Jones: Is the world closer to the edge of the ‘fiscal cliff’ today than it was in 2008?

By: /
29 October, 2012
By: Bruce Jones
Director and Senior Fellow of the NYU Center on International Cooperation

The question is slightly miscast, because in 2008 it wasn’t a fiscal cliff but a financial one – and we fell off, when the U.S. Treasury allowed Lehman to fail. The combination of quantitative easing, TARP, and coordinated expansionist policy by the key G20 members pulled us back onto the ledge.

Now, we face three distinct and reinforcing problems: a fiscal cliff in the U.S. that could trigger a new (but not great) recession; slowdowns in China and India; and the eurozone crisis, which holds the gravest dangers. Even ECB actions arguably pulled us away from the cliff in Europe. Likely, a new recession looms; but probably not a financial implosion à la 2008.

Before you click away, we’d like to ask you for a favour … 


Journalism in Canada has suffered a devastating decline over the last two decades. Dozens of newspapers and outlets have shuttered. Remaining newsrooms are smaller. Nowhere is this erosion more acute than in the coverage of foreign policy and international news. It’s expensive, and Canadians, oceans away from most international upheavals, pay the outside world comparatively little attention.

At Open Canada, we believe this must change. If anything, the pandemic has taught us we can’t afford to ignore the changing world. What’s more, we believe, most Canadians don’t want to. Many of us, after all, come from somewhere else and have connections that reach around the world.

Our mission is to build a conversation that involves everyone — not just politicians, academics and policy makers. We need your help to do so. Your support helps us find stories and pay writers to tell them. It helps us grow that conversation. It helps us encourage more Canadians to play an active role in shaping our country’s place in the world.

Become a Supporter