Engines of Development

Engines of Development
by Robert Macfarlane and Robert van Harten

Context for a new millennium

As our predecessors did 100 years ago, we stand on the verge of a new century trying to gaze into the future with little to base ourselves on but our past experience, highest hopes and deepest fears. Extrapolating from the past has always been a risky enterprise, especially considering the quantum shift type of changes at the global level that we have experienced during the past decade—the sudden end of the Cold War and the nuclear confrontation between the superpowers, the breakup of the Soviet Union, economic liberalization of China, explosive growth of the Internet, the East Asian financial crisis and launching of the Euro—most of which were not only unanticipated but almost inconceivable a few years before they became realities. But it would be equally hazardous to ignore the broader historical trends in favor of current perceptions and immediate preoccupations. Many of these trends represent the maturation or culmination of movements that can be traced back to early in the current century or even to the century before.

How then can we approach this task of assessing the prospects of the next century with some modicum of order and some hope of adding to the sum of our knowledge and understanding rather than merely stirring the already murky pot of divergent views on the future? This was the challenge that confronted Fellows of the World Academy of Art and Science at the 1998 Vancouver Assembly during a series of workshops on Development and Economics in the Global Century organized on three themes: The forces shaping global development at the turn of the 21st Century, the emergence of global economic organizations, and strategies for balanced development in the next century.

20th Century Accomplishments

Our speculations about the next century began by seeking a clearer perspective on the accomplishments of the century now drawing to a close. The 20th Century has generated such an astonishing range and depth of human accomplishments that it seems presumptuous to even hazard assertions about the future of development. In the past two hundred years social productivity has increased to such an extent that the global community now sustains a population 12 times larger than in 1800. From a rural-based, agrarian society in which less than three percent of the people lived in cities and towns, the human community has evolved into an urban-centered, industrial society in which the population of the world’s cities and towns now exceeds 40 percent of the total. Throughout history urbanization has been a great instrument for development, because it brings together at one place all the ingredients of social productivity—people, ideas, organization, technology, resources, capital—and magnifies the number and speed of interactions between them. The growth of urban communities during the last century has brought with it a host of problems—overcrowding, pollution, crime, etc.—but it has also brought political freedom, economic security, education and modern conveniences to billions of people.

At the turn of the 20th Century, most of the world still remained in the rural, agrarian phase of development—what Alvin Toffler terms the First Wave—that characterized human society for the previous 10,000 years. America was mostly frontier spotted with family farms. Horse-drawn carts and hitching posts were familiar sights in American towns. There were only 10 miles of concrete road in the entire country. Sixty percent of the population lived in rural areas, most of which were not even formed communities, in simple, poorly constructed single-storied homes. Large bands of unattached men roamed the country in search of employment. The most important products of the US economy were horse-drawn buggies, hairpins, bicycles, and horseshoes. The average life span was 49 years, less than two-thirds of what it is today. In 1870 only one doctoral degree was conferred in the entire country compared to 36,000 in 1990. Lanterns, candles, gas and oil lamps were the prevalent forms of lighting. The USA had only one power plant producing 5000 horsepower compared with more than 10,000 power plants producing three trillion kilowatt hours today. Less than 2% of the population had telephones. There were only 8000 automobiles in the entire country. Silk stockings were the most popular consumer product. Women did not yet have the right to vote.

Some parts of Western Europe were more developed than North America in the late 19th century, but the level of urbanization was about the same and rural life everywhere had much the same complexion. In 1870 there were only eight cities in all of Germany. In many parts of the world, only 10 to 20% of the people lived in urban communities. Large portions of the world population, including the entire Indian subcontinent and most of Africa, remained under foreign colonial rule. Democratic forms of government were a rare exception and no democratic country had yet extended voting rights to women. Large-scale famines were still common in the world’s two most populous nations, China and India. Life expectancy in most countries was less than one-half current levels. The ideal of secular, compulsory education had gained acceptance in the most progressive countries of Europe: Britain and Japan both introduced national systems of secular elementary education in the 1870s. But in other parts of the world, the vast majority of people still could not read or write. Banks began to proliferate in Europe only toward the end of the 19th Century. Coal, iron, steel and textiles were the world’s major industrial exports.

