The Case for Regionalism in a Post-Coronavirus World

The lingering COVID-19 scourge continues to devastate the global economy. Initial fears of an impending supply chain shock, arising from shuttered Chinese factories, have instead led to a moth-eaten global economy where rising supply is met with depreciating demand and vice versa. To make matters worse, COVID-19 relief funds — amounting to trillions of dollars in the West alone — have ended up benefiting the rich instead of the poor.

COVID-19 has merely acted as an accelerant — and not the cause — of our foundering global economy. Even fears over a "second wave" will not prevent mass demonstrations, riots, and socio-economic paralyzes in our quixotic "future-proof" cities that are already trembling with the rage of many.

Because of the need for scalability, next-gen governance models should be people- and region-centric. Regions like Scandinavia and the Baltics and the Association of Southeast Asian Nations — which had weathered the COVID-19 crisis remarkably well — are arguably better poised to handle the varied challenges ahead. The circumstances in various regions naturally differ.

But will governments, ossified by age-old bureaucratic traditions, be willing to tap into the synergies of people-centric regionalism?

The lingering COVID-19 scourge continues to devastate the global economy. Initial fears of an impending supply chain shock, arising from shuttered Chinese factories, have instead led to a moth-eaten global economy where rising supply is met with depreciating demand and vice versa. To make matters worse, COVID-19 relief funds — amounting to trillions of dollars in the West alone — have ended up benefiting the rich instead of the poor. Micro, Small, and Medium Enterprises (MSMEs), which were ostensibly prioritized for pandemic relief, are now bankrupting in their thousands each month.

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As seen in riots and wantons acts of thuggery throughout the United States, the inevitable social backlash was anticipated in previous studies of mine. It will spread worldwide as economies wilt. COVID-19 has merely acted as an accelerant — and not the cause — of our foundering global economy. Even fears over a "second wave" will not prevent mass demonstrations, riots, and socio-economic paralyzes in our quixotic "future-proof" cities that are already trembling with the rage of many.

The "Great Reset" anticipated by the World Economic Forum (WEF) seems as certain as its myriad failed forecasts and panaceas. The "global governance" it desperately touts smacks of a Soviet Union with a Techno-Potemkin facade. Many who had lived behind the Iron Curtain may not feel too nostalgic about the long queues, restricted movements, pervasive surveillance, and the Orwellian censoring of free speech that has returned behind the stalking horse of a pandemic.

Governments grappling for solutions will sooner or later realize that globalization is a construct that failed. Part of the problem lies with questions over "who calls the shots" and "where are they called from"? It ignores Maslow's Hammer's general caution, where conditioned biases lead to Sisyphean problem-solving through the same faulty framework.

Proponents of "global governance" face another problem: Every governance structure needs a functioning center. Nations and supranational blocs (e.g., Brussels/EU) have capitals. Global governance, which remains a concept, has nothing of the sort. Its center floats freely in the exclusivist ether of the transnational capitalist class (TCC), pulled only by the concentrated capital's fluidic forces. Technocrats can be appointed to front TCC policies and organizations in order to serve their interests. At present rates, wealth fractionation will exacerbate further, straining societies in desperate need of socio-economic stability.

Supply Chains and Governments

COVID-19 has exposed the myopia and fragility underlying our worldwide supply chains. Take the global healthcare ecosystem, for instance. When COVID-19 struck, India — a traditional pharmaceutical powerhouse — was sourcing 70% of its active pharmaceutical ingredient (API) imports worth $2.4 billion from China. The figures appear worse for the US. According to a recent CFR blog, about 97% of all US antibiotics were sourced from China, on top of 80% of APIs used in local drug production. To make matters worse, both the US and India are engaged in a severe geopolitical logjam with China. Imagine the consequences of a full-scale trade war?

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The levers of global supply chains are in the hands of the TCC rather than with governments. This is a direct consequence of widening global income gaps and a rapidly shrinking middle class. There is a very pecuniary reason why many billionaires are philanthropists who routinely muscle into traditional areas of taxpayer-funded social provisions such as healthcare, education and poverty alleviation. The source, means of production and supply chains are controlled by and arbitrated between them. Globalization has produced a rigged market.

