December 31, 2009

The monsters that thrive on hardship haunt my dreams

As a son of a Polish soldier who had to endure more than five years in a German concentration camp, I also connect to Martin Wolf's feeling that the civilisation we pray survives for our descendants is indeed at stake ("The challenges of managing our post-crisis world", December 30).

In this respect my worst nightmare is that unmanageable Versailles-type public debts will become fertile ground for those monsters that thrive on hardships, and that is why I often wake up wishing that the US, instead of taxing and inflating itself out of an almost impossible problem, would simply do an Argentine form of restructuring such as offering 10 cents of the new dollar for each 100 cents of old dollar debt, hand out some Dollar II to its citizens and then take it from there. I believe not only that the world would still accept Dollar II as it has little other choice but also that China would then wake up and adjust . . . you see, governments can't stop dancing either while the music plays.

Once the air is cleared then we might have a better chance of tackling other challenges to civilisation like the climate change threat. As to the banking system, there is nothing that could not be solved by asking ourselves the simple question about what our banks are supposed to do for us, because, unfortunately, that is the question our current very poor set of regulators have never asked themselves.

Happy new decade!