Andrew Sprung notes a prescient column by the FT's Martin Wolf two years ago:
Now think what will happen if, after two or more years of monstrous fiscal deficits, the US is still mired in unemployment and slow growth. People will ask why the country is exporting so much of its demand to sustain jobs abroad. They will want their demand back. The last time this sort of thing happened in the 1930s the outcome was a devastating round of beggar-my-neighbour devaluations, plus protectionism. Can we be confident we can avoid such dangers? On the contrary, the danger is extreme.
Once the integration of the world economy starts to reverse and unemployment soars, the demons of our past above all, nationalism will return. Achievements of decades may collapse almost overnight.
Right on cue, Krugman unleashes today on China.