We can tackle climate change, jobs, growth and global trade. Here’s what’s stopping us

We must leave behind established modes of thinking and seek creative workable solutions.

Another tumultuous year has confirmed that the global economy is at a turning point. We face four big challenges: the climate transition; the good-jobs problem; an economic-development crisis, and the search for a newer, healthier form of globalization.

To address each, we must leave behind established modes of thinking and seek creative workable solutions, while recognizing that these efforts will be necessarily uncoordinated and experimental.

Climate change is the most daunting challenge, and the one that has been overlooked the longest — at great cost. If we are to avoid condemning humanity to a dystopian future, we must act fast to decarbonize the global economy. We have long known that we must wean ourselves from fossil fuels, develop green alternatives and shore up our defenses against the lasting environmental damage that past inaction has already caused. However, it has become clear that little of this is likely to be achieved through global cooperation or economists’ favored policies.

Instead, individual countries will forge ahead with their own green agendas, implementing policies that best account for their specific political constraints, as the United States, China and the European Union have been doing. The result will be a hodge-podge of emission caps, tax incentives, research and development support, and green industrial policies with little global coherence and occasional costs for other countries. Messy though it may be, an uncoordinated push for climate action may be the best we can realistically hope for.

Inequality, the erosion of the middle class, and labor-market polarization have caused significant damage to our social environment.

But our physical environment is not the only threat we face. Inequality, the erosion of the middle class, and labor-market polarization have caused equally significant damage to our social environment. The consequences are now widely evident. Economic, regional, and cultural gaps within countries are widening, and liberal democracy (and the values that support it) appears to be in decline, reflecting rising support for xenophobic, authoritarian populists and the growing backlash against scientific and technical expertise.

Social transfers and the welfare state can help, but what is most needed is an increase in the supply of good jobs for the less-educated workers who have lost access to them. We need more productive, well-remunerated employment opportunities that can provide dignity and social recognition for those without a college degree. Expanding the supply of such jobs will require not only more investment in education and more robust defense of workers’ rights, but also a new brand of industrial policies for services, where the bulk of future employment will be created.

The disappearance of manufacturing jobs over time reflects both greater automation and stronger global competition. Developing countries have not been immune to either factor. Many have experienced “premature de-industrialization”: their absorption of workers into formal, productive manufacturing firms is now very limited, which means they are precluded from pursuing the kind of export-oriented development strategy that has been so effective in East Asia and a few other countries. Together with the climate challenge, this crisis of growth strategies in low-income countries calls for an entirely new development model.

Governments will have to experiment, combining investment in the green transition with productivity enhancements in labor-absorbing services.

As in the advanced economies, services will be low- and middle-income countries’ main source of employment creation. But most services in these economies are dominated by very small, informal enterprises — often sole proprietorships — and there are essentially no ready-made models of service-led development to emulate. Governments will have to experiment, combining investment in the green transition with productivity enhancements in labor-absorbing services.

Finally, globalization itself must be reinvented. The post-1990 hyper-globalization model has been overtaken by the rise of U.S.-China geopolitical competition, and by the higher priority placed on domestic social, economic, public-health, and environmental concerns. No longer fit for purpose, globalization as we know it will have to be replaced by a new understanding that rebalances national needs and the requirements of a healthy global economy that facilitates international trade and long-term foreign investment.

Most likely, the new globalization model will be less intrusive, acknowledging the needs of all countries (not just major powers) that want greater policy flexibility to address domestic challenges and national-security imperatives. One possibility is that the U.S. or China will take an overly expansive view of its security needs, seeking global primacy (in the U.S. case) or regional domination (China). The result would be a “weaponization” of economic interdependence and significant economic decoupling, with trade and investment treated as a zero-sum game.

The biggest gift major powers can give to the world economy is to manage their own domestic economies well.

But there could also be a more favorable scenario in which both powers keep their geopolitical ambitions in check, recognizing that their competing economic goals are better served through accommodation and cooperation. This scenario might serve the global economy well, even if — or perhaps because — it falls short of hyper-globalization. As the Bretton Woods era showed, a significant expansion of global trade and investment is compatible with a thin model of globalization, wherein countries retain considerable policy autonomy with which to foster social cohesion and economic growth at home. The biggest gift major powers can give to the world economy is to manage their own domestic economies well.

All these challenges call for new ideas and frameworks. We do not need to throw conventional economics out the window. But to remain relevant, economists must learn to apply the tools of their trade to the objectives and constraints of the day. They will have to be open to experimentation, and sympathetic if governments engage in actions that do not conform to the playbooks of the past.

Dani Rodrik, professor of international political economy at Harvard Kennedy School, is president of the International Economic Association and the author of Straight Talk on Trade: Ideas for a Sane World Economy (Princeton University Press, 2017).

This commentary was published with the permission of Project Syndicate — Confronting Our Four Biggest Economic Challenges

More: Biden administration’s antitrust victories are much-needed wins for consumers

Also read: ‘Dr. Doom’ Nouriel Roubini: ‘Worst-case scenarios appear to be the least likely.’ For now.

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It’s open enrollment season for health coverage. If you’re self-employed, you can’t afford to ignore it

Open enrollment season can be a time of trepidation for the self-employed

The stakes are especially high because if you need to buy individual or family coverage, the next few weeks could be your only chance for 2024, barring certain exceptions such as moving to a different state, getting married, divorced or having a child. 

