Capitalism: Destroying Itself
From the man who correctly predicted the debt crisis of 2008, Nouriel Roubini (@Nouriel), Professer of Economics at Stern School NYU, some chilling words about functional deficiencies in our captilast system. What makes sense on an individual level for firms and households is detrimental, nay potentially catastrophic, on a systemic level:
Karl Marx had it right. At some point Capitalism may destroy itself. You cannot keep on shifting income from labor to Capital without having an excess capacity and a lack of aggregate demand. That’s what has happened. We thought that markets worked; they’re not working. The individual can be rational. The firm, to survive and thrive, can push labor costs more and more down, but labor costs are someone else’s income and consumption. That’s why it’s a self-destructive process.”
