Inequality, the origin and end of many global imbalances heads the agenda of the World Economic Forum for the first time.
Inequality heads for the first time the Global Agenda that the World Economic Forum prepares annually through a survey among the members of its council. The research identifies the issues that this qualified panel believes will have the greatest impact on the world over the next 12 to 18 months. The results are synthesized into ten trends (Top 10 Trends), “a forecast of the social, economic and political aspects in which our collective horizon resides “, according to the author of the introduction, Al Gore, former vice president of the United States and president of the Meta-Council on the New Architecture of Governance.
“We are at a critical crossroads, a period of decision that will dictate the health and viability of our civilization in the coming decades,” announces Bill Clinton’s ticket to head of the US administration in the 1990s. Here is a synthesis of the ten trends that will mark the world debates in the coming months:
- Growing inequality
The difference in income is no longer a problem between rich and poor, but directly affects the middle class. It destroys the middle class. According to the 2014 Pew Global Attitudes Survey, inequality is perceived as a big problem in both sub-Saharan African countries and the United States. The income gap is widening in Asia and the Americas, persisting in Europe, and threatening growth in Africa. Although global economic growth maintains a good pace, poverty, environmental degradation, unemployment, political instability, and violence remain major challenges. “These problems are often closely related to inequality,” says Amina Mohammed, special adviser to the United Nations, vice president of the Global Agenda Council, and author of the chapter dedicated to this trend.
The persistence of unemployment
According to the chapter’s author, Larry Summers, a professor at Harvard University, “the term persistent growth in unemployment refers to the phenomenon whereby economies emerging from recessions show economic growth at the same time as mere maintenance, in some cases even decrease, of their level of employment ».
This phenomenon is especially felt among workers between the ages of 25 and 54, “the hard part of the labor force”, a segment in which unemployment has tripled, in a trend that seems inexorable. Professor Summers believes that we still have time to correct this trend, but for this it is essential that governments take action on the matter, starting with a change in education to promote those aspects of knowledge that cannot be replaced by automation: collaboration, creation, and leadership.
Leadership deficit
86% of those surveyed for the Global Agenda believe that the world is suffering from a leadership crisis. Shiza Shahid, co-founder and global ambassador for the Malala Fund and writer of the trend analysis, believes this lack is because the international community has failed to address major agenda items in recent years.
“While our governments have grown, their mechanisms have been beset by decades of factual alignment, dynasty, and deep corruption,” she notes. As an example, 90% of those surveyed in China through the Pew study point to corruption as a big problem, 83% in India and 78% in Brazil, according to other sociological research.
What, in your opinion, would the leaders need to regain the trust of their people? The panel’s response is the sum of several virtues: a global and interdisciplinary perspective, long-term planning, strong communication skills, prioritizing social justice and well-being over financial growth, courage, morality, and a collaborative nature.
A great demand, without a doubt, that is not appreciated by the current leaders, both in politics and in business.
The growth of geostrategic competition
The end of the Cold War, the fall of the Iron Curtain, and the integration of Russia and China into the global economic system have not been enough to improve the security of the world. “Geopolitics and realpolitik are taking center stage again,” says Espen Barth Eide, CEO of the World Economic Forum and author of this chapter.
“Instead of fearing the opposition of strong states, we are concerned about their weakness, the breakup of countries, and the global reach of terrorist networks,” he points out.
Although this trend ranks fourth in the global survey, it is the second concern for Europeans and Asians. The tensions between the European Union and Russia over the conflict in Ukraine, China’s rearmament and its friction with Japan over control of maritime space, and the worsening situation in the Middle East are worrying examples that could have consequences for the world balance.
“On the side of potential globalization (and indeed deglobalization ), the advance of nationalisms, and the growing discredit of multi-ratelarism, the most important lesson of 2014 is that we cannot remain impassive,” concludes Espen Barth.
The weakening of democracy
The Edelman barometer detects a worrying lack of credibility of institutions, both public and private, in their leaders and their processes. Mistrust spreads, especially among the youngest, and threatens the survival of the institutions that are responsible for managing democracy. The rise of populism in Europe is the expression of a collective disappointment in the functioning of a parliamentary system that discusses a lot and solves little.
There is a disconnect between citizens and their elected representatives, notes Jorge Soto, founder of Data4 and member of the Global Agenda Council on the Future of Government. The rapporteur of this trend points out that governments are staying on the sidelines of the conversations that citizens begin to spin thanks to the Internet and social networks.
“Our governments are elected, dissolved, re-elected only to pursue short-term agendas when the cycles that renew and build credibility with voters require long-term investments,” says Soto.
However, the solution is not to be found in an online democracy structured as a social network where everyone discusses their opinions at the same time, because that would lead to anarchy. Representative democracy needs to modernize and actively involve citizens in decision-making processes. Jorge Soto understands that “rather than seeing themselves as mere problem solvers, governments should position themselves as bodies that articulate the issues facing society and create the right environment for the private sector and academia to find solutions by providing of data, policies, and financial support”.
