by government will meanthetransformation of thefoundation of our economy. It is fundamental to notethat our economyisbuilt on fossilfuel, andit is propagated by it(Gray, 192). Hence, Naomi refers to thattransformation as an abhorrent to them, andtheyperceiveit astheend of their ideological projects. Thus, this is what is makingmanyprivateproprietorsandgovernmentswhoownbigfuelcompanies to denythetruthbeingadvocated by scientists. What’smore, Naomi helps us to comprehendthattheeconomy of mostdevelopedcountrieswasbuilt on fossilfuelsandthiseconomy is stillbeingdriven by fossilfuels. As a result, manydevelopedcountries are not ready to abide by any directive that will counterattack deregulated capitalism hence reducing climate crisis. Furthermore, Naomi continues to explicate to us howitis becomingsodifficultforthenationslike Germany to continuecutting their emission due to lack of deregulated capitalism. In Germany about 25% of energycomes from renewable energysources, andthis has enableditsgovernment to protect the environmentforquitea longtime. Nevertheless, Naomi continues to explainthateventhough Germany tried to prescribestrict neoliberal severityprograms on nations like Greece andsoon, still Germany has not yet succeeded to becomea neoliberal state(Gray, 113). This is because Germany did not dare to sayno to thefossilfuel enterprises as thissource of energy is causingunhealthycompetition to their source of energythusdiscouragingprivateproprietorsandgovernmentwhoownbigfuelcompanies.Fossilfuelenergyand renewable energy are competing in themarket. Forinstance, theprice of solar in themarket is depreciatingfast. This madeNaomi to enlightens usthatthe prices of solar is depreciating due to highcompetitioncaused by fossilfuelenergyhenceit is becomingdifficultforsolarproducers to withstandthiscompletion. As a result, many solar manufacturers arequittingthemarketleavingbehind thefossilfuelcompanies to remain dominating the market hence causing the climate crisis to continue prevailing. After going through ‘This Changes Everything: Capitalism vs. The Climate’we can pinpointthat Naomi has shownherstrength by elucidatingclearlytheconnection between capitalismandclimatecrisis. However, in writing her book Naomi portrayed one considerableweakness. Although Naomi describedthat renewable energy will fightinequalityand environmental degradationhencepromoting ‘Big Green’, shefailed to providesomerealinformation on renewables. Astheauthor, she could have opted to providesomepositiveexamples of renewable energysuch as climatescopeandanyattractiveinitiativethatthecountry could invest in through usingthe renewable energy(Gray, 173). Theaboveexplanations from Naomi havehelped us to understandthat deregulated capitalism is onlybenefiting a fewindividualsandpolitical ideological projects. Therefore, it is prerequisitethat weabandonthisoldeconomy,andestablish renewable energy to support our economy as thiseconomicform will fightinequalityand environmental degradationhencepromoting ‘Big Green’ in theworld. Comparison Both authors, Wolfgang and Naomi, have profoundly explicated the effects of having a deregulated capitalism. Wolfgang believes that a deregulated capitalism leads to more economic crisis and eliminates the existence of social democracy. Similarly, Naomi believes that a deregulated capitalism promotes environmental degradation resulting to a climate crisis. Wolfgang’s argument is that governments have never formulated and implemented permanent policies that can effectively circumvent full-scale economic crisis but have simply been buying time while the problems continue threatening social existence. Similarly,Naomiproclaimsthattheworld is stuck in theclimatecrisisbecause developed economies are not taking any considerable measures to counteract the problem, but are simply buying time since any action taken to avertthe climatic catastrophe will result to a massive loss to the developed economies. However, while Wolfgang discusses the connection between democratic politics and modern capitalism, Naomi explicates the connection between capitalismandclimatecrisis. Moreover, either writer strives to dig deeper into their respective connections, and somewhat succeed in enlightening their audience, the large population, particularly policy formulators and implementers. Conclusion In conclusion, the above expositions clearly indicate that Wolfgang and Naomi are acutely concerned with the issue of capitalism and its devastating effects to the contemporary society. Naomi expounds on the linking between climate crisis and capitalism whereas Wolfgang draws the link between modern capitalism and democratic politics. Both authors uses an interesting and engaging language to unveil the mystery and threats facing global social, economic, and political development. Works Cited Donald Tomaskovic-Devey and Ken-Hou Lin, ‘Income Dynamics, Economic Rents and the Financialization of the us Economy’, American Sociological Review, vol. 76, no. 4, 2011, pp. 538–59. Gray, John. Capitalism vs the Climate.N.p., 2014. Print. Karl Polanyi.The Great Transformation: The Political and Economic Origins of Our Time [1944], Boston 1957, pp. 68–76. Klein, Naomi. This Changes Everything: Capitalism Vs. the Climate. N.p., 2014. Print. Wheeler, Stephen M. Planning for Sustainability: Creating Livable, Equitable and Ecological Communities. Hoboken: Taylor and Francis, 2013. Print. Wolfgang Streeck. Buying Time: The Delayed Crisis of Democratic Capitalism.N.p., 2014. Print. 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