One Year On

On the one-year anniversary of the Lehman Crisis, the biggest names in financial punditry have been voicing their thoughts and concerns on the most important issues facing the world economy.  Let's take a look:

Martin Wolf, who spent most of the crisis bringing attention to global imbalances, has become a China bull:

China has emerged as the most significant winner from the global financial and economic crisis. At the end of 2008, many questioned whether China would achieve its growth target of 8 per cent in 2009. Who now dares to do so?

James Surowiecki and Felix Salmon say that inflation concerns are overdone because:

It’s hard to find someone who’s worried about inflation right now who isn’t always worried about inflation. If you stay worried about inflation for decades, of course, eventually you’ll be able to claim justification. But I’d take you much more seriously on the subject of inflation today if you hadn’t told me all the way through the Fed rate cuts of 2007 and 2008 that each one was about to unleash monster inflation and was a Really Bad Idea.

Clive Crook disagrees:

Grappling with the unwinding of its interventions would be hard enough for the Fed in any event. Justified anxiety about long-term public debt will make the task of managing inflation expectations, and hence the operation of short- and medium-term monetary policy, even harder. Congress and the White House could help by coming up with a fiscal consolidation plan ready to deploy once the recovery is secure. Inflation is not an issue yet, but sometimes it pays to think ahead.

Edward Harrison from Credit Writedowns sees a possible trade war between China and the United States as the biggest threat to the global recovery:

With this trade war looming, one must wonder if Chimerica, the marriage of China and America as one economic entity, will end in murder-suicide, taking the global economy down with it.

Simon Johnson writes another excellent diatribe on the social harm caused by our financial system in its current state:

Early in the First World War, British generals decided to attack German trenches with an initial light bombardment, followed by infantry walking in close order across No Man’s Land.  The result was tens of thousands killed in a series of military disasters, but the generals reacted with only small adjustments to their approach and essentially persisted in repeating the same mistakes for years.  “The English soldiers fight like lions,” one German general remarked. “True.  But don’t we know that they are lions led by donkeys?” was the reply.

Today, a year after global financial collapse and the ensuing tragedy for millions, our economic leaders are lining us up to suffer again (and again) through the same horrible experiences.

And finally, Bill Easterly describes, in pictures and words, how Africa needs more trade links in order to join the global economy: 

In short, Africa is disconnected from the global economy, which is very bad news for a continent that desperately needs international trade (the disconnection is both symptom and cause of the lack of trade). Lack of international trade = poverty for small economies.

It is remarkable how little things have changed from a year ago. Debates on inflation, anger over a rent-seeking financial system, explanations of greed and poverty, uncertainty about the dollar, US government spending and China. These are all the same issues that were being discussed a year ago. Has anything changed?

Any commentators care to chime in? What is different today, and how have things stayed the same? What will we be debating a year from now?