American Economic Alert: Growing Imbalances in the "Global Economy" Threaten to Sink All Boats - by Alan Tonelson

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Growing Imbalances in the "Global Economy" Threaten to Sink All Boats - by Alan Tonelson

One of the bedrock insights of modern economics is that there are no free lunches. Even with the most creative financial innovations, production and consumption must be kept in some sustainable balance. Recent globalization policies, and especially the outsourcing trade deals at their core, have held out to multinationals and their apologists in academia and public policy one of the most seductive free lunch promises of all time – of a world in which all the workers would continue to consume like Americans, but increasingly get paid like Chinese or Indians.

The concocting and pursuit of this fairy tale by the economic establishment has pushed the world far into uncharted policy waters and exposed it to frightful dangers. It is all too clear that the massive act of common sense needed to restore balance will have to originate outside its ranks.