TACOMA, Wash. – The economic collapse of 2008 exposed the Achilles’ heel of globalization: The financial markets that are spinning paper around the world are inherently unstable. The implosion of multiple banks also proved that we didn’t learn a lot from previous financial crises, says Michael Veseth, author of the new book, Globaloney 2.0: The Crash of 2008 and the Future of Globalization (Rowman & Littlefield). Veseth, the Robert G. Albertson Professor of International Political Economy at University of Puget Sound, points out in the book introduction, “We can’t afford to make the same mistakes again.”
Globaloney 2.0 is a major revision of Veseth’s earlier book Globaloney, this time taking into account the recent financial crisis. The book argues that although globalization is now in retreat, it will return. “But in what form?’ Veseth asks. “More cycles of boom and bust? Or can globalization be rebuilt on a more feasible and sustainable platform?”
The heart of Globaloney 2.0 is an analysis of the fundamental instability of financial markets and an explanation of how and why investors and policy-makers came to believe that global finance was “safe as houses,” when all evidence pointed to the opposite conclusion. Veseth explains how leverage, liquidity, and moral hazard helped produce the financial bubble, and he charts the deglobalization process that resulted from the collapse.
From there Veseth takes us through various models of what globalization could look like. He suggests a new model to consider that gives away “some of the potential upside gain to get a more stable and therefore more governable system of economic relations.”
However, he concludes, being armed with a compelling economic plan is not enough. To achieve a more stable system, we need to change the stories about the nature and benefits of globalization that people believe, exchange, and pass on to their children—that is, we need to get rid of the globaloney. Facts alone are ineffective in bringing about change; “Ideas are what matter in the long run,” Veseth says. “Learn the facts, then tell the stories that make the facts convincing.”
The first edition of Globaloney was widely reviewed and was named a Best Business Book of 2005 by Library Journal. Articles about the book appeared in The Washington Post, Newsweek, Accountancy Age, and elsewhere. Globaloney 2.0 follows in the same tradition of accessible and witty authorship, colored with elements of popular culture and underpinned with rigorous economics.
Veseth is author, editor, or co-author of more than a dozen books, including:
- The New York Times 20th Century in Review: The Rise of the Global Economy (Fitzroy Dearborn Publishers, 2002),
- Selling Globalization: The Myth of the Global Economy (Lynne Rienner Publishers, 1998) and
- Mountains of Debt: Crisis and Change in Renaissance Florence, Victorian Britain, and Postwar America (Oxford University Press, 1990).
Veseth’s next project is a book on the global wine market, Grape Expectations: Globalization, Two Buck Chuck and the Future of Wine. You can read more about this project at Veseth's popular blog, The Wine Economist. Also see Veseth’s Globaloney 2.0 blog for commentary and links to current events.
Press-quality photos of the Globaloney 2.0 book cover and of Michael Veseth are available on request.
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