Abstract

The financial aspect is the most evident aspect of this crisis, but in a capitalist economy financial aspects and real aspects are strictly intertwined. The real aspect – and cause – of the crisis is the change in the income distribution from wages to profits and rents, and the ensuing lack of demand and unemployment. The financial and political aspect is the Eichengreen-Chomsky “virtual senate” of global capital, which can exercise veto power over government policies that it considers irrational: this is a problem which can be solved only by means of a new international order. With regard to the means to prosperity the best recipe is Keynes’s social philosophy. As far as Italy is concerned the government should design a blend of three simultaneous measures: boosting the productivity, reinforcing the effective demand, and restructuring the composition of public debt