The break up of Microsoft by the FTC led to a financial market panic, fueled by inaction on the part of the US Federal Reserve. The resulting chaos quickly spread beyond US borders driving the world into the worst Depression ever experienced. The growing depression peaked in November of that year. In response to the continued depression, countries across the globe try and insulate themselves from the misfortunes of their neighbours by attempting to protect their own economies.
Global tensions mount.
Border skirmishes become common. The UN disintegrates as nations use it as nothing more than a shouting hall of blame wherein fist fights become common. Fed by the disparity between regions, South East Australia begins to form its own economic and social rules, cutting itself off from the rest of the country. As the Sydney area begins to show some economic recovery, other regions around the world begin to follow suit. By this time, only countries too small or too poor to support further divisions have maintained their National Identity.