My latest at Pieria:
"Bill Mitchell has been doing a series of posts on the circumstances leading to the UK's request for aid from the IMF in 1976. They give a fascinating insight into the economics of a time when trade balance and the international exchange value of the currency were the most important drivers of national economic policy. Since the great monetarist revolution of 1979 we have largely forgotten about this: nowadays it is fiscal, not trade, balance that concerns us, and we happily devalue our currencies and force down labour costs in search of elusive export-led growth. I believe we are chasing a dream.
For the last 40 years the world has been gradually rebalancing, as the West abandoned empire and colonialism in favour of free trade. Dismantling barriers to trade and freeing up world markets has not been easy, and it is fair to say that many Western countries have been more interested in ensuring that developing countries open their markets to imports than removing the tariffs and subsidies that protect their own precious industries. But the growth of supra-national companies, supported by (largely) free movement of capital around the world, has transformed the world economy. And from the point of view of the millions in developing nations who enjoy a standard of living of which their grandparents could only dream, this transformation has unquestionably been positive."
The remainder of the post can be read here.