The 1997 UNDP Human Development Report observed that over the past 50 years the world has made greater progress in eradicating poverty than during the previous 500. Around the globe, life expectancy is climbing, infant mortality is declining, epidemic diseases are receding, famine is becoming extinct and education is becoming more widespread. The world’s average life expectancy is more than 66 years, about twice the average in 1900. Even among the least developed countries, it is now six years longer than it was in the USA in 1900. More than half the world’s adult population is now literate. Universal primary education has become a global standard. Most of these gains have been achieved since 1950. Since mid-century, average per capita income has tripled and average real per capita consumption in developing countries has doubled, despite a more than doubling of world population.

There is substantial evidence to suggest that today’s least developed countries could match and perhaps even exceed the accomplishments of the most advanced industrial nations within a much shorter time than it took for the original achievements. Beginning in 1780, it took the United Kingdom 58 years to double output per capita. The United States did it in 47 years, beginning in 1839. Japan accomplished the feat in only 24 years, beginning in the 1880s. But after the Second World War, Indonesia did it in 17 years, South Korea in 11 and China in 10. From 1960 to 1990 real per capita standards of living based on purchasing power parity multiplied twelve-fold in South Korea, seven-fold in Japan, more than six-fold in Egypt and Portugal, and well above five-fold in Indonesia and Thailand. Some of these gains have been wiped out by the recent international financial crisis, but if we can draw appropriate lessons from that experience, comparable accomplishments should be possible for every country.

These global achievements mask considerable differences in the levels of development within and between countries. More than one and a quarter billion people still live in absolute poverty. Disparities between haves and have nots are widening. They also mask significant problems, such as environmental pollution, urban congestion and crime, that have been either a result or concomitant aspects of rapid global development. Nevertheless, viewed globally in a historical perspective, the accomplishments of the last 100 years are without precedent.

Catalysts of Development

The purpose of our inquiry was not to assess the actual achievements of the 20th Century, but rather to ponder the potential achievements of the 21st. Nevertheless, the discussion began by looking backwards to identify the forces responsible for the achievements of the last century and to determine whether the same forces will be more or less prevalent, as well as more or less relevant, to the process of human development in future. How then are we to account for the phenomenal achievements of the past 50 to 100 years? Many factors have been identified that have contributed to these accomplishments, but underlying them all is one central thread and compelling force. They all reflect a fundamental change in attitude. Humanity is no longer satisfied with a low level or slow pace of development. Society the world over has decided that it wants to live more comfortably, more intelligently and more progressively now. The force of that decision, which we have described elsewhere as the power of conscious human choice for unfailing success, began as a subconscious movement of the collective late in the last century and has now matured into an unrelenting insistent seeking by the society-at-large. This fundamental change has its expressions in all fields of social life and gives rise to a cluster of interrelated factors that in combination are essential conditions and powerful catalysts of the development process.

Peace

Any evaluation of development potentials needs to take into account the influence of internal and external social stability on social progress. War is a destroyer of development. It physically demolishes what society has accomplished. Although countless wars have been fought within countries and within regions in the past half century leading to enormous loss of life and waste of resources, the world as a whole has avoided the catastrophic consequences of large scale, international conflicts that devastate the productive capabilities of people across entire continents and paralyze international commercial and economic activity.

The Cold War involved a horrendous expenditure of precious human and financial resources to produce weapons of mass destruction, but it did somehow manage to avoid the even more unimaginable destructive impacts of nuclear warfare. The end of the Cold War has dramatically reduced the threat of armed international conflicts and the catastrophic consequences of nuclear war, providing a far more stable and secure climate for worldwide economic expansion. Since 1988, world military expenditure has fallen by about a third, i.e. $400 billion. If the current peaceful status is sustained, it could free up even more capital for development.

The long-feared negative impact of reduced military expenditure on economic growth has been much less than anticipated. Falling defense spending has been followed by a surprisingly rapid recovery in defense-dependent economies such as California and a long period of economic expansion in the USA. Robert van Harten pointed out that the end of the Cold War has already resulted in substantial economic benefits. “I find it amazing that almost no one draws attention to the fact that America’s unexpectedly prolonged economic expansion has occurred precisely during the period of declining military expenditure. The energies of the country have been turned away from military and political confrontation into creative channels for commercial development, just as the demilitarization of Germany and Japan supported their economic miracles after the Second World War. If properly nurtured and supported, the next few decades could bring an unprecedented period of peace and an unparalleled climate for global economic development. A truly global organization capable of safeguarding the security of all nations, a world army committed to enforcing non-aggression and global peace, would vastly reduce the military expenditure of individual nations and serve as an essential foundation for the full development of the world’s economic potential.”

