A Marshall Plan for the Global Economy?

By the time American citizens hunkered down as a result of the pandemic, back in late March 2020, our economy was booming and unemployment rates were historically low, oscillating around three percent.  We were not the only economy in this trajectory, the global economy was, for the most part, heading in a similar direction.  After thirty-plus years of accelerated globalization, national economies became incrementally intertwined, and more so with the consolidation of trade blocs and bilateral free trade agreements across the world.  The relatively deregulated flow of capital and the increasing influence of transnational corporations in the design of the world order also gave rise to new powerful economies that once belonged to the “developing world,” resulting in the, so called, BRICS countries (Brazil, Russia, India, China, and South Africa).[1]  Today, aside from China, the rest of the BRICS countries are struggling to overcome the pandemic.  Their future looks grim, they do not have the capabilities to jumpstart their economies like other advanced industrial nations, and their dependency on Foreign Direct Investment indicates that their economic recovery depends more on the decisions made outside of their country than the decisions they can make internally.

John Hopkins University, Coronavirus Resource Center. Data up to June 16, 2020. https://coronavirus.jhu.edu/map.html

I am not comparing the BRICS countries to the Europe of the World War Two era, Europe was at the center of geopolitical power prior to the war, but it is evident that the economic recovery of the BRICS countries is as crucial for the global market system as the European recovery back in the late 1940s.   The 1948 Marshall Plan engineered and funded by the United States, and to a lesser extent by Canada, reinforced our geopolitical power after the war and ultimately positioned our county as the Super Power of the world.  Our strategic decision to develop and implement an economic reconstruction plan for Europe, as a means to secure our own long-term political, cultural and economic power across the world, allowed the United States to ultimately construct the global market system in which we live in today.

“The Marshall Plan – A 60 Year Legacy.” America.Gov. https://photos.state.gov/galleries/usinfo-photo/39/Marshall_Plan_60_Year_Legacy/5.html

In this current era of globalization and under the potential threats of a global economic depression, should the United States design and implement a global economic reconstruction plan in order to rescue the key global economies that are strategically important for the preservation of our future geopolitical power?  Will there be a Pompeo Plan?  Is the current administration dedicating endless hours of work and building cohesion within all branches of government, as well as reaching out to key global, national and private stakeholders, in order to execute a global economic recovery plan?  Is there enough political cohesion, domestically, in order to execute a long-term foreign policy strategy?  Does the Democratic Party have a plan of their own in order to secure our position of power after the COVID-19 crisis?  Unfortunately, the answer is no!

There is no plan in sight, we seem to just be improvising a foreign policy strategy that lacks a long-term vision.  The current short-term strategy of nationalism, isolationism and protectionism, as a means to secure a reelection, is not going to set our nation for the geopolitical challenges of the Twenty First Century.  Sadly, the Democratic Party also lacks a long-term vision and, in the absence of a clear foreign policy strategy, is just willing to go back to the pre-President Trump status quo.  The most concerning issue is that Europe also lacks a plan; in other words, the Western nations are betting on the pre-President Trump era as a solution to the post-COVID-19 economic crisis, while China begins to roll up its sleeves and incrementally accelerates the implementation of its Belt and Road Initiative (BRI) and perhaps a global economic recovery plan.

BRICS Countries

Not only is China willing and ready to fund the economic recovery of the emerging economies of the world, but the industrialized nations as well.  As a BRICS country, they are particularly interested in aiding the reconstruction of Brazil, Russia, India, and South Africa since together, they represent the future of the global market system.  These five nations represent a market of 3.1 billion consumers (41% of the world’s population), a combined Gross Domestic Product (GDP) of $20.0 trillion, about a quarter of the world’s economic output, and close to 15% of the world’s GDP, surpassing at this point the European Union.

Statista. Accessed June 15, 2020. https://www.statista.com/statistics/270267/united-states-share-of-global-gross-domestic-product-gdp/

The fact that Italy welcomed its integration into the broader BRI in 2019, means that even advanced industrialized nations are willing to accept economic development aid and perhaps future economic reconstruction aid, even if it comes with the caveats stipulated by the Chinese Communist Party.[2]  Medical aid from China to the Western nations, under the current COVID-19 pandemic, has increased to levels never seen before, confirming that in times of crisis nations and their leaders put aside ideology in order to welcome desperately needed funding.

The United States capitalized on the vulnerability of nations in the post-World War Two reconstruction era and was willing to use its tax-payer money in order to fund the strategic global economic development initiative.  Today, in the absence of U.S. global leadership, China seems to be positioning itself in that role, thus determining the trajectory of the global economy and reaffirming its geopolitical power for the rest of this century.

John Hopkins University, Coronavirus Resource Center. Data up to June 16, 2020. https://coronavirus.jhu.edu/map.html

Our geopolitical position has weakened considerably, not in the past three years, but in the past thirty years as the United States abandoned its nation building plan and exchanged it for a neoliberal model that placed decisions in the hands of the private sector.  Government became a facilitator for the execution and acceleration of the globalization of the market, limiting itself to fighting the battles dictated by private interests while using the power of diplomacy to sign twenty free trade agreements thus far.[3]

There is no long-term plan, just a short-term nationalist hiccup.  There is no national project; nothing to unite us or motivate us, as a society, to push forward together, even under a pandemic and a potential economic crisis.  We do not even have a vision of where is it that we want to be as a nation by the end of this century.  China recognizes this, and therefore sees in this pandemic an opportunity to leap forward in its pursuit of its long-term geopolitical goals.  Meanwhile, we sit idle hoping for a miracle in the next election cycle, but the problem is not ideological but systemic.  No matter who wins, things will remain the same, our bipartisan system does not offer avenues of change but a return to the “great” Twentieth Century.

To correct our path we must revise our mistakes of the past thirty-plus years, and in the absence of a long-term vision and leadership, we must find the answer among the new generations of leaders, not politicians, that have a clear vision of where should we be heading as a nation in the next one hundred years.  If we want to impact the dynamics of the Twenty First Century we will have to reconstruct the economies of the world and we will have to strategically cooperate with China to preserve our own spheres of influence.  Isolating ourselves is too cowardly, and it is not the American way.


[1] In the early 2000s Jim O’Neil, Chairman of Goldman Sachs, and his research assistant, Roopa Purushothaman, coined the term BRICs (not including South Africa which was then added into the list of powerful emerging economies in 2010).

[2] Federiga Bindi. “Why did Italy Embrace the Belt and Roald Initiative?” Carnegie Endowment for International Peace, May 20, 2019.  Accessed June 15, 2020. https://carnegieendowment.org/2019/05/20/why-did-italy-embrace-belt-and-road-initiative-pub-79149

[3] Zero free trade agreements have been signed under the current administration.  “Free Trade Agreements,” Office of the United States Representative.  Accessed June 15, 2020. https://ustr.gov/trade-agreements/free-trade-agreements


Stefano Tijerina

About Stefano Tijerina

My name is Stefano Tijerina and this blog’s objective is to connect Maine’s social, environmental, economic, cultural, and political issues to the global system, centering on how the local impacts the global and how the global impacts the local or what is known in Global Studies as the "Glocal" effect. In our present era of globalization it is crucial for the general public to understand how the new dynamics of the international system impact our lives here in Maine and how our local decisions impact the earth. These are my personal views, and they do not express those of the University of Maine System or the University of Maine.