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Post-Pandemic Globalization

by |August 10, 2020

Authoritarian and nationalistic forces may be seizing on COVID-19 as an opportunity to restrict people and businesses to stay within their borders, but in the long run, the forces of technology, economic development and human curiosity will not be contained. Globalization has its downside, making governance in the public interest more difficult and complex, but instead of trying to shut it down, we need to figure out how to make it work. We are a planet that will remain governed by sovereign nations, but we need to get better at regulating global commerce. It doesn’t help that we have a president who is trying to make hatred of China a campaign theme—threatening harmless apps like TikTok and We Chat and trying to rename COVID-19 the “China Virus.” It also doesn’t help that China’s President Xi Jinping continues to consolidate power, and while less flamboyant than Trump, pushes a “China first” agenda similar to the American president’s “America first” policy stance.

Individuals, families, communities and nations pursue self-interest. That is a given. We seek advantage and try to get ahead. But competition does not make cooperation impossible, and global rules of the game can facilitate rather than impede competition. Xenophobia and racism are obstacles to achieving sustainable economic development. Understanding the history and motivation of people from other places can help us learn more about each other, and makes cooperation easier and more effective. And the internet can be a tool for sharing images and information globally. We know it is capable of magnifying disinformation and misunderstanding, but its capacity for truth-telling can’t be understated. Last week all of us saw the horrific images of Beirut’s explosion. Earlier this year we viewed the video of George Floyd’s murder beneath the knee of a police officer. Those shared images cannot be refuted, and they are shared globally. The planet we live on has been made smaller and more accessible by the world wide web. Economic development, like communication, is also global.

Global supply chains are a fact of economic life. They are built on geographic, historic and cultural distinctions between people and places. Different places and people come to specialize in producing different things. We are able to bring those specialties together in a supply chain. These chains rely on inexpensive communication, information and transportation, and enable higher quality and lower-priced goods and services. The economic and technological forces behind these trends is irresistible. Nationalist political leaders will lose the battle to influence global corporations if their political strategy does not include an understanding of the economic benefits of globalization.

Politicians like Donald Trump and Joe Biden are eager to rebuild American manufacturing. Nostalgia for the labor-intensive, blue-collar industries of their youth is impairing their judgment. Although the political appeal of this nostalgia is obvious, it is a vision built on a fantasy. Rebuilding American manufacturing is a good idea that will diversify our economy, but let’s face it, the factories of the future will be largely automated and run from control rooms rather than factory floors. They will not result in mass employment. We are in a brain-based, service-oriented economy. While millions of people are unemployed in the pandemic lockdown we are now living under, millions more are “working from home,” continuing to produce value for the economy. Some people may like the idea of working from home, but most are desperate for a resumption of normal life. Commuting may be annoying, but we like the world we find at both ends of our commute, and few of us seek to merge those worlds. The nature of work has been transformed by technology, but to a considerable extent, the politicians running our governments haven’t fully figured this out yet. The hardware in your iPhone is worth much less than the software and applications that run on it. The high value-added part of our economy is in creativity, design, communications, strategy and analysis. Manufacturing is necessary, but it is not as profitable as services including the design of production processes.

Humans are social creatures, and the technologies of communication, information and transportation send many of us all over the world in search of opportunity, travel and productive advantage. We want to return to that world, and when we get past this pandemic, we will. Globalization must be tamed rather than eliminated. The advantages of immigration should be obvious in a brain-based economy. If I run an organization and I can recruit my staff from a planet of 7.8 billion people instead of a nation of 331 million, the odds are I will recruit a more talented staff. That means my organization will be more creative and innovative, and that a globally staffed organization will tend to win in a free, competitive marketplace. The nation, city or organization that is most welcoming to people from all over the world and offers the highest quality of life has an edge in the global competition for talent. Regulating and reducing immigration of talented staff to preserve jobs for less talented local people is a losing strategy.

One of the reasons New York City and other global cities will come back after the pandemic is their attractiveness to talented people. In New York City, 40 percent of the people in residence were born in other nations. I was born here, but all of my grandparents were immigrants. New York City’s immigrant population doesn’t count my family and it doesn’t include foreign students, tourists and people here illegally. Young, ambitious and talented people are attracted to the city’s energy, dynamism, and excitement. When we learn how to gather together again safely, we will do just that.

Diversity is not simply valuable for reasons of ethics and ideology; it facilitates the creation of groups better able to deal with complexity. Modern production systems are complicated, and have many fixed and moving parts. Think of all the skills and talent required to create a movie. You need experts in storytelling, lighting, filming, sound recording, sound mixing, editing, set construction, acting, directing, costume design, makeup, and scores of other skills. When we work to address a problem in my own field of environmental sustainability, we often need lawyers, policy analysts, engineers, health scientists, ecologists, environmental scientists, management specialists, communication specialists and a wide variety of other experts. The life experiences that help build expertise vary. We need people from many places and with many backgrounds, and they need to be good at working in heterogeneous groups. Experience at working in a team with members coming from many places and with varied histories is a particularly sought after 21st-century professional skill.

When the pandemic is finally past, these fundamentals of global production will return. The communities that are built for homogeneity will lose to those built for diversity. Communities that welcome people with different backgrounds will be better able to attract the talent needed to compete. This is not an argument for open borders and immigration at will. It is an argument for encouraging immigration of talented people and their families and building on a central American heritage. With few exceptions, we are a nation of immigrants. Some of us were brought here unwillingly, and others came illegally, but we are fundamentally the planet’s most global nation. We should build on and take great pride in that diversity, and recognize the advantage it provides us in the competition to attract talent from every corner of the world.

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Deborah Lee Dailey
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Deborah Lee Dailey

Just a question on immigration and possible discontents An article by Tinku Ray for WGBH News (Boston) “No Escape from Caste” 2/26/19 finds that 90 % of South Asian immigrants to the US have been of “high or dominant class”. According to the artivle, this is very hard for the dalits, or lowest Hindu classes who have immigrated as well. South Asians seem to be in many tech jobs. Concern may be that the caste system might be perpetuated in the US. Annecdotally, there is a housing problem for lower income workers in Silicon Valley and a huge homeless problem… Read more »

David Coleman
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I wholeheartedly agree with the sentiments expressed in this article. Globalization has many benefits to nations and the world which should not be lost because a regression towards nationalism due to COVID19.