The End of Globalization: Lessons from the Great Depression

Some scholars see globalization as inevitable and irreversible, whereas others point out that even open and highly integrated international communities have dissolved in the past. James investigates the last great age of globalism, which was destroyed by the Great Depression and political upheaval in the 1930s, to put the debate in historical perspective. He finds evidence for the two most common explanations for economic collapse: rising volume and volatility of capital flows triggered unsustainable booms and busts, and widespread fear of globalization provoked a social and political backlash. But he also offers a third view: People and institutions were overwhelmed by a globalized world's pressures and consequences -- and the institutions that handled economic integration not only were burdened by crises but became the channels through which long-standing political resentment flowed. James acknowledges today's widespread antiglobalization sentiment but concludes that an essential ingredient for 1930s-style economic nationalism is missing today: a respectable intellectual package of antiglobalist policy ideas and a successful national model, such as the Soviet Union or Hitler's Germany. Time will tell whether such a package will re-emerge.