John Plender in the FT thinks that, "Buy America provisions and bail-outs for bankrupt motor companies are less damag- ing than trade barriers of the kind erected by the Smoot-Hawley Act in the 1930s. Yet the reality, in this financial crisis, is that we have protectionism by the financial backdoor and may soon have it by the front door too."

He goes on to state that:

"Since the collapse of Lehman Brothers last September, trade credit has become scarce, causing international trade to implode. The impact has been quite as severe as any controls over imports, although a return of financial stability would mitigate the damage.

A more lasting problem lies in foreign owned banks’ retreat from cross border activity. Capital and financial flows tend to display a homing instinct in a crisis. And this is now being reinforced by the regulatory response to the financial debacle."

...

"This financial de-globalisation is, as the Bank for International Settlements points out in its annual report this week, financial protectionism. By threatening to curtail cross border capital movements, such regulation will shrink trade in goods and services and thus moderate growth and development.

Reducing financial institutions’ international reach will, says the BIS, come at the expense of economies of scale and scope. So a safer and more stable financial system may be a less efficient one."