Is “Back to Normal” What We Really Want?
We all like to believe that things will go “back to normal” in the near future.
In Economic Principles, Ray Dalio shows how life has been growing progressively worse over the last 20 years for such a large segment of society.
In “Our Biggest Economic, Social, and Political Issue”, he highlights in detail how 60% of Americans are struggling with, amongst other things, issues like rising inequality, stagnant wage growth, loss of job security and barriers to wealth creation.
He also dives into the challenges facing millennials who will never afford to own a house, and the fact that trust in both media and government are at all-times lows.
When you add in the scale of projected job displacement from AI and robotics advancements and what that means for large sections of today’s workforce, there’s a lot to be concerned about.
These issues are not just being faced within the US — the growing populist movement around the globe, from Europe to South America, is indicative of a world reacting to these same issues.
This represents a socio-economic challenge of immense proportions that was already in place at the start of this year, before COVID-19 arrived.
When you add in the fact that we’re now facing a deep recession, or possibly a depression, the picture starts to get depressing.
Yet it gets even worse. One of the most concerning aspects of this economic crisis is that it’s blocking out visibility of a much bigger and more far-reaching crisis: climate change.
We’re living in a time where we may already have raced past the point of no return, with emissions reduction being valued far less than economic growth.
One of the things that has saddened me the most over these past weeks is that, despite all the great images of smog-free cities, emissions will only be down about 5% this year, and are destined to return with a vengeance next year.
This puts the scope of the challenge in front of us into perspective: how are we to half emissions in coming decades when even a global hiatus barely slows them down?
Given that all of the economic growth in history has been intricately linked with an increase in emissions, it starts to look as though our current capitalist viewpoint is in direct conflict with our ability to live on this planet.
If this sounds a bit over the top, or something of a conspiracy theory, I’ll point you back to the founder of the world’s largest hedge fund, who agrees.
This is a lot to deal with. Yet the answers and solutions to so many of these issues are already clear and available.
On a recent Project Drawdown webinar, Jonathan Foley very clearly and simply and professionally outlined how we got to this point on climate and what we can do to move forward (his full report is available for free as a download on the Project Drawdown website here).
The truth is that the answers are all waiting for us, but we just simply don’t want to look directly at them.
I can’t say how many conversations I’ve had with really smart people over the last couple of years who simply haven’t a real and genuine interest in talking about the long term implications of these global issues.
It’s too much, too scary. I understand, I’ve felt that way myself. It’s easier to ignore, to hide. But when a global pandemic forces us all into a collective timeout in our own houses, maybe it’s a good time to take a peek at what lies ahead?
Nobody saw this pandemic coming. No governments, organizations or corporations were properly prepared — it’s been a great leveler.
So what can we do?
The recent words of Marc Andreessen have really stood out in my head: We can build. It’s all we can do, and it’s surely what we must do. You fall off the horse, you dust yourself down and you get back on again. And if you’ve been asking yourself why I’m lumping in the economic crisis with the climate crisis, it’s for this exact point.
As Jonathan Foley eloquently outlined, the world is ours to build. It’s up to us what kind of future we want, and it’s also up to us to go and fight for that. Whether that’s for ourselves, our kids, our legacy or our sense of duty, it doesn’t matter. But there’s now a bigger moral imperative than ever to look directly at the issues that we collectively face and work together to find better solutions.
Moving forward we need to be brave and bold. There’s so much on the line that it’s tempting to play it safe and try to please everyone, but what we need is an ambitious vision.
The reset button has been pressed on the entire world, there’s never been a better time to change things. Despite all that’s currently on the line, there are new opportunities that didn’t exist before.
These once-in-a-lifetime crises also open up equally rare opportunities for reform.
I don’t pretend to have all the answers, but when I read the ideas and perspectives of the types of people I’ve already referred to, there genuinely seems to be a common consensus. It forms around central and critical themes:
- Now is the time for tax reforms so we can restructure our healthcare system, as it has never before been so valued or so needed.
- To pivot hard towards sustainable development, clean energy and clean transport. To support and incentivize the inevitably difficult transition towards what is undoubtedly our energy future.
- To take a deeper look at education and how digital advancements can provide everyone with the opportunities to grow within the ongoing and upcoming advancements in tech innovation.
- To reassess how public and private partnerships can work — and be held accountable — to deliver triple bottom line growth. That there is an opportunity for profitability that can also help people and planet.
If we’re not careful, we can stagnate and start slipping backwards in each of these critical areas. Or, we can get ahead of these things and position ourselves back at the forefront of global commerce and innovation. Which is it to be?
Economic learning shows us that capital growth always starts with productivity. America’s productivity was jolted into hyperdrive by the 1930s depression and the surge continued up until the 1970s, driven by innovation and increases in efficiency.
The resulting growth propelled the US into its position as world leader and drove an incredible amount of social reform.
By all accounts, that era is now over. But it stands to show us what we can achieve when there is a unity of purpose towards a clear vision.
Over the coming years, there will be a pace of change unlike anything ever seen before. Over the coming months, we have the chance to set a new vision and align ourselves with a better future. But the window won’t stay open forever. Do we have what it takes to act?
Hotel developer, sustainability advocate, economist. Doing my best to use my words.