Our So-Called Foreign Policy: First Thoughts on the Post-Brexit World

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2016 election, Brexit, Catalonia, David Cameron, Donald Trump, EU, European Union, Eurozone, Federal Reserve, France, globalization, Greece, Hillary Clinton, Im-Politic, Immigration, interest rates, Janet Yellen, NATO, North Atlantic treaty Organization, Obama, Scotland, Spain, terrorism, The Netherlands, TPP, Trade, Trans-Atlantic Trade and Investment Partnership, Trans-Pacific Partnership, TTIP, United Kingdom

I sure as heck was surprised by the United Kingdom’s decision yesterday to leave the European Union (EU). Were you? And now that “Brexit” will indeed take place, what’s in store for America and the world? My crystal ball has never worked perfectly, and much of Brexit’s ultimate impact will depend on how London executes the move, and how the EU and financial markets respond. America’s reactions of course will matter as well. Here are some initial reactions. 

>The unexpected Brexit verdict significantly changes the narratives about the global economy’s evolution, about the future of international trade and related economic policies, and about the fate of international political integration.

As recently as 48 hours ago, the safest bet was that British voters would behave similarly to voters elsewhere in Europe who have had the chance to change fundamental political arrangements. In September, 2014, the Scots voted to remain a part of the United Kingdom. Although Greek anti-EU sentiment runs high for reasons that are easily understandable given that country’s prolonged economic crisis, a much-feared (by those who were not hoping for it) “Grexit” vote never took place. Catalonia is still part of Spain, despite a strong separatist movement in the region – and a terrible Spanish economy. And in 2005, the French and Dutch electorates voted down a proposed new EU constitution that would have accelerated political and economic integration – chiefly by streamlining decision-making via greater powers for pan-European institutions. But the issue of departing the Union has not yet come up.

As with Scottish devolution in particular, I thought that instincts for caution would steadily overcome nationalist or ethnic (take your pick) feelings as election day approached, and that the British would ultimately reject a leap in the dark. And of course, my confidence was reinforced by my view that the UK is hardly an economic superpower, and that its prospects outside the EU objectively are iffy.

The British public’s refusal to back down – despite an unmistakable fear-mongering campaign by (now caretaker Prime Minister) David Cameron’s government and even the country’s central bank – signals that Europeans at least may be willing to shift integration into reverse, not simply keep it in place

>In that vein, one of the biggest worries of Brexit opponents entailed the possibilities of contagion – a “Leave” verdict encouraging similar EU opponents throughout the Union. And copycat Brexit votes are clearly back on the table, given widely acknowledged structural defects in the eurozone (a common currency area that includes 19 of the 28 – counting the UK – EU members, and that Britain never joined), Europe’s especially weak recent economic performance, and controversial EU decisions to admit large numbers of Middle East refugees.

Their success would be a genuinely historic, and indeed seismic, development, as Europeans themselves since the end of World War II have generally acknowledged that closer, more regularized economic ties were essential for breaking their centuries-old cycle of major conflict. It’s possible concerns about keeping Europe peaceful are overblown. For all the importance of economic integration, the main pacifier of the continent has been the American commitment to European defense embodied in the North Atlantic Treaty Organization (NATO). Brexit per se does nothing to change the UK’s role in the alliance.

Nevertheless, economic and security issues are never, or even often, completely separate. Therefore, particularly over the longer term, Brexit and other withdrawals from the EU could well turn Europe into a much less stable place than it’s been for the last 70 years. More uncertainty could be added to the European security scene if presumptive Republican presidential nominee Donald Trump, an outspoken critic of America’s NATO policy, won the presidency.

I’ve strongly critical of continued U.S. NATO membership, too – especially of what looks to me like a possibly suicidal nuclear security guarantee. Indeed, the risks created for America by its continued NATO role convinces me that fundamental changes in the alliance’s structure are inevitable anyway, since the U.S. promise to risk its existence on Europe’s behalf has become ever less credible. If Brexit brings the EU’s dissolution, or significant weakening, closer, then Washington will face fateful NATO choices it has long tried to avoid sooner rather than later. And the foreign policy establishment’s demonization of all proposals for proactively dealing with these dilemmas has left the nation completely unprepared for their growth to critical mass.

