The end of history ended

Richard S. Fuld Jnr is reported to have stopped breathing for 45 seconds in a panic attack on being appointed to head Lehman Brothers in 1994. He had made it to the very pinnacle in one of the world's top investment bankers after a one-employer career that gave him a better understanding than most of the power and the responsibility within his grasp. Nicknamed The Gorilla for his aggressive style, his leadership took Lehman to new heights. Last year, his pay was $40 million. It was the year the subprime chaos started.

Today, Mr Fuld is blamed for failing to appreciate the threat, for overestimating his bank's resilience, for having hung on too long to the investments which, finally, brought the towering financial edifice crashing down. He is blamed for dominating the august Lehman boardroom which rejected buyers who could have rescued the firm when it ran into trouble. His American Dream career ends in global ignominy at 62.

As Asian and European central banks take emergency action to resist the shock to their own financial markets, nobody can tell which way the domino effect will proceed, how soon which landmark financial institution will cause the next cataclysm. The reassuring statements of central bank governors that the matter is being dealt with can reassure no one.

Faith in the world's new religion is crumbling. The ponderous, awe-inspiring cathedrals to wealth which mesmerised believers and its priesthood, have become fragile, inconsequential things. Doubt and fear spread their cold hands over a billion hearts. Nothing could be worse than a global stampede and fear is magnified by the realisation that nothing and nobody can stop it once it starts.

All our realities have been reduced to money terms, simplified until they seem meaningless. Everything is translated into corporate or personal interest. It is a global lingua franca which has allowed the global network to expand and traffic to flow ever faster until the network itself has become a new reality, beyond anybody's control or regulation.

Until now the impossibility to control or manipulate it was hailed as its greatest virtue. It was described as a new nature finding its own balance and best left alone.

The myth of the free market died with the rescue of Fanny Mae and Fanny Mac and there is as yet no substitute myth in place. The Federal Reserve bailout of AIG necessitated by the Lehman crash fallout ends it for good. The world is in the state of Richard Severin Fuld Jnr, in a state of denial.

We feel the need to focus on the ongoing crisis and to address it as best we can; the world is intent on bringing things back to the way they were before and as soon as possible. There is little time to notice that this is a critical period of transition to another state of affairs.

Global corporate interests in permanent, mutual competition and outside the control of any nation state or global authority are a menace to themselves and to all humanity. The achievements of financial cooperation through financial markets to produce products and services otherwise unimaginable are no longer the only consideration to be put in the balance. The creation of seemingly endless wealth for the global elite no longer mesmerises the vast majority who have never had a hope of in participating in it. The American Dream exported into global culture is crashing and threatens to devastate the lives of billions.

The Twin Towers' implosions, attacked because they were the cathedrals of the new religion on 9/11, set off a process which allowed Americans to accept a wholesale devaluation of their freedoms through enactments such as the Patriot Act and the devastation of international law through the invasion of Iraq, damaging the American Dream far more than any bomb ever could.

The architects of that process were also the high priests of deregulation and free market fundamentalism, a conclave of cardinals in which a Dick Fuld was entitled to the purple.

With the collapse of the Soviet Union, capitalism triumphed worldwide. It was resilient to criticism when it benefitted by appearing to be under threat in the Cold War and then burst its banks and flooded the world when the enemy was gone at last. It may be time for many more to imagine something better than the false and enforced solidarity of communism and better than the idolised egoism of capitalism. History has not ended: this is a time for hope and optimism as we brace ourselves for the pain and shock of change.

Dr Vassallo is a member of the Committee of the European Green Party.

hcvassallo@kemmunet.net.mt