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In January 1979, at the height of the "Winter of Discontent", the British Prime Minister Jim Callaghan was interviewed as he disembarked at Heathrow. Asked about the strikes that had even left the dead unburied, Callaghan replied: "I don't think other people in the world would share the view that there is mounting chaos." This was summarised by the Sun in a memorable tabloid headline: "Crisis? What Crisis?" Two months later, Callaghan lost a motion of no confidence in the House of Commons, and in the subsequent election Margaret Thatcher swept to power. The moral of the story is: faced with a crisis, the one thing a leader cannot afford to show is complacency.

 
Angela Merkel has acknowledged the real threat to the West

I want to ask what we might call Callaghan's question: what crisis? What kind of crisis are we talking about? Is this present crisis really a crisis of capitalism? Or is it, rather, a crisis of the Western civilisation to which capitalism belongs? Until the rise of socialism, the market economy functioned more or less well. Then Marx renamed the market economy "capitalism" and insisted that it was inevitably destined for "crisis". This was good news for economists, particularly those of the Left, because their diagnostic and prescriptive expertise was thereby rendered indispensable — indeed, permanently so. According to the experts, therefore, capitalism has been in crisis more or less ever since. We have all got so used to this terminological conjunction that to our ears, "capitalism" and "crisis" belong together, like "in the long run" and "we are all dead".

Is it the case, as Marx believed, that economics determines politics and culture, or isn't the reverse true: that the predicament we face is primarily a cultural and political phenomenon, of which the economic upheaval is merely an epiphenomenon? 

My answer is that the economic problems we face are serious but soluble and certainly not systemic. In fact, the market's self-correcting mechanisms have already gone a long way to restoring equilibrium. The main contribution that governments can make is to live within their means, to maintain the money supply and to resist populist demands for punitive taxation or regulation. And, for the most part, these are indeed the measures that they are taking, in the teeth of often violent opposition.

But that is not the whole story. Underlying the present fluctuations in the financial and labour markets is a challenge to our fundamental values as a civilisation. It is this threat to Western civilisation that truly merits the appellation "crisis". The economic turmoil has the function of highlighting the stark choice that we will have to make, and on which will depend the future of our civilisation.

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d_lon
December 18th, 2010
3:12 PM
"the market's self-correcting mechanisms have already gone a long way to restoring equilibrium. The main contribution that governments can make is to live within their means" The author to have conveniently forgotten the role of governments in retoring equilibrium by bailing out the banks.

S Fox
December 14th, 2010
7:12 PM
Very excellent article. Anonymous Nov 30, you remark that 'such universal principles can be identified without recourse to an almighty'. Perhaps so. But can they be upheld and defended with the ferocity and ardour that is necessary in a world such as this by pure reason? Please note, I am not religious. I have required fifty years of life to learn that those moral relativists you (and the author of this piece) write of are fools. Yet they are, or appear to be, highly intelligent and eloquent. Almost without exception, it now appears to me, to be a successful, sophisticated intellectual in the academic or media world means to be so wrong about what really matters as to constitute a danger to society. Fortunately, figures like Margaret Thatcher, George Bush, and Ronald Reagan have arisen to defy the liberal, atheist consensus. Who can I thank if not G-d for their belief and commitment? I'm not sure where we'd be without it, but I am sure I don't want to go there.

Anonymous
December 4th, 2010
4:12 PM
If we tolerate the intolerant, we damage freedom and put it at risk, so obviously its not a contradiction.

Anonymous
November 30th, 2010
12:11 PM
What a magnificent article. Such breadth of vision and affirmation of principles that sorely need it in this nihilistic age of ours. My only objection is to the linking of 'universal values/freedoms' and belief in a deity. I happen to believe that such universal principles can be identified without recourse to an almighty - but in this context, these are quibbles. With our political, academic and media establishment either aiding and abetting Mises' enemies within, if they haven't joined that camp fully, it's a joy and relief to read an article like this one.

wam3
November 29th, 2010
5:11 PM
To "Anonymous," Nov. 26, 5:11 PM, I would respond that Western freedom generally has meant individual freedom. Thus there is not such a real contradiction between maintaining individual freedom and also keeping many Islamic practices illegal. This is because much of strict Islam severely restricts the individual--especially women and non-Muslims. And strict Islam does not allow for the separation of church and state. Sharia and individual freedom are incompatible. Also, the last sentence of Johnson's article answers your concern: "We cannot integrate those whose only purpose is the disintegration of our civilisation." Reason indicates that it is legitimate for countries such as the UK or the USA to act in self-defense, against those who would destroy the freedoms of their inhabitants.

Anonymous
November 26th, 2010
5:11 PM
It just seems fundamentally contradictory to hold freedom as a pinnacle of Western society, but then to say 'we cannot tolerate the intolerate'. The same argument can be used by the very people you criticise who are hostile to Thilo Sarrazin. I think it is obvious that Islamist Terrorism should not be tolerated in Western society, and we have laws which act to that accord. If you are speaking of people espousing general Islamic beliefs, the segregation of the sexes, arranged marriage, if these views cannot be tolerated, it seems to me that freedom is lost from Western society. However, I enjoyed the article and agree with much of what Sarrazin has to say.

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