Hyperglobalization Undermines Response to COVID-19 Crisis
- From what countries imports into the U.S. of critical COVID-19 response goods are sourced;
- How U.S. exports to China of such goods jumped in the first months of 2020 as the Trump administration failed to prepare for a health crisis at home even as China shut down exports of such products as demand in China grew; and
- How the sources of medical goods imported into the United States have shifted over time.
The current regime of hyperglobalization is undermining U.S. resilience against the COVID-19 crisis. The U.S. cannot make or get critical goods people need. More than 60,000 manufacturing facilities have been lost to 25 years of corporate-rigged U.S. trade policies that made it easier and less risky to move production overseas to pay workers less and avoid environmental protection costs.
The United States is especially vulnerable. Having the world’s largest trade deficit year after year means the United States is extremely reliant on other countries, especially China, to provide essential goods. The data show that imports into the United States from China of many of these products had declined relative to 2019, and in February and March 2020 had declined relative to January 2020 when demand for such goods began to peak in China as COVID-19 cases grew. This drop-off in imports of COVID-19-response goods from China was not caused by a drop in U.S. demand. Indeed, U.S. demand for masks, gloves, ventilators and more was growing in March. And the United States increased imports of these goods from other countries to try to fill the gap left by the drop in goods from China. But in January 2020, U.S. government officials urged U.S. firms to expand exports to China of the limited domestic production of key medical goods instead of considering U.S. residents’ needs.
With many critical goods now mainly made in one or two countries, when workers there fall ill or those governments prioritize their own people’s needs before exporting goods, a worldwide shortage of masks, gloves, medicine and more quickly develop. And it’s difficult to quickly increase production elsewhere. Long, thin globalized supply chains mean U.S. firms that seek to ramp up production cannot find inputs, parts and components. And monopoly patent protections in many trade agreements expose countries to trade sanctions if they produce medicine, ventilators and more without approval by and payment to pharmaceutical and other firms.
With policymakers and the public distracted, corporate lobbyists are pushing for more of the same trade policies that hatched the unreliable supply chains now failing us all. Instead, we must fundamentally Rethink Trade. The goals should be healthy, resilient communities and economic well-being for more people – not the current priority of maximizing corporate profits.