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Why COVID was bad for New York but good for Boise

The pandemic helped kill globalism and strengthen regional economies.

An empty street framed One World Trade Center in downtown New York on March 22, 2020.Wong Maye-E/Associated Press

There’s something very American about the intersection of individual autonomy and physical space. Our homes are larger, our vehicles are larger, our states are emptier. Even excluding Alaska, the contiguous United States has a population of about 330 million people in an area of 3.12 million square miles — about 105 people per square mile, or 260,000 square feet per person. The European Union, by contrast, houses 447 million people in 1.63 million square miles. That’s 274 people per square mile, or 100,000 square feet per person.

What that means, in practice, is that we can expand in ways that Europeans simply can’t. If people find New York to be too crowded when a pandemic hits, they can — and did — move to Boise, a city where house prices rose by 50 percent after COVID created a work-from-home economy.


European cities responded to the pandemic by revamping shared infrastructure — banning cars from the center of Paris, for instance, given how much space they take up, and replacing them with bustling bike lanes and wider pedestrian boulevards. “Streets for people,” as the slogan has it, rather than “streets for traffic.”

In the United States, on the other hand, COVID generally pushed people in the opposite direction: into cars, rather than out of them. Cities such as Boston and New York replaced some on-street parking with outdoor dining, but that was about the extent of the reorganization of public space in America as a result of the pandemic.

The effect on personal space was much more profound. Pre-pandemic, urbanists like the University of Toronto’s Richard Florida liked to talk about how the world was spiky: People and money and power and creativity tended to congregate in dense cities that exhibited winner-takes-all effects. Post-pandemic, the world was very much still spiky, but noticeably less so. The locus of workspaces moved out of central business districts and into individual homes, which could be anywhere. Midtown Manhattan and other places that used to have the highest density felt empty, while second- and third-tier cities like Austin or Boulder became ultra-popular and more crowded than ever. Broadly speaking, what we saw was both space per person and wealth per acre becoming more evenly distributed than they were before.


That’s probably good news for the United States as a whole. It means that talent no longer needs to move to one of a handful of cities in order to be able to make a big difference. More to the point, it means that talent doesn’t need to afford to be able to live in Boston or Silicon Valley or New York City anymore. It means that businesses are now more flexible when it comes to accommodating and getting the best work from a wide range of talented potential employees. It means that locally based service-industry professionals can make a good living in a much wider range of towns and cities. And it means that Americans as a whole — a nation where people love being able to spread out into large amounts of personal space, especially after they’ve started a family — now have more opportunity than ever to do just that.

There are downsides, too. Environmentally, all that personal space comes at a significant cost in terms of carbon footprint. Spreading out means more vehicle miles traveled, as well as more embedded carbon in larger buildings. It’s also possible that some of the benefits and serendipity of density might end up being lost — although, by the same token, those benefits could end up just being found in a larger number of cities.


There will definitely be an adjustment period as American capitalism recalibrates itself for the new spatial realities. There are undeniably advantages to having industries based in certain cities, just as there are advantages to being able to have impromptu in-person meetings or being able to learn how to do your job better by observing the people around you.

Still, the great shakeout has made many US regional economies much more productive than they were pre-pandemic, and that in turn makes the entire country more competitive on an international stage that was badly fractured by COVID.

The pandemic did major damage to international supply chains, throwing up barriers that had been coming down for decades. National supply chains, on the other hand, especially within the United States, were much less badly hurt. So a continent-sized country like the United States ended up with a significantly bigger advantage over its smaller competitors than it had pre-pandemic.

For globalists, after all, the pandemic was a true tragedy, one that set the internationalist dream back by decades. Before COVID struck, China and Russia were deeply embedded in a single global economy, to a degree never before seen in the history of the world. Then China implemented a zero-COVID policy that effectively stopped anybody entering or leaving the country, while Russia cut itself off from the West by invading Ukraine. By early 2022, the dream of a single global market had been entirely replaced by a new reality of onshoring and nationalisms.


Much of this is for the good, especially at the corporate level. Resilient local supply chains are going to prove their worth many times over in an age of global warming and increased geopolitical unrest. A focus on local communities over ill-defined global stakeholders will ground institutions of all stripes and head off a mindset that if you’re not the best in the world at something, you might as well not bother. The move away from a world of interchangeable raw-wood tables and third-wave coffee and toward some measure of idiosyncrasy, can only be welcomed.

It would be silly, however, to gloss over the serious downsides. We know from the history of “import substitution” in Brazil and other Latin American countries — that region’s 1950s version of onshoring — that attempts to do everything domestically can be disastrous and set economies back decades. On a global scale, free trade has helped to grow global GDP and reduce inequality between countries; if it’s rolled back, that’s going to have unavoidable negative financial consequences.

That said, there’s something attractive about the idea of today’s quasi-stateless international corporations being forced to pick a country and stick with it, through good times and bad. The jurisdiction-shopping days when Halliburton would decide that it was moving to Dubai, or Burger King to Canada, are probably over and are unlikely to be mourned by many.


Globalism lies in ashes, killed by much more than just COVID, although COVID was definitely part of the fatal cocktail. The phoenixes that rise from those ashes will be many, not just one. A thousand creatures will attempt to take flight, and many — possibly most — will fail, or will at least look small and weak in comparison to the world-encompassing wingspan of their predecessor.

I suspect, however, that more will prove better. Globalism was a one-size solution that ended up fitting almost nobody very well. The post-global world will have more resilience, more variety, and — if it goes well— more responsiveness to local needs. Global warming is the one area where the planet needs to get on the same page, fast. But most problems are local problems — and local problems often lend themselves to local solutions, even if those solutions don’t scale globally. Which is a big point in favor of smaller regional phoenixes.

Adapted with permission from “The Phoenix Economy: Work, Life, and Money in the New Not Normal,” by Felix Salmon, a journalist who is the chief financial correspondent for Axios.