In the 1990s and early 2000s, nations around the world witnessed the sweep of globalization–the growing integration of economies, societies, and political systems–and the democratization of trade, migration, technology, and information. In many developing nations, governments threw their countries’ agriculture, resources, and services open to global competition and slashed subsidies for their domestic producers to force them to compete in global markets. Many countries provided incentives for the poor to migrate from farms to cities, where they began to manufacture goods for export to the West.

Many economists believed this global integration had become so deeply rooted it could never be undone. They were wrong. As the global financial crisis deepens, the world is undergoing exactly the reverse of the 1990s–a wrenching period of deglobalization in which governments throw up new walls and the ties binding nations together rapidly unravel. Nations like the United States, Japan, and Germany may suffer, but they will survive, as will powerful developing nations like China or Brazil that have large cash reserves, diversified economies, and enough political clout to protect their industries. On the other hand, poor and trade-dependent countries that remade their whole economies to take advantage of globalization will be devastated. Having opened up, these nations are now highly vulnerable to global financial currents, without the cash on hand to weather the storm. Perhaps even worse, these financial shifts are likely to spark massive social unrest and could take down one government after the next. If you thought globalization was destabilizing, just wait to see what deglobalization will do.

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