Ariadne’s thread in Penelope’s cloth. Some provocative thoughts: The World and Europe

The aim of this essay is to address the three major challenges facing the global economy. For ease of reference, each challenge is addressed in a separate part.

Part One explores the future of the world economy, or “globalization”, through the lens of two provocative questions which are dominating current intellectual economic and political thinking such as “Will the 21^st Century Be the End of Western Leadership and Power?”, and then “What Will the New World and Governance  Be Like?”.

Actually, if we look at the data for the last twenty years, no world crisis is evident. Growth rates have been sustained in Asia, North America, Latin America, and recently in several African countries as well. Within this world framework, what clearly appears is a European structural crisis which will be discussed in Part Two.

In the meantime, this long-running world growth has been sustained by accumulating increasing financial disequilibria.  There are major questions about the world economy to be discussed: “Could these financial disequilibria allow growth to continue without limits in future years?” and “For how long can this growth be continued by accumulating additional financial disequilibria?”.

Indeed, if someone spends more than the income he produces and someone else gives him credit, we could say that there is an equilibrium. However, on the one hand, someone is accumulating debt and, on the other end, someone else is accumulating wealth. Debt on one side of the world and wealth in some other part of the world could also be “in equilibrium”, but…how long and how far can this condition be sustainable? How does the present and future world governance need to be changed in relation to both growth and financial disequilibria in all the different continents of  our planet?

Part Two is about Europe and the European structural crisis. The provocative question about the future of Europe and its role in the world economy is: “Is Europe Over or Will It Be the U.S.E.?”.

Indeed, if we look at the data for the last two decades, a European crisis emerges within the world economy but, at the same time, an Italian structural crisis emerges with respect to the European Union and the Euro Zone.

Both these two structural crises (Europe with respect to the rest of the World and Italy with respect to the rest of Europe) cannot be solved “from abroad”.