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Fed: Rudd calls for new era of "social capitalism"

31 Jan 2009 12:59 AM

SYDNEY, Jan 31 AAP - Prime Minister Kevin Rudd has denounced the unfettered capitalism of the past three decades and called for a new era of "social capitalism".

In an essay outlining plans to fix capitalism to be published next week, Mr Rudd criticises neo-liberals who influenced the market system in the 1970s, Fairfax reports.

He says the refashioning of the market ultimately brought about the financial crisis, and calls for a new era in which government intervention and regulation feature heavily.

"The time has come, off the back of the current crisis, to proclaim that the great neo-liberal experiment of the past 30 years has failed, that the emperor has no clothes," Mr Rudd writes of those who placed their faith in the corrective powers of the market.

"Neo-liberalism and the free-market fundamentalism it has produced has been revealed as little more than personal greed dressed up as an economic philosophy.

"And ironically it now falls to social democracy to prevent liberal capitalism from cannibalising itself."

As Franklin Roosevelt rebuilt US capitalism after The Great Depression, modern day "social democrats" such as himself and US president Barack Obama, must do the same again, Mr Rudd writes in a 7,000-word essay in The Monthly magazine.