While we are at the dawn of a radical economic and social upheaval, similar to that of the Industrial Revolution, politicians, economists and the productive actors must answer critical questions. And these answers, it is necessary to correspond to realities and not to theoretical and ideological forms which ultimately deceive and divide.
So reality tells us that in an economy, we have the side of wealth production, through goods and services, which is subject to the laws of trade. On the other hand there is the non-productive dimension, which concerns education, public health and safety and the protection of those who for a variety of reasons are marginalized.
The experience to date in developed countries proves to us that the best performance of the factors of wealth production is observed in countries where the best competitive conditions are welcomed and the rules of trade are meticulously respected.
In these countries, there is also the most significant degree of democratization of consumption, a phenomenon of paramount importance for the overall performance of an economy and its social environment.
It should be noted that in the above economies, monopoly situations are rare in their markets and every time they occur, the state undertakes to reduce them.
Also in developed countries, the redistribution of the wealth produced in the first phase concerns the fairer distribution of incomes resulting from the operation of the market economy and for a long period, the process was based on the accumulation of capital. In essence, the redistribution was based on the movement of goods and services, where we have a value for money transaction.
But in today's societies a significant part of the wealth produced comes from income and intangible values, which carry the issue of redistribution to the level of people. Simply put, it is now surreal to discuss income redistribution for an economy that does not exist. Very aptly, the French economist and columnist Paul Fabra, a few years ago, in his book "Capitalism without capital", spoke of the existence of an economy in which money flows without a face .
Nine decades ago, John Maynard Keynes, whom some constantly refer to today, called money "a link between the present and the future." Obviously, what he meant was that the way we use money today is an indication of how we think things will go in the years to come.
So what we did with our money from the first years of the 21st century until 2008, when the financial crisis hit, was to triple the amount of money available worldwide, much faster than the growth of the real economy. When the amount of money swells to such an extent, the message we send is that we expect a far richer future than the present. The crisis was simply the answer we received from the future: We were wrong.
But from the moment the crisis came, those responsible for its explosion, instead of studying the structural consolidation of the system, began to throw even more money on the market .
This was, in fact, the policy pursued worldwide after 2008. Printing a large amount of money resulting in a reduction in the cost of lending to banks, which falls to zero or even becomes negative.
When interest rates in the real economy turn negative, depositors, for whom the only way to secure their funds is to buy government bonds, are virtually forced to give up any income their savings would yield. Thus, because depositors are forced to invest their money in higher risk areas, both the stock market and the housing, commodity and gold markets are recovering. The result was a sluggish recovery, but the strategic problem remained.
From 2011 onwards, growth rates in the developed world were low and any increase in the US. was due to by 17 trillion. dollars increase federal debt from 2009 to 2016. For a decade so, trillions of printed dollars, yen, sterling and euros are in circulation, with rising household debt remaining unpaid. At the same time, from Spain to China, entire cities - ghosts, as a result of speculation in the housing market remain unsold. Until the outbreak of the coronavirus pandemic, only an impressive new generation of wealth could make the future sustainable.
Not only did this not happen, but on the occasion of the pandemic and the paralysis of the productive activity, new money is circulating in the market without any notice. This is the so-called "documentary money", which for a while allowed the whole world to live by creating debts, but what is happening today?
This question alone, because for the time being there is no clear answer - apart from this mass debt write-off - is a high-risk time bomb. With already side effects, such as the globalization of authoritarianism and populist activism.
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