From Crisis to Supranational Integration
New Directions in Modern Economics series
Why publish a new book on the 2008 financial crisis? The basic reason is that, during these dramatic years, we became aware of the fact that the first global crisis will have a similar impact on the international economic and political systems as the 1929 crisis between the two world wars had. Not only did the Great Depression mark the end of the gold standard, the old economic order of the nineteenth century, it also marked the beginning of the transition to a new political order, after World War II, based on the hegemonic power of the US and, to a lesser extent, the USSR. The main features of our study are analyses of the causes of the crisis and the measures of political economy required to build a safer and more stable international order. We try to show that the deep roots of the financial crisis are to be found in the flaws of the dollar standard. The heart of the crisis was in the US, but the turmoil immediately spread all over the world because of the deep integration of all national economies in the global financial market. The crucial vehicle for global economic integration is the dollar, but the dollar is the sovereign currency of the US, a tool at the disposal of the US government for its policy aims. The dollar as an international currency has no government and no central bank. Of course, this problem is not new – it has been discussed since the heyday...