Monday, September 29, 2008

Sovereign funds, global interdependence and a new hope?

As the world stock markets plummet it is all too evident that the American legislators are not up to the challenges of a globalized interdependent world. Unlike the sovereign funds of Dubai, Norway or China who all understand the importance of international financial stability, the House Republicans now act as if it was only about their own re-election or the vindication of their textbook orthodoxies.

Though partially out of self-interest, the sovereign funds all came to rescue last week as they offered to buy treasury bonds and support the 700 billion USD bailout. With the bailout now rejected things look depressing to say the least.

But maybe, and this is indeed a maybe, we will eventually leave this financial crisis with a real understanding of how interdependent the world has become. Out of that understanding a new hope of political cosmopolitanism may grow. As the devastating consequences of the economic maelstrom are felt all over the planet, and especially by the global poor, we may also recognize that the disintegration of global commerce (as advocated by some green thinkers) is not a particularly good idea.

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