Direct foreign investment is the flip side of domestic divestment. It's one thing to outsource goods and services to a different country and another to move your production to a different country. In the second case, the domestic economy gets divested. The mechanism is the same that, thought capital movements within one country, leads to economic crisis and unemployment in certain regions while others thrive. Free movement of capital leads to divestment and unemployment and forces nemployed people to move in chase of capital. Within a country there is freedom to move and so the "problem" is people's resistance to uproot themselves. The US has a culture of transience in which people will move large distances without much apparent trouble, but look at the massive migrations from the "dust bowl" to California during the Great Depression.

The question here is this: what is the point of national economic policy, and how do transnational corporations interact with national economic policy?

So, I am not opposed to free trade, and I am not opposed to free movement of capital but 1) if there is free movement of capital, goods and services there has to be free movement of people; 2) if you have free movement of capital you need a redistributive policy encompassing the whole scope of the free movement of capital.

Therefore, the European Union needs to strengthen its economic government. We already have a Central Bank for the Eurozone, and we need a supranational redistributive policy. The neoliberal nationalism that is now in charge of it is going to cause a lot of damage.

Furthermore, globalisation is going to lead either to a thirdworldisation of the developed economies (the gutting of the European welfare states is well under way, under pressure from internationally mobile capital), to a world economic government, or to a backlash and a return to protectionism. Protectionism will take the form of tariffs and barriers to economic migration, but it is unlikely to reverse the liberalisation of capital flows [cross-border "capital flight" used to be a high crime, up there with money laundering, in the 1980's].

Bush is a symptom, not the disease.