DAVOS, SWITZERLAND 22 January 2013
The weather here is crisp and snowy, but the global outlook heading into the 43rd World Economic Forum is decidedly more overcast. “Is global capitalism going through a prolonged period of convalescence,” asks the Guardian‘s economics editor Larry Elliott, “or is it suffering from an incurable sickness?” With the main engine of the world economy — the United States — still barely limping along with nearly8 percent unemployment, with the UK about to head into an unprecedented triple-dip recession, with the EU perpetually on the verge of falling apart, and with the pervasive sense that the political and financial institutions that ushered in the great post-war period of middle class growth are hopelessly broken, or at least not up to the task of producing a similar expansion in the new century, there’s ample fuel for pessimism. That’s why the theme of this year’s gathering is so appropriate: resilient dynamism.
It’s a complex concept — one that’s going to be defined in myriad ways this week — but for me it’s about exploring the idea that growth is no longer going to be something that just happens. And whether or not it does is going to depend on our ability — personally, collectively, globally — to respond to crises. We may not know what these new crises will be, but we know for certain they’re coming. And our collective ability to respond to them is going to be crucial. This is because, as Rockefeller Foundation president Judith Rodin writes, “What distinguishes today’s threats from those of the past are the escalating rate at which they are occurring, and the growing interconnectedness of our planet.”
Our burgeoning interconnectedness has given the world many gifts, but has also created many challenges. The consequences of a crisis in one area of the world are no longer contained by borders or language or currency or oceans. No longer can one nation that’s doing relatively well afford to ignore problems in other nations. In a sense it’s like the converse of the old saying “a rising tide lifts all boats.” Now, one leaky boat can have the power to actually lower the tide — and cause all the other boats to run aground.
We’ve seen this process unfold in the EU, where the economic system is only as strong as its weakest members. It’s not unlike the human body, where, of course, sickness in one part can’t be ignored just because other parts are healthy. So system-wide resilience is the key to health — the equivalent of a strong immune system. It’s not the absence of crises that determines our health, but our ability — and how we nurture and build and maintain that ability — to respond.
So how do we build a similar kind of resistance in the collective body politic? Rodin writes that decades of research at the Rockefeller Foundation have shown that there are five core characteristics that resilient systems have in common:
- Spare capacity
- Flexibility – the ability to change, evolve, and adapt in the face of disaster
- Limited or “safe” failure, which prevents failures from rippling across systems
- Rapid rebound — the capacity to reestablish function and avoid long-term disruptions
- Constant learning, with robust feedback loops
But even before efforts are taken to build these, one key element that’s required is will — we have to want to be resilient. And to bring that about we need to use the same interconnectedness that puts us in danger to increase the pathways of empathy. The more we can recognize the struggles of others, the more we can recognize our common humanity, the more we can come up with common solutions — an approach that is badly lacking in America’s political system today. This week, the Crossroads Foundation, a non-profit based in Hong Kong, will be returning to Davos with its “Struggle for Survival,” a sort of empathy-building boot camp that aims to put the participants in the place of those who are struggling for survival in the real world. It’s an experience that organizers say “deepens insights into challenges such as the battle for education, shelter, medical care, food, and the choices that face those who live with this reality.”
Another cause for optimism here in Davos is the World Economic Forum’s program for nurturing the next generation of leaders. Because if we’re truly going to build up the resilience necessary to face a new century of unprecedented challenges, we’re going to need new and unprecedented ways of seeing the world. And that’s most likely to come from those who aren’t mired in old ways of thinking that are no longer adequate for today’s challenges. Sometimes long experience is valuable. But sometimes it means being limited to offering old solutions for new problems.
The Global Shapers, as this WEF’s program is called, is a worldwide “network of Hubs developed and led by young people who are exceptional in their potential, their achievement and their drive to make a contribution to their communities.” Young people like Omnia Eteyari, a railway engineer in Libya, whose focus on building up transportation capacity makes her a literal interconnector; Arun Raj, a recent college graduate working in India’s non-profit sector to bring sustainable water supplies to the country’s urban areas; and Andrea Latino, founder of Green Geek School Education, a Rome-based project that spotlights the need for environmental awareness among our youngest and most tech-savvy innovators.
These Global Shapers are of a generation that grew up in a world of connectedness where the drive for empathy is an everyday part of their lives. And we’re going to need them. As Businessweek‘s Jeremy Kahn writes, “Over the course of 2012, the U.S. economy rebounded with all the vitality of a slug waking from a long nap.” He notes a paper written last year by Northwestern University professor Robert Gordon entitled “Is U.S. Economic Growth Over?” According to Gordon, future GDP growth “will be slower than in any extended period since the late 19th century.” One of the factors Gordon cites is the “need to reduce government and consumer debt” and the resulting “contentious political landscape” from fights over how to do that.
But if we’re really going to build resilience across the globe — as with our bodies — we’re going to have to provide our economies the fuel needed to grow. Diets, done right, are fine, but not eating at all isn’t a diet, it’s a hunger strike. When starved, our system starts to break down and eat itself — a phenomenon not unfamiliar to an observer of the European political and economic landscape of the last few years. So any attempt at building resilience is going to have to start with a recognition of the consequences of starving the patient. As with empathy, what we need is expansion, not contraction.
As Rodin writes, “Building resilience is not a luxury, it’s a 21st century imperative.” I’m looking forward to a week of discussions about how to meet that challenge.