Old habits are hard to break. In a recent survey of the world economy, The Economist 's Clive Crook examined official spending in 17 rich, developed nations. Between 1980 and 1996, governments at all levels increased their share of the economy in all but three countries - the UK, the Netherlands, and Ireland. Even in the United States, during 16 years of Reagan-inspired government bashing and market promoting, government spending still grew from just under 32 percent of the economy in 1980 to just over 33 percent in 1996. As at home, so abroad.
Global markets limit the effectiveness of national regulation.
But even as they whine about their own powerlessness, politicians are busily erecting new global regulatory machinery, covering everything from the rules of world trade and copyright to global warming. Why, national politicians, of course. This is why the next five years will be so tumultuous. Politicians are extending their power even as they say they are retrenching. But as they do so, they are in fact undermining their own authority.