CRISIS SOLUTIONS – GREAT TRANSFORMATION

Abstract

This crises is the neoliberal system crises. At the beginning of the nineties, after the collapse of the socialism, liberal capitalism has been marked as the unchallenged winner and universal model of the future world order. Development of the society (state) has been understood as a general privatization, liberalization and deregulation followed by economic growth as a natural consequence of the market mechanism and invisible hand. That system has developed greed. Wealthy people have become wealthier and poor people have become poorer. Income inequalities increased and resulted in a great crisis. Exit from the crises is in the great transformation or transition from neoliberal system towards the welfare state which will provide – within different models – (1) production of public goods (health, education, housing, welfare) that are available to everybody, (2) ensure income equality and, (3) preserve the environment for the next generation. Invisible hand and visible hand of the state should be coordinated, and reproduction of the added value should be divided equally between labor and capital. That is the a way out from the crises and a condition for the sustainable long term development.