About the authors: Eric LeCompte is the executive director of Jubilee USA Network. Cathy Feingold is the international director of the AFL-CIO and deputy president of the International Trade Union Confederation.
War rages in Ukraine and a global crisis looms. Gas prices rise and around the world, wheat, corn and fertilizer prices skyrocket. The International Monetary Fund says the global economy will slow, contributing to food shortages in developing countries. Russia’s war on Ukraine combined with Covid-19 made a terrible global situation worse. There are economic policies that Republican and Democratic leaders can find common ground with the Biden administration to make the U.S. and global economy more resilient in the face of these threats.
Before the war, the pandemic revealed the catastrophic consequences of persistent global poverty and inequality for everyone—not just the poor. In response, U.S. economic strategy must focus on transparency, democracy, and what Pope Francis calls “a preferential option for the poor.”
The Ukraine crisis shows what a difference U.S. leadership makes. As the world suffers impacts from the war and pandemic, our country can and must be the respected neighbor whom others look to in a crisis. We can bring other countries together to help ensure our global future is peaceful, prosperous and democratic. Covid shows that public health is global—when some of us are vulnerable to the disease, we all are. The same is true of economic prosperity. With supply and economic shocks, U.S. prosperity depends on global prosperity.
The U.S. should pursue four international economic objectives in response to the Ukraine war and the impacts of the pandemic.
First, in this intense moment of global instability, we must maintain the basic financial health of developing countries. We must ensure all countries’ access to vaccines and protective gear. We must stop new coronavirus variants from emerging in developing countries if we are to prevent new viruses that evade our vaccines and create new economic shocks.
Global economic stability also means having well-defined processes for international debt relief to help withstand crises. This is an urgent need in Ukraine today. But despite agreements by world leaders, we continue to fail to have a bankruptcy process at the country level. Adam Smith, the founder of classical economics, witnessed debt’s devastating impact and urged the creation of a bankruptcy process for nations. Until we follow his advice, we will lack the tools to mitigate economic shocks and deal with crises in Ukraine and countries worldwide.
Second, if we want a prosperous and stable global economy, we need policies that lift up working people, policies based on values as old as the Bible. The coronavirus crisis heightened inequality, destabilized supply chains, and led to workers working harder for less. We live in a global labor market, yet we lack rules for every worker to fairly enjoy the fruits of their labor, to rest, be with family, and have time to recover from Covid and other illnesses. Stronger, more resilient supply chains and greater economic stability depend on eliminating huge differences in wages and family security worldwide. Then we can remove the temptation to exploit workers by any business organized enough to lease a shipping container.
Third, financial markets and institutions have a part in stabilizing global society. But alone, they will not invest fast enough in needed technology to eliminate Covid-19 as a threat to the world economy or invest fast enough to stop climate change from becoming an existential threat to human society. We need coordinated action among governments to ensure there are sufficient investments globally to secure our common future.
Finally, we need to end multilateral and individual country-level policies that wink at tax evasion and corruption by corporations, oligarchs, and the wealthiest. Over the last 40 years, tax evasion became the norm, not alone because of rogue tax havens, but because the world’s major economy governments were influenced by the super rich and corrupt. Russian oligarchs are not alone in wanting to enrich themselves while starving investment in local, national, and global communities.
While we see progress on these policies in recent years in Congress, consecutive White Houses, and the IMF, G20, and G7, we need to move faster and with greater ambition to implement these policies.
All around us we can see how important it is to have a global economic order that can withstand and more importantly act to prevent crises and provide good lives to those who do the world’s work. If we fail to implement these policies, the types of crises we have experienced in recent years, with their attendant failed supply chains and price shocks, are likely to repeat and worsen, profoundly threatening America’s prosperity and stability. But there is a better way. America can lead. We can emerge from this moment of crisis and realize the promise of a more prosperous, democratic, and humane global society.
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