As the financial crisis forces Europe to decrease its trade deficit, major world economies must step in and help the United States absorb the burden of rebalancing global trade in order to prevent the rise of American protectionism.
China’s current economic policies, which borrow from future household income to stimulate present growth, follow the development model that gave Japan extraordinary short term growth but led ultimately to a period of significant economic decline.
Local governments and state-owned enterprises have created China’s current housing bubble, but average Chinese taxpayers will bear the burden of the pending housing market collapse.
Rising coastal production costs and declining transport costs are reshaping China's economic landscape in ways that may resolve the controversial role that Beijing is accused of playing in shaping global trade imbalances.
Private demand is not yet strong enough in advanced countries to compensate for the drag to come from fiscal stimulus withdrawal. Large countries that can afford to delay the withdrawal should do so.
In the face of the euro crisis, questions have emerged about Europe’s cohesion—particularly the strength of the institutions called for under the Lisbon treaty—and what that means for its relevance in major international challenges.
The Russian government’s drive to modernize its economy is increasingly reflected in its foreign policy priorities, including its relations with the United States, Europe, and China and its position on Iran's nuclear program.
Improvements in the housing market are necessary for the U.S. recovery to continue, but housing sales and prices appear to be weakening. Though policy options are limited, leaders should continue efforts to simulate aggregate demand and job creation.
While the U.S. trade deficit will still increase over the next year, growing anger in the United States over trade imbalances is likely to result in new protectionist policies.
The crisis in the eurozone may prove a blessing in disguise for Turkey, given its strong economic performance over the past years, and could even revitalize Turkey’s prospects for membership in the European Union.























Stay connected to the Global Think Tank with Carnegie's smartphone app for Android and iOS devices