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Failing future fast forward
Everything is happening so fast that we feel as if the future is being compressed into the present at frightening speed. Conservatives hark back to the golden age of stability and gradual change. Liberals hate the current inequalities but cannot agree on how to change things. But if technology is moving at Moore’s Law of exponential growth, then knowledge and complexity are expanding too fast for most of us to comprehend and decide how to cope with an unknown future.
Sociologist Mauro Guillen at the Wharton School has given his projections in the book 2030: How today’s Biggest Trends will collide and Reshape the Future of Everything. All the big trends, macro and micro, will shape the future. The biggest trends are demographic—how rich countries are aging and poor ones are growing—but these numbers will push migration that creates border wars. At the same time, women will grow richer and the Asian middle class will edge out the European and American middle class. Climate change will threaten cities through rising sea levels, and water and food shortages. Technology will be the new tool to solve problems, but job disruption is a major political threat. We may no longer need to own anything, but subscribe to or rent cars, houses and smart gadgets, simply to keep up with the technology. Money will shift to digital currencies and finance will be very different with zero interest rates.
These trends are well known. In 2017, the US National Intelligence Council publication “Global Trends: Paradox of Progress (to 2035)” and the EU study titled “Global Trends to 2035”, conducted thoughtful reviews of the future seen from their perspectives. Macro-trends that converge at unprecedented pace will make governing and cooperation harder, fundamentally altering the global landscape. Both studies recognise that conflict risks will grow, because the world is increasingly fractured between ageing and shrinking rich, and growing young, poor and unemployed, packed into over-crowded cities that are ready to explode.
The US study surmises that the 2035 world will splinter into national “islands”, regional “orbits”, and sub-state and trans-national “communities” that will interact to make global and national governance harder. Interestingly, it predicted that “the global pandemic of 2023 dramatically reduced global travel in an effort to contain the spread of the disease, contributing to the slowing of global trade and decreased productivity.” They foresaw the pandemic, except it happened three years earlier, and they bungled its management.
In contrast, the EU study focused on four possible scenarios: (1) Sick men of Europe: unstable Europe in stable world; (2) Cold War: stable Europe in stable world; (3) Hollow foundations: unstable Europe in unstable world; and (4) Europe as Global Power: stable Europe in unstable world. Europe knows it has to get its act together.
But what has the Covid-19 pandemic taught us so far?
First, the pandemic was mismanaged globally, with “UBRIC” epicentres, namely, US, Brazil, Russia, India and Colombia, having the highest infections and mortality rates. Europe and Africa are still adjusting and East Asia, being the first to be hit, was the first to control and economically recover. The coronavirus has its own timetable and if its spread is not properly controlled, the economy will suffer for longer.
Second, the global system is now more complex and harder to govern. If a 3x3x3 Rubik’s Cube game has 43 quintillion (10 to the power of 19) possible permutations, we realise that seven or more key players interacting with each other at “island”, national and regional “orbits”, and transnational “communities” levels means that everything is possible, which is exactly why we are in the current mess.
We have sick men running sick economies in a pandemic that is out of control. Both leaders and economies are surviving on steroids. No one can think long-term. All are reacting short-term rather than dealing with the important long-term consequences.
With top leaders and their inner circle infected, new factors emerge every day that change the direction of the game profoundly. Coronavirus has turbo-charged “future fast forward” and hastened existing trends, pushing the shift to online faster as well as killing off dying or obsolete industries.
Basically, hardware can be obsolete and expendable, but people are dying, which is why we need to teach them to become more resilient and adaptable to rising risks and threats. In short, invest in people, their health, education and in re-skilling them to address technological, employment-related, military and natural threats. Be smart and we will survive and thrive. Dumb us down and die.
Two important studies show how investing in hardware is less effective than investing in people. Jorda, Schularick and Taylor (2017) discovered that between 1870-2015, risky real returns on equity and real estate averaged seven percent per year, whereas safe returns averaged one to three percent per year, and these have been declining with lower productivity. What financialisation has done is to distort the rate of return, favouring the rich and actually slowing down productivity and the growth rate.
A World Bank study on 139 countries since 1950 showed that the average rate of return on education is nine to ten percent per year, with private returns on low-income primary education as high as 25 percent.
Simply put, the best investment in current volatile times is to invest in our people. The world is not facing a trade war, it is facing a talent war. Because East Asia has invested more in the last four decades in their young, teaching them to act cooperatively rather than to engage in narcissistic individualism, the region has been able to handle the pandemic better than other regions and catch up with technology and industries. It is not about democracy or freedom, but about inclusive education in the common sense.
If people and the planet are recognised as one, then the young will learn how to take care of other people and contribute to our common home, the planet, as Pope Francis emphasised in his encyclical Laudato Si . Politics and morality are people’s issues.
Future threats and opportunities are coming at us fast and furious. Future fast forward is not about denial and who is to blame. Throughout the ages, humanity has survived calamities because the community taught the young common sense and survival skills. That is the true mission for surviving and thriving beyond this pandemic.
Andrew Sheng is an honorary adviser with the CIMB Asean Research Institute and a distinguished fellow with the Asia Global Institute at the University of Hong Kong. He writes on global issues for the Asia News Network (ANN), an alliance of 24 news media titles across the region, which includes The Daily Star .