Bosco,
Thanks for posting Rubin's speech. I found it interesting, but he didn't focus directly on what I take to be root problem, that the structural model of export driven growth that the Asian countries adopted is fundamentally flawed, and will of necessity result in over capacity when too many countries of collectively sufficient size do it. He does obliquely refer to it when he says,
<<Our belief in markets stems partly from the capacity of markets to discipline governments to pursue the right policies for solid growth. Our goal should be a strong market-based financial architecture which
induces sound decision-making by investors, encourages capital to be used productively, and rewards governments that pursue sound policies.>>
Perhaps he was just being diplomatic, I don't know. But if they don't adopt policies that encourage a strong middle class and basically free trade, along with the accounting standards and transparency that Rubin calls for, and if they continue to try to direct subsidized investment from on high, encouraging a small extremely wealthy class with some trickle down consequences, they will continue to destroy the industries that they invest in, and capital flows will continue to be distorted. I guess you might say that they are sort of like Republicans on the issue of Clinton: with their current structure, they don't know when to stop. |
