Hard Times Are Just The Beginning

Yoko Ono concluded 1980’s Double Fantasy singing ‘Hard Times Are Over.’ For better or worse – I am personally fond of Ono – we are not living in a Yoko Ono album. Hard times, in fact, are just beginning. I am not one to peddle doomsday predictions with sanguine efficiency in the manner of Nouriel Roubini. More often than not, such predictions are vague and errant exercises in vanity. On the eve of the G20 conference in my fair City of London (actually the conference is closer to the Docklands, suggesting just how much the City’s power has faded) it seems appropriate, however, to consider the state of the world and where it is going. The current trajectory, I fear, is not a destination festooned with palm trees and frivolity.

Much of the banter on the G20 conference has focused on the myriad challenges participants must discuss – global financial architecture, regulation, stimulus packages, coordinated action, etc. The world economy is indeed in turmoil and there doesn’t seem to be a day that goes by without some other piece of news on growing unemployment or new business failures. These hardships are real and serious. People’s livelihoods are at stake, lifestyles are in a period of painful readjustment, and much of the global populace is ridden with uncertainty. There is a justified fear amongst policymakers and politicians that public ire brought on by these difficulties may erupt into something nastier. Unfortunately politics are mostly national and compromise is going to be difficult.

It will be easy to try and placate those affected by the current economic crisis by scolding and scapegoating irresponsible businesspeople, yet it is ultimately a distraction from the eclectic range of challenges facing the world. As the G20 protesters themselves indicate, there are many issues demanding urgent attention and there is a risk that addressing each problem appropriately will be drowned in a sea of angst. Cleaning up the financial mess we currently find ourselves in is indeed the first matter to attend to, but like good chefs, global leaders must have the second, third, and fourth courses simmering on the backburners, ready to be dished out when the order is up. It seems many of the world’s orders are up.

Global activity – I use that term loosely and generally –requires a functioning economic and financial system to move forward in a state of ‘normality’. Confidence is a significant part of this normality and the lack thereof is aggravating a condition that is anything but normal. As normality is achieved, several key global challenges must be addressed with urgency. The principal three challenges in my view include climate change, careful management of paradigm shift in global political order, and, yes, a framework to deal with artificial intelligence and nanotechnology.

Climate change seems to have safely entered the daily discourse and awareness is high. Yet consumers – everyone is a consumer, see the previous post for more on this - are reticent to face changes in lifestyle while facing economic hardship not encountered in the developed world for quite sometime. Changing the global economic architecture will not just require a gutting of the existing framework. It will require a new design and new expectations. It seems highly spurious to try and price carbon and other pollutants while compensating consumers. The fundamental message our current debacle is we have over consumed material things. A shift is needed, as there is no panacea falling from the sky allowing us to live indulgent lifestyles while keeping our environment in a state of habitability. I do not envy the politicians dealing with this quagmire. There is ample opportunity to weave green issues into economic issues as they are inexorably linked. To ignore climate change and take the easy way out in soft reductions of emissions is to invite nature to do its work for us. Already some British climate scientists are suggesting that the population may fall to 1 billion people (it stands at nearly 7 billion now) by the end of the 21st Century. Natural changes are already occurring and are likely to have a profound impact on the geopolitical landscape to come.

Changes in material lifestyle are difficult for any populace to deal with, but hopefully a discourse can be constructed that appeals to the better factions of human behaviour. Material changes in lifestyle combined with a new societal order are far more challenging. Social order is showing its first frays in the developed and newly developing world in a long time. Being denied an SUV is one thing, but facing a shifting power structure that alters your ability of self-determination complicates the matter. China and India are indeed rising powers, but it is unclear if they are keen to exercise the leadership such political power bestows on them. So far this does not seem to be the case. They want a seat at the table, but are happy for the US to remain in possession of the gavel. The actual unfolding of events will be slightly different I imagine. Despite the economic hurricane we find ourselves in, let’s call it the West’s financial Katrina, lifestyles have been too entrenched in capitalism to upturn this power structure. Capital itself has become subservient to the power of consumption.

The global elite – look to the World Economic Forum in Davos for the types I’m talking about – have no doubt taken a punch, but they have been remarkably good at scapegoating some of their own in order preserve the institutional power structure that has served them so well. Masters of the Universe is not a term to be given to this group of individuals. This is not a group that is coordinated in conspiracy theory fashion. It is a group that is moulded and shaped by structures that have slowly evolved in a Foucaultian network of power. Self-preservation, however, is instinctual, and they will ensure a political and social order that serves them. This will continue to revolve around the nexus of capital and consumption, compounding the problem of climate change. Political economist Susan Strange was onto something when writing a book entitled The Retreat of the State: Diffusion of Power in the World Economy. In it she describes the shift of power from states to markets and multinational corporations. Already she has been vindicated by her pronouncement that markets outgrew governments. In the absence of leadership, it will be MNC's that likely gain significant power as governments are weakened from the cleanup process they are now just beginning. Privatisation will see a new onslaught brought on by fiscal need more than anything. It is likely things we would never imagine could be privatised. What this means for social stability remains unseen, but from an optimistic perspective, some corporates might tackle climate change with vigour from a profit motive. How much MNC’s adapt aspects of a political structure in the vein of postmodern science fiction remains to be seen.


Artificial intelligence and nanotechnology hold both great promise and great risk for society. More often than not, lack of supervision and political structures tend let risks slip through the cracks and I fear this is this case with both A.I. and nanotech. I am not an expert in these matters, but from my limited understanding of complexity theory and the concept of Singularity, there is much to fear. The challenges previously discussed are at least all on the table of world leaders. Some effort is being made, productive or not. This is not, however, the case with A.I. and nanotech. Guidelines are needed and the institute that promotes the creation of a technological Singularity – an artificial intelligence greater than human intelligence – is most definitely aware of this. Eliezer Yudkowsky of the Singularity Institute (www.singinst.org) gives an in-depth overview of the risks of benefits of A.I., which is available to download from the Institute’s website. It is the rate of A.I. intelligence growth that must be carefully managed and a public discourse created to discuss the social and moral implications of such a radical change in our society. The longer this is put off, the more likely the technology will run ahead of governance mechanisms, much in the way the markets have done over the past twenty years. Unlike financial crises, an A.I. crisis may have more malevolent implications than unemployment or egg throwing at bankers. Policymakers and global leaders take note.

Hard times are not over. They are just beginning. My predictions may well be very off and other new challenges may come into view due to the inevitable myopia of human beings. I hesitate to even describe the above as predictions, but rather potential scenarios. Nonetheless, I believe these are scenarios to be aware of and ready for a response should they occur. Hope is not lost, but those expecting an easy ride are apt to be disappointed.

This brief discussion warrants a critical overview of scenarios presented in creative works, which will be an upcoming piece, so watch this space.