Two Forces of Globalization

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Your own acts tell the world who you are and what kind of society you think it should be.

Ai Weiwei

We are in the midst of an unprecedented transition globally. This change is historic, cutting across all segments of society, and is not happening in a predictable way. Two examples from the past year illustrate this historic moment in time.

Independence referendums in Scotland and Catalunya, as well as movements in Wales and Northern Italy, show that there is strong sentiment for separation from the countries where they currently belong.  As the picture above from the demonstrations in Glasgow leading up to the Scottish referendum vote says, "You are better than you think you are."

In Greece, a national referendum showed that the people of the nation desired a non-austerity solution to their nation's financial crisis. Yet, the country's financial crisis demonstrated that the nation of Greece was no longer in control of its own welfare. It had lost it to the Troika of the European Commission, the International Monetary Fund and the European Central Bank as they sought to impose austerity measures upon the nation.

While the reach of governing institutions, whether national governments or global supra-national ones, has grown over the past two hundred years, another global phenomenon is emerging represented by the capacity of individuals to create small, focused entrepreneurial organizations and movements to affect change on a global scale.

We now find that there are two forces for change functioning within this 21st. century global context.

One is the force of global integration of business and government.

The other force is of personal initiative operating within the context of networks of relationships.

It is at the point of interaction between these two forces that this historic moment of transition is taking place.

The Force of Integration

This first force seeks to integrate all functions of society into one seamless efficient system of governance by global institutions.

The people and institutions at the center of the preeminent expression of this global force believe that it is through the integration of economics and governance that a peaceful and prosperous world can be achieved.  These international institutions emerged after the First World War to manage how the nation-states of the world interact to create peace and prosperity.

Emerging the past half century are similar movements like ISIS that want to want to integrate global governance through the eradication of people and nations who do not follow their strict line of belief.

These two very different versions of globalism share a belief in integration, but through different means.

This drive for integration is the logical unfolding of the modern hierarchical organization. Whether in business or government, integration enhances efficiency and the control of variables that affect the functioning of large complex institutions. Remove the inefficiencies and you achieve success. Unfortunately, human beings tend to represent the greatest form of variation in these large organizations.

The theme of integration has emerged in popular young adult novels and films like The Hunger Games, Divergent, The Maze Runner and The Giver. In each of these narratives, a governing authority seeks to or has accomplished the integration of society by controlling how each person functions within that world. In these stories, characters of a particular independence of character and diversity of talent foster a crisis of change for the governing systems of society through their own personal leadership initiative to bring people together to resist the forces of integration.

The Force of Personal Initiative

The second force is reflected in the native desire of people to live lives and do work that matters. These acts of human initiative operate within the context of relationships of trust and mutuality, and are facilitated by the growth of computing and communication technology.

Many of these acts of personal initiative are done without recognition. The gift of a meal to a hungry person. The mentoring that takes place in scouting, sports and in youth club programs. The volunteering that takes place in local communities through religious congregations and community non-profits. Entrepreneurial programs to train and develop the leadership of new businesses. Event planners who bring people together to support local programs. The meetings over coffee where community understanding and healing begin to take place where conflict has existed. In each situation, the beginning of the effort starts with a person taking initiative, and then, grows through the networks of relationships that emerge at both the local and global level.

We can see this force of personal initiative in the central characters of the stories mentioned above. Their motivation to act comes from a source of inner values that move them out of the crowd into a place of influence.

Katnis in The Hunger Games steps forward to compete in the games instead of her sister.

Tris in Divergent is motivated by an inner sense of justice about the importance of family.

Thomas in The Maze Runner discovers within himself a calling to serve the members of The Glade by leading them through the maze to a safer place.

In The Giver, Jonas discovers within himself an emotional depth that is expressed in his love for Fiona, his desire to save the infant Gabriel, and, ultimately to take action to cross the boundary that will release memories both painful and joyful back into society.

These two forces are not necessarily incompatible. However, the challenge is how the legacy institutions of global hierarchy can adapt to growing importance of networks as the structure for human work and community.

The particular context of this great transition are the structures of society, government, business, communities, and the non-government organizations that serve people.

The Context of Organizational Structures

It is important to understand how organizational structures function in society.

Organizational structure has no voice, but it has force.

It is invisible because its presence is so comprehensive.

The force within every organizational structure is to resist change. It seeks regularity, consistency and efficiency.

Real change cannot happen without change to the structures of society and organizations.

How many carriage makers went out of business a century ago because they could not change from making horse drawn buggies to automobiles?

How many small businesses and religious congregations closed their doors because they could not adapt to changes in their neighborhood or the technology of their business?