>Economically, Brexit carries disruptive potential, too. Just look at the financial and currency markets today. But epochal political events inevitably create short-term costs; any other expectations are completely unrealistic. Especially inane have been claims on social media (e.g., by The New Yorker‘s Philip Gourevitch) over the last twelve hours that the initial turbulence touched off by Brexit proves it a failure.

Sure to be complicated greatly, however, are efforts to conclude a major trade agreement between the United States and the EU. This Trans-Atlantic Trade and Investment Partnership (TTIP) has been a long slog anyway. But since such negotiations always entail achieving a delicate balance of interests, and since the UK is a significant part of the overall EU economy, any important compromises that have been struck in the talks would seem to be threatened.  

President Obama has already concluded with eleven other countries a Pacific rim-centered trade agreement called the Trans-Pacific Partnership (TPP), but it’s doubtful that Brexit will do much to dispel Congressional skepticism that has prevented Mr. Obama from formally submitting it for approval.

Keep in mind, though, that trade – including with Europe – is still a pretty minor part of the U.S. economy. The channel through which the biggest Brexit impact is likeliest to be transmitted to America is monetary policy – the province of the Federal Reserve. At the Fed’s June 15 meeting, Chair Janet Yellen made clear that the possibility of Brexit, and especially its impact on financial markets, was one factor behind the central bank’s decision to keep interest rates on hold. Until business-as-usual in the world economy resumes, don’t expect any rate hikes – good news if you believe that the U.S. desperately needs super-easy credit to sustain its current feeble recovery, and bad if you believe that prolonged near-zero rates have prevented the post-financial crisis adjustments needed to restore real health to the economy.

>In fact, such existing skepticism around these trade issues, as well as around immigration policy, makes me doubt that Brexit will have a notable effect on American politics and policy. Sure, the same kinds of economic anxieties that have fueled Trump’s campaign helped lead to victory for “Leave.” But his followers won’t be able to cast more votes for him as a result of the British decision.

Supporters of his presumptive rival, Democrat Hillary Clinton, are surely horrified by the resistance to unlimited immigration and massive refugee admissions signaled by Brexit, so they wouldn’t seem headed for the Trump camp. And it’s difficult to imagine many independent voters marking their ballots in November based on the British vote. Indeed, this poll tells us that Brexit isn’t even on the screens of most U.S. voters. Rightly or wrongly, that choice will be overwhelmingly Made in America.

One possible exception – but one that’s largely independent of Brexit: A wave of overseas terror attacks could easily heighten American anxieties about their own security, whether an Orlando or San Bernardino repeat occurs or not. Ditto for some major military success by ISIS or a similar group abroad, or an unrelated international crisis. More terrorism-related developments could favor Trump. Something like a showdown with Russia over Eastern Europe or China over the South or East China Seas could break in Clinton’s direction (due to judgment and experience considerations). In the process, these contingencies could also remind us how quickly Americans might forget all about Brexit.

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(What’s Left of) Our Economy: More Trade Double-talk from Obama

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fast track, free trade agreements, Obama, TPP, Trade, Trans-Atlantic Trade and Investment Partnership, Trans-Pacific Partnership, U.S. Trade Representative, USTR, {What's Left of) Our Economy

President Obama has repeatedly tried to justify to critics his progressive trade policy bona fides by acknowledging how far so many previous trade deals have fallen short of their promises – and then insisting that his proposed Trans-Pacific Partnership (TPP) and a companion European deal are incorporating the right lessons.

The trouble is, the rest of his administration doesn’t seem to have gotten this message, conveying the impression of a government speaking literally out of both sides of its mouth – and therefore undeserving of sweeping new fast track trade negotiating authority.

Speaking at the headquarters of offshoring-happy Nike earlier this month, the president acknowledged that “past trade agreements, it’s true, didn’t always reflect our values or didn’t always do enough to protect American workers.  But that’s why,” he insisted, “we’re designing a different kind of trade deal.”

Addressing progressive activists in Washington a few weeks earlier, Mr. Obama was even more emphatic:

“[P]ast trade deals didn’t always live up to the hype.  A lot of trade deals didn’t include the kinds of protections that we’re fighting for today.  And I saw it in Chicago and in towns across Illinois where manufacturing collapsed, plants closed down, jobs dried up.  When I ran for office, I’d talk about a man I met who had to pack up his own plant before he was laid off.  And that made a mockery of the value of community and the dignity of work.  So for a lot of Americans, they attribute those changes to what happened in the aftermath of trade agreements.  And I understand that.  But we’ve got to make sure we learn the right lessons from that.”

