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The Top Ten Lessons of the Global Economic Meltdown

Author: Walter Russell Mead, Henry A. Kissinger Senior Fellow for U.S. Foreign Policy
May 24, 2010
American Interest

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The world economy is like a person with a bad stomach flu; that horrible sick feeling keeps coming back.  In 2008 it was mortgage-backed bonds and the failure of Lehman Brothers; last year it was the worst recession since the 1930s; this year it's the European financial crisis.  We still don't know where this is going; there is plenty of good news out there.  The National Association of Business Economists is upgrading its growth forecast for the US in 2010; China remains strong; the IMF is upgrading its growth forecasts worldwide.  On the other hand, some of the world's smartest investors are buying gold like there was no tomorrow, there is talk about a new global meltdown, and the world's financial markets seem ready to plunge on the slightest whiff of bad news.

It is still too soon to tell whether we are in the recovery phase or whether the global economy is still getting sicker.  Already hundreds of millions of people around the world have lost their jobs, lost their homes, changed their retirement plans, pulled kids out of school and made other adjustments.  Even those who've kept their jobs and homes are suddenly aware how fragile prosperity is.  Government employees across Europe and North America wonder what will happen to their pensions; private sector workers are braced for new layoffs, and getting used to life in a more insecure and volatile job market than they once expected.

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