Freedom

The extension of democratic freedoms raises human aspirations. It encourages individuals to take active initiative for their own advancement. It facilitates freer and wider social interactions. It releases greater social energy. It vastly increases the dissemination of information and the multiplication of new organizations. N. Jayashree traced the historical relationship between freedom and economic development in Europe. “The decline of feudalism, the Renaissance, Reformation, Enlightenment, commercial and democratic revolutions that transformed Western Europe between the 15th and 17th Centuries are rightly viewed as various expressions of a single social movement that liberated the individual citizen intellectually, religiously, politically and economically from blind submission to the social collective. These movements resulted in a tremendous outburst of human energy and creativity that have culminated in the great technological and economic accomplishments of the past two hundred years. The common seed of all these movements is the rising value of the individual human being.”

As the transition from monarchy to democracy was a catalyst for rapid economic advancement of Western countries over the past three centuries, the spread of democratic institutions in recent decades opens up greater possibilities for global expansion. Following World War II a democratic revolution swept the world breaking down colonial empires and liberating more than one billion people from foreign domination. It gained further momentum after 1980, spreading through Latin America, Eastern Europe and, most recently, Africa, freeing another half billion people from repressive, authoritarian regimes. As peace provides a secure external environment for international development, democracy provides a stable and conducive environment within countries for more rapid social progress.

The American experience has amply demonstrated that the establishment of nominally democratic political and legal institutions is not necessarily synonymous with widespread human freedom for all citizens. It has taken more than two hundred years to extend full and effective rights to some sections of the US population and that task is still underway. In many countries democratic institutions remain in an early stage of development. As they mature, the growth of political freedom will make possible the emergence of political individuals who exercise freedom of choice with regard to issues of governance. That freedom encourages the free movement of ideas, social experimentation, and pioneering individual initiatives that are driving forces for development. The progressive extension of full and effective rights to people around the globe is an irresistible movement that promises to accelerate in coming years and usher in a much more truly democratic revolution than that which has released and stirred so much change in the recent past.
Education

In his opening remarks, World Academy President Harlan Cleveland placed greatest emphasis on education and information as the catalysts for all the factors that have spurred development during the last five decades and are fueling the globalization process. “The globalization trend is more than any other factor a product of the spread of knowledge.” He cited the example of South Korea, which initiated an intensive program of primary and secondary education in the early 1950s. “They did this without resources in the usual sense of that word. A whole generation got educated and the result has been spectacular. In less than 50 years South Korea joined the exclusive club of wealthy OECD nations.” Such remarkable accomplishments are driven by human aspirations, rather than external factors; by the inner choice of society, rather than external circumstances.

Worldwide, a change in social attitudes has compelled the birth of democracy. Democracy thrives on education. Education elevates the importance of information. Globalization is the result of a collective urge to expand the identity of the collective beyond national borders.

Levels of education have risen dramatically during this century and continue to rise in countries at all levels of economic development. The impact of primary, secondary, technical and higher education on development has been documented by a number of studies. N. Asokan summed up the impact of education this way: “The spread of education is making people more aware of opportunities. It is increasing their productive skills and thereby increasing their earning capacity. It is stimulating scientific research and technological innovation, while weakening religious superstitions. Wherever education spreads we see that there is a corresponding decline in fertility, which is improving the prosperity of the national economies. And wherever education spreads we also see that democratic aspirations get stronger and, correspondingly, there is a weakening of autocratic regimes. When education spreads in rural and agricultural countries, there is a consequent rise in productivity that helps transform agrarian economies into industrial ones and, at the next level, helps turn industrial economies into the post-industrial and information economies. The trend toward rising productive skills and earning capacity and declining fertility and superstition will only intensify as education spreads further. What Harlan described in South Korea has been a force, a powerful force, behind many of the changes that have occurred worldwide.”

