Wednesday, June 25, 2014

Nouriel Roubini | The Great Global Backlash

Anaemic economic recovery has given populist parties an opening to blame foreign trade and foreign workers
by Nouriel Roubini

In the immediate aftermath of the 2008 global financial crisis, policymakers’ success in preventing the Great Recession from turning into Great Depression II held in check demands for protectionist and inward-looking measures. But now the backlash against globalization—and the freer movement of goods, services, capital, labour, and technology that came with it—has arrived. This new nationalism takes different economic forms: trade barriers, asset protection, reaction against foreign direct investment, policies favouring domestic workers and firms, anti-immigration measures, state capitalism, and resource nationalism. In the political realm, populist, anti-globalization, anti-immigration, and in some cases outright racist and anti-Semitic parties are on the rise. These forces loath the alphabet soup of supra-national governance institutions—EU (European Union), UN (United Nations), WTO (World Trade Organization), and IMF (International Monetary Fund), among others—that globalization requires. Even the Internet, the epitome of globalization for the past two decades, is at risk of being balkanized as more authoritarian countries—including China, Iran, Turkey, and Russia—seek to restrict access to social media and crack down on free expression.

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Nouriel Roubini is an American professor of Economics at New York University`s Stern School of Business and chairman of RGE Roubini Global Economics
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