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Campaign 2000: New World, New Deal: A Democratic Approach to Globalization

W. Bowman Cutter, Joan Spero, and Laura D'Andrea Tyson
March/April 2000
Summary: 

The next Democratic president should build on Bill Clinton's legacy of embracing globalization and easing its downsides. This means developing a new system of global economic relations based on American leadership, open markets, engagement with China and other emerging markets, and stronger multilateral regimes to handle transnational challenges such as the environment, labor rights, and the information economy. A new world will need a global New Deal.

W. Bowman Cutter is Managing Director of Warburg, Pincus and served as Deputy Assistant to President Clinton for Economic Policy. Joan Spero is President of the Doris Duke Charitable Foundation and served as Undersecretary of State for Economic, Business, and Agricultural Affairs from 1993 to 1997. Laura D'Andrea Tyson is Dean of the Haas School of Business at the University of California at Berkeley and served as National Economic Adviser and Chair of the Council of Economic Advisers during President Clinton's first term. They advise Vice President Al Gore's presidential campaign on economic issues.

Letter to the Editor
NEW WORLD, BUM DEAL?
Bernard Wasow
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AN ERA OF FUNDAMENTAL CHANGE

The United States enters the 21st century as the greatest beneficiary of the global system it helped create after World War II. As a power with unrivaled dominance, prosperity, and security, it must now lead the peaceful evolution of this system through an era of significant changes. Rapid shifts in technology and the embrace of markets by developing and formerly communist countries are shifting the balance of power among nations, between nations and nonstate actors, and between nations and global economic forces. New technologies are making the world much more interdependent. These technologies are accelerating the movement of goods, services, ideas, and capital across national boundaries. They are also displacing traditional security threats with nontraditional worries like international terrorism, organized crime, drug trafficking, and environmental degradation while strengthening the capacities of nongovernmental organizations (NGOs) to influence policy. Tension is mounting between the fixed geography of nation-states and the nonterritorial nature of global problems and their solutions.

The United States cannot shield itself from the effects of globalization. In today's interdependent capital markets, global perceptions of the stability of the American economy and the credibility of American economic policy can significantly affect the dollar's value and domestic interest rates. Despite its economic and military might, the United States cannot protect itself from global environmental problems like ozone depletion, climate change, and threats to biodiversity by acting alone.

The international economic challenges facing a new American president are twofold: first, to grasp the fundamental changes in the global economy, and second, to respond by fostering the conditions and institutions required for a world in which the United States can remain secure and prosperous. The central task of international economic policy is to help develop a new system of global economic relations -- a task made essential, rather than simply desirable, by the enormous and irreversible changes now sweeping the world.

THE TRANSITIONAL 1990S

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