The Challenge Network

   go back   

The time frame of events

The time frame of events

The previous section set out the grounds for the new scenarios. We developed the axes of diagram which is shown below, and showed how this related to and grew from the previous set of scenarios. We made the point that the trajectory that the scenarios followed was crucial. Here, we blur these lines, to emphasize the uncertainty of both timing an agency. The two scenarios, New Deal and Broken Edge, are described in detail in separate papers. Here, we review the time frame of events that leads to their realization.

The scenarios have grown organically from the previous cases, Pushing the Edge and Renewed Foundations. The names reflect this. Broken Edge is, however, unequivocally a more challenging world in which to live that its predecessor. New Deal will be reached only through much perhaps inadvertent pain and conscious effort. For reasons which we have already explored, there is no room for a 'business as usual' scenario and whatever we do - or fail to do - will build our future on new ground.

The scenarios dynamics offer considerable latitude, both in timing and trajectory, as suggested by the blurred lines on the figure. Some nations and activities will move at one speed, some at another. World economic performance is shown from 1900, with two general paths to 2025. These should be taken more as indicative of the overall timeframe, pace of onset and intensity of event than literal growth rate projections. Blunted Edge is shown to have historically high initial growth rates in part from the enthusiastic uptake of technology and capital by the industrialising countries, and in part as a metaphor, to underline the impact of fast economic change of social factors. The New Deal pattern reverses the long-term decline that has occurred since WWII. This may be due as much to institutional sclerosis as to over-consumption. It is worth noting that consumption can be private or public, just as investment can be, and that large-scale public expenditure on externalities such as geriatric care and the natural world are a form of (laudable) consumption, which cannot be expected to generate tradable wealth.

Timelines

Timelines

Readers may find it helpful to read the detailed scenario descriptions before delving into these detailed time lines. The table is split into red and blue rows, which refer to the two scenarios. Red rows relate to Broken Edge, blue to New Deal. The bars in these rows show when the issue has its chief impact, with the thickness of the bar suggesting the strength of this. To give and example of how to read this, the row related to demographic change has a similar time-frame between the two scenarios, but the impact of it is stronger in the early years of New Deal than Broken Edge. This is because New Deal suffers early economic and institutional difficulties, in which demographics play an important role.

 
  2005 2010 2015 2020 2025
Issues internal to the rich nations
Demographic change          
         
Pressure on welfare budgets          
         
Acute difficulties with public governance          
         
Reactionary-claimant political parties          
         
Significant institutional change          
         
Dominant role for knowledge economy          
         
Reliance on international outsourcing          
         
Acute human resource shortages          
         
Mass acceptance of guest workers          
         
Issues internal to the industrialising nations
Demographic bulge seeks jobs          
         
Influential consumerist social groups          
         
Influential reactionary groups          
         
Acute issues of security and policing          
         
Political instability          
         
Institutional upgrade and political stability          
         
Issues of transnational relations
Open trade and lessened tariff barriers          
         
Block formation and decreased openness          
         
Meaningful intl. consultative organisations          
         
Meaningful intl. management of capital flows          
         
Effective policing of international accords          
         
Acute security difficulties          
         
 

Within the industrial nations, three fundamental trends need to be monitored.

First, the nature of the economy is changing: it deals increasing with intangibles, which we neither know how to measure or to systematise; and the individual organisation is increasingly "permeable" to its collaborators, scrutineers, regulators, customers and critics. Any one of these stakeholders can and do impose additional layers of complexity on management. The demands of management are, therefore, undergoing swift and parallel change. Able people need to be enabled to spot opportunities, not directed to tasks. Common sense assessments are needed in place of accounting rigor; but fantasy and bubble-creation need to be curbed. Renewal has to be built on the foundations of what has gone before, where such structures owe as much to brand as to technology, to established regulatory relationships as to tangible capacities.

Some two billion graduates will be alive in 2020, connected by the extraordinary IT and other systems of the time. The industrial world population will be something over a billion, with about half of those people dependent on others, chiefly through age. It will be hard to maintain the relative economic position of the old nations. Newly industrialised countries will have their own agendae, and will certainly challenge established positions. The "old industrial nations" will have to live on their knowledge base and their web of tacit infrastructure built on trust, interlinkage and insight. Their public sector systems will have to be at least as able as commerce in adapting itself to this world.

