The Role of United States in the Global Financial Crisis
The Role of United States in the Global Financial Crisis
Government and Business in Volatile Times by Elizabeth Van Acker and Giorel Curran is a book that focuses on the Global Financial Crisis. This is the first issue introduced in the book and is presented as an ironical situation. The authors are of the opinion that the crisis began in 2007. The American population has been a constant bickering urging the government to unregulate the market. They reiterate that it is the same market, which has maintained the stability in World Bank, US treasury and the International Monetary Fund. This introductory part of the book illustrates the issue that arises which is the questioning of the values of the American’s economy and its leaders blamed for not taking the necessary measures in securing the global economy. The book also mentions that America has been making amends by deregulation of the financial sector. This has been towards curbing the frauds in the banking system. Evaluating the book further will discuss the roles played by America in the global financial crisis and the amendments made.
The first chapter focuses on the business and government in the States. The progress of the American capitalistic economy as it established itself, as a pioneer of free enterprise is quite ironical as illustrated. Considering the help, it has received from federal and states governments, it is quite clear that the notion of free enterprise and letting a business or economy flourish without assistance is misleading. The book delves into detail on the mythology of the self-image portrayed by the American and the thriving of its economy based on the high tariffs. According to the authors, America has held on to the belief that its economy thrives by itself without any assistance. This is illustrated by the strong criticism Barack Obama received when he suggested that small businesses do not thrive on their own.
The second chapter focuses on American Economic Leadership. It starts by giving a detailed explanation on how the America economy rose from an agricultural nation to a major economic power. It explains the process through which America tried to identify which role it can play in the global economy as a nation with the strongest economy. This process led to the war between America and the European nation. It clearly mentions the shift in economic power between the two nations as the European nation had a much stronger financial standing. The next part of the chapter depicts the situation of depression and the factors that contributed to it. Apart from the roles played by the American government, the leaders are also part of the role-playing as described in this chapter.
The third chapter is on the failures of the American leadership. It begins by explaining the integration of the global economy due the spread of globalization. The American economy brought together other economies and formed a close-knit network with the nations being interdependent and reliant on each other. According to the authors, this type of network would mean that any effect on one economy would greatly affect the others. The book goes further to explain the failures of the global economy, which are attributed to the USA.
The authors are keen on giving specific detail on the development of the American economy that gives the foundation for their argument. The second bit illustrates the development of America to a world economic power. The outlining of the failures of America is the last part, which achieves the aim of the authors in expressing their opinion after evaluating the economic global crisis.
There are several points that are brought forward in the reading. The first main point in the first chapter is the irony of the origins of the global financial crisis in America. It this is attested to the unregulated American markets in a bid to let business flourishes by itself. The next point is the questioning of the values stated by America concerning unregulated markets and their validity. This point positions America in the limelight as it is blamed for the global financial crisis. The intertwining of the economies is another aspect that is clearly brought by the evidence of the global crisis that resulted due to a globalized economy. The effects in the crisis are also pointed out and critically discussed.
In the second chapter, the major point is the capitalistic nature of America’s economy and its development over time. The mythology of the free market enterprise is presented as a façade used by the nation’s economy in maintaining its self-image. The exceptionality of the American economy is also discussed as it is compared to the other nations. Another point that is brought forward is how the government and the business in America are two different entities run under different department which is quite conflicting owing to the fact that the two entities should be on the same level in terms of management. This adversarial nature is discussed in depth.
In the third chapter, there are three main points presented. The first point us about the rapid industrialization of the American economy following the exploitation of its natural resources that was funded by foreign investors. The second point is the shifting economic power from Britain to America. Different aspects of the two economies are presented. The following chapter points out the failures of the American nation as an economic power and its contribution to the global financial crisis by misleading concepts such as the free market enterprise.
Many examples have been used in the text to support the authors’ argument. The first example is the questioning of the American value that occurred in 2008 and the blaming of the US by the international leaders for the global financial crisis. The next example is Europe’s economy crisis; the authors mention that the case was severe landing the nation in sovereign debt crisis that threatened the demise of the Euro and the end the European Union. This example is used to show the effects the globalized economy had on other nations besides America. The case where Obama is confronted by the republicans when he questions the concept of free markets is evidence that indeed the concept is based on mythology. Evidence provided by the Cato Institute, show that the federal subsidization greatly costs the taxpayers, an amount of money that totals to $ 100 billion dollars. This serves to refute the validity of the free market enterprise viewing it as wasteful and unwarranted.
The convincing parts of the text are the arguments forwarded by the author against the free market enterprise, which is concentrated on by the first and second chapters of the text. The part which I found unconvincing is the last chapter where the failures of the American nation are forwarded.