Global Economy: Recover or Reconfigure? Part II

The United States and the EU are taking unprecedented steps to generate economic growth in response to both the global recession caused by the pandemic and to the political turmoil that stems from decades of minimal wage growth for many Europeans and Americans. But tensions arise between these motivations, as many on both sides of the Atlantic question an economic model based on growth, which seems to benefit companies and the stock market more than workers, and as it generates inequalities and harms the climate and environment. Digital technologies, too, propel growth and create opportunities, but often with painful disruption. Trade has raised the living standards of billions, but often at the expense of European and American workers. Rather than growth, including that which would come through enhanced transatlantic trade, perhaps the focus should be on a better distribution of wealth, changes in consumption patterns, and greater regulation. Companies, too, increasingly seem to understand that they lose from eroding political systems which undermine the rule of law, so many are seriously investing in ESG (environmental, social, and governance) considerations, perhaps no longer just to stave off new regulation.

Do U.S. and European leaders need to fundamentally change our approach to economic policy? Do structural changes need to be made to our economic systems? Digital technologies can create huge new opportunities (e.g., for “micro-multinationals” and the maker movement), but how do we best handle the disruptive changes they bring?  Given that U.S. and European companies are deeply invested on both sides of the Atlantic, how do we ensure that the United States and the EU take compatible approaches to ESG regulation? How would all this affect efforts to promote transatlantic trade—and public perceptions of those efforts?