Towards a Resilient Global Economy

If I had to pick a single word to describe the global economy today, it would be fragile.  Policy makers and business leaders have actively built a system that destroys the environment in order to produce profits in the short term — by distributing goods and services across a global supply chain that is designed to minimize costs and maximize financial returns — while relying on structures that are profoundly susceptible to disruption.

This is done by dodging societal responsibility through a shadow network of tax havens (building up debt in the nations of the world and increasing wealth inequality); avoiding environmental protections by choosing to operate in countries where government officials can be bought on the black market (damaging the ecological commons on which all life depends); and creating deregulated zones where worker’s rights are minimal or non-existent (sowing the seeds of upheaval by keeping large numbers of people in a state of desperation).

All of this is done to extract as much monetary wealth as possible for investors who don’t care about the suffering they cause to those around them, as I described in How will the 99% deal with 70 Million Psychopaths? earlier this year.  This economic system has been built up gradually over the last few centuries.  Yet it is not built to last.  It is prone to manipulation by financial managers and can be destabilized to the point of collapse and ruin, as we saw in 2008 when speculative finance wreaked havoc upon the nations of the world…

…We need a global economy that is resilient against environmental change, political upheaval, and the various network effects of multiply connected systems.  And yet our politicians all-too-often focus on simplistic solutions like deregulation or cutting taxes, ignoring the immense complexity of the world as it really is and making the situation more dire by increasing our vulnerability to systemic risk with these actions.  We need robust infrastructure (e.g. roads, courts, hospitals, schools, etc.) and a social capacity for handling complexity that is nuanced, subtle, and riddled with surprises.  This means we need our citizenry and our institutions to be capable of managing the unknown (and often unknowable) linkages between diverse and evolving patterns of activity.

I realize that this is a tall order.  In a time when authoritarian ideology is on the rise, partly due to the fact that many people feel anxious and insecure about the accelerating changes unfolding around them, it seems unlikely that enough people will take on the challenging task of learning to think in evolutionary and dynamic terms about social, economic, political, and natural systems.  And yet this is what these times call for us to do.

To read more of this excellent analysis by Joe Brewer of the Cognitive Policy Works about what is necessary to repair our  economy from the destruction done by the 1%, please click here