Second, the capacity to take choices in the public domain is likely to become a critical limitation if current trends continue. There are three basic issues that need to be addressed.

The vast ocean of knowledge on which sound policy can be based lies well outside of government. The possession of such knowledge does not come with a guarantee of finality or even of closure - indeed, the opposite is always true amongst experts - but if a nation is to have good policy, it must nonetheless tap and synthesize this knowledge. Nations in which policy is patched together by a elite "advisors" will suffer waves of fashion, will find that one aspect of their activity does not match with another, and that one-size-fits-all does not work in an increasing differentiated country in which each region is playing to its particular strengths. The institutions which are needed to handle the knowledge economy in the public sector have yet to be defined.

The esteem in which the political process is held in most of the industrial states has been on a downward trend for decades. Around a third of the US electorate appears (2001, National poll) to feel that the "government will always try to act for the general good." Two thirds thought that it would not. People are cynical about the state's ability to run operational activities (save in military spheres) but the chief odium is reserved for representative government. The reason for this seems unavoidably entwined with the party political system.

It is strange but unremarked that two (or at most, three) pressure groups afford themselves official status as political parties, and so utterly dominate both legislative power and political debate. In a situation where matters were polarized along one axis - rich versus poor, slave owners versus liberationists, the Court versus the wealthy classes, this religion versus that, or versus all comers - so two groups might emerge to champion one or the other polarity. It is virtually impossible to find such issues today. Where there are issues which generate polarization, it is almost impossible to bundle a position together such that the supporter of a party can find his or her position on each of these exactly reflected. One may agree on a position on education, perhaps, but this is no useful guide to where one may stand as an individual on health or defence. The clusters of attitude which do exist within a society (which we have already discussed) are something of a guide, but individuals in the industrial world bob in and out of membership of any one cluster in ways which depend on context. You, the reader, can flip from being a rabid consumer, to a concerned environmentalist or a caring parent in the course of a single sentence.

It follows that a party leader cannot say anything very strong or very clear without alienating more people than he or she attracts. Indeed, the trend is for leaders to talk about their style of governance than their substantive policies. Brand is therefore deeply important as a differentiating factor. The role of brand and news managers has, therefore, tended to grow within in the policy process. Citizens are, however, extremely discriminating consumers (we may receive over 10,000 advertising messages a week if we live in a big city and watch television) and so we are inclined to see this as at best vacuous.

Third, the industrial world is faced with unhappy demographics, for which many societies have made scant provision. Italy, for example, has provided for about 3% of its public pensions commitment and - saving the Netherlands, Denmark and Scandinavian nations - continental Europe is in a generally bad situation. These deficits are such that they will double or treble state debt by 2040 if Europe does not experience extraordinary growth. Japan has similar problems.

A substantial gray minority will influence the political process. European taxes are already high, and may creep further, doing so in order to fund consumption rather than investment. Europe will need 20-40 million guest workers to act as carers and health workers, according to several studies.

We have already pointed up the key positive issues of development (institutions and internal coherence, the management of inequality, the ability to encourage saving and investment , and the capacity to attract foreign resources.) The negative factors - social fragmentation, rejectionism and the building of power bases on alienated groups, the inability to bring coherence to muddle, vested interests and corruption - need no further exploration. Societies which get these factors right, whilst avoiding the traps which are inherent in fast change, grow very rapidly. By contrast, studies such as the Failed States Task Force and assorted World Bank and UNIDO analyses are able to predict those nations which will fail to grow on the basis of their institutional weakness, the inability of their commerce to withstand free international competition and assorted indicators of social progress and cohesion, such as female engagement in the economy, educational and political processes.

States seem to rest on a tripod, made up of social capital, economic capability and institutional strength. If one leg is weaker than the others, then this sets the limits to what can be done. If one leg crumbles (as it did in the USSR) then the whole enterprise is downgraded. The measure of what is being achieved is, essentially, the complexity of the system that can be supported. Weak 'legs' will support only basic, simple structures. The more complex societies need equally robust and complex supports. The very complex nations - such as the US, for example - are being projected off the map of known experience, and are having to invent the infrastructure on which they stand. British and US restructuring built very complex interlinked and flexible systems during the 1985-95 period, and it may well be that their currently high rates of economic growth reflect this. Much the same has to be true of the developing nations. Those which have dismantled previously functional machinery - as with the Balkans, Zimbabwe - or which have tried to grow on the back of primitive systems, as did Indonesia and as do most dictatorships - are doomed to slow mid-term performance. In the order of 20% of the states in the world have been in technical failure - economic crisis, political spasm - since useful statistics began to be collected in the 1960s. In tolerating the conditions which predispose societies to this, we tolerate decades trimmed off the individual life expectancy of billions, untold lost human potential and misery.

