Their actions also revealed that diverging social groups now have the intention to raise their voice more than ever because the current global economic and financial crisis affects many countries and social classes. The fact that the reactions have become more and more intense proves that we have to prepare ourselves for further social tension because those who have nothing to lose are ready to transform this tension into mischievous social unrest.Societies that have much to lose are already well represented by several NGOs all over the world; however, their governments prefer to show themselves in forums like the G20. It’s certain that the group of 20 leading and emerging nations is subjected more than others to the social consequences of the global crisis and that the worst is probably yet to come.
It’s only natural that capitalist economies face crises from time to time. However, in order to assure this economic system’s success, crises should remain controllable, allowing new initiatives. However, as for today, the crisis of capitalism has become unmanageable and a new initiative seems difficult to achieve. That’s why old capitalist powers and other countries that benefit from the current system, like China, are working hard to find ways to extinguish this crisis and to survive through it.
G20 countries have similar approaches to understand this crisis and also agree that something has to be done about it. However, their proposed solutions are not identical. It’s not likely that they will pick up one of the models economics proposes and apply it in a cooperative fashion. There are radical differences about measures that should be implemented and, because of these differences, the economic crisis may even become chronic.
Three main trends can be seen in the economic model in place. The first is the so-called Chinese model, which is based on printing huge amounts of Yuan and on using cheap labor. This model has the risk of damaging the US’s economic interests in Asia and especially in the Far-East. However, as the current American model is about stimulating production by encouraging consumption, there is no big conflict with the Chinese model as of yet. On the other hand, the EU’s model is based on reducing public spending -- being more economical, in other words. So, while the US and China defend expansion, the EU promotes contraction.
The EU’s economic model is meaningful from a household economics perspective; nevertheless, it is doubtful that it corresponds to global economic realities. Moreover, the US believes that the model the EU proposes, and which is mainly defended by Germany, may reduce the size of the markets and cause an even worse crisis. The EU doubts that the real intention of the US is to seize as many of the EU’s market shares as possible.
The difference in the economic approaches naturally affects political relations between the US and the EU. Many think the main target of rising xenophobia in EU countries is Europe’s Muslim population. However, one should not forget that xenophobia espoused by the higher social classes, including many politicians in some European countries, focuses on the US, too. It is not necessary to remind you of how risky an economic confrontation between the EU and the US may be under the current circumstances. Let us hope that common sense prevails after all and that everyone sees that this crisis is good for no one.
