Posts tagged ‘intellectual capital’


Coronavirus: the weakening of globalization, and the lessons to learn

12.03.2020

A generation ago, I don’t think many would have thought that globalization could be brought to its knees by a virus. They may have identified crazy politicians using nationalism as a tool, but probably considered that would not happen in developed economies and democracies sophisticated enough to withstand such assaults.
   This course correction might be poetic to the pessimist. Those who emptied their own nations’ factories in favour of cheaper Chinese manufacture perhaps relied on appalling conditions for their working poor; and if China were incapable of improving their lot—and you can argue just why that is—then with hindsight it does not seem to be a surprise that a virus would make its leap into humankind from Wuhan, itself not the shiny metropolis that we might associate with the country’s bigger cities. Those same corporations, with their collective might, now find themselves victim to an over-reliance on Chinese manufacture at the expense of their own, with their primary, and perhaps only, country of manufacture no longer producing anything for them as the government orders a lock-down.
   I argued months ago that failing to declare the coronavirus as a matter of international concern a week before the lunar New Year was foolhardy at best; perhaps I should have added deadly at worst. Here is the period of the greatest mobilization of humans on the planet, and we are to believe this is a domestic matter? If capitalist greed was the motive for downplaying the crisis, as it could have been within China when Dr Li Wenliang began ringing alarm bells on December 30, 2019 and was subsequently silenced, then again we are reaping the consequences of our inhumanity: our desire to place, if I may use the hackneyed expression, profits above people. And even if it wasn’t capitalism but down to his upsetting the social order—the police statement he was forced to sign said as much—the motive was still inhuman. It was the state, as an institution, above people and their welfare.
   We arrive at a point in 2020 where one of Ronald Reagan’s quotes might come true, even if he was talking about extraterrestrials. At the UN in 1987, President Reagan said, ‘Perhaps we need some outside universal threat to make us recognize this common bond. I occasionally think how quickly our differences worldwide would vanish if we were facing an alien threat from outside this world.’
   This might not be alien, but it is a universal threat, it is certainly indiscriminate and it affects people of all creeds and colours equally.
   Our approaches so far do not feel coordinated globally, with nations resorting to closing borders, which prima facie is sensible as a containment measure. You would hope that intelligence is being shared behind the scenes on combatting the virus. I’m not schooled enough to offer a valuable opinion here so I defer to those who are. But I’m not really seeing our differences vanish, even though we are being reminded at a global level of the common bond that Reagan spoke of. This is a big wake-up call.
   Examining the occidental media, there appears to be a greater outcry over President Donald Trump closing the US from flights from the EU Schengen zone than there was when China faced its travel ban, suggesting to me that barring your nation from people within a group of 420 million is a bigger deal than barring people from a group of 1,400 million. One lot seems more valued than the other lot.
   What I do believe is that we have made certain choices as a people, and that while the pure model of globalization raises standards of living for all, we, through our governments and institutions, haven’t allowed it to happen. We’ve not seen level playing fields as we were promised. We’ve seen playing fields dominated by bigger players, and for all those nations that are sucked into the prevailing mantra that arose in the 1980s, we’ve allowed our middle classes to shrink and the gap between rich and poor to grow. The one economic group that assures prosperity has been eroded.
   As it’s eroded then we’re looking at economies that favour the rich and their special interest groups over the poor, rather than investing in public infrastructure and education.
   No wonder many lack faith in their institutions, and their willing and continued pursuit of the monetarist order over humanistic agenda.
   Yet at the one-to-one level many differences disappear. It’s not helped by social media, those corrosive corporations that seek to separate through algorithms that encourage tribalism, but those that take the time to have a dialogue realize that we are in this together. Within these elaborate websites lies some hope.
   My entire working career to date has been mostly one where individuals and independent enterprises have formed contracts to do business, creating things that once didn’t exist through intellectual endeavour. We have done so outside elephantine multinationals, within which many imaginations have been stifled. We are people who can think outside the square—and all too often, the inhabitants of the square reject us anyway.
   When the world comes back online, I hope we have learned some lessons about the source of our troubles. We’ve willingly let certain institutions get too big at our expense; we’ve allowed a playing field slanted in their favour that encourages a race to the bottom by outsourcing to underpaid people; and as a result we’ve allowed unhygienic conditions to flourish because they’re “over there”, instead of holding corporations and nations to account. It will take us making choices with our eyes open about policies that champion individuals over big corporations; genuinely creating level playing fields where entrepreneurship can flourish at every level and benefit all; ensuring that we properly fund education and other long-term investments; and having strong foreign policies that can constructively call out injustices by suggesting a better way. We need to do this over the long term. The big corporations have mustered global power and so must individuals. Nationalism is not the answer to solving our problems: it is a reaction, a false glimpse into the past with rose-coloured glasses. It is no more a reflection of our past than a young northern lad pushing his bicycle uphill to Dvořák’s ‘New World Symphony’. Nostalgia is often inaccurate.
   Whether you are on the left or the right, whether you love Trump or Sanders, Ardern or Bridges, we’re simply lying to ourselves if we think the other political side is our enemy, when it’s in fact institutions, political or corporate, that have grown too distant to be concerned with anyone but those in power.
   Call me an idealist, but we could be on the verge of a humanistic revolution where we use these technological tools for the betterment of us all. Greta Thunberg has done so for her agenda, and we have a chance to, too: a global effort by individuals who see past our differences, because we have those common bonds that Reagan spoke of. Let’s debate the facts and get us on track, resisting both statism and corporatism at their extremes, since they’re sides of the same coin. What empowers us as individuals? In the system we have today, is there a party that can best deliver this? Who’ll keep the players honest? When we start asking these in the context of the pandemic, the answer won’t be as clear as left and right. And I’m not sure if the answer can even be found in major political parties who wish to deliver more of the same, plus or minus 10 per cent.
   Or we can wait for the coronavirus to disappear, carry on as we had been, keep dividing on social media to help line Mark Zuckerberg’s pockets, and allow another pandemic to venture forth. It can’t be business as usual.

