Globalization: The Future of Freedom

A highlight of the opening afternoon sessions of the Arthur W. Page 2008 Spring Seminar was a presentation on “Globalization: The Future of Freedom” from Dr Fareed Zakaria, editor of Newsweek International, bestselling author and frequent TV commentator. Dr Zakaria’s latest book, “The Post-American World,” was just published.

In a wide ranging commentary he touched on a number of issues – the disconnect over the last few years as seemingly negative political news has had very little impact on the financial markets; the tendency of media in a 24/7 news cycle to focus on bad news just because it’s there; the relative lack of success of terrorist groups which have morphed into small, dysfunctional and not very well organized groups who have only managed to undertake localized events.

He made the case that there have been two great shifts in power in the last 500 years. The first was the rise of the Western world from the 15th century on, and the second the growth of the United States into the most powerful and richest country in the world — as the US took advantage of post 1880s industrialization.

Now we are in the middle of the third great power shift, the rise of the rest of the world. For example, in 2007, 120 countries grew at a rate of over 4% per annum. We have never before seen such synchronous global growth in every corner of the world. Modernity has now become an indigenous culture in every part of the globe, and there is a complete proliferation of multiple cultural perspectives – as opposed to a monocultural, US centric view – in many countries.

The implications for the United States are significant. The first is that we don’t define the global policy structure anymore. But we still have a major strength in the American education system — which, on an apples for apples basis, is still the best in the world and enables us to be enormously competitive. It means that we can move up the value chain very quickly. So we have many core strengths, and it’s important not to throw them away.

In responding to questions from the floor, Dr. Zakaria was asked to expand on the three most pressing issues that the US has to solve in order to maintain its economic and political status.

The first, he said, was to get our entitlement system in order, particularly around healthcare and especially Medicare and Medicaid. The proportion of GNP that is going to the health care system is on an unsustainable trend, and will have a major negative competitive impact.

The second was the solve our energy problems. We haven’t figured out a way to use energy efficiently, and are still too reliant on the 19th Century technologies — the outcome is an enormous wealth transfer to energy producing countries.

And the third is to reorient our foreign policy to become a coordinator and a catalyst rather than adopt a hegemonous approach. People in other countries don’t like to be pushed around, and we have to become part of the solution rather than part of the problem.

A very stimulating session, and a great example of the thought leadership the Arthur W. Page Society is bringing to the evolving role of corporate communications.