Rebuilding the
Global Economy

A special series outlining policy priorities
and solutions heading into 2021 by the
Peterson Institute for International Economics

The world economy is experiencing a corrosion of globalization. The web of economic and commercial ties across the world is fraying, with more frequent and larger gaps in it—even as trade in goods, services, and technology shifts locations and in some places grows. For globalization is multidimensional, encompassing much more than international trade, though panic about trade gets most of the political and press attention. What matters for human welfare is the quality, not the quantity, of globalization. As global economic integration deteriorates, its benefits for everyone are eroding.

Worldwide, people want to be left in peace, make a decent living, educate their children, look after their families, and, if possible, save for the future. For decades that simple but profound state of economic safety and freedom became ever more widely attained, largely hand-in-hand with increased international openness. But we have been going mostly in the wrong direction on both counts since at least 2008, well before COVID-19. The economic and social impact of the pandemic has not just accelerated the corrosion of commerce and relationships across borders but also made undeniable the extreme vulnerability of the world’s population to disease, economic insecurity, and exclusion.

As a result, the risks of the most genuinely existential threats—climate change, technological slowdown, racial and gender-based oppression, digital disinformation and removal of privacy, aging populations, and the likely recurrence of epidemics—have risen. All of these threats are global, in that they are common to all humanity, and can be lastingly reduced only by global cooperative action. All of these threats are economic, in that beyond their direct human toll, their causes and lasting impact are meaningfully changed by our economic activities and policies. Both markets and international institutions have failed to deliver economic safety in the absence of global engagement by governments. Successful economic cooperation needs specific constructive policies with tangible deliverable results.

That is why we at the Peterson Institute for International Economics (PIIE) are providing work plans for Rebuilding the Global Economy. Heading into 2021 (and a new US presidential term), we are telling policymakers what needs to be repaired by defining critical and practical priorities and solutions. Our work plans will be published on a rolling basis through the end of 2020, culminating in the release in January 2021 of a comprehensive policy program for rebuilding. They will take the form of memoranda to policymakers and Policy Briefs, accompanied by data visualizations, blogs, videos, and virtual events with experts from our team of fellows and our Board of Directors.

Rebuilding is a very deliberate and, we believe, apt verb for the task at hand. The global economy continues to exist, and it is necessary for the future well-being of all people, whether or not governments decide to withdraw from it. People and nations need a safe structure in which to conduct their economic lives, to join communities, and to be left in privacy. The building, however, has been allowed to sink into disrepair and, in some ways, has ceased to be fit for purpose. The architecture of the 1940s, updated on the fly in the early 1970s and again after 1989, does not meet today’s standards of inclusion and accessibility, does not have room enough for many growing (and some already grown) economies, and is inadequate shelter against the environmental threats we now face.

But the global economy is repairable. What is needed now are actionable plans setting out clear priorities for economic policymakers. These plans must reject the status quo and must be objective and specific in their assessment of what can be salvaged and repaired as opposed to what should be torn down and replaced. These plans must not, however, be grandiose architectural fantasies—we all have to continue living and working in the global economy even while substantial renovation is underway, and there are limits to how far people want to be disrupted. This is where the Peterson Institute can make a meaningful contribution.

The starting point for our Rebuilding the Global Economy program is a set of 50 memos targeted at specific senior policymakers in the US government, the European Union, and international organizations. In these memos we specify what the policymaker and their agency or department should prioritize to rebuild the global economy in their remit, what critical things they should stop doing or reverse immediately, and what institutional relationship they need to change or repair. These are being released in tranches by agency or issue area and will be accompanied by online public meetings, starting now with the US Commerce Department and US Trade Representative (October 22) and the White House including strategic dialogue with China (October 26). In January 2021, PIIE will release a comprehensive rebuilding blueprint featuring more developed versions of the key policy proposals and set out how they fit together globally across countries and issues.

We have limited our recommendations to policymakers in official positions because that is where actions must be prioritized and implemented. Nongovernmental organizations and interest groups—including labor unions, business organizations, environmental watchdogs, and representatives of excluded groups—must have a voice in this process, but the Institute does not presume to speak for any of them. We hope to engage them in discussion of our proposals over the coming months. Similarly, we have directed our memos to American, European, and especially international officials, where our fellows have experience, standing, and background. The officials of other regions of the world and some international organizations beyond our scope of research should be at the table just as much as the governments of the Group of Seven (G7) countries. We look forward to engaging with them as well. In March 2021, we will launch an annual high-level conference on Rebuilding the Global Economy to be held in Singapore, cohosted with the Lee Kwan Yew School of Public Policy to facilitate inclusive global dialogue. Starting now, PIIE will track the state of the global economy and the success of policy measures adopted to rebuild it in an accessible online format, to provide ongoing assessment of progress.

