Samuelson: The world economy is adrift

WASHINGTON POST, 11/3/2011 by Robert J. Samuelson (Hat tip: John H. Detweiler)

[Excerpt] We are moving from Globalization 1.0 to Globalization 2.0. In Globalization 1.0, countries benefited from expanded trade and worldwide technology transfers. From 1980 to 2010, global trade volumes grew fourfold. Countless millions were lifted from poverty; new middle classes arose in Asia and Latin America. In Globalization 2.0, the economic interconnections among countries are breeding instability and nationalistic rivalries.

Time was when the United States automatically assumed the leadership role. Beginning in 1948, the Marshall Plan provided Europe with the equivalent of $850 billion — needed desperately to buy food, raw materials and machinery — to recover from World War II. In the 1980s, the United States took the lead in defusing the Latin American debt crisis; in the late 1990s, it did the same with the Asian financial crisis. The architecture of the postwar global economy was largely a product of U.S. leadership.

But under President Obama — possibly no one else could have done differently — America’s capacity and desire to lead have flagged. Read more at the Washington Post...