Each year I choose a book to be the Globalization Book of the Year, i.e., the “Globie”. The prize is strictly honorific and does not come with a check. But I do like to single out books that are particularly insightful about some aspect of globalization. Previous winners are listed at the bottom.
This year’s choice is Crashed: How a Decade of Financial Crises Changed the World by Adam Tooze of Yale University. Tooze, an historian, traces the events leading up to the crisis and the subsequent ten years. He points out in the introduction that this account is different from one he may have written several years ago. At that time Barak Obama had won re-election in 2012 on the basis of a slow but steady recovery in the U.S. Europe was further behind, but the emerging markets were growing rapidly, due to the demand for their commodities from a steadily-growing China as well as capital inflows searching for higher returns than those available in the advanced economies.
But the economic recovery has brought new challenges, which have swept aside established politicians and parties. Obama was succeeded by Donald Trump, who promised to restore America to some form of past greatness. His policy agenda includes trade disputes with a broad range of countries, and he is particularly eager to impose trade tariffs on China. The current meltdown in stock prices follows a rise in interest rates normal at this stage of the business cycle but also is based on fears of the consequences of the trade measures.
Europe has its own discontents. In the United Kingdom, voters have approved leaving the European Union. The European Commission has expressed its disapproval of the Italian government’s fiscal plans. Several east European governments have voiced opposition to the governance norms of the West European nations. Angela Merkel’s decision to step down as head of her party leaves Europe without its most respected leader.
Angela Merkel risked everything when she approved unbridled immigration into Germany in 2015.
The recent election in Hesse sealed her fate. She could announce her retirement or be thrown out in some future election. (Or be thrown out by her own party.)
In fact all the discord mentioned in your paragraph which begins with “Europe has its own discontents” came after the unbridled immigration into Europe. (And long after the economic upheaval of 2008.)
This is an old lesson being relearned. Elected politicians can not lead the electorate to a place where they do not want to go! At some point the electorate realizes that their interests are only secondary to the politicians.
And your comments on the economy seem to indicate that you believe that the problems in 2008 were all about the banks and “LIQUIDITY”. Save the banks and all would be well. The banks were saved and the rest of the economy was secondary.
President Trump was elected in 2016 because he campaigned against the entry of illegal immigrants and against the free trade treaties.
Does anyone begin to see a pattern here?
The EU isn’t globalism, the EU is regional and “nationalist” itself. This is a blunder people make.
No Trump was “elected” because of James Comey and Supreme Court voters sticking with him despite his “ways”. You see your mistake?
Oh yeah Jim. How do you like Trumps new “NAFTA”? Looks like the same trade scams to me. Excessive debt vehicles. So much for Trump not liking trade…………more like how Trump makes his share.
China tariffs? They have support in China for them. I wonder what part of the “machine” in China would enjoy those tariffs?
A nice feature of the book is the way each chapter (typically ~25 pages) is written in such a way that issues are compartmentalized. So if you want to review specific chains in the narrative, you don’t have to reread the entire 600+ pages. Each chapter covers the ground independently while still giving the book a smooth narrative. That’s quite a skill. I highly recommend “Crashed”. I found it much better than Bernanke’s book, or Mervyn King’s “Alchemy”, Stiglitz’s book on “Euro” or even Barry Eichengreen’s “Hall of Mirrors”, which I also liked very much.