Yanis Varoufakis: A New Deal for the 21st Century - The New York Times: The answer lies in ditching both globalism and isolationism in favor of an authentic internationalism. It lies neither in more deregulation nor in greater Keynesian stimulus, but in finding ways to put to useful purpose the global glut of savings.
This would amount to an International New Deal, borrowing from Franklin D. Roosevelt’s plan the basic idea of mobilizing idle private money for public purposes. But rather than through tax-and-spend programs at the level of national economies, this new New Deal should be administered by a partnership of central banks (like the Fed, the European Central Bank and others) and public investment banks (like the World Bank, Germany’s KfW Development Bank, the Asian Infrastructure Investment Bank and so on). Under the auspices and direction of the Group of 20, the investment banks could issue bonds in a coordinated fashion, which these central banks would be ready to purchase, if necessary.
By this means, the available pool of global savings would provide the funds for major investments in the jobs, the regions, the health and education projects and the green technologies that humanity needs. A further step would be to generate more, better-balanced trade by establishing a new international clearing union, to be run by the International Monetary Fund. The new clearing union would help to rebalance trade and create an International Wealth Fund to fund programs to alleviate poverty, develop human capital and support marginalized communities in the United States, Europe and beyond.
Today’s false feud between globalization and nationalism is undermining the future of humanity, and spreading dread and loathing. It must end. A new internationalist spirit that would build institutions to serve the interests of the many is as pertinent today across the world as Roosevelt’s New Deal was for America in the 1930s.
This would amount to an International New Deal, borrowing from Franklin D. Roosevelt’s plan the basic idea of mobilizing idle private money for public purposes. But rather than through tax-and-spend programs at the level of national economies, this new New Deal should be administered by a partnership of central banks (like the Fed, the European Central Bank and others) and public investment banks (like the World Bank, Germany’s KfW Development Bank, the Asian Infrastructure Investment Bank and so on). Under the auspices and direction of the Group of 20, the investment banks could issue bonds in a coordinated fashion, which these central banks would be ready to purchase, if necessary.
By this means, the available pool of global savings would provide the funds for major investments in the jobs, the regions, the health and education projects and the green technologies that humanity needs. A further step would be to generate more, better-balanced trade by establishing a new international clearing union, to be run by the International Monetary Fund. The new clearing union would help to rebalance trade and create an International Wealth Fund to fund programs to alleviate poverty, develop human capital and support marginalized communities in the United States, Europe and beyond.
Today’s false feud between globalization and nationalism is undermining the future of humanity, and spreading dread and loathing. It must end. A new internationalist spirit that would build institutions to serve the interests of the many is as pertinent today across the world as Roosevelt’s New Deal was for America in the 1930s.