2020, how to get out of the vicious circle

In 2020, domestic politics, geopolitics, and economic issues will be closely linked to the highest level in decades. The weak economy and the problematic governance methods in many parts of the world may lead to a vicious circle: the bad consequences of the economy will lead to radical populism at home and more brutal nationalism abroad; and as The rise of protectionism, which in turn will worsen the economic situation and cause investment to decline, which in turn will reduce consumer confidence. A bad economy drives bad politics, and then makes the economy worse and worse.

Regardless of economic or political level, 2020 will be turbulent from the beginning. This is both bad news and good news. Perhaps the global economy will fall into recession, and the risks of major political events and even military confrontations will be higher than at any time since the end of the cold war. But from a more optimistic point of view, due to lower expectations, people do not need much effort to produce unexpected results, thus bringing about a virtuous cycle of improving the economic and political environment.

First, let’s start with the economics. The International Monetary Fund (IMF) creatively uses the term “synchronized slowdown” to describe the current dilemma: 90% of global economic growth is decelerating, and the overall growth rate is expected to be faster than the 2008 global financial crisis Be slow at all times. This is actually a euphemism for a long period of stagnation, and this characteristic of the global economy is becoming increasingly apparent. In the environment of slow population growth, whether it is increasing inequality or the high degree of uncertainty in returning savings funds, it has become a key issue.

As in the 1930s, developed economies cannot achieve sustained growth at a healthy rate based on sound financial and policy foundations. According to market expectations, central banks will not be able to achieve the 2% inflation target in the next decade. Even in order to satisfy the wishes of voters and solve what they believe is the weak growth of the middle class’s living standards, countries have to issue negative interest rate debt of 15 trillion US dollars worldwide, and have unprecedentedly large budget deficits in peacetime and let go Various financial behaviors are not regulated.

In the global economy, although the share of emerging markets is much larger than ever, and the resilience shown during the financial crisis has exceeded most people’s expectations, its success still depends on developed countries . The most successful growth trajectory of emerging markets is based on the continued growth of exports of manufactured goods to advanced economies. But the slowdown in economic growth, the return of manufacturing, and the rise of protectionism mean that in the next few years, this growth path will become narrower and narrower. In recent years, forecasts for growth in emerging markets have been overly optimistic. I am worried that this situation will continue and profound structural challenges will follow in the coming years.

On the evening of October 15, 2019, the fourth debate of the Democratic primaries in the US 2020 election was held at Otburn University, Ohio. Twelve Democratic candidates competed on issues such as automation, tax cuts, and illegal immigration. The debate, co-sponsored by the New York Times and CNN, is by far the largest debate in the Democratic Party.

Judging by these economic challenges alone, the situation will be very serious, although all this may not be more serious than the past oil crisis, severe inflation or financial crisis. What makes the current challenge even worse is the deterioration of rational coping abilities in almost everywhere. The United States once won the Cold War by relying on the international system dominated by one hand, and promoted the level of social development in emerging markets to gradually approach the level of developed countries. But now, under Trump’s leadership, the United States is convinced of the old-age concept of endless struggle between nation states and has taken the lead in withdrawing from global integration. The United States is absent on issues such as trade agreements and cooperation to combat climate change.

Blaming Trump has become a trend, and he himself has almost never missed any opportunity to make mistakes. But it’s important to keep in mind that before Trump announced the United States’ withdrawal from the Trans-Pacific Partnership Agreement (TPP), more Democrats opposed TPP than Republicans, and candidates for the Democratic 2020 election could attack Trump China’s policy is too moderate. In a sense, the consensus on American leadership after World War II can be concluded with the knowledge of former US President Barack Obama. Obama’s grand strategy comes down to four words: don’t do stupid things.

More fundamentally, the nationalist transformation in the United States is a manifestation of the typical global trend with Brexit as the highlight. Decisions based on rational, healthy economic operations and international cooperation are being overwhelmed by a wave of raging public anger and nationalist fantasies.

More resistance to globally integrated markets, as well as reduced foreign investment and international cooperation, will only mean slower economic growth and more insecurity and frustration for the working class. By then, they will be more likely to unite with those who have the simplest narrative style and the widest range of empty checks, rather than supporting a return to centrist cooperation policy. This will only exacerbate the recession.

Worldwide, one of the most important choices in 2020 will be the choice made by US voters in the general election. In the history of the United States, as of now, the correction of direction has become extremely important. The United States and the world need a new American president who values ​​unity above conflict and pursues inclusive and comprehensive prosperity. This means that the United States needs to focus on necessary public affairs investments in infrastructure, education, and innovation, improve the efficiency and stimulus of tax laws, and allow businesses to focus on meeting social needs rather than provoking labor and business, the middle class and The war between the rich.

At the same time, it also means ending the current US trade war against most countries in the world, stopping using capricious trade moves to generate influence, and abandoning diplomatic means to pursue domestic political goals. Restoring the US alliance system, resisting protectionism, and working with other countries to address global challenges such as climate change, tax evasion, and new technology regulation should be the focus of attention.

What the United States does, what policy it pursues, and the way it affects the rest of the world requires changes to make it possible to avoid vicious political and economic cycles. The election of Roosevelt during the Great Depression, the election of Reagan during the Western self-doubt period, and the election of Obama after the Iraq war and the financial crisis have all had a complex impact on changes in the world system. People will see the changes of the city on the mountain and follow suit. For better or worse, at least 2020, it will all happen.

On the evening of October 15, 2019, the fourth debate of the Democratic primaries in the US 2020 election was held at Otburn University, Ohio. Twelve Democratic candidates competed on issues such as automation, tax cuts, and illegal immigration. The debate, co-sponsored by the New York Times and CNN, is by far the largest debate in the Democratic Party.