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sistence of double digit unemployment rates in Europe arouse increasing protest and opposi-
tion. Lack of medical insurance in the United States (including the fact that more than 40
million American citizens have no medical coverage at all). and the contrast between high
medical expenditure and low survival tates (especially of disavantaged groups) in the US lead

to anger and frustration. which are beginning to get politicized. The persistence of poverty in
the richest economies also elicits continual protest.The attempted implanting of capitalism in
Russia has led to a series of economic crises and a very steep rise in mortality rates the
longevity of Russian men have fallen substantially below those nearly everywhere in Asia (with
the exception of countries with special adversity. such as Afghanistan).

On the political side. the triumph of capitalism over socialism has been promptly

followed-oddly enough by the defeat of conservative and liberal governments in the hands of
social democratic opposition parties. as happened in one country after another in West
Europe : Britain. France. Germany. Italy and others. Similar changes can be seen in many
developing countries as well. The voice of rebellion against the unrestrained market economy
so strongly praised not long ago seems to get louder every day. The massive protests in Seattle
that effectively busted the W.T.O. conference last month are not just straws in the wind. but
more like uprooted trees in the storm. What. we may well ask. has gone wrong with capital-
ism?

Before I try to address this question (what if anything has gone wrong?). let me ask
a prior guestion : in what sense and in what way did things go so right for capitalism when the
going was good? On what was capitalism's success-and it has been a remarkable record of
success based? It would. of course. be very silly to decide from the present discontent about
the international market economy that it never worked anyway. Rathe we have to see how it

had worked reasonably well over quite a long time. In so far as it has not worked. we also have
to ask what the problems have been. and how we can seek supplementation of what the
markets can achieve. That. by the way. is also the right way of understanding the questions that
the Seattle protests unfolded. The questions raised can be given the attention that they
certainly deserve. This can done as a serious social exercise without falling either for the
smugness of dismissing the protests as just silly of pernicious. or for uncritically acception the
assorted basket of somewhat contradictory answers that found their way into slogans and
posters of the protesters in Seattle. The answers are not blowing in the air. but the questions

certainly are.

Non-market Institutions and the Success of the Market Economy
So we bigin with the question why and how has capitalism succeeded. Some detect
the roots of capitalism's success simply in the superior efficiency of markets. On the one hand.
and unobstructed profit maximization, on the other, And yet the experience of successful
capitalism has always been based not just on the market mechanism alonte, but also on the