Interview with Ukraine’s InvestGazeta
I often get interview requests from newspaper and magazines as they probe for a better understanding of the world ahead. However, the request I received two days ago was a bit unusual.
On Monday, I received an email from Elena Snezhko, a journalist with the Ukrainian financial weekly magazine InvestGazeta, posing a series of question about which countries will rise to power 40 years from now, and why.
In 200 BC, the great Carthaginian General, Hannibal, used an army of elephants to symbolize power. In World War II the idea of power was symbolized by heavy artillery in the form of tanks and bombs. Tomorrow’s battles may be so strange that people will long for the days of guns and knives again.
Here is how I answered her questions.
Elena Snezhko – In what way will the power shift among countries (in the world) by 2050?
Thomas Frey – It’s an intriguing exercise to think through the process that people will use to rise to power in the future.
In the future, will corporate CEO’s have more power and control than leaders of individual countries? Will religious organizations, wielding their international clout, begin to usurp the authority of their host nations? Will groupings of countries such as the European Union, OPEC, and the UN supersede the power of their member states? Will non-governmental organizations such as the International Monetary Fund, the World Bank, and perhaps even ICANN rise in influence to a point where they can usurp the authority of individual countries? Will the economic ties of large professional organizations, such as IEEE (Institute of Electrical and Electronics Engineers – currently 365,000 members worldwide), transcend the authority of the countries where their members live?
In the past, the power of a nation was considered the ability to defeat an enemy and protect its own people. But power today is more about the ability to influence and control other countries, even though a few still cling to the notion that it’s about defeating the enemy.
In the future, a few dominant countries will continue to serve as the global police to quash uprisings and resolve disputes. But as communication systems improve, we will see fewer and fewer willing to openly wage war with an enemy.
Most of the power shifts between now and 2050 will result from subversive economic battles, and the ability to control or disrupt revenue streams. For the disruptors, the tools for creating chaos are becoming more destructive, and soon a single individual with the right kind of gear will be able to shut down, perhaps even destroy, an entire nation.
The power centers of the future will be the countries with systems most adept at competing in the global marketplace. Large countries like China, Russia, Brazil, India, Japan, England, and USA will still play major roles, but smaller countries will have a distinct advantage with their ability to quickly adapt and experiment with new approaches.
ES – What will be the main reasons for that kind of shift?
TF – Three primary drivers will be our improved communication systems, including the Internet, an increasingly mobile society, and our seemingly relentless drive for transparency.
1.) The Internet. With social networking tools like Facebook, we can easily become friends with people in dozens of different countries and read about their family and friends. We are far less likely to go to war with people when we know their families members by name. Instead, our Facebook friends become our business partners, our advisors, and our talent pools.
As the Internet continues to develop, it is becoming the nerve center for a larger global intelligence that is still in its infancy. In its current form, the Internet has the ability to shift public opinion and even alter the balance of power at a moment’s notice.
Future iterations of the Internet will be unrecognizable by today’s standards, and as it evolves, the power of nations will evolve with it.
2.) Increased Mobility. In much the same way borderless economies created by the Internet caused individual countries to lose control of commerce, personal air transportation devices in the future, such as flying cars, will cause countries to lose control of their citizens.
People will increasingly work and live in multiple countries. As our ability to move across country borders becomes more seamless, society itself will become far more fluid, with loyalties to an individual country diminishing along the way.
3.) Transparency. Transparency will not only result from the availability of handheld cameras, video devices, online reputations, and data mining. It will come from all of those and far more.
In much the same way programs like Microsoft’s Photosynth can stitch together numerous photos to create one massive panoramic image, programs in the future will use thousands of different inputs to stitch together an increasingly clear profile of every individual on earth. Their accomplishments, failures, foibles, and idiosyncrasies will all come to life in the coming era of transparency.
For this reason, the concept of leadership will change, and country leaders will have far less of what we describe as the “unbridled power” of the past.
ES – Are we to expect the number of countries in the world to remain the same? Or will it change? For what reasons?
TF – To answer this question, we should begin with asking how the role of a country will change in the future.
In the past we have associated a country with attributes such as a single geographical territory, a common people with a common culture and language, a common government with its own currency and its own set of laws and regulations, and a series of systems that tie the country into a functional entity.
My prediction is that a series of small micronations will begin to emerge within the next 10 years, and they will dramatically shift the face of global politics. Many will serve as experimental nation states giving rise to new forms of government and unusual political models.
Some will experiment with things like corporate nation-states, religious states, tax-free zones, single-function or single-purpose countries, cause-related countries, and even rental nation-states where organizations can “rent a country” for a year or two to test a specific project.
Some existing nations may even buy or create their own island countries as a way to extend their influence and test new systems in other parts of the world.
“Open enrollment” citizenship may emerge. As the concept of creating a virtual citizenry, where citizens do not have to reside in the country they are affiliated with, gains in popularity, open enrollment will cause many new laws to be created to sort out responsibilities between countries and the people they control.
As more and more countries come into being, vying to attract the wealthy and talented, existing countries will be forced to compete to retain their own citizens. If something or someone were to cause a mass migration of wealthy families to micronations, this would cause grave concern among established governments.
ES – What countries will be economic leaders of the world in 2050? In what way will they achieve it?
