Fannie Mae, Freddie Mac, Chrysler, AIG, General Motors and Citigroup have all been called "too big to fail". As the story goes, their collapse would cause "systemic risk" to the US economy. To avoid such risks, developed nations are spending trillions of dollars on bank bailouts and stimulus plans.
Yet it's the developing world that now comprises more than 47% of the world's $55tn economy, and is the source of more than half of all Organisation for Economic Cooperation and Development country imports. The developing world is also home to the 3 billion people living on less than $2.50 a day.
More than the corporations, the developing world is too big to fail. The Obama administration should be making that case to the US public and to the world as it prepares for the G20 summit in London next month.
Although the G20 called for a coordinated global response to the crisis, the world's poorer countries are receiving very little attention. The most desperate nations have sought help from the International Monetary Fund, which has been applying a double standard as it responds to the crisis.
The International Labour Organisation has compiled a comprehensive survey of stimulus plans and finds that the majority of G20 countries have put together some sort of stimulus package, totalling roughly $2tn. By definition, all of these plans are expansionary in nature - meaning they increase spending to stimulate demand.
With the exception of most Latin American countries, the majority of these plans originate in developed or large developing countries. The US plan of $787bn consists largely of tax cuts and support for infrastructure, with some funding for healthcare and green energy. China's plan of $586bn (much larger than the US plan in terms of GDP) goes into infrastructure, disaster protection and programmes for automakers, shipbuilders and electronics factories.
Latin America was one of the few regions in the world that created stabilisation funds during the commodities boom. According to the United Nations Economic Commission for Latin America and the Caribbean, nations of that region have embarked on a host of smaller but significant stimulus packages, in addition to bank bailouts and efforts to save their currencies.
No country is safe. Despite Latin America's valiant efforts, the Economist magazine put Mexico, Brazil, Argentina and Venezuela among the nations most likely to fall. These countries either have a high amount of short-term debt as a percentage of their total reserves, or their bank loans as a percentage of total deposits are at a risky level, or both.
Pakistan, Latvia, Ukraine, Hungary and Iceland have already had to seek refuge in the IMF. Others are approaching their door. And since the rich countries set the agenda at the IMF, one might think that the organisation's policies would mimic the broad stimuli of the rich countries, right? Think again.
Even though the G20 called for counter-cyclical approaches to the crisis (cut spending when times are good, increase during economic decline), the IMF is pushing policies that cut spending on the recipients of their loans. While the rich countries lower interest rates to zero and spend trillions of dollars to recover - even when that means going into ever more debt - Pakistan is being forced to cut fiscal spending and raise interest rates. Latvia is being forced to cut spending and slash wages. Since these policies went into effect, Latvia's government has gone up in flames and Ukraine and Pakistan seem to be on shakier ground every day.
If the world's developing countries aren't part of a comprehensive global response to the crisis we will all be worse off. Rich-country stimulus plans have been too focused on their domestic multiplier effects, rather than global ones. At the very least, if the developing countries do not grow, where will our exports go?
If the response isn't global we will also push more of the poor off the cliff. The World Bank's most recent estimates show that up to 53 million people fall into poverty if the crisis persists. That is on top of the 73 to 105 million that have been pushed into poverty from the food crisis that has shaken the world over the past few years.
The Centre for Global Development conservatively estimates that the developing world needs at least $1tn to cope with the crisis. When the Obama administration goes to the upcoming G20 summit next month, it should leverage at least that much for the poor and call on the IMF to halt its double standard when it comes to loans for poor countries. The global economy, and the world's poor, will depend on it.