How many communities now languish because they could not adapt to changes taking place in the larger society?

In ancient times, kings would build a wall around their city to guard against the invading forces of change. Today, physical walls don't work. They have been replaced with political, legal and economic walls. The fortress walls of today are under threat, and are just as susceptible to collapse as those ancient ones.

Today, the structure of integration seeks to create an orderly and efficient system of governance throughout global society.

The institutional force of integration is hierarchical, operated by an elite circle of global leaders, who hold authority over the whole system.

In business, when one company totally dominates the marketplace, so that all their competitors are in effect dependent upon them, we call this a monopoly.

In politics, if a small group of people hold dominant control over the governance of a city or a nation, we may call that an oligarchy or a dictatorship. The history of nations and empires is filled with examples of these kinds of hierarchies. We can also see that they are unsustainable.

The mandate of hierarchical structures is to bring control to all facets of business or society.  In a global context, this governing hierarchy trumps democratic choice. This is the one lesson of the Greek crisis.

The question that interests me here is whether this trend can last.

Has the power of personal computing and communication technology, as it has expanded globally over the past 25 years, now made it possible for many things to be done without the requirement of an hierarchical authority?

I do not believe that the future is either utopian nor dystopian.  I do see that global networks of human relationships are structured very differently. Its power to adapt and to extend its reach quickly without prior expectation is remarkable.

At the heart of the network is the individual who initiates and acts to create opportunities within relationships of trust and mutuality. 

Hierarchies are not built on trust, but rather on the integrity of the system.

Networks, on the other hand, only function well when there is trust at the center of the relationships.

Both systems are inherently fragile and susceptible to change from outside forces.

Hierarchy-NetworkRelationships

I have thought a long time about the difference between these two structures. Increasingly, I am convinced that hierarchy is a structure that functioned well in an earlier era, but no longer. 

The authors of the introduction to Jean Baudrillard's In the Shadow of the Silent Majorities, characterize a shift that has taken place in the society where Henry Ford's factories once were the norm.

"The dominant characteristic of Fordism was repetition and stability. Post-Fordism, to the contrary, brings out instability and adaptability, all qualities instilled by advanced capitalism."

In effect, the direction that we are moving globally is from a world of regularity and predictability to one where there are no givens. Some of the skills required for this new world are ones of adaptability, collaboration and personal accountability.

With this disintegration of traditional hierarchical institutional structures comes opportunities that are present directly in front of us each day.  As a result, networks of relationships provide a structure that more easily provides a globally dispersed people the capacity to work in concert towards shared goals.

Five Questions for Understanding

My search for understanding about these two global forces has been driven by the following questions.

How did we get to this point of significant transition in how we live and work?

What is the long term impact of the growth of networks? What is the future of global hierarchical systems of economics and governance? Can they adapt by adopting the relational structures and values of networks of relationships?

Who is most significantly benefited by this interplay between the forces of integration and the network?

Where is this leading? What changes are coming that we can barely imagine right now? What opportunities will come with these changes?

What obstacles make it more difficult for networks of relationships to reach their potential impact? What must each of us as individuals do to alleviate those problems?

We are on the verge of seeing a great calamity as the structure of supra-national institutions diminish in credibility and effectiveness. The dependence that national governments have placed on these supra-national institutions to managed progress towards global peace and prosperity will become more difficult. 

In effect, these global institutions are painting themselves into a corner from which there is no easy exit. This is what I see in the Greek crisis.

The conflict between the forces of global integration and the power of personal initiative expressed through networks of relationships is the context of this growing crisis.

It does not have to be, however.

All we must do as leaders and global citizens is to begin to take personal responsibility for the world at our finger tips, by acting to make a difference that matters, by building networks of relationships that facilitate greater capacity for organizations and communities to adapt to a changing world.

I return to the quote of Ai Weiwei that began this post as a fitting place to end.

Your own acts tell the world who you are and what kind of society you think it should be.

May each of your actions build strength in your own circle of impact.


9/11 - Learning from the past

WhatDidYouDoInTheWarDaddy

You may hear this said a lot today.

"Those who don't learn from history are doomed to repeat it." (George Santayana).

It would be also helpful to hear Paul Simon sing the words from his song The Boxer,

"Still a man hears what he wants to hear and disregards the rest."

There are many lessons to be learned from the most costly terrorist attack ever on American soil. The question are we in a mindset to learn them?

In an excerpt from his new book, A Journey: My Political Life, former British Prime MinisterTony Blair states,

In short, we have become too apologetic, too feeble, too inhibited, too imbued with doubt and too lacking in mission. Our way of life, our values, the things that made us great, remain not simply as a testament to us as nations but as harbingers of human progress. They are not relics of a once powerful politics; they are the living spirit of the optimistic view of human history. All we need to do is to understand that they have to be reapplied to changing circumstances, not relinquished as redundant.