The very notion that everyone should be educated would have seemed preposterous, if not outrageous, to 18th Century Europeans, who regarded learning as the exclusive privilege of the upper classes and clergy, or to the Brahmins of India, who believed that knowledge should be the exclusive endowment of the priestly caste. And even if they had embraced and endorsed such a fantastic notion, the common people would have spurned it as a superfluous adornment. We have now progressed to the point where virtually every society on earth has accepted in principle the need to educate all its citizens and the vast majority of people in every country have come to value education as a precious and essential endowment. But for all the commendable progress in extending the scope and benefits of education, the task of equipping all the world’s people with the knowledge and technical skills needed to prosper in increasingly technologically advanced societies is still at a very early stage, both in terms of the number of years of education and, even more so, in terms of the quality of education that people receive. The 21st Century could well become the century in which everyone has access to quality lifelong education.

Technological Application

When people are asked to identify the driving force for social development in the 21st Century, technology most often comes first to mind. But it should be evident from the previous discussion that the enormous productive contribution of technology is built upon an essential political and social foundation. Peace, freedom, education and social interchange are needed to release the creative powers of human inventiveness and to harness the products of that inventiveness for productive purposes.

We are now at the close of a century that has witnessed mind-boggling technological transformations—from the horse and buggy and the steamboat to the automobile, airplane and space shuttle; from Pony Express and the telegraph to Federal Express and the Internet; from abacus to personal computer; from horse-drawn ploughs and threshers to hybrid seeds and hydroponics; from oil lamp to laser; from amputations to organ and limb transplants; from locomotive engineers driving trains to bioengineers guiding biological evolution.

Carl-Göran Hedén pointed out that in recent years the rate of technological innovation has far outpaced the rate of technology dissemination and utilization. “Technology is rushing ahead at a pace with which humanity is unable to keep up.” The time required both to develop and disseminate new technologies is becoming shorter, but technological development far outpaces technological applications and accomplishments in even the most advanced societies. Even if there were no significant new technological discoveries over the next five decades, there is probably enough potential for applying proven technologies to elevate every citizen on the planet to middle class western standards of living. Adoption and full utilization of already proven technologies can dramatically elevate performance in every country and in every field.

Robert van Harten cited a single dramatic example of this potential. “The average yield of tomatoes in India is 8 tons per acre, yet more advanced farmers achieve yields as high as 20 tons. The average yield of tomato in California is 35 tons in California, but one of California’s leading tomato farmers with 1200 acres under cultivation routinely obtains average yields of 55 tons or more by applying advanced systems for micro-nutrient management applicable to all crops and climates. Applying more sophisticated and capital intensive technology, Israeli farmers achieve yields of 250 tons of tomato per acre.” This wide variation in the application of technology within and between countries is nothing new. But it is a significant determinant of development and a factor that is responsive to social policies.

Furthermore, the rate of technological innovation is still increasing. In fact, we now understand that invention is not a finite process of discovering a limited number of possibly useful things. It is a process that multiplies in potential as it grows. The more we invent and discover, the greater the possibilities for further innovation. This suggests that the contribution of technology to development could be even greater in future, provided we learn how to more rapidly and fully convert scientific discoveries into social innovations that benefit broad sections of humanity.

Technology has released its productive power because society has fully awakened to the powers of technology and chosen to endorse the development and utilization of this power for its collective progress. This awakening and choice have resulted in a breathtaking speed of progress. A time will come when society becomes fully conscious of the productive power of human choice and action. Then human development will blaze ahead at unimagined speed.

Social Velocity

Development is a function of the velocity of social transactions. The speed of movement of information, ideas, decisions, technology, people, goods and money has significant impact on the productivity of the society and its further advancement. For Canadian businessman John Banks, greater speed means greater commercial opportunities. “The ‘shrinking of the world’ through better transportation, communication, information and technology flows opens up commercial opportunities inconceivable just a few years ago.” During the past two decades the volume of international travelers, freight, telephone and other forms of electronic communication have increased enormously. Between 1980 and 1994, overseas telephone traffic to and from the USA increased from 200 million to 3.4 billion calls. New technologies such as satellite-based wireless phones are reducing the cost of expanding the communications infrastructure. Electronic mail has drastically reduced the cost and increased the speed of written communications. The meteoric growth of the Internet provides instantaneous low cost access to global information sources and commercial markets. The speed of technology diffusion is also accelerating. The Xerox machine was not introduced into India until the late 1970s, more than 15 years after its use became widespread in the USA. Four years ago, Windows 95 was launched in New Delhi just weeks after its release in the USA. Two years ago Intel announced its latest microprocessor simultaneously in USA, India and Beijing. Our perspective on the next century needs to take into account the impact of the increasing velocity of social transactions on the speed and course of future development.

