The economic system died: What do we do now?

What kind of economic system is best for human well - being? This question will define our era because, after 40 years of neoliberalism in the United States and in other advanced economies, we now know it's not working.

The neo-liberal tax experiment for the wealthy, production and labour market degradation, financialization, and globalization ʹ were spectacular failures. Economic growth is smaller now than it was in the first quarter after World War II. After decades of stagnation or even loss of income for those beneath the top, neoliberalism must be declared dead and buried.

To succeed, we have at least three major political options: extreme right nationalism, centre left reformation and progressive left [with the representation of the centre left of neoliberal failure]. Yet, the exclusion of the progressive left, these options remain linked to a form of ideology that has expired [or must expire].

The centre left, for example, is showing human-faced neoliberalism. Its goal is to bring the policies of former US President Bill Clinton and former British Prime Minister Tony Blair in the 20th century, making very small revisions of the prevalent forms of financialisation and globalisation. Meanwhile, nationalist right denies globalisation, blames immigrants and foreigners for all today's problems. And yet, as Donald Trump's presidency has shown, it is no less committed to cutting taxes for the rich, corrupting markets, and eliminating social programmes.

For the dilemma of these two, the third camp interprets what I consider to be progressive capitalism, which describes a radically different economic agenda based on four priorities. The first is to restore balance between markets, state and civil society. Slow economic growth, growth in inequality, financial instability, and environmental degradation are market-made problems, and as such cannot be overcome by the market on its own. Governments are tasked with restricting and shaping markets through environmental, health and safe access and other types of regulation. It is also the government's job to do what the market cannot do, how to invest actively in basic research, technology, education and health for people.

The second priority is to accept that “the wealth of nations” is the result of a scientific search for world learning around us and social organizations that allow large groups of people to work together for the common good. Markets still have a complex role to play in the framing of social cooperation, but they will serve that goal only if governed by order and law and subject to democratic control. Otherwise, individuals can become rich by blowing up others, not putting out wealth from rent seekers rather than from their intelligence. Most of today's rich people went on their way to get to where they are. They are well served by Trump policies, encouraging rent-search while destroying existing sources of wealth creation? Progressive capitalism requires just the opposite.

This brings us to the third priority: addressing the growing problem of market power concentration. Exploiting the advantages of information, buying potential components, and creating barriers for entry, domino firms are able to engage in a large-scale search to harm each. The rise in market corporations' power, combined with the decline in buying workers, explains why inequality is so high and growth is so small. If the government doesn't take a more active role than in neoliberal descriptions, these problems will probably get worse because of the advancement of roboticisation and artificial intelligence.

The fourth key issue in the progressive agenda is to cut the link between economic power and political influence. Economic power or influence and political influence are strengthening each other, especially when, both in the United States, wealthy individuals and corporations can spend without limits in elections. As the United States moves even closer to the non-democratic system of “a dollar, a vote,” the responsibility-giving system that is so important to democracy seems to be out of place: nothing will limit the power of the rich. This is not just a moral and political problem: economies with less equality perform better. Capital-progress reforms should be launched through cutting money's influence on politics and reducing inequality.

There is no magic bullet that can reverse the damage caused by decades of neoliberalism. But a comparison agenda designed above could absolutely be. It seems to focus on education, research and other sources of wealth creation. It must protect the environment and fight climate change with the same alert as New Course supporters in the United States did. And it has to offer public programs to ensure that no citizen is denied basic conditions for a good life. This includes economic security, job access, and dignified wages, health care, safe retirement, and quality in educating his children.

This agenda is affordable; in fact, we cannot afford not to do it. Alternatives offered by nationalists and neoliberals would guarantee more stagnation, inequality, environmental degradation, and political divisions, which could potentially lead to a future we don't even want to imagine.

Progressive capitalism is not an oxymoron. It is the most stable and vibrent alternative to an ideology that has completely failed. As such, it represents the best chance to escape the illness of the current economic and political system. /The Project Synditate.

*Joseph E. Striglitz is Nobel Prize laureate in Economics.