By Roberto Savio

 

 

In this article, Savio writes that if, as seems to be the case, the only certainty to come out of all of this is that banks will not be allowed to fail even when their own actions lead them to the verge of bankruptcy, there is clearly nothing keeping them from returning with impunity to their speculative practices and recreating conditions for another catastrophe, for which once again the taxpayers, and not they, will pay the price.

But would a radical reform of the financial system have been possible? In recent years, the US has changed its beliefs and tendencies so profoundly that the idea of another Bretton Woods is more dream than reality. Keynes famously likened financial speculation to gambling: "When the capital development of a country becomes a by-product of the activities of a casino, the job is likely to be ill-done." Today would such language and a true reform of private financial institutions be possible?

(*) Roberto Savio is founder and president emeritus of IPS.

//NOT FOR PUBLICATION IN CANADA, CZECH REPUBLIC, IRELAND, POLAND, THE UNITED STATES, AND THE UNITED KINGDOM//

(FIN/2009)