Which is the future? Free-market capitalism or state-run capitalism? That was the burning question supposedly posed by the western financial crisis.
In hisessay in Foreign Affairs, later turned into The End of the Free Market: Who Wins the War Between States and Corporations, geo-political analyst Ian Bremmer wrote that even democratic, Western governments had to resort to state ownership of their collapsing financial institutions at the height of the crisis.
He warned against the advent of state capitalism and the retreat of the free market.
But is it possible the question he posed is moot? Is it possible that both types of capitalism - in China and America respectively - are essentially charades that mask an underlying plutocracy? There is the 'family business' argument put forward by authors Carl Walter and Fraser Howie about China.
And then there is the 'banana republic' argument about the US put forward by Yves Smith, an economics blogger, and Simon Johnson, a former IMF chief economist. Johnson caused an uproar from top bankers and politicians with his May 2009 article in the Atlantic Monthly in which he compared the stranglehold of the financial oligarchy on Wall Street over Washington with that of politically-connected business elites in emerging countries.
'In its depth and suddenness, the US economic and financial crisis is shockingly reminiscent of moments we have recently seen in emerging markets,' he wrote.
'There's a deeper and more disturbing similarity: elite business interests ... played a central role in creating the crisis, making ever-larger gambles, with the implicit backing of the government, until the inevitable collapse.'