While we may find some comfort in his words, I'd say his perspective is not large enough.

The nations and culture of the West are products of long historical trends that are at a transition point.

One of those trends was the Enlightenment belief in rationalism, preeminently embedded in our belief in the progress that would come to humankind through Science. For many Science (large S) has become the replacement religion of intellectuals. It did not require a belief in any mystical being or in the aristocratic social and political structure of old Europe. As a philosophy, it was a ideology of revolution that turned upside down virtually every nation in the northern hemisphere.  In a very real sense, this belief in progress was a belief in the morality of science and progress. For as a replacement religion, it inevitably had to have a moral core to its purpose.

This belief in the absolute and ultimate fulfillment of human progress began to erode with the outbreak of World War I. There was an innocence about this belief in progress prior to the war. However, with it, innocence was lost, and irony as Paul Fussell writes in The Great War and Modern Memory, was the result.

lrony is the attendant of hope, and the fuel of hope is innocence.One reason the Great War was more ironic than any other was that its beginning was more innocent. "Never such innocence again," observes Philip Larkin, ...

Furthermore, the Great War, was perhaps the last to be conceived as taking place within a seamless, purposeful "history" involving a coherent stream of time running from past through present to future. The shrewd recruiting poster depicting a worried father of the future being asked by his children, "Daddy, what did you do in the Great War?" assumes a future whose moral and social pressures are identical with those of the past. Today, when each day's experience seems notably ad hoc, no such appeal would shame the most stupid to the recruiting office. But the Great War took place in what was, compared with ours, a static world, where the values appeared stable and where the meanings of abstractions seemed permanent and reliable. Everyone knew what Glory was, and what Honor meant. It was not until eleven years after the war that Hemingway could declare in A Farewell to Arms that "abstract words such as glory, honor, courage, or hallow were obscene beside the concrete names of villages, the numbers of roads, the names of rivers, the numbers of regiments and the dates,"  In the summer of 1914 no one would have understood what on earth he was talking about.

I see that the past decade, in a different way, has brought us back to the place Europe was in 1914. There is a loss of innocence, a loss of purpose, a loss of confidence and loss of knowing what we must do. We live in a time of irony and cynicism, of suspicion and warring factions, where all motives are suspect. We live in a time where words as abstractions that transcend time, giving us perspective and direction for the future, are lost in meaningless of the sales pitch.

As we remember those who died at the hands of terrorists on 9/11/2001, let us not fall into a belief that hope and meaning are lost. That the course of human history is downward toward the apocalypse. Rather, let us see that we are at a crossroads in history, not just the history of our nation, but the history of all humankind.  To see the long view is to see that there is a historical progression that leads to our time.

Let me end with a long quote from Peter Thiel's essay, The Optimistic Thought Experiment.Thiel is co-founder and former chairman and CEO of PayPal, Inc. In his essay addresses the same questions that have interested me over the past several months. He sees two ways forward.

In the long run, there are no good bets against globalization

And as it was in the days of Noah, so shall it be also in the days of the Son of man. They did eat, they drank, they married wives, they were given in marriage, until the day that Noah entered into the ark, and the flood came, and destroyed them all.  - Luke 17:26–30

For the judeo-western inspiration, it is a mistake of the first magnitude to place too much value on the things of this world. Those who busy themselves with the meaningless ideologies of politics, or with the interminable drama of human soap operas, or with the limitless accumulation of wealth, are losing sight of the impending catastrophe that may unfold towards the end of history. The entire human order could unravel in a relentless escalation of violence — famine, disease, war, and death. The final book of the Bible, the Book of Revelation, even gives a name and a place: The Battle of Armageddon in the Middle East is the great conflagration that would end the world. Against this future, it is far better to save one ’s immortal soul and accumulate treasures in heaven, in the eternal City of God, than it is to amass a fleeting fortune in the transient and passing City of Man.

For the rationalists of the eighteenth and nineteenth centuries, as well as for all those who consider themselves cosmopolitan today, this sort of hysterical talk about the end of the world was deemed to be the exclusive province of people who were either stupid or wicked or insane (although mostly just stupid). Scientific inculcation would replace religious indoctrination. Today, we no longer believe that Zeus will strike down errant humans with thunderbolts, and so we also can rest peacefully in the certain knowledge that there exists no god who will destroy the whole world.

