ABSTRACT
The debate on global capitalism is polarised between the fear of globalisation and the belief in the virtues of free trade. Economists agree that countries tend to prosper when they are open to trade and that direct foreign investment, which goes into longterm productive enterprises, brings similar benefits. However, this act of faith in the virtues of the free market has been pushing rigid doctrines, slashing the state’s role in industry, accelerating the restructuring of the formerly state-owned companies. In order to revamp the banking system it is necessary to apply a solid macro-economic management, strengthen the legal system which protects property rights and adopt business friendly fiscal policies. The only concession to social aspects is to advocate good educational standards and provide a relatively fair distribution of income and political stability. The belief that open markets will magically produce prosperity in all conditions is erroneous since the global economy is pretty much in the robberbaron age. The classical capitalist medicine cannot avoid a long list of the negative effects of globalisation. It can hardly be denied that multinationals have contributed to labour, environmental and human rights abuses including: the exploitation of the labour of women and children, sixteen hour workdays, no overtime pay, limits to the freedom of movement of the workers, the use of toxic materials and lax safety standards, the spread of international sexual tourism, the trade of human beings through massive immigration, environmental damage. The risk of a recurrent international financial crisis, such as indicated by the examples of Mexico, the Far East and Russia, increases with the globalisation process and dependence on shortterm foreign capital. It is a model of development pushed in a cumulative way by foreign investment and often by speculative monetary flow from abroad. It does not allow any realistic evaluation of the fundamentals of individual projects, such as many enormous investments in so called global cities and it inevitably increases the macro-economic instability and danger of financial collapse.