Organization

The 20th Century has been one of unprecedented advances in the technology of organization, the human know-how to design and operate larger, more efficient and effective economic and social systems and institutions. Hand in hand with the multiplication of technological innovations designed to expand the range and increase the productivity of human activities has come an amazing proliferation of innovative social organizations that are essential for effective utilization of these technologies. But while most people are quite aware of the advances in technology and their potential contribution to human development, there is far less appreciation of the essential and invaluable role of new and improved types of social organizations in the development process and their vast unutilized potential to accelerate global social and economic progress. Organization is the social mechanism for supporting and promoting new activities in society. Never before in history has humanity created and disseminated such a dazzling array of new organizational innovations in virtually every field of human activity.

Asokan identified the proliferation of organizations as a powerful driving force for globalization. “The phenomenal progress that we see all over the world is the result and creation of new organizations at the local, national and international organizations. At the physical level these organizations include the development of essential infrastructure such as roads, telecommunications, railroads, power grids. At the social level it includes the development of a wide range of systems and institutions such as banking and leasing, stock exchanges, commodity markets, credit reporting, and collection agencies. At the mental level, it includes the development of organizations for information, education and scientific research, such as research labs, libraries, think tanks, the Internet and the World Wide Web. In addition to the formal institutions directly related to economic activity, there are also a large number of non-institutional organizations that formulate international technical and commercial standards governing such activities as inter-bank transactions, international air transport, telecommunications, and product quality. Without these standards international trade would grind to a halt. Each advance in organization has led to advances in the speed, quality, efficiency and productivity of economic activities resulting in material improvements in living standards.”

The recent financial crisis in East Asia powerfully demonstrates the importance of improving our understanding and mastery of the technology of economic organization. As Ivan Head pointed out, “The pace of globalization is so rapid that even the most sophisticated economic institutions seem unable to keep up with the demands for organizational innovation. The issue of global economic organization demands much more attention on the part of policy advisors than is now the case.”

Jingjiai Hanchanlash stressed the growing importance of international economic institutions at the global and regional level and the parallel organization of private financial institutions that operate along side the public sector apparatus, but not always in close coordination with it. “Internationally, we have the organizations created fifty years ago, the World Bank and some regional organizations, that have met certain needs and continue to meet to serve an important purpose. But in addition we need many new types of organizations to make the opportunities of globalization accessible at the local level in countries around the world.” Iridium, the first truly global telecommunications corporation established by a combination of public and private stockholders in sixteen industrialized and developing nations, is one example of a new type that is emerging.

When we look at the future of economic development, we need to understand which organizations are essential to drive social growth, how these organizations emerge in society and become effective, and what we can do to promote the creation of new organizations fast enough to deliver ideas, products and information to meet social needs. Organization grows and thrives on information—not just the quality but the quantity of it. As information is dramatically expanding in the world, we need to better understand the impact of that on the quality and complexity of our organizations. The growing complexity of globalization does not fit the old paradigm of centralized or decentralized organizations. The pattern that is emerging is much more what Cleveland terms uncentralized, consisting of many different functions being initiated from independent but interrelated centers, rather than everything being controlled from one point. We need to understand much better which functions can best be performed by centralized, decentralized or uncentralized structures.