There are good things which the wealthy world could do to help. Some of these are abstract, such as the creation of systems that predispose the world financial system to tranquility, which help to limit the energy needs of developing nations and the like. Some are more concrete, such as the provision of advice, training, guidance and the occasional firm hand. Multi-national companies can be an important force for good, in that they are the almost unique conduit for management talent and training. However, it is also the case that domestic markets are protected against the exports of the poor nations (clothing, shoes, simple tools, steel and food for example) and that the US, Europe and Japan subsidize their farmers at direct cost to the farmers of the poor world. Worse, they over-produce food and depress world prices by exporting it. If farmers are to be kept solvent by the taxpayer, it would be sensible for this to be done in ways which the tax payer would recognise as being desirable. UK moves to make farmers 'custodians of the land' is appropriate, but no more than the late recognition of one of the scenarios published by the Nickerson Seed Company in 1981!

A closely-coupled world will be tied together by trade, commercial relationships and the realities of economics, knowledge and the understanding of best practice, by common individual aspirations and consumerism, by information technology, popular culture and human migration. Its arrival is essentially unavoidable, although its welcome will be mixed and tempered by all manner of exclusions and special cases. Farmers and unions which represent low-skilled workers are mercantilist examples which we have already met.

If hitherto isolated agencies are brought together, then new systems are created. Such systems are as open to exploitation as any that already exist. They can be exploited for crime or for valid wealth generation, for new options or social friction, for peace or terror. New regulatory structures will be needed in order to push the systems to a positive outcome. There is limited time to build such systems, notably as real power has to be vested in them and real sovereignty surrendered to them. This will not happen easily, and will certainly not come about if the industrial nations are unhappy with their situation. Unhappiness at rapid change has tended to be a factor chiefly confined to the developing world. Aging, and the extraordinary rate of change which is in prospect, may transform attitudes in the industrial world. These transformations are already evident in some European opinion surveys. The figure sketches the relationship between social cohesion and economic growth that may pertain in 2020, as compared to 1990.

Disruptive and over-rapid economic change can generate as much difficulties as underperformance and economic misery. This happy middle way can be achieved much more easily by design than is likely through random self-assembly. Design is, however, necessarily a piecemeal concept, aimed to enable people to adapt rather than to prescribe what they should do. Access to information and the ability to interpret and make use of that information is crucial to adaptation. Access to more or less formal and tacit networks of collaboration and cooperation is another central factor.

The focus on terrorism that has dominated the news and has to some extent driven another major issue, that of the environment, from public attention. Nevertheless, fresh water and air, usable crop land and productive marine resource will be at issue when 8 billion people operate at roughly twice today's economic product. We use around half of the available fresh water at present. Almost all uncultivated land is of a type where the productivity goes down when it is farmed. By contrast, European and most US farm land is more productive (grams of carbon fixed per unit area) when it is managed as compared to when it is fallow. An area equivalent to Australia was farmed in 1900. We have in the order of Asia and Russia under the plough today. On today's trends, an area the size of Australia will be all that is left of the green wilderness by 2020. Nitrogen, sulphur and other nutrients will fall in the rain as pollutants at 3-10 times natural background levels. Atmospheric haze may make blue skies a thing of the past.

The major effort that has been undertaken to study historical climate patterns, to model the existing climate and to study patterns of ocean currents (themselves subject to a slow moving "weather" which is the dominant feature of our climate) has shown the fundamental instability of the weather on which we all rely. The data do now seem to support an unequivocal pattern of increasing temperatures and more turbulent weather. Projections of carbon emissions make this ominous for the future. We cannot know what heroic technologies may come forward: engineered graphite- or diamond-generating trees intended for permanent carbon sequestration in buildings, for example, or the cultivation of the nutrient-poor deep ocean. What we can know is that measures which manage such issues will require collaboration, the surrender of sovereign choice and long-term working relationships. Once again, the focus falls onto working international institutions. Dull, to be sure, but necessary.

 to the top