Rising pollution in the developing world
The solution to pollution demands a technological and intellectual revolution, perhaps the second is more difficult. In addition, the challenges that climate change implies have now been joined by harmful pollution in large cities, already responsible for one in eight deaths. Zou Ji, deputy director general of the National Center for Climate Change Strategy and International Cooperation, asks in his chapter about an alternative route to economic growth that preserves resources and limits CO2 emissions. “The developing world has learned a lot from Europe and North America about business models, infrastructure, and technology; however, the planet’s carbon capacity does not allow us to continue on this path, “says the Chinese analyst.
Developed countries have three ways to help emerging economies reduce their carbon and health hazard emissions: drive a flow of finance to the developing world, make the case for financing policy change, and cooperate on the innovation of low CO2 technologies. According to Ji, it’s crucial to come up with solutions early on, “because once the high-carbon ones are in place, it’s very hard to replace them.” The potential for corrective measures is very high, but the window of opportunity is very small in terms of time.
The increased frequency of natural disasters
Directly related to climate change, the solution to severe weather events is more on the side of prevention than reaction. A good example of this is the ability of scientists to assess the effects of global warming, anticipate the consequences, and predict severe weather events.
Adil Najam, dean of The Frederick S. Pardee Scholl of Global Studies at Boston University, stresses the lack of leadership to address this issue. The rapporteur proposes to strengthen the resilience of countries and companies before the natural disaster occurs. “That means investing in long-term developments, the cost of which may be high and the speed of change low, but the long-term returns are impressive for national economies, businesses, and certainly for the poorest segment of the population, which is the most vulnerable and the one who will pay the highest price if these measures fail.
When a disaster occurs, social solidarity is admirable, but it does not solve the problem, it only helps to alleviate its devastating consequences.
The advance of nationalism
It might seem like a contradiction in an increasingly global world, but perhaps it is a sociological response to precisely this phenomenon. Nationalism runs in favor of the current, not only that which circulates along the path of the demand for independence by appealing to a new State but also of the countries themselves through protectionist policies.
Selfishness encourages in the depths of the human condition, it even induces its ethics, exclusive, sometimes exclusive (xenophobia, for example), which tends to justify the defense of one’s own from moral principles and, of course, very emotional.
“Can we show how neighbors of different cultures, traditions, and identities can work together in a more open and global environment than in a limited multinational state?” asks former British Prime Minister Gordon Brown in this chapter. Scotland was on the verge of giving a negative answer to this question, although in the end, a majority opted to “do what we have always done best: think big, not small”.
Increased stress due to access to water
Due to a combination of problems, such as rapid population growth, restricted water supply, and high levels of poverty, countries like India, Bangladesh, Indonesia, and Nigeria will be hit hard by this trend.
Matt Damon, co-founder of Water.org, believes that “despite the obstacles we face, there is room for optimism.” The actor shares with Gary White, I consider a delegate of Water.org, the writing of the chapter dedicated to the effects that the scarcity or lack of water produces in millions of people. In their analysis, they ensure that the water crisis has two components: one refers to the resource itself; the other, is access. “Even when the resource is full, there are millions of people who lack access,” they say. They believe that governments should play a central role by financing long-term investments, either directly or through private companies subject to public service contracts.
The growing importance of health for the economy
No one should doubt that Spain’s public health system is one of the country’s great assets. Sometimes such a belief is more established outside the national territory than inside, perhaps because we Spaniards are bad propagandists for our achievements. Health is a challenge for all nations, not just for the least developed. 85% of the participants in the Pew Research Center study say it is a problem in their country of residence.
Amid the debate on the privatization of health, at least of its management, it is curious to see how when a major health alarm occurs, citizens look to the Public Administration, demanding that the Government address and resolve the crisis. This has happened recently with the cases of Ebola in the United States and Spain. In this sense, the authors understand that the challenge is not addressed by building more hospitals, but by investing in a wide range of activities, including the promotion of a healthier culture, in addition to the fight against tobacco, alcohol, and obesity, leading cause of death in some of the world’s most developed countries.
The World Bank attributes half of the growth differential between developed and developing countries to weak public health policies and low life expectancy in the latter. Health is one of the main and most strategic decisions of any government. It is impossible to progress when the disease stalks the base of the pyramid that feeds the middle class.
Francis Collins, director of the National Institutes of Health, notes that “fortunately, technology makes it easier to prevent, detect, and treat disease.” From his point of view, thanks to the development of electronic records, remote treatment, and the ability to share data online “we have a variety of solutions available, even in low-income situations.”
Anti-immigration sentiment
The analysis of the trends ends with a concern, not yet incorporated into the Global Agenda, but which is knocking on its doors: the increase in the rates of rejection of immigration. “Racism, xenophobia, intolerance, and Islamophobia are advancing,” warns Jose Manuel Barroso, president of the European Commission until mid-2014. The Portuguese politician stresses that “anti-immigration sentiment can only be diluted through strong leadership.”
It will take a lot of leadership and many leaders to face the ten challenges plus one of the Global Agenda. A new leadership that does not have financial roots, but ethics.