TF – Counties serve as the economic and social operating system for the people and businesses operating within their borders.
To improve their standing in the global community countries will need to improve the efficiency of their own internal systems. As an example, a super efficient heathcare system will minimize the loss of talent and allow additional resources for other matters. Similarly, a highly proficient immigration system will enable countries to attract talent at a moment’s notice.
I’ve often said that the country with the most efficient tax system “will win.” Most taxes have a severe dampening effect on economic activity. They create a adversarial relationship with the government and occupy entirely too much intellectual bandwidth.
Tech-savvy countries will have the edge. Digital systems will prove far more efficient than paper ones. But digital systems alone are not the answer. They need to be coupled with efficient government decision-making processes. China has shown a remarkable ability to shift gears and adapt to new situations.
In addition to the BRIC countries of Brazil, Russia, India, and China, some of the rising stars in the emerging global economy will be Poland, South Korea, Mexico, Turkey, and Vietnam. They will rise to power based on the speed and efficiency of their own internal systems, their access to talent, and their ability to adapt to new situations quickly.
ES – What factors will influence the economic and global political power of USA, China, Russia, Germany and European Union?
TF – The biggest factors will be the national and global systems, grooming next-generation talent, and population levels.
1.) Global Systems. We find ourselves going through a unique period where we will be transitioning from national systems to global systems. Behind every economic battle will be a battle of systems, and an underlying effort to streamline and simplify. At the same time, competing efforts will be pushing to extend system capabilities in a way to gain a competitive advantage.
As an example, nations today each have their own systems for dealing with patents and intellectual property. It’s a cumbersome and highly inefficient. Cross-border monitoring and regulation is difficult at best. Companies who dedicate resources to working through this minefield have fewer resources to dedicate to other issues. A global patent system will reduce the cost of doing business globally and give some of the emerging technologies more of a fighting chance.
2.) Next Generation Talent. Today’s education systems are clunky and highly inefficient. They tend to focus on developing skills for the past, emphasize textbook learning as opposed to practical experience, and bestow credentials with little relevancy to tomorrow’s employment marketplace.
Future online education systems will enable the bright young minds of tomorrow to have access to skill and training repositories from around the world with little regard to their current social status.
3.) Population Levels. One huge economic factor in the background that gets very little attention is the declining population levels among today’s most powerful countries. Fertility rates are declining and every change in the population alters the supply-and-demand equation for the global marketplace.
Declining populations will require fewer buildings, less food, and fewer purchase transactions. Yes, there may be some short term anomalies where a country’s economy will pick up in spite of a declining population, but in the long run, since people create the demand, fewer people will mean lower economic drivers.
ES – What will be the main geopolitical and economic challenges the world will face in 2050?
TF – I often describe the future with human-like characteristics. So think of it this way. The future hates complacency, so much so that it has built-in self-sabotaging mechanisms to continually hold our feet to the fire. It will not allow us to shift into neutral. If we are not moving forward, we are moving backwards. There is no middle ground.
People are at their best when they are challenged. If we don’t challenge ourselves, the future has a way of giving us challenges anyway. There is great value in our struggles and human nature has shown us that we only value the things we struggle to achieve. We are currently out of balance between backward-looking problem-solving and forward-looking accomplishments.
Forward accomplishments help erase past problems. They solve problems in a different way. We need more forward-looking accomplishments, and our greatest challenges in the future will come in this area.
To this end, I recently announced what may be the world’s most challenging competition, a contest that will involve sending scientific probes to the center of the earth.
The “Race to the Core” competition is being framed around an Olympic-style battle of the minds where individual countries will field teams to tackle the enormous problems associated with sending scientific probes 3,950 miles straight down to the center of the earth.
Every time we experience an earthquake, volcano, or hurricane, we have very little understanding of why it happened or what may be done to prevent it. As we solve the massive technical issues associated with sending probes to the center of the earth, we will also find new mineral deposits, gain in our understanding of the weather, earth cycles, and even human survival.
ES – Are we to expect the creation of the global government by 2050? If yes – what structure do you think it will have? If no – please explain what factors will prevent the world from creating the united global government?
TF – The best way to answer this question is to create a scenario involving the world’s first global election where over a billion people vote and select a winner for some global office. Naturally, some of the first questions that will come to mind are “what office will this person hold?” and “how much influence will they have?”
It may be possible to stage a global election like this, and for the people involved to rise to power. But I really can’t envision a scenario where there will be any form of global government over the next 50 or even 100 years. There may be some attempts, but none will get much traction.
What we will see, however, are a growing number of global systems, and these systems will grow in importance over time. As an example, we will see efforts to create a global stock market, global accounting standards, global standards for weights and measurements, global systems for dispute resolution, global currencies, and possibly even a system for global taxation. Some will work, others will be colossal failures.
A friend of mine recently asked me if I speak “earthling,” and went on to push his notion that we need a global language. While we will undoubtedly move towards technologies with global translation capabilities, there is also little chance that we will see any true global language within the next 100 years.
ES – What will happen with the climate of the Earth by 2050? What might disappear by that time?
TF – I often talk about the “life cycle of a cause.” The only thing that will disappear by that time will be the talk about climate change. As with every major cause of the past, we simply “adjust and move on.”