Plugging into the age of uncertainty

October 7, 2010


For most of the past century, the big global narrative has been the clash of rival paradigms: Nazism versus liberal democracy, communism versus free market democracy, and, more recently, fundamentalist Islamic states versus the secular, democratic west. When the cold war ended, Francis Fukuyama predicted that this clash of paradigms would end. He was right, but not for the reason he thought.

The battle of rival ideologies has ended not because, as Fukuyama foresaw, the triumph of capitalist democracy has been universally acclaimed. Instead, it is because all of us have realized we face a new challenge — how to thrive in the high tech, global economy — and no one country or single ideology is yet certain of getting this exactly right.

This isn’t the cold war, or the clash of civilizations, or even the end of history — it is the age of uncertainty, as the entire world struggles to understand and keep up with the biggest economic transformation since the industrial revolution.

I was persuaded that this single, uncertain global effort to keep pace is our new overarching challenge at a venue which was the setting for one of the seminal decisions in the age of rival paradigms: the Livadia Palace, in Yalta. In this cream colored villa a comfortable lawn’s distance away from a rocky cliff that drops to the Black Sea, Churchill, Roosevelt and Stalin made their infamous pact to divide Europe between the communist east and the democratic west.

Today, Yalta is again at the crossroads of democracy and authoritarianism as Ukraine, the country to which it now belongs, wavers between integration with Europe and integration with Russia. But when I spent two days there early this month moderating a conference on geopolitics, the most important takeaway was that this old dilemma was the wrong one for Ukraine — and everyone else — to focus on.

The most articulate expression of the new paradigm came from Carl Bildt, the former Swedish Prime Minister, who was re-appointed foreign minister last month after the election victory of his centre-right party.

“The megatrend of our age is globalization,” Bildt said. “That process of globalization has shown remarkable resilience over the last ten to fifteen years. In one crisis after another, globalization comes back and is stronger each time. The success or failure of nations is really are you able to plug into and be successful in globalization or not.”

One thing that’s interesting about Bildt’s remarks is that they could be made in any city anywhere on the planet and be as relevant as they were in Yalta — one aspect of the economic revolution we are living through, and one sign that it truly is global, is the fact that the whole world,  from London to Lagos, and from Silicon Valley to Shanghai, is going through the same transformation at the same time.

What else is interesting about what Bildt identified as the challenge of “plugging in”, and what makes it very different from the ideological clashes of the past 100 years, is that no one country and no single ideology has yet claimed to have it all figured out. China’s state capitalist model, with its repressed citizens and efficient government is delivering high growth, but so is India’s flourishing democracy and chaotic government, while neo-authoritarian Russia struggles to become more than a petro-power.

The welfare states of southern Europe are among the most troubled economies in the developed world; the Nordic welfare states among the most vibrant. Success and failure co-exist even within a single country or even a single region — consider the miracle of Silicon Valley and the failed state of California.

Bildt alluded to the diverse models of success by pointing to the wildly contrasting examples of his native Sweden and of China: “We had a global age that ended in August of 1914 and then it took us a long time to recover,” Bildt said. “It was only in 1990 that Sweden was back where we were in 1914 [in terms of connection with the global economy].”

But between 1990 and today, he said, Sweden’s integration with the global economy doubled. “We’ve gone through an enormous process of globalization just in two decades,” Bildt said. “But we are not as successful as China, which has gone from being one of the most closed economies in the world thirty years ago to an even more integrated global economy than Sweden today and accordingly has growth figures that are fairly impressive, to put it mildly.”

Tolstoy wrote that happy families are all alike and unhappy families are unique in their unhappiness. Today, it is the unhappy countries that have a lot in common — corruption, lawlessness and autarky don’t work anywhere — and the happy countries that are a pretty diverse lot. But, for once, the whole world is grappling with the same question: how to plug in.

Photo: Carl Bildt, center, at the Yalta European Strategy conference in October 2010.  Photo Credit: Sergei Illian (Yalta European Strategy).


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Global economy = Corporatism . Governments are not in control, people don’t realize the power they have as consumers (or are unwilling to use it) and corporations are learning to use their muscle to get past regulations or change them to their liking. Unhappy are those who are losing jobs to foreign lands or watching their resources leave the country with no benefit to those who live there. Things will only get better when corporations are under control. Until then, they will constantly try to position themselves for maximum profit at the expense of everything else.

Posted by ThePup | Report as abusive

Re your Silicon Valley-California remark: There is no more miracle in Silicon Valley. It is a failed geo-economic area that has morphed into a small group of uber-rich and the middle class is shrining, while the underclass is growing in leaps and bounds.

This is the norm in all of California, and it is what the politicians who are in control of California (Liberal Leftist-Progressives-Fabians). Only this group is more interested in moving the state of CA into Socialist-Communism as quickly as possible, ahead of Obama’s stated goals for the rest of the USA.

The author of this article seems to be firmly ensconced in the Left, so her viewpoint is one where the Middle Left is really the Central. Orwell is alive and well, or at least his warnings.

Posted by Damocles | Report as abusive

Karl doesn’t seem to get it. Thanks to globalization, Sweden’s banks went head first into the Baltic counties, lending tens of billions in Euro denominated mortgage loans which are now seriously under water. The toxic waste is buried in the balance sheets, waiting for the inevitable day that Swedish taxpayers pick up the tab.

Volvos will soon be made in China and the European plants will eventually close once China has sucked the technology dry.

10% of the population is immigrants, mostly from Islamic countries — people displaced by predatory trade practices, politics and wars. It has spawned an ultra-right backlash.

Ahh… let us all enjoy the fruits of globalization. Only the elites can look at globalization with pride — they think they’ll just hop on their private jets and go to sunnier climes when the going gets tough.

Posted by upstater | Report as abusive

Globalization will work fine until a good war gets started. Then all the spare parts to fix your foriegn equipment will be located in bombed out areas or sitting on the dock somewhere waiting for pick up. To have strong countries requires independence and self suffieciency. Having China manufacture things without quality control is a bunch of bunk. We let our politicians take money for selling out on trade agreements. We also put up with shoddy designs for vehicles that would have to be replaced instead of saving the natural resources.

Posted by fred5407 | Report as abusive

And what about going to space during the cold war ? Or having many colonies during the 19th century, in Europe ? They are also global objectives recognised as a “must do” by every country.

Clearly, what is new, is the number of countries involved in the new trend, the “plug in” rush. But you have other ones : “reaching the chinese customer” in the developped world, or “getting the developped world investments” in the developping world.

Moreover, as the iranian president does not seem to care about the veto against his country, I don’t really think that the “plug in” rush is above political concerns…

Posted by judelanoe | Report as abusive

Oregon atop AP poll for first time (AP)…

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Posted by Score Board | Report as abusive

Totally disagree with you on that one. Nice try though!

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Hey. Great post… not sure what all the trolls are doing here though.

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It would appear to be the case. Appreciate the info….

Posted by Leah Fernando | Report as abusive

Don’t think its wise to do that…. but go for it if you want!

Posted by Ariel McMorron | Report as abusive