No one, however, seems to have told the U.S. Trade Representative’s (USTR) office, the Commerce Department, or even the White House staff.

Thus according to USTR, “The process of opening world markets and expanding trade, initiated in the United States in 1934 and consistently pursued since the end of the Second World War, has played an important role in the development of American prosperity. According to the Peterson Institute for International Economics, American real incomes are 9% higher than they would otherwise have been as a result of trade liberalizing efforts since the Second World War. In terms of the U.S. economy in 2013, that 9% represents $1.5 trillion in additional American income.

“Such gains arise in a number of ways. Expanding the production of America’s most competitive industries and products, through exports, raises U.S. incomes. Shifting production to the most competitive areas of our economy helps raise the productivity of the average American worker and through that the income they earn. With the ability to serve a global market, investment is encouraged in our expanding export sectors and the rising scale of output helps lower average production costs. Such effects help strengthen America’s economic growth rate. Moreover, imports increase consumer choice, and help keep prices low raising the purchasing power for consumers. Imports also provide high quality inputs for American businesses helping companies and their U.S. employees become or remain highly competitive in both domestic and foreign markets.”

What’s not to like?

Then there’s Commerce: “Free Trade Agreements (FTAs) have proved to be one of the best ways to open up foreign markets to U.S. exporters. Trade Agreements reduce barriers to U.S. exports, and protect U.S. interests and enhance the rule of law in the FTA partner country. The reduction of trade barriers and the creation of a more stable and transparent trading and investment environment make it easier and cheaper for U.S. companies to export their products and services to trading partner markets. In 2014, 47 percent of U.S. goods exports went to FTA partner countries. U.S. merchandise exports to the 20 FTA partners with agreements in force totaled $765 billion, up 4 percent from 2013. The United States also enjoyed a trade surplus in manufactured goods with our FTA partners totaling $55 billion in 2014.”

In other words, and contrary to the president, past free trade deals have indeed promoted American values as well as American economic interests.

Finally, the White House itself: “The Administration has made progress in expanding global trade opportunities for U.S. exporters by signing into law three trade agreements, enforcing U.S. companies’ rights under existing trade agreements, and strengthening trade relationships in major emerging markets.” So it seems like the president learned the right trade policy lessons even before launching into the TPP talks?

It’s perfectly reasonable (if factually challenged) for U.S. officials to argue that past trade deals have been big successes, and that therefore America needs more of them. It’s also perfectly reasonable for Mr. Obama to claim that past trade deals have often failed, but that he’s discovered a real recipe for success. But it’s anything but reasonable for a single administration to be taking both positions. If anything, it’s a tell-tale sign of a time-honored political trick: Throw enough mud at a wall and expecting some of it to stick.

Our So-Called Foreign Policy: Former Military Bigwigs’ Militarily Dubious Case for New Trade Deals

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alliances, China, Cold War, deterrence, energy, export-led growth, free trade agreements, geopolitics, Germany, Japan, Korea, Middle East, NATO, oil, Our So-Called Foreign Policy, Russia, Soviet Union, technology transfer, TPP, Trade, Trans-Atlantic Trade and Investment Partnership, Trans-Pacific Partnership, tripwires, TTIP, Vladimir Putin

Despite my great respect for America’s uniformed military and for the civilians who try to manage the nation’s huge defense establishment, many of them have just reminded us that they have long suffered from a big, fat blind spot when it comes to U.S. foreign policy and its relationship to trade and economic policy.

Seventeen former Secretaries of Defense and leading generals on Thursday released a letter expressing their “strongest possible support” for President Obama’s proposed Pacific Rim trade deal and its trans-Atlantic counterpart. According to the signers, who included Colin Powell (a former Secretary of State to boot), and former Pentagon chiefs Leon Panetta, Chuck Hagel, Robert Gates, and Donald Rumsfeld, as well as former U.S. Iraq commander and CIA chief David Petraeus, “There are tremendous strategic benefits to [the two deals] and there would be harmful strategic consequences if we fail to secure these agreements. In both Asia-Pacific and the Atlantic, our allies and partners would question our commitments, doubt our resolve, and inevitably look to other partners. America’s prestige, influence, and leadership are on the line.” Needless to say, the letter claims that the economic benefits of these pacts would be “substantial,” too.