In the meantime, people worldwide, sans malcontents in need of a revolution, are bracing themselves for tough times ahead. If governments can trim themselves down through the right mix of priorities, citizens may likewise concede to tightening their belts over the near future. Sub-contracting an army of Internet censors and thought commissars is not a social priority; healthcare, education, and jobs certainly are. Many jobs will inevitably be lost during this decade. However, the years ahead can be a real reset period where workers can be retrained for the industries of tomorrow.

The first order of business, therefore, should be in ensuring the integrity of critical supply chains. Elected officials cannot play dice with basic necessities like food, medicines, clothing, public transportation, and the assorted nuts and bolts of daily societal functions. A repeat of faulty personal protection equipment (PPE) that swamped the world in the aftermath of the COVID-19 outbreak must be avoided. Supply chains should be shorter, less prone to exogenous risks, and must be dictated by long-term strategic imperatives rather than economics. (For a rough analogy, it can be broadly argued that the Soviet Union had prevailed over Nazi Germany in WWII partly because its supply chains were internally-sourced for the most part).

If critical supplies cannot be sourced internally, they should be acquired from the "near-abroad," i.e., within the region. This, in turn, will promote regional stability in a highly-anticipated VUCA decade (2020–2030) [1] .

The Role of Quadruple Helix Regionalism

Public policies should be re-modeled for its original purpose — to serve the public. For far too long, the rhetoric here has been drifting perilously away from reality. When it is not aggravating income inequality, globalization has exposed nations to exogenous risks at the expense of regional synergies. The COVID-19 saga, along with ham-fisted lockdowns, is one unintended consequence. The provision of basic necessities during this period became a government responsibility. Automatic responses, without the benefit of pre-emptive risk foresight, lead to systemic socio-economic exhaustion.

To prevent contretemps like these in the future, an alternate governance model is needed. It should include the citizen as a stakeholder in the national and regional policy processes. This can be effectuated through a net-centric quadruple helix model, as shown in the figure below.

Governance Transition: Traditional-National vs. Citizen-Technocrat Regional Models

With the citizen as an equal stakeholder and the public and private sectors and academia, policy formation and societal risks become a shared responsibility. Crowdsourced Delphi (E-Delphi) and foresight can be used to refine and execute publicly-generated ideas for various national and regional needs.

Sooner or later, intelligence gathered for any quadruple helix-based issue within the PESTLE spectrum would necessitate Big Data Analytics (BDA). Rising levels of governance-related complexities are inevitable but need not necessarily lead to runaway cul-de-sacs that typify the current global order. (Most global think tanks, for example, lack blogs or expert columns to tap into ideas from the public domain).

Various scalable governance models towards this end have already been conceptualized in anticipation of this VUCA decade. The author himself had formulated one for his doctoral thesis. Researchers linked to the Finland Futures Research Centre and Lithuania's Kazimieras Simonavicius University have been working on regional innovation models underpinned by Big Data and foresight.

At the end of the day, the ideas are there in the public domain to see us through this turbulent decade. The public is there to generate those ideas, and experts are available to refine and execute appropriate policies. Because of the need for scalability, next-gen governance models should be people- and region-centric.

Regions like Scandinavia and the Baltics (which the author collectively calls "SCANBALT") and the Association of Southeast Asian Nations (ASEAN) — which had weathered the COVID-19 crisis remarkably well — are arguably better poised to handle the varied challenges ahead. The circumstances in various regions naturally differ. While SCANBALT has an enviable level of cultural cohesiveness and technological know-how, ASEAN can be the beneficiary of industries moving out of China. Eastern European nations may likely seek a sub-regional compact in order to avoid the discombobulations of its Western counterparts in the European Union.

But will governments, ossified by age-old bureaucratic traditions, be willing to tap into the synergies of people-centric regionalism?

1. Maavak, M. (2021). Horizon 2020-2030: Will Emerging Risks Unravel our Global Systems? Accepted for publication. Salus Journal, Issue 1 2021.