Constructive economic solutions to the existential threats we face are possible, but they must be targeted at practical rebuilding, and they must be global. Please join us in this effort.

—Adam S. Posen
President, Peterson Institute for International Economics

Read the memoranda to policymakers

UNITED STATES

THE WHITE HOUSE

Jason Furman to the Director of the National Economic Council [pdf] [Read online]
Karen Dynan to the Chair of the Council of Economic Advisers [pdf] [Read online]
Nicholas R. Lardy to the Chair of the US Delegation for Bilateral Economic Talks with China [pdf] [Read online]
Douglas A. Irwin to the Director of the National Trade Council/Office of Trade and Manufacturing Policy [pdf] [Read online]

OFFICE OF THE US TRADE REPRESENTATIVE

Chad P. Bown to the US Trade Representative [pdf] [Read online]
J. Bradford Jensen to the Deputy United States Trade Representative and Ambassador to the World Trade Organization [pdf] [Read online]

US DEPARTMENT OF THE TREASURY

Lawrence H. Summers to the US Secretary of the Treasury [pdf] [Read online]
Maurice Obstfeld to the Under Secretary of the Treasury for International Affairs [pdf] [Read online]
Joseph E. Gagnon to the Incoming Treasury Assistant Secretary for International Finance [pdf] [Read online]

US FEDERAL RESERVE

David Wilcox to the Vice Chair of the Federal Reserve Board [pdf] [Read online]

US DEPARTMENT OF COMMERCE

Evan G. Greenberg to the US Secretary of Commerce [pdf] [Read online]
Mary E. Lovely to the Under Secretary of Commerce for International Trade [pdf] [Read online]
Martin Chorzempa to the Under Secretary of Commerce for Industry and Security [pdf] [Read online]

US DEPARTMENT OF STATE

Marcus Noland to the Under Secretary of State for Economic Growth, Energy, and the Environment [pdf] [Read online]
Jeffrey J. Schott to the Assistant Secretary of State for Economic and Business Affairs [pdf] [Read online]
Cullen Hendrix to the Assistant Secretaries for the Bureaus of Energy Resources and Oceans and International Environmental and Scientific Affairs [pdf] [Read online]

US CONGRESSIONAL COMMITTEES

Gary Clyde Hufbauer to the Chairs and Ranking Members of House and Senate Subcommittees on Trade [pdf] [Read online]
C. Fred Bergsten to the Chairs and Ranking Members of the Senate Foreign Relations Committee and House Foreign Affairs Committee [pdf] [Read online]
Edwin M. Truman to the Chairs and Ranking Members of the Senate Foreign Relations Committee, House Financial Services Committee, and House Foreign Affairs Committee [pdf] [Read online]

EUROPE

Olivier Blanchard to the President of the European Central Bank [pdf] [Read online]
Simeon Djankov to the President of the European Bank for Reconstruction and Development [pdf] [Read online]
Jean Pisani-Ferry to the President of the European Commission [pdf] [Read online]

INTERNATIONAL

Pinelopi (Penny) Koujianou Goldberg to the President of the World Bank [pdf] [Read online]
Anabel González to the Director General of the World Trade Organization [pdf] [Read online]
José De Gregorio to the Managing Director of the International Monetary Fund [pdf] [Read online]
Olivier Jeanne to the General Manager of the Bank for International Settlements [pdf] [Read online]
Charles D. Lake II to the Leaders of the Parties to the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) [pdf] [Read online]
Peter Orszag
to the International Monetary and Financial Committee [pdf] [Read online]

MORE COMING SOON, INCLUDING:

Caroline Atkinson to the Secretary-General of the Organization for Economic Cooperation and Development
Monica de Bolle to the President of the Inter-American Development Bank
Jacob Funk Kirkegaard to the European Commissioner for Competition
Robert Z. Lawrence to the European Commissioner for Trade
Adnan Mazarei to the Executive Secretary of the United Nations Economic Commission for Africa

EVENTS

Visit the event page for the latest information and registration links.