Opinion (N. Rubini, Economist): We have to solve problems associated with debt by relying on ourselves rather than reassigning problems to a higher level. Among other reasons, the crisis of the advanced economies is triggered by excessive debt in the private sector – households, banks, and the corporate sector. The financial crisis resulted in disproportional debt at the level of regional, municipal and national governments.
Indebtedness is not exclusively a European problem; it also exists in Chinese economy and constitutes 80% of its GDP. Transferring debt to a higher level is not a legitimate solution since there are no such things as a “Cosmic Ministry of Finances” or some kind of “Central Bank” that can step in and save everyone. We should stop pretending that we are solving the problem when we are in fact simply postponing it to a future date. The difficulties we’re experiencing now will only increase in the future and we’ll eventually hit a wall that will bring all economies to an end.
Comment: The fact is that none of the decision makers can resolve the situation because the solution lies in a new integral perception of society and economics. The crisis will force them to re-evaluate their attitude towards the world instead of looking through the panacea of obsolete theories.