And yet, if the truth were to be told, our slumber is not as peaceful as it once was. Beginning with the Great War in 1914, and accelerating after 1945, there has re-emerged an apocalyptic dimension to the modern world. In a strange way, however, this apocalyptic dimension has arisen from the very place that was meant to liberate us from antediluvian fears. This time around, in the year 2008, the end of the world is predicted by scientists and technologists. One can read about it every day in the New York Times, that voice of the rational and cosmopolitan Establishment. Will it be an environmental catastrophe like runaway global warming, or will it be murderous robots, Ebola viruses genetically recombined with smallpox, nanotech devices that dissolve the living world into a gray goo, or the spread of miniature nuclear bombs in terrorist briefcases?

Even if it is not yet possible for humans to destroy the whole world, on current trends it might just be a matter of time. The relentless proliferation of nuclear weapons remains the most obvious case in point. The United States became the first nuclear power in 1945; by the 1960s and through the 1980s, at the height of the Cold War, five declared nuclear states (the U.S., the uk, France, the ussr, and China) maintained a semi-stable equilibrium (at least as recounted by the historians who know ex post that the Cold War remained cold); as of today, there are two more known nuclear states (India, Pakistan) and perhaps even more (Israel, North Korea). And what if there are 20 nuclear powers in 2020, or 50 nuclear powers in 2050, armed with Jupiter missiles that can rain down destruction on enemies everywhere? We suspect the answer to this question, for we know that there exists some point beyond which there is no stable equilibrium and where there will be a nuclear Armageddon. A scientific or mathematical calculus of the apocalypse has replaced the mystic vision of religious prophets. 1

On the surface, the world’s financial markets remain eerily complacent. For the most part, they remain firmly rooted in the nineteenth century, when the march of History and Progress were more optimistic and certain. Although it encounters perturbations and larger corrections, the climb of the Dow Jones continues on an inexorable north-easterly path.

The news and business sections seem to inhabit different worlds that coexist on the same planet but rarely intersect. 2 Most financial actors are content to rule their separate kingdom, and to refrain from unprofitable questions about the integrity of the larger whole. Those who ask too many questions are not given a serious hearing. Like the deranged orators in London ’s Hyde Park, the prognosticators of a financial doomsday have been wrong for too long. Consequently, they have been relegated to a marginal role, if for no other reason than that they have lost most of their money and have no significant capital left to invest in anything.

More generally, apocalyptic thinking appears to have no place in the world of money. For if the doomsday predictions are fulfilled and the world does come to an end, then all the money in the world — even if it be in the form of gold coins or pieces of silver, stored in a locked chest in the most remote corner of the planet — would prove of no value, because there would be nothing left to buy or sell. Apocalyptic investors will miss great opportunities if there is no apocalypse, but ultimately they will end up with nothing when the apocalypse arrives. Heads or tails, they lose.

In a narrow sense, it seems rational for investors to remain encamped at the altar of the efficient market — and just tend their own small gardens without wondering about the health of the world. A mutual fund manager might not benefit from reflecting about the danger of thermonuclear war, since in that future world there would be no mutual funds and no mutual fund managers left. Because it is not profitable to think about one ’s death, it is more useful to act as though one will live forever. 3

Such a narrowing of one’s horizon cannot, however, be the last word. After all, there exists some connection between the real world of events, on the one hand, and the virtual world of finance, on the other. For macro investors, it would be an abdication not to wrestle with the central question of our age: How should the risk of a comprehensive collapse of the world economic and political system factor into one ’s decisions?

From the point of view of an investor, one may define such a “secular apocalypse” as a world where capitalism fails. Therefore, the secular apocalypse would encompass not only catastrophic futures in which humanity completely self-destructs (most likely through a runaway technological disaster), but also include a range of other scenarios in which free markets cease to function, such as a series of wars and crises so disruptive as to drive the developed world towards fascism, anarchy, or both.

Since the direct approach to our central question leads to paradoxes, absurdities, or at best money-losing investment schemes, it might prove more profitable to explore the inverse as a thought experiment: What must happen for there to be no secular apocalypse — for what one might call the “optimistic” version of the future to unfold? And furthermore, which sectors will do well — surprisingly well, in fact — if the world more or less stays intact, even if there are some major bumps and dislocations along the way? Any investor who ignores the apocalyptic dimension of the modern world also will underestimate the strangeness of a twenty-first century in which there is no secular apocalypse . If one does not think about forest fires, then one does not fully understand the teleology of each tree — and one badly will undervalue those trees that are immune to all but the greatest of fires. Even in our time of troubled confusion, there exists a chance that some things will work out immeasurably better than most believe possible.

(Read the whole essay.)

