Our attention was bound to come around to the first age of capital,
those years that stretched from Britain's repeal of the Corn Laws in
1846 to the outbreak of the First World War. For once we had entered
into a great controversy about the integration of global finance and
markets in our time, that first global economy became a very usable
past.
In a way, it came rather too easily. By a leap of faith, by
imaginative historical analogies, the Internet became for us what the
railroads were for that earlier age. Today's heady belief that
commerce has tamed conquest and made wars unthinkable can also be
located back in that era. So when the evangelists of globalization
trumpeted the birth of Pax Kapital, the historically-minded, and
particularly those most skeptical about the claimed novelty of our
times, headed straight into the past, into that First Global Economy.
There they saw the precursors of the present moment: transnational
capital, mobility of labor, a global monetary authority attained
through the functioning of the gold standard, and, most vivid of all,
the titans of industry who loomed larger than princes and the rulers
of states. They also saw rack and ruin and illusion. Then, too,
nations thought they had tamed the beast--only to be overtaken by
war, the destruction of markets, and the shredding of economic
liberalism.
It was with this story that the influential and popular economist
Paul Krugman launched his column in the New York Times. For his
maiden voyage on January 2, 2000, the economist-turned-pundit chose
to write of that First Global Economy. We have been here before, he
warned, and the seemingly "unstoppable logic of growing trade and
investment" could again be undone. "To some extent", Krugman wrote,
