Abstract:The huge size of current global economic imbalances is unprecedented. Such imbalances are both unsustainable and inequitable (see the IPC webpage on the State of the World Economy, e.g., Working Papers #12 and #23). A few rich countries are running large current account deficits. One in particular, the US, is running a deficit about 3.5 times larger than the deficits of all other OECD countries combined. (...)