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The New/Old Politics of Globalization

Debates and protests about globalization have been muted since last September's terrorist attacks. But that silence does not mean that they are over. Indeed, protests about globalization seem likely to return with more normal times. When they do, our understanding of the process will be greater if we look back at history.

Among historians, globalization provokes a keen sense of déjà vu : we were here a century ago. Great achievements - material progress, dizzying new technologies such as the automobile, the telephone, the typewriter - existed back then, but also protests against a world that seemed out of the control of traditional political institutions.

Then, as now, the backlash came chiefly from rich industrial countries, rather than from poor peripheral countries which were often seen as the objects of capitalist exploitation. It was advanced countries that imposed tariffs against "unfair" competition from abroad. Central banks were instituted with the responsibility of managing disorderly capital flows. Migration policy became more restrictive, as some big recipients of immigration began to debate selectivity in their choice of immigrants.

The process of integration was reversed after the WWI and finally destroyed in the Great Depression, in a series of vicious shocks: tariff protection, contagious financial panics that spread from the periphery to the heart of the world's financial system, and a turn to economic nationalism and autarky. What had before 1914 been safety nets against excessive globalization became after the WWI gigantic snares which strangled the world economy.