Not everyone is going to want to play in our casino. Why should they? The last time, they got fleeced.

TO BE NOTED: From Forbes:

"Why We Can't Get Along
Thomas F. Cooley 04.01.09, 12:01 AM ET

Gordon Brown was on the stump in the U.S. and around the world last week in advance of the G-20 meetings taking place in London. He has argued fervently for a multilateral approach to the many problems that confront the world economy and proposed an ambitious set of goals for the G-20 meetings. Why does it seem like he is tilting at windmills? Perhaps it's because the current world economic crisis, far from uniting us in a common struggle to solve common problems, is instead fostering a "coliseum" culture in which the U.S., China and Europe are all giving each other the back of their hand.

The level and passion of the criticism is rising, and rather than collaboration and multilateralism we are seeing a hardening of positions and a growing resentment of the U.S. A big part of the problem has been the United States' arrogance in lecturing the rest of the world about fiscal and monetary policy and our hypocrisy in putting in place beggar-thy-neighbor trade policies as we try to revive our economy. This swaggering approach to our allies was supposed to have ended with the Bush administration, but it has been replaced with a self-righteous assertiveness that the rest of the world is not buying.

There is no doubt that this summit will result in a reaffirmation of the commitment of the G-20 to fight protectionism and increase cooperation. They will talk the talk. But they did the same at the November summit in Washington, and that resolve didn't survive the plane ride home.

Many countries have raised tariffs, restricted imports, blocked takeovers by foreign companies and reinstated subsidies. They have jumped to the defense of home industries by filing complaints with the world trade organization over dumping--the practice of flooding another country with goods at below-market prices. More importantly, bailouts and subsidies are inherently protectionist because they prop up operations of uncompetitive or insolvent firms at the expense of more efficient producers who are often foreign.

The United States has been pretty egregious in its protectionism. It threw down the gauntlet to Mexico over the trucking industry, inserted self-defeating Buy American provisions in the stimulus package and increased restrictions on foreign-born workers, to cite just a few examples. We are not the worst offender, nor are we approaching the Smoot-Hawley foolishness of the 1930s. But rather than show leadership on such an important issue, we proclaim one view but act otherwise.

We have been singularly inept in dealing with the most important emergent economic power, the Chinese. We got off to the wrong start immediately in January when Timothy Geithner, the Treasury Secretary, told U.S. lawmakers that President Barack Obama, "backed by the conclusions of a broad range of economists--believes that China is manipulating its currency."

The criticism provoked a backlash that has increased in intensity. China is the largest buyer of U.S. Treasury bonds, and they have begun voicing concerns about the safety of those investments. The massive amounts of U.S. debt issued have pressured bond prices and also threatened the strength of the dollar, which could further reduce the value of holding Treasuries. The dramatic expansion of the Federal Reserve's balance sheets also worries them. Last week, the Chinese showed mettle by suggesting that the dollar should no longer be the world's reserve currency. And Geithner gaffed again, saying this was "worth thinking about" (dollar falls) ... and then saying, "probably not" (dollar recovers).

More recently, we have been lecturing the Europeans that they need to be more like us in their efforts to stimulate their economies. Britain, like the United States, has undertaken an aggressive fiscal stimulus, slashed interest and greatly expanded the balance sheet of the central bank to make more reserves available to banks. But Germany and France have opposed calls for further large stimulus packages and even greater deficit spending. The European Central Bank has kept interest rates higher than they are in the United States and Britain.

Secretary Geithner pressed the Europeans to adopt a coordinated fiscal stimulus, suggesting an average 2% stimulus this year. But the E.U., led by the Germans, says it is more important to assess the impact of fiscal measures already announced rather than announce new ones.

The economic pundits, led by Paul Krugman, have also jumped all over the Europeans for not adopting enough stimulus. But the Europeans don't think the Americans have invented fire, and they are concerned--rightly--about the impact of the staggering deficits on future generations. The discussion has also completely ignored the fact, as I wrote in my column last week, that the demographics of Western Europe are very different from ours. The population is older and is aging faster. This means the burden of their debt on future generations will be greater.

Chancellor Angela Merkel has also pointed out that social democracies, through their welfare systems, have more powerful stabilizers. These have a built-in stimulative effect that is missing in the U.S.

So to the question--Can we all just get along? It is one thing to show leadership--and quite a different thing to lecture others on what they should do. We have to acknowledge that we are in the midst of the biggest fiscal and monetary crapshoot ever. Not everyone is going to want to play in our casino. Why should they? The last time, they got fleeced.

Thomas F. Cooley, the Paganelli-Bull professor of economics and Richard R. West dean of the NYU Stern School of Business, writes a weekly column for Forbes."