Bretton Woods Committee | Wed, Apr 8, 2020
by Beverly Barrett
Beverly Barrett, PhD is policy program advisor and economics faculty at the University of St. Thomas, Houston. Dr. Barrett is the author of Globalization and Change in Higher Education: The Political Economy of Policy Reform in Europe (Palgrave Macmillan). You may email her at [email protected]. This blog is a part of special series on the coronavirus.
In the spirit of Bretton Woods, the time is now. This is a call for “Institutional Entrepreneurship.” How can we rely on our institutions to support the nations of the world, and to convene forums and laboratories, in addressing the most pressing issues of the day?
In every crisis there is an opportunity. The pandemic provides this opportunity to work together internationally to present solutions for humanity in health and in stabilizing the global economy. By evolving and strengthening the current rules-based economic system, the value of international economic cooperation is stronger than ever.
Two weeks after the World Health Organization (WHO) designated the virus a global pandemic, the G20 issued a statement of solidarity with guidelines and objectives for the global community. As the G20 Leaders stated at their meeting on March 26, in the text of The Extraordinary G20 Leaders’ Summit Statement on COVID-19, the virus reminds of our interconnectedness and our vulnerabilities.
“The G20 is committed to do whatever it takes to overcome the pandemic,” and what would it take? Perhaps a return to the institutional entrepreneurship that was in the spirit of the Bretton Woods meetings during July 1944 in New Hampshire. There were many post-World War II initiatives to rebuild the world; while the Bretton Woods institutions have endured and provide the pathway for future cooperation.
However, what does this look like in practice? As we envision the next steps, what international institutions will be required to bring this forward? Can we rely on national institutions alone? Or would an institutionally based global framework come together to advance scientific innovation and to sustain economic production? This would facilitate that the national solutions that we find can be shared among nations to advance the longevity and prosperity of our lives.
This is a paradigm shift in recognizing our collective vulnerabilities, in valuing other nations, and in working together. The gradual escalation of the virus spread – day by day and week by week - is distinct from the paradigm shift, that took place, suddenly, following 9/11 in 2001. Both were external shocks that have impacted our daily lives and our security.
Interconnected and International in the Era of Pandemic
Given how interconnected the world is with global supply chains, to assure the continued flows in the international economy is vital. A remembrace of internationalism, facilitated by the rethinking brought by this pandemic, can take us further toward the goal to realize free and fair trade and to keep markets open. Aligned with the important role of the World Trade Organization (WTO), we can apply the lessons from the pandemic to reforming the WTO to serve the world in addressing 21st century challenges including data flows and international regulatory cooperation.
The tensions between nationalism and internationalism are evident. As the world economy slowed down to a virtual halt in mid-March, the isolationism – with series of orders to “stay at home” – comes together with the realization that we are all in this together. The widespread cancellations of sports, arts, and conferences, and even the postponement of the 2020 Summer Olympics in Tokyo, tells us that it is time for a pause. We can make the most of this time to reconnect and to present shared solutions for the future.
After WWII the opportunity was to construct the international economic order. We need to do it again, building on what we have accomplished in the past, and rise to the occasion to address the pressing challenges of providing health, economic stability, and humanitarian support globally.
As we look back to the Spanish flu of 1918 for lessons and insights, what we are experiencing today is proving to be a once in a century global health crisis. Overcoming the virus will take application of scientific knowledge and community cooperation. On an individual level, we can overcome fear and demonstrate the forward-thinking and willingness to innovate and to trust each other.
On a global level, the challenge remains to come up with an international collective response beyond the statement of commitment from the G20. Awareness through medical testing, as much as available, and empowerment through shared lessons and optimism remind us that, “knowledge is power.”
Supporting Economic Prosperity
The international community can do this, just like we came together after WWII at Bretton Woods, we can come together now. Technology has provided us with new ways of relating to each other with instant messages that circle the globe, digitally enabled voice calls, and omnipresent video screens.
The next generation, with their energy and creativity, can bring forward new ways to relate and to problem solve together as we remember the successes that resulted from the commitment at Bretton Woods. Whether we are cooperating to stay well and to keep the economy going, until there is a therapeutic cure and vaccine, or looking ahead to other ways to work together as we face higher stakes in the environment and technology, we are all in this together. “Global action, solidarity and international cooperation are more than ever necessary to address this pandemic,” advised the G20. In every crisis there is an opportunity, and let us use this time wisely.