The Future of Capitalism

The inaugural Bristol Festival of Economics (organised by the Festival of Ideas and programmed by Diane Coyle) kicked off this evening with a panel about the Future of Capitalism at At-Bristol. 

Despite the inevitably bleak subject matter (in short: financially, we’re screwed), our four expert panellists and chairman David Smith (economics editor at The Sunday Times) presented an entertaining and engaging debate.

Here are the top lines…

Rachel Lomax is the former deputy governor of the Bank of England. This is my opportunity to mention that when I lived in London my next door neighbour was Eddie George, governor of the Bank of England until 2003: never let it be said that I miss an opportunity to name drop! 

“The 1970s were a crisis of confidence in the existing economical framework, even more so than now. There was high inflation, high unemployment, and high industrial unrest. The world was not working well. But it was a period of intense political debate that lasted until the 1980s, when a new capitalism was built. But what’s going on now?

“Economists didn’t see the 2007 crisis coming. In 2007/2008, I thought that some serious rethinking would be a great outcome of this crisis. But I don’t see that happening. Although there is a lot of pressure on banks to rethink their business models. But won’t we still be an unequal society prone to financial crisis?

“We’ve gone so far with means testing that we’ve poisoned the people just above the poverty line. Means testing has turned the nearly poor against the very poor.”

In terms of the situation for women, Rachel added: “The position of women is so much stronger than 30 or 40 years ago. That’s not to say it’s perfect, but life chances for women are hugely improved.”

Daniel Stedman Jones is a barrister and author.

“It was clear there were neo liberal policies there in the 1970s, ready to be picked up if you wanted them. Now it is less clear. We need to be much clearer about what the state can do in terms of regulation. But is it possible now to run one-country economic policies? In Britain we’re dominated by a Euro-sceptic agenda.”

John Kay is founding director of the Said Business School at Oxford University and an author.

“Nobody knows how a market will develop [he uses the development of computer as an example]. It’s a process of experiment, where most experiments fail and get shut down. That’s how market economics work, and why they’ve been more successful in generating progress than any other economic programme.”

Larry Elliott is economics editor of The Guardian and an author.

“Capitalism has produced the goods over a very long period. I don’t have any nostalgia for the world as it once was, but this crisis is a big one. It’s too early to say if it’s bigger than the 1970s’ one.

“There are certain key elements that make capitalism work: profitability, stability, legitimacy, sustainability and creativity. If we want capitalism to regenerate itself, then the current policy mix is probably working against that and keeping zombie businesses and banks alive. We’re not getting new blood coming through.”

The Bristol Festival of Economics continues tomorrow (Saturday, November 24) with three more sessions. For more information and to see if tickets are still available, please click here.

On March 8, 2013, Confronting Women’s Poverty: Turning Things Around will be a one-day event at Bristol City Hall. For more information, please click here.