Vaclav Klaus U.N. Speech

http://www.futureofcapitalism.com/2010/09/vaclav-klaus-un-speech

The president of the Czech Republic, Vaclav Klaus, is really something. From his speech today at the U.N. General Assembly:

The first issue is the worldwide economic crisis and the methods to overcome it. I am afraid we are moving in a wrong direction. The anti-crisis measures that have been proposed and already partly implemented follow from the assumption that the crisis was a failure of markets and that the right way out is more regulation of markets. This is a mistaken assumption. It is not possible to prevent any future crisis by implementing substantial, markets damaging macroeconomic and regulatory government interventions as it is the case now. It is only possible to destroy the markets and together with them the chances for economic growth and prosperity in both developed and developing countries.

The solution to this or any other crisis does not lie in rising protectionism and it is positive that most governments have behaved quite rationally in this respect. The solution doesn't lie in "more bureaucracy" either, in creating new governmental and supranational agencies, or in aiming at global governance of the world economy. On the contrary, this is the time for international organizations, including the United Nations, to reduce their expenditures, make their administrations thinner and leave the solutions to the governments of the member states which are directly accountable to the citizens of their countries.....The UN's role is not to push for global governance and to play the central role in it. The UN exists primarily to enhance friendly relations among its members and to look for solutions to problems which can't be confined to national boundaries.

Back in January 2009, Mr. Klaus wrote a memorable piece for the Financial Times: "A big increase in financial regulation, as is being proposed so often these days, will only prolong the recession....The best thing to do now would be temporarily to weaken, if not repeal, various labour, environmental, social, health and other "standards", because they block rational human activity more than anything else....Our historical experience gives us a clear instruction: we always need more of markets and less of government intervention. We also know that government failure is more costly than market failure."

by Ira Stoll  |  Sep 25, 2010 at 11:50 pm Related Topics:  Capital Markets Regulation, Europe receive the latest by email: subscribe to the free futureofcapitalism.com mailing list