12 March 2020

Globalization and Today's Reality

Markets across the West are down 9 to 15% today. It's important to talk globalization.

The most defining issues of our day are not national. Pandemics, economies, financial markets, global warming, immigration, culture, ideas, research .... all of these issues are about as neatly contained within borders as are clouds.

The US went to war in 1860 to settle a really important question: would we be a confederacy of independent states or a union of states? Before Lincoln, the most common phrase was "The United States are." After Lincoln, the most common phrase was, "The United States is." Lincoln made us a nation. By 1860, railroads, a nascent stock market, and factories able to make enough goods for a nation and not just a neighborhood had transformed the US from a collection of neighborhoods and states into a nation. The world had become bigger and our government needed to adapt. At that point, state economies had become less meaningful than the national economy and we needed a national government to match that.

Today a similar thing has happened in regards to national borders. We cannot resolve the big issues of the day with national policy. It requires international alliances and strong international organizations, just as the growth of the economy in the late 1800s required a national government.
Globalization is not just about international trade. It is about creating strong alliances and organizations that enable coordination and cooperation. National today is what states were 150 years ago. And just as states still have distinct cultures and policies, so will nations. That said, our reality is global. We need institutions that match that reality.

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