Volume 45 Number 179,
October - December 2014

Strategies for Sustainable Development in Three Crises: Financial, Economic and Environmental, Eugenia Correa, Alicia Girón, Arturo Guillén and Antonina Ivanova (coords.), Miguel Ángel Porrúa-UAM-I, 2013.

Thanks to the various perspectives of the academics that participated in the colloquium “Choices in the Global Crisis: Strategies for Sustainable Development,” in this book, we can start to see an interpretation of the path to follow to emerge from the “crisis,” focusing on Latin America and, more specifically, Mexico. One question that arises is: why is this interpretation important? To which the answer would be: the future of our region is fairly uncertain, especially in light of the global crisis, because although our dependence on Europe and the United States is not what it once was, the dollar is still the central currency and is affected by movements in the European and Asian markets.

Despite the “growth” and behavior of the United States economy throughout much of the 1990s, and the faith they maintained in the spillover effect that the “new economy” would produce, the country entered into recession in 2001, the culmination of an economic slowdown that began in the third quarter of 2000.

It is extremely important to note that the shadow of a possible recession remains latent, although some countries in the Eurozone (such as the United Kingdom or Germany) have come out fairly unscathed, to date. This could affect not only developed countries but also nations such as China, which up until now have been rather detached from the financial turbulence in the United States and Europe.

The main contribution of these works is that they do not focus exclusively on a single aspect of the crisis, but rather touch on and delve into a wide variety of factors, analyzing them with respect to the crisis. They include aspects of the financial, economic, energy, food, political and social crises, as well as problems related to employment and the strategies to face this crisis.

Arturo Guillén offers a very detailed analysis of the role of financial earnings, which should be considered rather as a “windfall,” given the maximization of earnings obtained in the financial sphere to the benefit of and for the “financial oligarchy,” thanks in large part to predatory neoliberal policies put into place by the governments of many developed countries to the detriment of developing nations. The past few decades have seen the full development of financial markets that guarantee certain privileges and power to that capital.

Alicia Girón argues that one of the principal issues in the current crisis is the lack of credit and the job offer, which is why the economic cycle has not yet been reactivated. This impacts countries not only economically, but also in other areas, such as the environment. The current financial crisis appeared as a sharp and untimely contraction of liquidity, with serious consequences for short-term markets (both between banks and monetary). A year later, it had deeply shaken up the real economy, international commerce, bank functioning and finances all around the globe. It is extremely important to understand the crisis as a sequence of actions. First, the real-estate market fell. The second half of 2005 already showed the first signs of saturation in housing sales. In 2006, construction activity and the building of new homes began to retreat, and there were also nascent signs of weak prices.

Another relevant topic is financial regulation, which is key to understanding the crisis as such, because a crisis of regulation must be understood as an obstacle to the accumulation processes of countries in a slowdown and, on occasion, with negative growth and development rates, as well as times of slow productivity.

Wesley Marshall highlights the fact that during the rescue years that followed the crisis, there were no real efforts to erect new structures to regulate the behavior of the banks that were “too big to fail,” which were at the center of the crisis. It is clear that the profound economic crisis that the world is currently experiencing originated in the United States financial sector, but its repercussions can be felt in all economic sectors and in the rest of the world. This phenomenon is an expression of a structural issue in capitalist functioning, the outcome of a set of public policies applied by governments in recent years. The crisis mainly affected those who had taken out mortgage loans and led to losses in the millions. Consumers all around the world began to pull back on consumer goods spending, and global production consequently fell. Now, the commercial effect of the crisis on each country depends on its export destination markets. In other words, when exports are more concentrated in the zones most affected by the crisis, the consequences are more severe. Mexico, for example, has been one of the countries most affected by the crisis, because so many of its exports are destined for the United States. More diverse economies such as Brazil and Peru have mitigated the effects of the crisis, demonstrating that diversity in destination markets is just as important as the diversity of products exported.

One lesson we can draw from these works is the idea that high economic volatility in the region brings with it a more severe slowdown of economic conditions, increasing poverty, precarious labor and inequality, as well as unemployment, and a reduction in the growth of formal employment.

The relationship between the global economic and environmental crises of today is one of the factors making this current situation different from past crises, such as the 1929 crisis. The magnitude of our environmental challenges only increase the potential for global instability in the future, which will be marked by the exhaustion, in the medium term, of an energy model based on oil and fossil fuels, an increase in natural catastrophes due to weather changes and growing structural inequalities in the global agricultural and food system. The failures of climate change summits such as Copenhagen 2009, Cancún 2010, Durban 2011 and Doha have made it clear that the current capitalist system is unable to respond to the crisis it has engendered. The current capitalist offensive centered around privatization and the mass trading of common goods finds its maximum expression in the green economy. A green economy that is not an “alternative” but rather seeks to increase the basis for exploitation and do business with nature. The works introduced here reveal that the consequences for jobs, poverty and social relations, on the productive level, will depend not only on the external conditions that countries in the region face, but also their local conditions, closely related to factors determining labor relations, the productive structure and the containment policies implemented. Up until now, officials of countries in the region have sought to put in place policies to mitigate the local effects of the crisis and consolidate efforts to diversify production and exports, as well as integration measures based largely on free trade agreements.

Diego Juárez

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Published in Mexico, 2012-2018 © D.R. Universidad Nacional Autónoma de México (UNAM).
PROBLEMAS DEL DESARROLLO. REVISTA LATINOAMERICANA DE ECONOMÍA, Volume 49, Number 195 October-December 2018 is a quarterly publication by the Universidad Nacional Autónoma de México, Ciudad Universitaria, Coyoacán, CP 04510, México, D.F. by Instituto de Investigaciones Económicas, Circuito Mario de la Cueva, Ciudad Universitaria, Coyoacán,
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