JACKSON, Wyo. -- Federal Reserve chairman Ben Bernanke cautioned lawmakers yesterday to avoid the temptation to impose protectionist trade policies as the United States grapples with fierce competition from globalization.
Globalization has shrunk the world and made countries increasingly connected through economic ties. The opportunities for companies to sell their goods to more and more countries can generate wealth and boost living standards. That has benefited some workers, but has hurt those left behind in the changing worldwide economic landscape.
``Further progress in global economic integration should not be taken for granted," Bernanke told an economics conference that explored the forces of globalization.
``Geopolitical concerns, including international tensions and the risks of terrorism, already constrain the pace of worldwide economic integration and may do so even more in the future," he told the meeting organized by the Federal Reserve Bank of Kansas City.
Bernanke's remarks came amid higher trade tensions between the United States and China, and as global trade talks have stalled. Americans also are increasingly anxious about the potential of losing their jobs to China and India.
Against that backdrop, US lawmakers -- as they have through the years -- may be tempted to enact protectionist measures to try to slow globalization.
``The challenge for policy makers is to ensure that the benefits of global economic integration are sufficiently widely shared -- for example, by helping displaced workers get the necessary training to take advantage of new opportunities," Bernanke said.
``The emergence of China, India, and the former communist-bloc countries implies that the greater part of the earth's population is now engaged, at least potentially, in the global economy," he said. ``There are no historical antecedents for this development."