But its predictions of strategic disaster flowing from rejecting the Trans-Pacific Partnership (TPP) and Trans-Atlantic Trade and Investment Partnership (TTIP) stem from fundamental misunderstandings of how and why America’s main alliances are structured and work. More specifically, these former leaders either don’t or refuse to recognize that U.S. allies need the United States much more than the reverse, and similarly, they have lined up with America because their own self-interest desperately requires it.

After all, whatever benefits Americans get from these arrangements, the United States is located thousands of miles away from any rivals that could seriously threaten it, and retains more-than-ample power to deter attacks on the homeland from any minimally rational adversary. (Alliances have no apparent potential to strengthen U.S. security against non-rational enemies armed with weapons of mass destruction.) The allies, however, are all located very close to countries that can cause them major grief, and Washington’s assistance is especially prized not only because it is abundant, but because it comes from a power too far away to dominate them in any meaningful sense.

It’s true that, during the Cold War, major fears were expressed about Western Europe “Finlandizing” itself and agreeing to some form of informal Soviet hegemony. And one concrete problem could have ensued – Moscow could have interfered with U.S. efforts to supply Middle East military ventures through European bases. But if no such scenario unfolded during those decades, why would it emerge given the much weaker state of contemporary Russia? Even weirder, given the enormous American potential recently revealed for substantial energy independence, and given Europe’s continued reliance on the Middle East, control of the continent would put the onus on Vladimir Putin to defend the free flow of oil from that dysfunctional region, and generally police it. More power to him.

For their part, America’s Asian allies have significant reasons to kowtow to China – mainly because so many of them are connected with the PRC economically through the vast multinational manufacturing production complex the region has become. At the same time, commerce (properly understood) also prevents East Asia from simply casting its lot with the Chinese and excluding the United States in any (further) meaningful way. For America is by far the single biggest national customer for the products turned out by their export-heavy economies. China is way too poor, way too protectionist, and way too export-led itself to serve as a substitute.

The former military leaders are on firmer ground in suggesting that America’s allies have reason to doubt U.S. defense commitments. But that has nothing to do with the fate of trade deals. Instead, it reflects chronic doubts about whether the United States would risk its own security on their behalf, especially against nuclear-armed adversaries. Washington’s traditional response has been stationing U.S. forces (and during the Cold War, their families) directly in harm’s way, to increase the odds that attacks on the allies would claim U.S. victims. Thus American leaders would be left with no real choice but to respond in kind, the allies would recognize this, and adversaries would be further deterred.

Since the Cold War’s end, these American “tripwires” have been thinned out, but they’re still deployed in Korea, Japan, and Germany. The big new commitment questions raised in Europe have concerned the conspicuously complete lack of permanently stationed tripwires in the newer NATO members that were once part of the Soviet bloc but that still may be in Putin’s sites. In the Far East, the credibility of the American deterrent, as I’ve written, is being undermined by the ongoing development of Chinese and North Korean nuclear forces capable of striking American territory and largely invulnerable to retaliation or preemption. Neither trade deal being pursued by the president has the slightest chance of easing these doubts.

There is one way that the TPP could bolster the American stake in East Asia’s security status quo – if the deal had any real promise of reducing the region’s main predatory trade practices and turning U.S. commerce with it from a net loser to a net winner, or something close. But since these Asian practices (and barriers) are generally informal, and carried out by bureaucracies that are expert at keeping secrets from foreigners, they’ve been difficult enough for Americans even to identify and document, much less combat effectively.

Finally, it’s vital to point out that, for all the alarms sounded by these former military leaders about using TPP specifically to offset China’s rise and economic influence over its neighbors, not one of them has ever registered a single complaint about the wealth and technology (including defense-related knowhow) that American policy has showered on China for literally decades. This apparent ignorance of the first maxim of strategy – don’t enrich and empower your enemy – shows that these former defense officials and senior generals and admirals may not deserve to be taken seriously even on many national security questions, let alone on trade issues.

(What’s Left of) Our Economy: What Washington’s Missing About Trade and Global Growth

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currency, dollar, exchange rates, exports, Financial Crisis, Global Imbalances, gross domestic product, growth, imports, Obama, TPP, Trade, Trans-Atlantic Trade and Investment Partnership, Trans-Pacific Partnership, {What's Left of) Our Economy

Yesterday I took to task U.S. leaders who keep complaining about foreign countries’ practice of keeping their currencies artificially cheap to gain advantages in trade, yet who also keep opposing dealing with the problem effectively in America’s trade agreements. That’s a huge issue nowadays because Congress is poised to debate giving President Obama a blank check to negotiate big new trade deals that suffer from exactly that shortcoming – and many others.

