Ideological foundations of modern world under threat

There is turmoil in the world. A global cyclone, unprecedented in human experience, is gaining momentum. By the time it has run its course, it will have blown away the seemingly rock solid ideological foundations that have underpinned the modern period.
John Maynard Keynes says: “The ideas of economists and political philosophers, both when they are right and when they are wrong, are more powerful than is commonly understood. Indeed, the world is ruled by little else. Practical men, who believe themselves to be quite exempt from any intellectual influence, are usually the slaves of some defunct economist.” The theories and ideas that rule the world today run the gamut from Adam Smith’s “invisible hand,” through David Ricardo’s concepts of equilibrium to, efficient markets, free trade, perfect information, privatization, growth, risk, reward and, volatility, to more arcane concepts. This “ideological capital” is the theoretical bedrock on which the economies of the modern world are built.
The brilliant men and women — such as Keynes himself — who created this “capital” suffered from no illusion. They knew that theories are only as good as the premises on which they are based. Change the premises or, prove them invalid, and the most elegant theory collapses into a pile of sand. The “creators” knew this, and had their ideological capital remained in their domain, there would have been no problem. But it escaped to the grubby little hands of “practical men.” These are politicians, businessmen, bureaucrats, bankers, stockbrokers and their ilk who mistook a carefully nuanced and elaborately conditioned set of ideas for gospel.
And so there emerged a set of “truths,” unimpeachable, axiomatic, and universal in their application. Privatization was good, government ownership bad. Subsidies and trade barriers were bad. Unfettered markets were good. To seek eternal growth — in willful ignorance of the inevitability of the law of geometric progressions — was good. This is the “bedrock” on which the modern economic order is built. Could it be that the bedrock is in fact quicksand?
It is starting increasingly to look that way. That things are not well in the world is clear. Climate change, skyrocketing oil prices, food shortages, rising poverty, and an increasing disparity between those who have and those who do not, all bear witness to a sad, but inevitable truth. The ideological substructure that supports the global economic order is starting to buckle.
Look carefully at this “structure” and you will notice that it’s linchpin is the premise that unabated, eternal economic growth is both possible and desirable. Never mind that the Earth is a closed, finite system with limited resources and — at best — a marginal capacity for abuse. The unimpeachable truth is that our future will not be like our past: The overreaching ambition of today to consume and possess, beyond the limits of reason or need, or ability must be discarded. This will mean changes that will ramify deep into the foundations of the world we have built. No aspect of the way we live our lives will remain untouched. The way cities are designed and built will change. The basic premises on which capitalism has operated will be reviewed. The solitary focus on growth, profit and shareholder value will give way to a gentler corporate ethic focusing on the community, job stability, care for the environment, sustainability. The financial services industry will change. It will no longer be able to create buying power out of thin air. The recent “credit crunch” bears witness to these mindless excesses motivated by a strange mix of megalomania and avarice.
Governments will need to take back responsibilities they have thoughtlessly shed in the name of privatization, competitiveness and efficiency. New models of economic output that seek to balance the urban-rural mix must be developed. Jobs must move out of the cities to the countryside. The world’s — especially the third world’s — cities, bursting at the seams, already places of filth, squalor and congestion, cannot take any more people.

n Nadeem Mumtaz Qureshi is the chairman of Mustaqbil Pakistan Party.