I love Krugman’s columns, partly because I generally agree with him, and partly becasue from time to time, he reminds me that life is cyclic. Today he finds a disturbing cyclic pattern, that we call globalization.
So far, the international economic consequences of the war in the Caucasus have been fairly minor, despite Georgia’s role as a major corridor for oil shipments. But as I was reading the latest bad news, I found myself wondering whether this war is an omen — a sign that the second great age of globalization may share the fate of the first.
If you’re wondering what I’m talking about, here’s what you need to know: our grandfathers lived in a world of largely self-sufficient, inward-looking national economies — but our great-great grandfathers lived, as we do, in a world of large-scale international trade and investment, a world destroyed by nationalism.
We’re supposed to learn from our mistakes, on all levels, not just personally. But, history doesn’t support that notion, now, does it? Krugman gives us an example and then points out the head-in-the-sand responses from current analysts.
Some analysts tell us not to worry: global economic integration itself protects us against war, they argue, because successful trading economies won’t risk their prosperity by engaging in military adventurism. But this, too, raises unpleasant historical memories.
Shortly before World War I another British author, Norman Angell, published a famous book titled “The Great Illusion,” in which he argued that war had become obsolete, that in the modern industrial era even military victors lose far more than they gain. He was right — but wars kept happening anyway.
We haven’t learned from history, and it’s time we do.
