Is a national policy which maintains the domestic requirements for a primitive form of capitalism, high output per worker and low wages, by finding demand for mass produced goods and services in other nations. This is also called Export Led Growth and was once known as Mercantilism.

This has been the policy of the government of China for some 30 years since the takeover of that country by a dictatorship of the bourgeoisie. But this policy does not seem to be working anymore. It has failed lately because, like all good dysfunctional behaviors, it requires a willing partner.

This partner having been the United States, which has spent the past thirty years buying the goods sold by China while it neglected its own domestic production. This required the packaging and resale of large quantities of IOUs, mainly to China and the packaging and marketing of huge quantities of cheap manufactured goods. These activities provided profits for our financial and "service" - really marketing - sector and kept workers, whose real incomes were stagnant, happy by allowing them to consume beyond their means.

Like all dysfunctional relationships this depended on a mutually held fiction. That the IOUs that were sold to China would actually be paid back and therefore represented real stores of value. This fiction permitted Chinese capitalists to pretend that they were actually making profits rather than just starving their workers. It permitted our financial sector to turn healthy profits and "earn" huge bonuses.

It permitted the rest of us to believe that things were OK and we really did not need to change our behavior. We really can't sustain this fiction any longer.

It seems that our friends in the government of China still have not overcome their denial. They are responding to this crisis with export subsidies and currency devaluations. Wonks Anonymous expects that the international economy will be slow for some time.