TUBINGEN, Germany — Many say the world financial crisis could not have been foreseen. Perhaps not by financiers and economists, but others who were watching how markets were developing — often with dismay — were more than worried.

As early as 1997, I warned of a repeat of the collapsed economic order of 1929-1933 in my book “A Global Ethic for Global Politics and Global Economics”: “The slightest remark, for example by the president of the American Federal Bank, Alan Greenspan, at the beginning of December 1996, that an ‘irrational exuberance’ had led to an overvaluation of the financial markets was enough to drive nervous investors on the high-flying stock markets of Asia, Europe and America into a spin, and panic selling. This also shows that crises in globalization do not a priori balance out, but perhaps get progressively worse.”

Back then, I was venturing what is, for economists, a heretical presumption: that chaos theory should be applied to the economy; that devastating effects can follow from the smallest causes. One could by no means rule out “a return of the world economic crisis . . . of 1929-1933.”

So I was not at all surprised by the speed and dimension of events in recent months. Indeed, only a few economists — such as the 2001 Nobel laureate in economics Joseph Stiglitz and the 2008 laureate Paul Krugman — warned about fatal developments in the globalized economy.

Contrary to many predictions by economic experts, the crisis has not been limited to the financial sector. Instead, it is generating a massive impact on the real economy — hitting the automobile and chemical industries especially hard.

In contrast to 1929, credit is not being throttled; on the contrary, public money is being pumped into banks and the economy. But these measures will be successful only if they are not taken in an isolated and populist way. They need to be part of a convincing overall plan that combines responsible state intervention with relief of the financial burdens of individual citizens, as well as savings in public budgets. Unforeseeable state debt — at the cost of coming generations — is neither a viable nor an ethical solution.

Fortunately, there are signs that the general state of mind that helped spawn the crisis is changing. In the rich industrialized countries, after an era of cynical and shortsighted profit- maximizing behavior, we may be at the dawn of a new age of modesty and sustainability. Companies are facing growing pressure to behave ethically, and unethical business behavior is at last being punished.

On a lecture tour of the United States in November, I could see that many people were complaining about the overwhelming desire for profit in business and about megalomania in politics. As markets failed, calls for ethical regulation of the quest for profit has become justified not only in principle but also in fact. Ethics is not merely an incidental addition to the global market economy. Rather, the new financial architecture that many are calling for must be supported by an ethical framework. The fatal human instincts of greed and hubris can be tamed only with some elementary ethical norms.

So what should this ethical framework entail?

A paragraph from the “Declaration toward a Global Ethic of the Parliament of the World’s Religions in Chicago” in 1993 reads: “In the great ancient religious and ethical traditions of humankind we find the directive: You shall not steal! Or in positive terms: Deal honestly and fairly! Let us reflect anew on the consequences of this ancient directive: No one has the right to rob or dispossess in any way whatsoever any other person or the commonweal. Further, no one has the right to use her or his possessions without concern for the needs of society and Earth. . .

“We must develop a spirit of compassion with those who suffer, with special care for the children, the aged, the poor, the disabled, the refugees and the lonely. We must cultivate mutual respect and consideration, so as to reach a reasonable balance of interests, instead of thinking only of unlimited power and unavoidable competitive struggles. . . . In greed humans lose their souls, their freedom, their composure, their inner peace and thus that which makes them human.”

Many hopes throughout the world are now pinned on Barack Obama, who enters the U.S. presidency with a moral claim that is extraordinarily high for a politician. Of course, Obama cannot work miracles, but he is in a position to define an ethical framework for rebuilding the global economy.

In view of the oppressive — and unprecedented — abundance of problems with which Obama is confronted at home and abroad, he will certainly not be able to fulfill all expectations. I shall not pass judgment on his plans for the world economy as reported so far. But it is certain that he has recognized the ethical dimension of the current economic crisis: “It amounts to one of values: Do we assign a value only to wealth or the work which creates it?”

The suffering that so many people are enduring leads to pressure for reform, and Obama has shrewdly transformed these pressures into a political force. All this shows that reflection on common ethical values, a global ethic, is needed more urgently now than ever before.

Hans Kueng is president of the Foundation for a Global Ethic (Stiftung Weltethos) and professor emeritus of ecumenical theology at the University of Tubingen. © 2009 Project Syndicate/Institute for Human Sciences (www.project-syndicate.org)

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