In an interesting feature on the unraveling of Budapest, MARCUS MABRY reminds us of the dangers of globalization, and how everything can all come undone.
In the years since China, then Russia and its satellites, joined the world economy, confidence has become the currency of this globalized world. One of our era’s dominant features had been a swaggering self-assurance, a sometimes smug pride in our modernity. Until it all started to come apart last year, a sense of optimism and possibility infected a border-hopping elite and, to some extent, the middle and working classes from Budapest to Bangalore.
Global trade rose as economic barriers fell, and prosperity grew and spread. More than a billion people were lifted out of poverty in the last four decades, most of them in Asia. And in much of Eastern Europe, prosperity and personal freedom arrived together.
We took that world for granted. We behaved as if it were perfectly natural to be able to travel freely from one side of Europe to the other, to withdraw money from our home checking accounts at A.T.M.’s in Africa.
An entire industry grew up around globalization, with its cheerleaders and critics, its Thomas Friedmans and Fareed Zakarias on one side, and Joseph Stiglitzes and Samuel Huntingtons on the other.
Now, the globalized world faces its greatest challenge: an economic contraction the likes of which it has never seen. As many economies shrink under the burden of bank bailouts and consumers and creditors tighten their grips on their wallets, unemployment will rise most everywhere.