‘Back to the Bubble?’
So asked David Ignatius in his column Sunday in The Washington Post, questioning why a return to the unsustainable, bubble-fueled imbalances of foreign borrowing and domestic consumption should be the goal of global efforts to fix the current economic meltdown.
The danger now, as economic activity slows around the globe, is that the G-20 leaders will seek recovery in a new version of the old, unbalanced system. That is, the nations of Europe and Asia will look to America, with its multitrillion-dollar stimulus and rescue programs, to rev up the world’s sputtering engine. America, massively in debt, will go back to its role as import glutton, and the rest of the world will go back to selling us products. And then we’re back to where we started.
At least it’ll be easy to predict what happens next.