Giving Compass' Take:
- Krishna Kumar and James Dobbins explain why American citizens would benefit in all facets of life from continued global integration after COVID-19.
- Are you prepared to support continued global integration after COVID-19?
- Learn how you can support various communities impacted by COVID-19.
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Even when the world was not in crisis, the economic effects of globalization within the United States and elsewhere have not been uniform. The less skilled, especially in the manufacturing sector, have lost out as developed countries have turned to outsourcing and imports to take advantage of cheaper labor in emerging economies.
Given these downsides to openness, why not erect permanent barriers and become more closed? Because losses from globalization are concentrated, while gains are diffused, those who say yes to this question tend to be more vocal. And in times of distress such as the present moment, this stance is understandable.
However, it would be a mistake to rush to an answer without looking at the benefits of global integration. Globalization has reduced poverty and improved the standards of living for millions of people
Even within the United States, many sectors including manufacturing have benefited from global supply chains, with each country supplying parts and components based on its comparative advantage. Higher education, travel, and tourism have also benefited from global integration and consumers from lower prices. While jobs were lost in sectors susceptible to imports, new ones were created in exporting sectors.
Global integration is the collective decision of billions of world citizens. Instead of fighting what is inevitable, and ultimately beneficial overall, a robust global system should be built to bring prosperity to all and coordinate responses to any challenges that may arise. The alternative of erecting barriers and closing America off to the world would leave it more vulnerable to the next big shock.
Read the full article about the importance of global integration after COVID-19 by Krishna Kumar and James Dobbins at RAND Corporation.