Thursday, 30 April 2015

The world looks like it’s getting worse. Here’s why it’s not.

In World Economy News 30/04/2015

The world may feel like it’s about to explode.
Death ships on the Mediterranean. Cyberattacks in America. Syria in turmoil. War in Yemen and Ukraine. Islamic State, Boko Haram, al Shabaab — all on the move.
If the world seems more volatile, it is. If it seems more dangerous, not so much.
Welcome to the war of perceptions, in which an ever-improving planet seems ever more at risk largely because of the noise.
Many more people are hearing from many more people as they compete for the same, or fewer, resources. The result: a louder world, and more anxiety about the noise, but not necessarily deeper crises underneath.
“It’s almost the principle of network mathematics that when you build a system of globalization like the one we’re building with computers and speed, you’re going to get volatility, and we see it in the financial markets, and we see it in the rise of groups like ISIS overnight and their ability to empower themselves through their own engagement with global technologies and communications,” said Steve Coll, author of several books on terrorism and dean of the Columbia School of Journalism. “You’re looking at a world that is more subject to sudden shocks.”
Coll was among five previous winners of the Lionel Gelber Prize interviewed for a video project to mark the 25th anniversary of the award, which is named for the late Canadian diplomat who helped create the state of Israel. The award — granted, through the Munk School of Global Affairs at the University of Toronto to the best English-language book on international affairs – was given this week to Serhii Plokhy, author of The Last Empire: The Final Days of the Soviet Union.
The others interviewed were Paul Collier of Oxford University; China scholar Jonathan Spence of Yale University; the American political scientist Walter Russell Mead; and human rights expert Adam Hochschild of the University of California at Berkley.
Each author was asked about the world today, and whether it is in better shape than in 1990, when the award was created, communism was on its deathbed and the Internet in its cradle.
They noted the world has seen extraordinary declines in poverty and child mortality, epic rises in global trade and investment, and the spread, albeit fitfully, of democracy and human rights. The threats of loose nuclear weapons from collapsing nations, debt crises in Latin America, Southeast Asia or Russia, a war between India and Pakistan, the collapse of Africa and a litany of global pandemics have all been avoided.
The Gelber winners each said they maintained optimism about the next 25 years, for different reasons. But equally, they remain concerned about the world’s ability to cope with emerging small forces, including terrorists and cyberattackers, and the potential that their asymmetrical pressures bring to bear.
Despite the noise, five of the dominant themes of the past quarter century — terror, rising China, the struggle for human rights, poverty and American hegemony — have been reasonably well managed. Even terrorism, Coll contended, could have been a lot worse, as fears of massive, random civilian attacks in the West subside.
How those forces play out in the next quarter century may be more challenging:

Spence, one of the world’s pre-eminent sinologists, who has been visiting the country for 60 years, said he is still shocked by China’s ability to manage rapid change. “I certainly didn’t expect the kind of speed with which China would be integrated in a kind of global community. That startled me, and still startles me.”
He said the regime — more so recently under President Xi Jinping — has been able to manage disruptive forces across the country through a sophisticated system of rewards and punishments, even within the Communist Party.
China will be challenged to maintain that system as it reaches into other countries, and continents, to protect and expand its interests — both through the hard power of its military and the soft power of its diplomatic and economic interests. Mining in Africa. Oil exploration in the Arctic. The promotion of Chinese language and media. Spence said one of the great challenges of the coming decade is the rest of the world learning how to live with an expansionist China, and China learning to adjust to global responsibilities.

The most positive story of the past quarter century, especially in Africa, is the reduction in poverty. Now the challenge is to translate economic growth into social progress and a stronger middle class.
The collapse of commodities prices has thrown some of Africa’s recent hopes into question, but for those who assume oil and mineral prices will regain some of their strength, Africa is still the new frontier — and a very young one. The continent’s urban population is projected to triple by 2050.
“We are at the point of a big struggle over whether natural resources will become an opportunity that is harnessed or a mistake that is repeated,” Collier said. Will Africa’s new mineral and oil wealth finance despots and their cronies, as was the case in the commodities booms of the 20th century? Or will they produce competitive private-sector players, create high-value jobs and sustain well-functioning governments and public institutions?
Democracy and human rights

The collapse of communism opened the floodgates to the spread of democratic principles and human rights. Those are under assault once again in Ukraine, Russia, across the Middle East and North Africa, as well as in China.
Still, Hochschild, who has written extensively about the long march of human rights, particularly in Africa, does not see a reversal. Peaceful, democratic transitions of government in Nigeria, Sri Lanka and Indonesia are positive examples.
Digital and satellite technologies secure an inevitable, if halting, progress by giving citizens the tools to probe, understand, criticize and even select (through mobile voting) their governments. The Internet may yet prove to be more valuable than the U.S. Bill of Rights as an envoy for democracy.

Militant groups don’t need to seize power anymore; they can carry out their objectives by infiltrating societies everywhere through mass technology.
As Coll noted, extremists such as Islamic State “manage their own media operations, their own branding strategies and recruitment strategies without really much need for the formal mechanisms of the state because of the way technology makes it possible to self-empower.”
A greater concern, he said, is the use of cyberwarfare by states and their proxies. A major disruption, such as a utilities network, could lead to reprisals and bring down far larger networks.
“Cyber is the most important new field of defense competition and probably the most important new field of warfare looking out over 20 or 40 years,” Coll said.
He is most concerned about China and Russia, China because of its desire to use technology to match U.S. military supremacy and Russia because of its need to offset its declining traditional power.
American hegemony

For those who, in 1990, had doubts about the future of the last remaining superpower, the United States is as great a force as ever — in military affairs, diplomacy, education, media, energy and, most profoundly, digital technology.
Although the outcomes of the Iraq and Afghan wars remain uncertain, the United States remains the global cop. It also endures as the preferred quarterback for humanitarian operations, from Haiti to the Ebola zone. And its corporations continue to expand despite attempts by the European Union and China, among others, to curtail them.
Don’t assume these forces are benign, especially to governments and economies that follow a different model. “American power is inherently not a calming force in the world,” Mead noted.
But if the world feels like it’s about to explode, the perceived victims are likely to continue to turn to the United States.

Source: Reuters