Remember way back in the early Nineties, when history had ended? Global leaders and policymakers more or less settled on the “Washington Consensus”: a combination of free-market capitalism with at least a modicum of political liberty had won the Twentieth Century’s agonized debate over which system works best.
Countries all over the world rushed to implement the new model after the fall of the Soviet Union. The common features were market capitalism combined with either a lot of freedom (Estonia) or a little bit of freedom (China).
This was a revolution in how the world organizes its societies. Americans live in the only nation in history that has believed in freedom from the start. It’s all too easy for us not to appreciate that humans have almost always lived under the thumbs of despotic rulers.
Few remember this critical thing about the past two decades: the global revolution in finance and market-capitalism has enabled at least one, and perhaps two billion human beings to rise up out of grinding poverty.
And now everything is rushing back in the opposite direction. The world’s deep thinkers are considering whether capitalism, and even freedom itself, harbor a fatal flaw, a genetic predisposition to financial self-destruction. Whether or not this is true (and I don’t profess to know the answer), it will be a long time before the world tries them again on such a grand scale.
Americans will remember the coming decade as a lean period, not as bad as some we’ve lived through. But for many of the world’s poor, it might be an evil memory for centuries, like the Black Death.