In fact, the reassertion of the individual state, throwing off the yoke of global forms of governance and policy making had already begun in recent years, well before the pandemic hit and made closed borders a necessity. President Donald Trump’s ‘America First’ model severely affected US trade with many countries, especially China; the Trump Administration also limited immigration and put the overall focus on building up the US, with international relations taking a back seat.
In Europe, the United Kingdom withdrew from the European Union, in part to be exempt from liberal immigration policies and to re-establish the country’s sovereignty. Other examples include Hungary and Poland, which had been closing their border for non-Christian immigration. The pandemic, and all the emergency measures it triggered, will undoubtedly further diminish the globalization utopia, intensifying trends that have been already well underway. The global financial crisis in 2008 also put a major damper on the enthusiasm for—and workability of— globalization.
Globalization had gotten its main impulse from the neo-liberal policies of the 1980s in key countries, in particular Ronald Reagan’s America and Margaret Thatcher’s Great Britain. The role of the state was curtailed. Instead, free-market policies won the day and set many countries on the road to economic liberalization and the creation of a global network. Exceptions included the insular nations of the China and Russia, among others. The European Union, too, played a major role in promoting global trade and open borders.
With the arrival of the pandemic, governments were forced to strengthen state institutions, to protect citizens’ health, maintain social cohesion, and protect and repair national economies hard-hit by financial losses and liabilities due to the closure of businesses and the unemployment crisis. Not surprisingly, international solidarity has also declined, as most countries are failing to help nations that are particularly struggling; in that vein, Italy and Spain, both overwhelmed by the pandemic, complained about the lack of support from their northern neighbors.
The pandemic has interfered with the world economy in all its phases: production, distribution, and consumption. The increasing complexity of the distribution and supply-chain network, the lifeblood of the global economy, makes the structure very vulnerable. After the end of the Cold War, the victorious powers designed this complexity so that, for the sake of peace, countries would be interdependent. Any particular state would have to rely on other states for goods, materials and parts essential for the functioning of its economy.
That elaborate international system has now been dealt a blow by the pandemic, which has been prompting individual nations to try to become self-sufficient, within its borders, as within a closed system. The global economy, with all its moving parts, its delicate structure is very difficult to repair. Matter are made still worse by trade wars and accompanying tensions between major powers like the US and China—the two principal drivers of the world economy. What’s more it will be a long road for many countries before they are able to fully participate in the world economy before their own economic house is in order.
Aside from the health and food industries, rebuilding a country’s overall economic productivity will be extremely slow while—due to the pandemic—the systems of transportation and distribution are not optimally functional and when consumers are unable or hesitant to go shopping. Matters are made worse by the relative abandonment of the free-market system so eminently suitable to and essential for globalization, with its free movement of capital. Instead, just as happened in the wake of the financial crisis of 2008, the state begins borrowing and investing heavily in public services, especially health care. This dynamic scares off private investment, shrinking the free flow of capital so essential for the process of globalization.
Yet, this shift is called for in the battle against COVID-19, such as massive spending on the coronavirus vaccines, which is obviously a drain on the economy. And all this emergency spending is very likely to continue in one form or another once the pandemic has been truly defeated, such as spending on research on COVID-19 and other deadly virus strains, and on developing ways to protect the population from the next pandemic.
It is thus that the pandemic will hurt globalization. Logistically, globalization will continue in the form of the rapid exchange and distribution of information, air travel, and commerce. What will likely also survive the pandemic is countries going it alone, downplaying international cooperation, taking care of their own, and manifesting a xenophobic bent. That inward-looking orientation will rob globalization of its humanist, internationalist soul.
