POL 130 Final Prompt 5: Global economic system (How did global responses…
Dan Drezner argues that the global economic system “worked” to prevent the Great Recession from turning into another Great Depression. Explain how global responses to the stock market crash in 1929 differed from the responses after the US housing market crash in 2009. If the global economy were to suffer a similarly severe shock today, do you think the international community would respond effectively? Explain why, describing the relevant actors and institutions that you think would shape this response.
The main difference between 1929 and 2008 is that we acted a lot quicker and more aggressively in 2008, which is why we got out quicker. I don't think we'd respond as effectively this time, but we'd still be more effective than 1929. This is because interest rates are already at 0% and the world is less open and bc of congressional gridlock, so we wont be able to act as quickly.