U.S. companies continue shifting production abroad to take advantage of low wages, no unions, minimal regulation and the freedom to export at will back to the U.S. market. China now emulates Free Asia, devalues its currency to get a leg up on its rivals and begins inundating the U.S. market, running up huge trade surpluses. Free Asia is slowly shouldered aside. The peso collapses, and investors who had plunged into Mexico start crying for a new bailout. Money pours out to Asia, Russia and Latin America.
Debt piles on debt as competition for the U.S. market gets ever fiercer.
The IMF suggests that Thailand and Indonesia would benefit from devaluation. Much of Asia follows suit. Then, Russia devalues and defaults. Countless nations are today awash in debts that will never be repaid. Had the United States followed a traditional policy of tough reciprocal trade agreements with Japan and Europe, had we let the markets do their winnowing work when foreign investments went sour, today's crisis would not be at hand.