To overcome the dichotomies that so often enter into debates about the role of organization in development, Mircea Malitza proposed a new intellectual paradigm. He depicted the evolving organization of global society as an orange with multiple, interrelated layers of nets around it. The inference is that we cannot arbitrarily divide the world into private sector and public sector, or into scientific, economic, social and religious parts. Society is a single complex web of organization. Walt Stinson emphasized the need for an appropriate balance and blend of public and private organizations. “Public organizations cannot do many things that private organizations do, but perhaps even this type of contrast or polarization is really part of the problem. The reality we seek to describe is the organization of human society. There is a regulatory function that government can best carry out. There is a need for individual creativity and initiative, which is the natural role of the private sector. Society needs to discover the right functional relationship and proper balance between each strand of this very complex fabric of organization, which is increasing in complexity so rapidly that we do not even have a computer model that can track its evolution. This is the knowledge we need about organization.” As Ivan Head put it, “We are engaged in a knowledge process. We need to discover what best we can do to design more successful knowledge organizations.”

In the quest for global knowledge, we also need to understand much better the organic relationship between our organizations and the society. Building organizations is not a question of finding a right magical formula for some external super-structure. Organizations have arisen in the world at the local level, at the national level and internationally as an outgrowth, a flowering of seeds in each society. We need to better understand that process and the link between the structures we have created and the societies that give them birth, especially when we want to transfer those structures to other societies where they have not arisen by themselves.
Concerns about Globalization

The approach of a new millennium raises fresh hopes and new fears, wildly optimistic dreams of unimagined accomplishment and paranoid visions of conspiracy threatening to destroy all that has already been achieved. In spite of phenomenal material, political and social achievements over the past 100 years, the process of globalization that is gaining momentum around the world raises powerful anxiety, uncertainty and resentment among those who feel they are being left out or short-changed by forces beyond their control. There is, as Jack Fobes described, “a growing sense of resentment against inequalities, disparities, gaps, against the globalization of power in money, markets and media.”

Resentment of Inequities

Many people despair that they are worse off than before and actually losing ground in the race for progress. How can we reconcile statistics that indicate unprecedented accomplishments for most human beings with the widespread perception that many people are less satisfied than before? The answer may lie in what Cleveland termed the revolution of rising expectations while he was working in Asia back in the early fifties. He observed that newfound political and social freedoms, access to education and information, and the opening up of opportunities for individual advancement had released an enormous outburst of social energy and activity. Now this same force has spread through Eastern Europe and most countries of the developing world, even to outlying villages in Asia and Africa. The spread of information, education and social opportunity is unleashing a powerful force for social transformation. People everywhere dare to aspire for more than their ancestors ever thought possible. They have learned not only to aspire for more, but in the growing atmosphere of freedom to also demand more, sometimes vehemently and even violently. If there is any hope of a better future for the world, it is because this aspiration has been ignited.

Rising aspirations have had two demonstrable consequences. First, they have contributed to a tremendous release of social energy, an outpouring of social innovation and individual initiative unparalleled in history. Even in many of what were until recently traditional, conservative societies, change has come to be accepted as the only constant. People everywhere are breaking out of the patterns of the past, venturing into new activities, experimenting with new ideas, new technologies and new ways of life. Second, almost everywhere the growth of aspirations and expectations has outpaced actual human achievements, leading to the paradoxical situation of increasing standards of living and growing dissatisfaction with what has been achieved. If we look back in history—there was a time not too long ago when the whole country lived for the sake of one man whom people called a monarch. What we find today is an increasing intolerance for inequity. At the same time we find everybody aspiring to have what previously was possible only for very few.

This explains the apparent paradox of increasing prosperity accompanied by increasing discontent. As development advances, people tend more and more to judge their present status not in terms of what they enjoyed in the past but in terms of what other people have achieved, of which they are increasingly aware due to the information revolution. Rising aspirations, when not immediately satisfied, can fuel increasing resentment.

Threats to Cultural Diversity

One of the most serious concerns regarding globalization is the fear that it will eradicate the world’s rich cultural diversity. Cleveland rejected the view that globalization is synonymous with uniformalization, that it will result in a single, homogeneous global culture. “Globalization certainly does spread uniform technologies, but I am increasingly impressed with the fact that the most important product of all this globalization is diversity. The process is making people aware of differences and making them deal with differences in ways that they did not have to do before, because they never mixed with those other people, or because they dominated them, or were dominated by them. I am coming to believe that on balance the net affect of globalization is probably to increase variety rather than to propagate more uniformity.”

