Abandoning globalization is a sure path to immiseration | Do we blame trade — or the fact that the United States addresses disruption very poorly?

# The “globalization makes supply chains more brittle” argument is bogus

> The lesson policymakers in Washington took out of this was that far-flung supply chains were perhaps too fragile. “Reshoring” production — bringing it home — would buttress our economic resilience. But events also lend themselves to an alternative interpretation: that [the global supply chains built over the past several decades are essential to maintain economic stability](https://www.imf.org/en/Publications/fandd/issues/Series/Analytical-Series/Globalization-Resilience-Mishra-Spilimbergo).

> There is much hanging on the survival of globalization. The battle against climate change, for starters, will likely be lost without it. The tariffs the Biden administration has deployed against imports of Chinese clean energy technologies, which are more than likely to remain in place, if not grow, during a second Trump presidency, will hinder the transition away from fossil fuels.

> Nixing globalization will, in fact, stymie the main forces undergirding the innovation that has fueled the nation’s remarkable run of prosperity: its ability to draw investment capital and top talent from around the world — which has propelled productivity growth way ahead of its peer nations.

# The “globalization increases inequality” argument is bogus

> For all its flaws, the narrative that globalization has sacrificed broad-based prosperity to serve the interests of multinational corporations and the oligarchs at their helm is ultimately wrong. Yes, the American social contract is deeply flawed. It has produced the most unequal society in the affluent world, exhibiting symptoms of social dysfunction unheard of in other developed nations. But hanging these ills on globalization lets us off the hook.

> America suffers from its inability to provide public goods and mitigate the negative consequences of the economic disruption that has been central to its overall success.

> Globalization is among the disruptive forces shaking the working class. But the United States isn’t even particularly exposed to globalization’s disruption. Many countries that are more plugged into the global economy exhibit fewer of the ills that afflict American society. Disconnecting the U.S. economy from the world will do nothing to fix them.

# The “China shock” argument is bogus

> For starters, the China “shock” was small-bore and localized. Trade with China has been, on average, [positive for the United States](https://www.annualreviews.org/content/journals/10.1146/annurev-economics-082222-082019). The hit to manufacturing jobs was undoubtedly painful in some regions, particularly in the South. But the shock is impossible to detect in the nationwide trend of manufacturing employment, which has been declining as a share of total jobs for more than half a century, driven by increasing automation.

> What’s more, factory jobs are no longer the key to a successful American society. Nostalgia is understandable. But economic policy designed to mitigate globalization’s impact on manufacturing employment hopes to re-create the past rather than build a future. [Manufacturing jobs have been declining as a share of employment in many countries](https://www.ft.com/content/aee57e7f-62f1-4a57-a780-341475cd8f89), including the United States and China. The trend is unlikely to stop, regardless of whether Washington withdraws from globalization or not.

> That’s not only because robots can do the job better. It’s also because manufacturing is no longer the central activity in a modern economy. To build an effective policy to improve the lot of the working class, policymakers must drop their infatuation with factory jobs and focus on the industries that matter: largely services, which account for the lion’s share of employment.

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