Paul Krugman vs. George Soros: Debate on Capitalism, Globalization of the Economy (1997)
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Economic globalization is the increasing economic interdependence of national economies across the world through a rapid increase in cross-border movement of goods, service, technology, and capital. More on Soros: https://www.amazon.com/gp/search?ie=UTF8&tag=tra0c7-20&linkCode=ur2&linkId=687ceed01ce30d3501d2f25764c3220b&camp=1789&creative=9325&index=books&keywords=soros Whereas globalization is centered around the rapid development of science and technology and increasing cross-border division of labor, economic globalization is propelled by the rapid growing significance of information in all types of productive activities and marketization, and the advance of science and technologies. Depending on the paradigm, economic globalization can be viewed as either a positive or a negative phenomenon. Economic globalization comprises the globalization of production, markets, competition, technology, and corporations and industries. While economic globalization has been occurring for the last several hundred years (since the emergence of trans-national trade), it has begun to occur at an increased rate over the last 20--30 years under the framework of General Agreement on Tariffs and Trade and World Trade Organization which made countries to gradually cut down trade barriers and open up their current accounts and capital accounts.[3] This recent boom has been largely accounted by developed economies integrating with less developed economies, by means of foreign direct investment, the reduction of trade barriers, and in many cases cross border immigration. It can be argued that economic globalization may or may not be an irreversible trend. There are several significant effects of economic globalization. There is statistical evidence for positive financial effects as well as proposals that there is a power imbalance between developing and developed countries in the global economy. Furthermore, economic globalization has an impact on world cultures. The Economic Commission for Latin America and the Caribbean (ECLAC) has proposed an agenda to support conditions for developing countries to improve their standing in the global economy.[20] Economists have theories on how to combat the disadvantages faced by developing countries. However, the advantaged countries continue to control the economic agenda. In order to rectify the social injustice dilemma, international economic institutions (such as the World Bank and the International Monetary Fund) must give voice to developing countries.[21] A solution is to issue global rules that protect developing countries. It is still difficult for leaders of developing nations to influence these global rules.[22] In his article, Gao Shangquan elaborates this point saying that economic globalization has in fact expanded rather than reduced the gap between the North and South. He is referring to some UN report in 1999, in order to show that the number of developing countries that have benefited from economic globalization is smaller than 20, that the average trade deficit of developing countries in 1990's increased by 3% as compared with that in 1970s, and that over 80% of the capital is flowing among US, Western European and East Asian countries.[23] The influx of international corporations not only brings positive advantages regarding global financial transactions. Some may emphasize that the multinational corporations may raise education levels as well as the financial health in developing countries, but that only applies to the long term effects of economic globalization. In the short term, poor countries will become poorer and unemployment rates may soar. Automation in the manufacturing and agricultural sectors always follows the appearance of multinational corporations. This lessens the need for unskilled and uneducated workers thus raising unemployment levels. Also, in the developing countries where this phenomenon occurs, infrastructure to re educate these unskilled workers are not properly established which means a redirection of the government's focus from social services to education. http://en.wikipedia.org/wiki/Economic_globalization
Comments
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What economic system can do that...Capitalism...true
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Actually it has transformed people with very little to middle class within a generation
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A wise man once said: "If you can't explain something simply, you don't understand it well enough." This is a competition of intellectual ability, not a conclusion or debate of issues.
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Capitalism gives purpose, without purpose, you die.
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My God! If soros was right! why does the world economy spends trillions of dollars a year on defense. So much for integration, mutual understanding. How wonderful and productive would the human society have been if that money is used in productivity and development of science, taking care of environment etc. In the modern times it appears as though Nations are out to improve their own wealth with no regards for finite resources and the health of the environment. America for example is going into defensive mode as jobs are lost to cheap labor. So in this process of equilibrium it's quite logical that US would have to equilibriate downwards from it's excesses to fill the deficits of developing nations. This transition point can be very precarious for a society that is used to excesses. We are witnessing it's effect in the modern times (18 yrs later)
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Krugman was a young idiot then. Now he's just an idiot.
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Soros deserves huge credit for his prescient remarks about the degree of destruction markets would inflict only a decade later. He sounds here like he could have been a founding father of the Occupy Wall Street movement.
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Interesting to see this after 14 years, after the Asian, Internet, and '08 financial crisis. Soros's points are more important than his style. He discussed bubbles present in the economic system, while Krugman talked about general trends going up. The following years would show Soros's view of bubbles and busts was more valuable than Krugman's gradualist view. Krugman claimed economists do not hold laissez-faire views, and Soros view of economists are unrealistic. 14 years later, abundant evidence showed economists pushed laissez-faire views for their own profit and power. Krugman's rosy view of the economics profession now seems deeply naive. Soros concern about financial instability counters the norm of economics. Soros makes mistakes, too, when he said that Washington economists are generally reasonable. Larry Summers and other reasonable economists were about to lead the charge on Glass-Steagall, the seminal factor that led to the '08 crisis.
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George Soros uses his capital to bring about as much global democracy as humanly possible. Democratic socialists like Paul Krugman intend to bring about something else entirely, by hook or by crook, with other people's capital. Trust me.
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One has a good track record and the other has an award but a poor track record. - I'll back the guy with the good track record !!
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Writing on the eve of the non-second Charge of the Light Brigade,-wise.Perfect truth vs. pluperfect hypocrisy. A Planetary view? Funny Human race.........Supercomputers written through a human robot.
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I wonder what Krugman would say today.
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right after this in 1997... argentina, dot com bubble collapses, asian financial crisis, LTCM, Russian financial crisis, and also beginning of U.S. housing bubble. Surprised Krugman used the "froth" analogy as Greenspan used the same for what was then not a housing bubble.
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Soros push Hattie under the carpet fine your one hell of capitals globalist, Gorge Soros.
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This demon is re-growing black hair, his voice is youthful--> he is reversing the aging processes. Notice how the listeners are coughing and sniffing because the air is laced with Sulfur.
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Krugman on "the poor," assumes that there is some enduring class who are poor in some meaningful sense. Most Americans for example living below the government-set poverty line have a washer and/or a dryer, as well as a computer. More than 80% have air conditioning. More than 80% also have both a landline and a cell phone. Nearly all have tv and refrigerator. Most Americans living below the official poverty line also own a motor vehicle and have more living space than the average European.
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I come across such views so often, I almost feel it's the same person but under a different name. I also see the same words again and again: marxism! communism! libertarianism! globalization! government bad, bad, evil! Holy smokes!!!! Can't you libertarian types turn out a decent passage of words without resorting to these useless terms? Or at the very least, give us something fresh to think about?
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Krugman showing even then he was a young Marxist, he'd never get away with this crap with Milton Friedman about. Globalisation is the best thing to ever happen, its going to lead to a far more Libertarian society. His whole rich argument is a none zero sum fallacy, and I bet id find it hard to find any American if given a real choice to say sack 100,000 from the department of agriculture alone, from a crony congress subsidising millionaires. FDR turned America from a great country slowly commy
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Alright, after watching the debate I must admit that Mr. Soros' claim about the inherent instability of globalized finance was extremely prescient given that the Asian Financial Crisis broke out a few months after this debate. However I think Mr. Krugman had stronger points overall; this system is the best we've come up with so far and it has yielded tangible benefits.
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Holy crap a young(er) Paul Krugman!
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