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Posted in business, China, culture, globalization, politics, social responsibility, technology, USA | No Comments »


In the wake of the ’quake, a time to be bold

06.03.2011

The Christchurch earthquake is certainly not over, not while the city rebuilds. And the bill, at a meeting I had with some other luminaries last Thursday, is estimated to be in excess of the NZ$20,000 million that the New Zealand Government predicts.
   So, other than juggling the funds, what does the Government intend to do?
   Because for the last decade or so, I cannot see anything from either major party that has fundamentally encouraged the New Zealand entrepreneur to build an international enterprise, nor can I see anything that shows me that the government of the day understands that we face an ever widening gap between rich and poor as foreign-owned companies’ profits go offshore.
   Yet if both major parties are so intent on the idea of global trade and this so-called level playing field, then why has New Zealand always buried under it? It’s not level when our best firms become subsidiaries of foreign corporations, and our innovation makes our innovators very little money.
   A truly level playing field would have seen more Kiwi companies acquire overseas ones—and I don’t mean solely in the dairy sector. Only then can the free-trade pundits claim success in raising real GDP and standard of living for New Zealanders.
   If the bill runs into the NZ$60,000 million region that we bandied about, then those funds have got to come from somewhere. Selling more of the family silver or shifting money around a limited pool aren’t going to cut it. We know this from the post-1984 experience.
   While the world has a demand for intellectual capital, and products and services that are based around the sort of innovation that New Zealanders are well poised to deliver, it’s still astonishing that this sector contributes under 10 per cent to our GDP. It should be doing twice that.
   It should have been grown a long time ago, certainly since the late 1990s when I had begun banging on about it.
   I certainly wasn’t the first, not by a long shot.
   Any effort like this must be coordinated, as any venture: both private and public sectors need to be geared to this reality. But the Government acts as though it doesn’t matter if we keep slipping behind, or if we get locked in to industries as a result of TPPA.
   Singapore might not be perfect politically—as Mr Brown’s blog details—but there is much to admire about its willingness to embrace intellectual capital as a means of economic growth.
   The negative growth we have had over the last few years—and Labour’s complacency during the good years before that—is going to lead to a credit crisis in the future, no matter what the credit-rating agencies say. The earthquake as only hastened this date.
   It’s not unbridled growth I’m talking about here. I am referring to us getting our fair share of the pie rather than ‘make the pie higher’, with the independent thinking I have seen New Zealanders being capable of, time and time again.
   When I was asked on Thursday what I expected to see, I answered: (a) strong New Zealand-owned businesses that are globally oriented; (b) cooperation between public and private sectors on innovation; (c) a real understanding of a level playing field—which does not mean furthering the technocratic agenda, which, ultimately, decreases the potential tax take any government could have to fund social services.
   It’s a long-term plan, and for me, Wellington could have served as a microcosm of what is possible.
   Under Mayor Wade-Brown, it still can, and she has certainly stated on a few occasions that she has a desire to see the tech sector grow in this city. It’s a start.
   And now is not a bad time to start on this course, because Christchurch is going to take us years to rebuild and to pay for.
   If only we had vision on the national stage. Now is, Prime Minister, the right time to be bold, and work for the interests of New Zealand once more.

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Posted in business, leadership, New Zealand, politics, technology, Wellington | 2 Comments »