BBC Wednesday, 4 February 2009
By James Melik
Business reporter, BBC World Service
A clause in the US economic package which President Barack Obama hopes to get approved by the Senate has raised fears that the world will revert to protectionist measures witnessed during the Great Depression of the 1930s.
“I don’t think they want to take a protectionist route but the domestic pressures are so overwhelming that they are caught in kind of a Greek tragedy”
Professor Jeffrey Garten, Yale School of Managment
At times of global economic crisis, enemy number one is isolationism
Protectionism can only exacerbate the situation, as it did after the Great Wall Street Crash of 1929, says Pascal Lamy, director-general of the World Trade Organisation (WTO).
President Obama is not the only world leader who has expressed a need to protect workers at home – although he has since made it clear that he wants to avoid a trade war. “An eye for an eye makes the whole world blind Mahatma Gandhi”
Britain’s Prime Minister Gordon Brown recently warned against the US bailing out its struggling automakers, arguing that global competition has made their decline irreversible.