The task before us is large because we are venturing into an unknown world where the past is not our greatest asset, but a distraction. We need to see history in its proper context, and learn new ways of being a global society. This is the conversation that we should have today. And I hope that you'll take some time with loved ones to reflect back nine years, and then ask the optimistic question, without doubt or guilt or recrimination, how could we make this different a decade from now. Then our remembrance of those lost will honor their lives, and not simply feel sorry for them and angry at their murderers.

May God give us all peace and wisdom on this day of remembrance.

Image: The Great War and Modern Memory: The Illustrated Edition, Paul Fussell


Quick Takes: Welcome to My World, Barack

Secretary of State Condolezza Rice speaks on the world that Barack Obama inherits and the Bush legacy.

"... the United States under this president has been more active and more insistent that democracy is not just something for a few."
...
I’ve seen too many peoples dismissed as not ready for self-government. First it was Asians, and then Latin Americans and Africans were there for a while. I know for a while black Americans were, too. I’ve seen it said, well, you know: They’re illiterate; how could they vote? And then you see in Afghanistan people line up for long, long lines. Because somehow they know that making a choice matters.
...
George W. Bush deserves credit for recognizing that the terms were now going to be set for the next big historical evolution. The president recognized that freedom was something that was not just desirable but essential for the United States; that it meant not just freedom from tyranny but also freedom from disease, from poverty. And that if you were going to have democratic leaders, they had to be able to deliver for their people. Thus the president supported the millennium challenge and the H.I.V. AIDS and Malaria project. And linking up the great compassion of the United States with our security interests. Making it about democracy, defense and development. We’re at the beginning of that historical transformation, and yes, sometimes it’s lonelier at the beginning than at the end.

It’s really recognizing that this is about a single answer to what is the right form of government, and that’s democracy. It takes different forms: there is Japanese democracy, and there’s American democracy, and there are fragile democracies, and there are emerging democracies, and there are states that are trying to find some form of popular legitimacy.

During the Bush first term, I felt that the 21st century would be the century of freedom. That is at the heart of my own political philosophy.

When I read pieces like this interview with Secretary of State Rice, it takes me back to a summer I spent in Pakistan in1981 doing refugee work during the Afghan / Soviet War. We traveled all over the NorthWest Frontier Province along the Afghan-Pakistani border. We met people everyday who loved the USA because we represented freedom and hope to them. The Afghan's we met were fleeing war. The Pakistanis lived under a military dictatorship friendly with the US government.

The challenge that faces President-elect Obama is the complexity that forces moderation of ideology. However, when core principles are built on a common denominator that can be shared by all people, like freedom, then progress can be found.


A Sheltered Existence, A Global Perspective

One of the issues I have with the current state of politics and the media is the narrow, self-serving, imperial nature of it all. If you pay much attention to it, you'd come away with a very jaundiced view of the way life is in our country. If you turn off the TV news, and ignore the political culture, a different perspective begins to creep into the picture.

What I'm finding is that I've lived a pretty sheltered existence. The impression we may have is that Hollywood and Washington control the fortunes of the worlds nations. What I'm beginning to realize is that they have little impact in areas that matter. 

If you want to be informed, then pay attention to these trends or developments.

China: I can't say any more, except I realize that I know nothing about China, and that China will be the focal point of global development for the next hundred years.  I don't know where to begin on China. I'm open to suggestions.

Global Corporations: They are supra-national institutions uniting the world economically in ways governments cannot. Read Thomas Friedmann's The World is Flat as a start, and then find those who see global corporations as the greatest threat to our freedom.

Churches in the Global South: You can't judge Christendom by the current state of the American church. Read Philip Jenkins' The Next Christendom: The Coming of Global Christianity and The New Faces of Christianity: Believing the Bible in the Global South, and also Global Schism: Is the Anglican Communion Rift the First Stage in a Wider Christian Split? , a Pew Forum interview with him.

The U.S. Military: Frankly, I didn't think of this until I heard an interview with Robert D. Kaplan, The Atlantic Monthly writer and author of numerous books on global hot spots.  His latest release is Hog Pilots, Blue Water Grunts: The American Military in the Air, at Sea, and on the Ground. Hugh Hewitt, radio talk show host spent three hours talking with Kaplan about his travels with the US military. It is not the perspective that you get from the mainstream media or from the politicians.  Download and read the transcript, or spend about an hour and 45 minutes listening to their conversation. The audio is in three segments, here, here and here. Hewitt is a good interviewer. He's well prepared; asks good questions; and lets Kaplan do most of the talking.

A thread that underlies these four forces is the importance of technology. There is much more to learn, and I find myself constantly reminded of just how shelter most American's are. As I learn more, I'll share it here.