Y376 International Political EconomyY376 International Political Economy

March 19, 2012March 19, 2012

Thomas FriedmanThomas Friedman

New York Times since 1981New York Times since 1981 Three-time Pulitzer Prize winnerThree-time Pulitzer Prize winner 1984-88 Israel Bureau Chief1984-88 Israel Bureau Chief Major Books:Major Books:

From Beirut to Lebanon (1989)From Beirut to Lebanon (1989) The Lexus and the Olive Tree (1998)The Lexus and the Olive Tree (1998) The World is Flat (2005)The World is Flat (2005) Hot, Flat, and Crowded (2008)Hot, Flat, and Crowded (2008)

ChimericaChimerica

Niall Ferguson idea Friedman: “… We in America built more and Friedman: “… We in America built more and

more stores, to sell more and more stuff, made more stores, to sell more and more stuff, made in more and more Chinese factories, powered by in more and more Chinese factories, powered by more and more coal, and all those sales more and more coal, and all those sales produced more dollars, which China used to buy produced more dollars, which China used to buy more and more U.S. Treasury Bills, which more and more U.S. Treasury Bills, which allowed the Federal Reserve to extend more allowed the Federal Reserve to extend more and more easy credit to more and more banks, and more easy credit to more and more banks, consumers and businesses…” (p. 4)consumers and businesses…” (p. 4)

Iceland’s Banks and Melting IceIceland’s Banks and Melting Ice

In 2003, three biggest banks in Iceland In 2003, three biggest banks in Iceland had assets of $140 billion, bigger than had assets of $140 billion, bigger than Icelandic GDPIcelandic GDP

2003-7: growth of banking fueled big jump 2003-7: growth of banking fueled big jump in incomes, real estate and stock pricesin incomes, real estate and stock prices

October 2008 collapse left Icelandic October 2008 collapse left Icelandic citizens holding the bagcitizens holding the bag

Video

Collapse of the Wilkins Ice ShelfCollapse of the Wilkins Ice Shelf

Wilkins Ice Shelf in the Antarctic crumbled Wilkins Ice Shelf in the Antarctic crumbled in January 2009in January 2009

Scientist blamed global warming for the Scientist blamed global warming for the collapse of this and nine other ice shelves collapse of this and nine other ice shelves in Antarctica in Antarctica

video

What Happened? (Friedman’s What Happened? (Friedman’s explanation)explanation)

The trend to deregulation (especially under The trend to deregulation (especially under Reagan)Reagan)

End of the Cold WarEnd of the Cold War 9/119/11 ““And when the bugle sounded we heard the call: And when the bugle sounded we heard the call:

‘Go shopping.’” ( p. 35)‘Go shopping.’” ( p. 35) “…“…the biggest danger America faces today is not the biggest danger America faces today is not

so much that it will suddenly nosedive…it will so much that it will suddenly nosedive…it will undergo a gradual but very real erosion of its undergo a gradual but very real erosion of its strengths and assets as a country…” (p. 41)strengths and assets as a country…” (p. 41)