Back to basic values

A self-described social economist schooled in Latin American history, Murphy would relate to the values on which British Prime Minister Gordon Brown grounds his understanding of the market.

Murphy's analysis of the financial turmoil - and looming consequence of a world economy in reverse - is one that observers outside of the financial circle hope will penetrate the focus on "market" solutions at global forums such as the Group of Twenty summit in Washington on Saturday.

As head of a Labour government, Gordon Brown sees no contradiction in his admiration of the ability of the market "to release the dynamism and enterprise of people".

Thus his government is "pro-business and pro-markets, and always will be", Brown writes in a commentary in The Daily Telegraph, attributing his received value system to the generations of his father's family who worked the land.

But "I also know that we do not live by markets alone", he writes. Markets rely on values that they cannot generate themselves. "Values as important as treating people fairly, acting responsibly, co-operating for the benefit of all ... are not born in markets, nor in states. These values ... are learned in families, neighbourhoods and communities, and developed in the relationships we enjoy as a society."

Scholar Joe Camilleri is encouraged by the emergence of political leaders such as Brown, Australia's Prime Minister Kevin Rudd, and now, US president-elect Barack Obama.

"Markets are terribly important in the buying and selling of goods and services," notes Camilleri, internationally regarded professor of international relations at La Trobe University in Melbourne and dialogue partner in interfaith forums.

The problem has been since the pendulum swung too far over the past 30 years to the mistaken view that the "free" market should be left to operate, regardless of social norms.

One consequence of this Thatcherite "there is no such thing as society" view has been the rise of what Camilleri describes as a small group taking advantage of the system, leading to market failure such as the crisis on Wall Street.

"We do need to watch the market, and the state needs to intervene from time to time," says Camilleri.

The problem is that with the global nature of today's economy, individual states alone cannot correct market failure.

"We have arrived at an extraordinary moment when the international community has to set the norms, and to internalise the values, norms and surveillance mechanisms to govern the market," says Camilleri.