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Global Trend #1: Economic Upheaval

The story would be as familiar to a late 18th-century Londoner as it is to a 21st-century New Yorker: Rapid technological change is fundamentally altering not just our economies but our very lives. If that sounds abstract, the result is anything but.

That was the top trend Via Meadia saw shaping the world in the coming decade when we issued our “Top Global Trends for the 2010s” just about two years ago today. Back then, the global economy was coming off one of its worse annual performances in decades, but “green shoots” were beginning to show. The financial crisis had passed, emerging markets were chugging along, and America’s fiscal stimulus package was kicking into gear. Sure, there were vague mutterings about “PIGS” (note: only one “i”), but the recovery, we were assured, was “shovel ready.”

The shovel-ready paradigm, as it happens, overlooked the durability and magnitude of the technologically driven shifts in the international economy. Via Meadia predicted that economic policy managers around the world would struggle to adapt their approaches, coordinate their reactions, and manage the political and social disruptions brought on by economic turmoil.

So where does that forecast, and the world, stand, two years on? The forecast looks good, even if the world economy doesn’t. The eurozone teeters on the edge, while European leaders do nothing but layer fudge on top of fudge on top of ineffectual…you get the idea. Meanwhile, former emerging market economic darlings are in trouble, too. Turkey, India, and even almighty China have their own problems and can’t pull the economy out of its rut anytime soon. Doha is dead, and those pesky “imbalances” linger. Back in the United States, “shovel ready” ended not with a bang but a whimper, while our leaders cling to an obsolescent Blue Social Model.

We don’t mean to suggest that things are all bad. The same disruptive technological and economic forces wreaking havoc are also opening up opportunities for new businesses to make our lives better. Ultimately, the productivity increases promised by new technology will transform lives all over the world.  Progress is sometimes painful, but growing pains and death throes are very different conditions.

Granted, this is cold comfort for the global malcontents camped out across the world, from Zuccotti Park to London to Wukan. Coping with the social and political fallout of global economic disruption, as well as searching for creative and constructive ways forward, will remain the central challenges for the powers-that-be for the rest of the decade. Just as we warned two years ago, you should be skeptical of anyone who tells you otherwise.

Hold on. It is going to be a wild ride.

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  • stephen b

    “Economic policy managers” should be very careful about attempting to “manage the political and social disruptions brought on by economic turmoil.”
    This is what got us into trouble in the first place.
    They wanted us to believe they were being careful, but mostly they were feathering their own nests, or buying off preferred political constituencies, which amounts to the former.

  • Anthony

    “A new economic order is taking shape before our eyes, and it is one that includes accelerated convergence between old Western powers and the emerging world’s major new players.”

    In line with WRM’s Global Trend #1, this convergence has many fathers but primarily it reflects a new international economic order; this order has been facilitated by massive debt creation in the west – financial excesses, unprecedented leverage, etc.

    Now, in seeking creative and constructive ways forward, new enlightened policy making vis-a-vis market economies requires reform but in what manner remains to be established – a wild ride it will be.

  • Jacksonian Libertarian

    I’ve been calling it Great Depression 2.0, it is characterized by the deflation of the Dollar, while at the same time Energy supply created inflation in the CPI hides the 30% fall in home prices ($6 trillion in lost equity for American family’s), and unemployment driven deflating wages.
    And our stupid Democrat leadership is so owned by the Enviros that we can’t even build a pipeline.

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