The Washington Consensus, the neo-liberal economic prescription presumed to be universally and permanently valid, was broadsided by the current world recession, writes Roberto Savio, founder and president emeritus of IPS news agency.
In this article, Savio writes that numerous studies, including some by the World Bank itself, have convincingly shown how structural adjustment programmes, the primary instrument of the Washington Consensus, caused serious damage to the weakest economies and to the most vulnerable sectors throughout the Third World, though these were supposed to be the main beneficiaries.
Today we are seeing considerable back-pedalling by many long-standing champions of the invisible hand of the market. The World Bank now insists on the central role to be played by the state, having wasted a decade bankrolling its disappearance. What must now happen is this: on the basis of our own experience, we must to stop believing in the theory of the free market and adopt a regulatory system that would restore the human being and the social to the centre of the economy and of society.
(*) Roberto Savio is founder and president emeritus of IPS news agency.
//NOT FOR PUBLICATION IN CANADA, CZECH REPUBLIC, IRELAND, POLAND, THE UNITED STATES, AND THE UNITED KINGDOM//
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