Principal Kevin Nealer featured in "The International Economy"
Principal Kevin Nealer was featured in the Summer 2016 edition of "The International Economy". His contribution is below.
Health threats in the form of pandemics aren’t a surprise for the global economy, because they are inevitable. What qualifies as surprising is that the international community remains stunningly under-resourced to respond to them. House inaction on a modest Zika funding measure is evidence that health risks don’t become retail politics until it is too late. The entire WHO’s budget remains flat and its contingency funding for global emergencies is just $228 million, half what it was in 2013. Information sharing and coordination among governments remains weak. The tacit learning from Ebola, MERSA, and other outbreaks is that they are hyped as threats. That is true until it is not. CBO estimates a severe pandemic would shave 4.25% off of US GDP; even a mild outbreak could cut US growth by 1% and cost $3 trillion worldwide.
The unexpected contraction of ISIS could reduce terrorisms’ tax on global growth. Prudent planners assume the loss of the “caliphate” means terror risk of the kind experienced in Europe, Turkey, Bangladesh, and Indonesia becomes the new normal. But it is equally possible that the loss of its refuge and most of its revenue deprives ISIS of recruitment, funds, and energy. The late ‘70s and early ‘80s saw a convulsion of terrorist threats from groups like the Bader-Meinhof Gang, Red Brigade, Red Army Faction, and Black September. Despite prediction they would persist and expand, each withered to nothing. What’s different about ISIS? It doesn’t enjoy support from a superpower as an instrument of Cold War brinksmanship. In fact, ISIS has antagonized every government on the planet, and regional actors as diverse as Israel, Iran, and Saudi Arabia. There may be no big peace dividend if ISIS disappears, but that result would require adaptation of US and global security policies that have governed since 9/11.