“For most people, the nationwide open enrollment period for individual and family coverage is your best shot to review your options and enroll in a new plan,” explained Anthony Lopez, vice president of individual and family and small business plans at eHealth, a private online marketplace for health insurance, in an email.

More from Year-End Planning

Here’s a look at more coverage on what to do finance-wise as the end of the year approaches:

Picking health insurance on your own — without the help of a human resources department — can be daunting. Instead of throwing up your hands in frustration, here are answers to questions self-employed individuals often have about open enrollment.

Healthcare.gov and other options for information

Freelancers, consultants, independent contractors and other self-employed individuals can visit www.healthcare.gov to research and enroll in flexible, high-quality health coverage, either through the federal government or their state, depending on where they live. You can also choose to work directly with an insurance agent or with a private online marketplace to help you wade through options. To be considered self-employed, you can’t have anyone working for you. If you have even one employee, you may be able to use the SHOP Marketplace for small businesses

The deadlines you need to stay on top of

Most states set a deadline of Dec. 15 for coverage that begins Jan. 1, so don’t delay when it comes to signing up for benefits, said Alexa Irish, co-chief executive of Catch, which helps self-employed individuals choose health-care plans. Also, remember to pay your first month’s premium before your health care is supposed to start or you’ll be out of luck as well. “If you miss those deadlines, there’s no wiggle room,” said Laura Speyer, co-CEO of Catch.

If you are already enrolled in a marketplace plan

Those who were already enrolled in a plan last year can make changes by Dec. 15 for coverage that begins Jan. 1. Doing nothing will mean they are automatically reenrolled in last year’s marketplace plan. 

Qualifying for tax credits and other savings

Many people assume they won’t be entitled to savings, but they should still investigate their options, Irish said. Indeed, 91% of total marketplace enrollees received an advance premium tax credit in February 2023, which lowers their monthly health insurance payment, according to data from the Centers for Medicare & Medicaid Services, a federal agency within the U.S. Department of Health and Human Services.

Credits and other eligible savings are available based on an applicant’s income and household size and can be estimated even before they officially apply. It’s advisable to check for savings possibilities every year, Irish said.

What to consider in making coverage decisions

The thought process will be similar to what you went through when picking health insurance offered by an employer. Whether you are signing up for the first time — or deciding whether to renew your existing plan or choose a different one — you’ll want to consider factors such as who in the family needs the coverage and for what purposes, and how different plans compare in terms of coverage options and cost. This analysis needs to take into account copays, prescription drugs you take or may start to take, whether the plan covers your doctors, and out-of-pocket maximums. 

If you’re self-employed and aiming to grow your business in the coming year, possibly by hiring employees, it’s good to know you can enroll in a small business plan at any time of the year, Lopez said. “Small business group plans aren’t governed by the same open enrollment rules as individual and family plans. So, you can enroll in an individual plan today, then switch over to a group plan in mid-2024 if you add a couple employees and want to provide them with health benefits,” he said.

How much health insurance costs the self-employed

Cost will vary, depending on the plan you choose, who is covered and what subsidies you’re eligible for. But, as a general guide, the average total monthly premium before tax subsidies in February 2023 was $604.78. The average total premium per month paid by consumers after the tax subsidies was $123.69, according to the Centers for Medicare & Medicaid Services.

Self-employed individuals may also be eligible for a cost-sharing reduction, a discount that lowers the amount paid for deductibles, copayments and coinsurance. You’ll find out what you qualify for when you fill out a marketplace application, but keep in mind, you need to enroll in a “Silver” plan, one of four categories of marketplace plans, to get the cost-sharing reduction. 

Wading through policy options, working with an agent

You don’t have to go through the process alone. There are assisters who are trained and certified by marketplaces to help you apply and enroll. If you want more specific help, you can also choose to work with an agent or broker who is trained and certified to sell marketplace health plans in the state they are licensed. Agents can advise you and give you more detailed information about the plans they sell, and since health insurance premiums are regulated by your state’s Department of Insurance, you don’t have to worry about paying more by working with an agent.

A few things to note: Some agents may offer other plans that aren’t available on government exchanges, but that comply with government requirements. However, to take advantage of a premium tax credit and other savings, you must enroll for a plan through a state or federal marketplace, on your own or through an agent. 

The risk and reward of high-deductible plans

Marketplaces offer multiple plans to choose from and they will vary in terms of coverage and price. One option that’s becoming more popular, especially with young entrepreneurs, is called a high-deductible health insurance plan. This type of insurance plan comes with higher deductibles in exchange for lower premiums, which could be a good choice for people who are healthy and don’t visit the doctor much. Another benefit of a qualified high-deductible plan is the ability to contribute to a tax-advantaged savings vehicle known as a health savings account, or HSA. 

When deciding whether to choose a high-deductible plan, individuals should take into account factors such as how often they visit the doctor, how much they can afford to pay out of pocket, whether their doctors are in network and what the out-of-pocket maximums are. It’s also important to know you have the means to cover a high-cost medical event, should the need arise. If a high-deductible plan makes sense for your circumstances, you can then consider an HSA.

Lopez recommends people don’t delay when it comes to reviewing their coverage options, which may also include dental and vision insurance. “The last week or so of open enrollment can be a busy time for licensed agents too; if you want the best chance of talking to an agent to get your personal questions answered, don’t put it off.”

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