Today I’m going to broaden the critique. Washington seems equally clueless about a related but more fundamental issue – the wisdom of juicing growth overseas by whatever means, including with new trade pacts like the above. The two big problems with the determination of the Obama administration, the Federal Reserve, and other trade cheerleaders to follow this course are that (1) they completely ignore the structural differences among the world’s major economies that ensure, all else equal, that growth fueled by trade will be grossly lopsided to America’s disadvantage; and (2) the resulting imbalances will worsen the kind of financial instability that set the stage for the last decade’s financial crisis and its bleak aftermath.

The conventional wisdom here holds that a faster growing world economy will create larger markets for U.S. exports than a slower growing economy. That’s why there’s strong support for the president’s goal of signing deals that supposedly will stimulate economic activity on both sides of the Pacific (through his Trans-Pacific Partnership) and the Atlantic (through the Trans-Atlantic Trade and Investment Partnership with the European Union).

But it also explains why the administration and the nation’s central bankers are so far pretty blasé about the impact of the strong dollar. They’re confident that even though America’s overseas sales will take an initial hit because U.S.-made goods in particular are getting costlier, enough growth abroad will be spurred by correspondingly weaker foreign currencies to offset exchange rate damage. Indeed, it’s been reliably reported that, despite American concerns most recently expressed in a Treasury Department report last week, Washington has actually decided to permit foreign currency weakening to proceed apace.

It all sounds so perfectly reasonable – until you realize that these expectations depend on at least most of the world being structured economically like the United States, and sharing the priorities Americans attach to consumption over production, and openness to imports versus growth strategies depending on wracking up not only exports but net exports (i.e., trade surpluses). When, however, in recent decades has this been the case? And why would anyone suppose that to be so now?

The best evidence for viewing the world as highly diverse economically, and recognizing that simple, across-the-board trade liberalization will produce equally diverse – and dangerous – results, comes from America’s own trade data. They clearly show that America’s exports have a much different relationship with the country’s growth than its imports. By extension, these relationships also differ among America’s trade partners when they’re lumped together.

As is always the case when discussing trade policies’ effects on an economy’s performance, oil and services need to be removed from the picture. The former isn’t dealt with at all in trade agreements, and . Fortunately, the U.S. government’s trade statistics make that easy, at least going back to 1995.

From that year through the end of last year (the latest available figures), the U.S. economy expanded by just over 58 percent after adjusting for inflation. (The “real” growth figure is the one monitored most closely.) During this 1995-2914 period, America’s non-oil goods exports certainly grew nicely – by just over 128 percent, or more than twice as much. But the nation’s non-oil goods imports nearly tripled after inflation – increasing by some 201 percent.

These numbers by themselves don’t prove that America is significantly more import-friendly than its trade partners collectively. Maybe the United States was leading the world in growth (which would, all else equal, have boosted its imports faster than its exports)? Yet judging from this chart, based on International Monetary Fund data, that hasn’t been the case.

And if not, then the U.S.-only statistics take on even more importance. What they reveal is that, since 1995, for every amount by which the American economy has grown in real terms, its non-oil goods exports have grown 2.21 times faster. But its non-oil goods imports have increased 3.46 times faster. In other words, inflation-adjusted U.S. growth over nearly three decades is associated with 1.57 times more non-oil goods import growth than export growth.

Moreover, the gap hasn’t closed much during the current economic recovery. Between the second quarter of 2009 – when it technically began – through the end of last year, U.S. real non-oil goods imports have risen 1.36 times faster than comparable exports. But this ratio has grown steadily, and in 2014 reached 1.83 – much higher than the post-1995 norm.

Most economists would undoubtedly still point to deficient American savings as the main problem – since countries’ trade deficits equal their net savings position. Savings behavior of course can be culturally influenced, at least in part. But it’s also unquestionably shaped by government policy. Moreover, as I’ve pointed out, savings rates “explain” absolutely nothing about trade flows. The mathematical relationship between the two that’s so widely relied on is simply an identity. That is, it doesn’t tell us that A cause B (or vice versa). It simply says that A equals B.

