Protectionist dominoes are beginning to tumble across the world
Ambrose Evans-Pritchard
The Daily Telegraph
December 26, 2008
Greece has been in turmoil for 11 days. The mood seems to have turned “pre-insurrectionary” in parts of Athens – to borrow from the Marxist handbook.
- A d v e r t i s e m e n t
This is a foretaste of what the world may face as the “crisis of capitalism” – another Marxist phase making a comeback – starts to turn two hundred million lives upside down.
We are advancing to the political stage of this global train wreck. Regimes are being tested. Those relying on perma-boom to mask a lack of democratic or ancestral legitimacy may try to gain time by the usual methods: trade barriers, sabre-rattling, and barbed wire.
Dominique Strauss-Kahn, the head of the International Monetary Fund, is worried enough to ditch a half-century of IMF orthodoxy, calling for a fiscal boost worth 2pc of world GDP to “prevent global depression”.
“If we are not able to do that, then social unrest may happen in many countries, including advanced economies. We are facing an unprecedented decline in output. All around the planet, the people have reacted with feelings going from surprise to anger, and from anger to fear,” he said.
Russia has begun to shut down trade as it adjusts to the shock of Urals oil below $40 a barrel. It has imposed import tariffs of 30pc on cars, 15pc on farm kit, and 95pc on poultry (above quota levels). “It is possible during the financial crisis to support domestic producers by raising customs duties,” said Premier Vladimir Putin.
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