Financial crisis furthered divide between global economics and local politics
The financial crisis has seen some predictable reverberations. The loss of economic power among the populations of many Western nations has given rise to both the Occupy movement, as well as the Tea Party movement.
Feeling frustrated by the inability of their governments to – in their eyes – pursue policies that are in the best interests of the nation, groups have taken to the streets to voice their opposition to the status quo. This has been less common in Asia and India because those regions continue to experience economic growth.
The crisis, which began with the collapse of Lehman Brothers in 2008, has also had some interesting reprecussions. Rather than acknowledging the reality of an interdependent global economic structure, many governments and their leaders have turned inward, ignoring the unmistakable political and economic trends.
In an analysis published in the Financial Times, Philip Stephens examines the structural weaknesses that the financial crisis exposed.
“Behind all this, however, lies the structural problem – the mismatch between global economics and local politics. States have been shedding power to globalisation. The big lesson has been about the extent to which globalised capitalism has outstripped the capacity of national governments to manage it,” he writes.