The unmistakable lesson taught by these figures, and by bitter experience, is that the more trade between diverse economies and the more neglect of resulting deficits and global imbalances, the closer the world comes to Mega-Financial Crisis 2.0. Equally clear: By indiscriminately fueling trade, President Obama will deserve just as much blame for this disaster as his predecessors merit for the last one.

(What’s Left of) Our Economy: New Obama Report (Unwittingly) Shows Why Trade Deals Need Currency Manipulation Bans

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China, currency, currency manipulation, Eurozone, exchange rates, Financial Crisis, free trade agreements, Global Imbalances, gross domestic product, Japan, Korea, KORUS, Malaysia, New Normal, Obama, recovery, Singapore, Taiwan, TPP, Trans-Atlantic Trade and Investment Partnership, Trans-Pacific Partnership, Treasury Department, {What's Left of) Our Economy

U.S. leaders keep showing us that they remain “The Gang That Can’t Think Straight” when it comes to international economic policy. Just look at yesterday’s Treasury Department report on exchange rate policies around the world – the department’s biannual assessment of whether America’s trade competitors are artificially keeping their currencies low to reap trade advantages. No countries were officially accused of this form of protectionism, but several had a Treasury finger wagged their way, including recent free trade agreement partner South Korea.

According to the report, although the Koreans have made international promises to refrain from competitive devaluations, the “sustained” rise in Seoul’s reserves and the country’s net forward position “indicates that they have intervened on net to resist won appreciation.” For good measure, Treasury noted Korea’s rising goods trade surplus with the United States and a July, 2014 International Monetary Fund judgment that the won “remains undervalued.”

In other words, Korea isn’t manipulating, but it looks suspiciously close. As a result, “Treasury has intensified its engagement with Korea on these issues. We have made clear that the Korean authorities should reduce foreign exchange intervention, limiting it to the exceptional circumstance of disorderly market conditions, and allow the won to appreciate further.”

Of course, here’s the rub: Seoul is completely free for all intents and purposes to ignore this “engagement.” For Korea’s currency interventions may clash with the international obligations it’s assumed (as in the World Trade Organization and the International Monetary Fund). But they don’t flout the only such commitment that could plausibly be enforced – that trade deal (KORUS) with the United States. After all, consistent with Washington’s reigning bipartisan consensus (especially between the last two presidents, and apparently now including Fed chair Janet Yellen), that enforceable currency manipulation bans don’t belong in trade deals, KORUS ignored the issue.

This gaping and damaging (by Treasury’s own admission) disconnect has big future implications as well. The president also staunchly opposes including an enforceable currency manipulation ban in the Trans-Pacific Partnership (TPP) trade agreement he’s seeking. This deal would already include countries widely accused of past manipulation: Japan (chided in the new Treasury report for its heavy reliance on yen weakening monetary policies to boost growth), Malaysia, and Singapore. Among likely follow-on countries: leading exchange-rate protectionist China, Korea, and Taiwan (which also just came onto Treasury’s manipulation radar).

Nor is the problem confined to East Asia, in the administration’s own view. President Obama is pursuing a lower-profile trade agreement with the European Union – even though Treasury’s report charges the Eurozone with a Japan-like easy money-led growth policy.

To be sure, the new Obama Treasury Department report doesn’t flag these or any other foreign currency policies as significant direct threats to America’s welfare – even though the rising trade deficits to which they contribute subtract from the gross domestic product’s expansion at a time when the nation remains growth-starved. But it does emphasize the potential for major indirect harm, warning that the world economy is once more becoming overly reliant on the United States as an engine of demand, and that “Doing so will not lead to a pattern of strong, sustainable and balanced global growth….” It should have added “and indeed helped set the stage for the last financial crisis and sorely inadequate New Normal that’s emerged in its wake.”

At the same time, the administration keeps insisting that new trade deals with net export-led regions will not only help speed up the historically weak U.S. recovery, but spur greater world-wide growth, too. Instead, as its own new foreign currency report makes painfully clear, it’s much likelier that if this approach to globalization succeeds:

>The United States will be more closely integrated than ever with economies determined to grow at its expense.

>It will have virtually no internationally authorized way to respond effectively.

>Therefore, slow-growth, lousy wages, surging debts, and greater financial instability will mark its future – if it’s lucky enough to avoid a new crash.