Jack Gao writes on the Economic Questions blog here that coronavirus need not spell the end of globalisation. Indeed, as he concludes:
“a balkanized and disintegrated world is neither feasible nor desirable. The coronavirus does not have to kill globalization, instead, it is our chance to rebalance the world economy to better serve collective social goals and tackle future challenges as a coordinated global community.”
He hopes that the responses to the pandemic and its aftermath will lead to a more balanced form of globalisation which no longer prioritises “economic integration over public health, environmental, and climate concerns”.
Whatever the outcome, the global political economy will surely look very different. The pandemic has forced dramatic changes in social priorities across the world in record time, and ensuring better preparedness to respond next time (for there surely will be one, many even) will make this so.
There is a parallel here with Hyman Minsky’s quip which neatly summarised his theories, that ‘stability is destabilising’. He meant that the behaviour of private firms or households would respond to periods of seeming economic tranquility by taking on riskier financial positions, making balance sheets increasingly fragile, and setting up the economy for the next crisis.
This can also be applied in more general terms to governments as well as the private sector, putting a lack of preparedness for a crisis down to rising complacency as memories of the last one fade and new generations with no experience of severe crisis, of whatever form, take up influential positions in the economy and society. This will need to be applied to public health which, as we are discovering with renewed urgency, is a global public good requiring global cooperation as much as narrowly national responses. While national governments’ priority is to protect their citizens, this can only be achieved fully with substantial measures of global cooperation.
Historically, global cooperation in the absence of a hegemonic power, or at the very least, a crisis common to all, has been difficult. We have been living in recent decades with the rise of China as an economic superpower, even as the US under Trump is both reluctant to let this continue, and has in some ways been turning away from relatively consistent cooperation with traditional allies.
Each nation may plot a different path through this crisis, but with ever greater availability of information in many countries, governments and citizens have the opportunity to share and learn from each other more than ever before. Despite this, we also experience the scourge of misinformation, and uncertainty over which sources we can trust. At the same time, we are all subject to partiality, bias and particular beliefs which distort our vision of the world and prevent us from achieving a healthier understanding, in spite of information abundance.