• by Hazel Henderson
• Thursday, February 23, 2012
• Inter Press Service

The urgent need for a paradigm shift in economics and its financial and mathematical models has been widely recognized for decades. Recently, Credit Suisse research as well as complexity theorists at the Swiss Technical University in Zurich have demonstrated the concentration of companies in the current global economic system. They used network analysis of positive feedback effects (the network grows faster as more join, like Facebook). These dynamics also concentrate connectedness and produced a pattern: of the 50 largest companies in the world, 45 are financial intermediaries (‘ Global Finance Lost in Cyberspace"), writes Hazel Henderson, president of Ethical Markets Media (USA and Brazil) and author of many books.

The top brass of these companies meet in Davos at the World Economic Forum. These firms (Barclays, UBS, Citi, etc.) operate on outdated economic theories, assumptions and financial models and tend to favour the current cruel austerity being imposed on citizens in Greece, Italy, Spain, Ireland, Portugal and the U.S. Their financial and policy models have been critiqued by scientific research in physics, thermodynamics, anthropology and, recently, brain science, endocrinology and the behavioural sciences, as I documented earlier in The Politics of the Solar Age (NY Times Book Review, 1981).

This concentration of corporate power and its outcomes are now evident in today's global financialization and led to the financial bubble which burst in 2007-9, still causing widespread human misery. Re-inflating these too-big-to-fail banks allows them to continue dominating the actual activities of real-world, local ‘main street’ economies, rather than serving their banking and credit needs. Thus, efforts to reform today's financial system simply have bailed out the past mistakes so that more crises, booms and busts are likely to continue.

(*) Hazel Henderson is president of Ethical Markets Media (USA and Brazil), author of many books, former advisor to the U.S. Office of Technology Assessment, National Science Foundation National Academy of Engineering, the Calvert Group, Fellow of Britain's Royal Society for Arts and the World Business Academy.

© Inter Press Service (2012) — All Rights Reserved. Original source: Inter Press Service

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