March 27, 2013Dear Sir,There’s been a growing level of churlishness in the discussions of whether IB was/is/will be the saviour of Bermuda. I’ve been in the ‘Not So Much’ side of the argument. Figuring out an economic regime which supports most of the citizens as well as can be, rather than the few, is a difficult job. Those who worship at the feet of IB tend, based on what gets published here, not to care much about anyone but the 0.1 percent who do well from the presence of IB. In today’s New York Times, Paul Krugman (www.nytimes.com/2013/03/25/opinion/krugman-hot-money-blues.html?_r=0), writes a column which every Bermudian really should read. Krugman earned a Nobel for his economics, so he’s got some game. Right wing nuts tend not to like him, just because he tends to deflate their shenanigans. Tough. The column deals with Cyprus specifically, but more important to Bermuda, the notion of laissez faire capital flows generally. Now, that’s important to Bermuda and IB, you betcha. Here are some on point quotes:n It will mark the end of an era for Cyprus, which has in effect spent the past decade advertising itself as a place where wealthy individuals who want to avoid taxes and scrutiny can safely park their money, no questions asked. But it may also mark at least the beginning of the end for something much bigger: the era when unrestricted movement of capital was taken as a desirable norm around the world.n In the first couple of decades after the Second World War, limits on cross-border money flows were widely considered good policy; they were more or less universal in poorer nations, and present in a majority of richer countries too. Britain, for example, limited overseas investments by its residents until 1979.n But the truth, hard as it may be for ideologues to accept, is that unrestricted movement of capital is looking more and more like a failed experiment.n It’s hard to imagine now, but for more than three decades after the Second World War financial crises of the kind we’ve lately become so familiar with hardly ever happened.n I don’t expect to see a wholesale, sudden rejection of the idea that money should be free to go wherever it wants, whenever it wants. There may well, however, be a process of erosion, as governments intervene to limit both the pace at which money comes in and the rate at which it goes out. Global capitalism is, arguably, on track to become substantially less global.In sum: whether the IB zealots like it or not, the merry-go-round is slowing down. The free lunch on ‘Other People’s Money’ is coming to an end. Time to figure out a more stable way to run the economy. If that means a tad fewer billionaire mansions, well, too bad.BUGGY FUNBUNNYConnecticut