Rejecting fears of cultural uniformity, Ivo Slaus believes that the impact of globalization is to increase the possibilities. “Globalization increases the number of options—the total number of options and also the number of options for each individual. This offers a chance for every individual and every social group to essentially catch up at any time. That chance is not a guarantee. It is a global opportunity. The whole aim is to increase these opportunities. Therefore, I would suggest that development involves an increase in the number of options and this is what globalization is bringing. The force behind this movement is the human being with her or his free choices. The challenge is to make choices that increase the freedom for others to choose, rather than to limit their possibilities. We need diversity in cultures as much as we need biological diversity in order to survive and keep increasing our options.”

Certainties and Uncertainties

Discussion of the globalization process uncovered a host of certainties and uncertainties. Among the certainties, it is evident that the next century will see even greater recognition of and insistence upon the value and central importance of the human being in the society. Human aspirations for freedom and opportunities for free choice will grow ever more powerful and insistent and the options available for the exercise of that choice will become ever more varied. Average levels of educational levels will far exceed what is common today. Technologies will continue to multiply. Access to information will become truly universal. Everything will move many times faster than it does today. Organizations will provide greater opportunities for creative expression of individuality and thereby themselves become more creative. Also certain, that global society possesses the means, if it possesses the determination, to guarantee every citizen opportunities for gainful employment and reasonable levels of prosperity.

Among the uncertainties, it is not at all clear whether society will succeed in closing the gulf between expectations and outcomes. Nor do we know whether social tensions resulting from this gap will rise further or decline. Presently it is uncertain what type of global organizations we need to fully support universal peace and prosperity nor whether the nations of the world will cede sufficient sovereignty quickly enough to avert greater divisiveness in international affairs.

In spite of recent achievements, some were pessimistic that the prospects for developing countries would substantially improve in coming decades. Others shared the confidence expressed by Bob Berg when he described the world emerging in the coming century as one of enormous opportunities for social progress. “We have already started a whole bunch of processes that will accumulate to make the decades ahead over the next century a kind of golden age of social development.”

Need for a new paradigm

The discussion on the likely future impact of globalization seemed to polarize participants into groups representing widely divergent views of the process. Some believed that the benefits far outweighed the costs and considered most of the problems associated with the process as temporary obstacles that would inevitably be overcome for the overall benefit of humanity. Others viewed the process as an inexorable movement of domination by the rich and powerful over the poor and vulnerable people and countries of the world.

Francisco Sagasti suggested that this dichotomy of positions is the result of a too linear view of development and argued that we need a different kind of thinking and new theoretical concepts to understand the implications of globalization. “What we have is a contradictory process—some trends point in one direction, trends that are going in a different direction at the same time. About 20 percent of the world’s population still live at a subsistence level. They remain within the local circles of accumulation and have nothing to do with the globalization process. What we are seeing could be called a fractured global order—an order that is pulling all of us together and, at the same time, maintains deep divisions and some of those divisions and separations are broadening—an order that makes us aware of everybody else but at the same time makes us very much aware that not even in a hundred years we may reach somewhat the levels of consumption or well-being that are available for other people. We have to start changing the way we think about it. Instead of thinking in linear terms, we must learn to think in paradoxical terms, to be able to confront these new situations—chaotic, paradoxical, and uncertain—without being overwhelmed by them. We must have the intellectual capacity to apprehend contradictory facts and the ability to transform those perceptions into more or less sensible actions, which is not very easy to do. Over the next several years in this paradoxical messy complicated uncertain situation that has no immediate scope for neat dialectical or logical resolution, we are going to have to open up the very concept and idea of development in a much more radical way and evolve new conceptions of culture and development.”

What then should be the role of our leaders in an age of unparalleled opportunity and uncertainty? Slaus described it this way: “Let us live with the uncertainties and let us realize that in the concept of leadership, rather than a leader being somebody who should take us on a very well predictable course, the primary role of the leader is basically to increase the number of options for individual human beings. The goal should be to increase the freedom that each one of us has and the best process of doing that is, of course, education.” A more profound change in our conception of leadership may even be warranted. Perhaps in future it will not be personal leaders at all, but rather thoughts and ideas that play the determining role in directing the energies of society.

Walt Stinson went even further in stating that increasing human choice is the one essential goal of the development process. “Development means different things to people, so we will never be able to arrive at an objective set of measures to satisfactorily measure it. Therefore, I suggest a subjective measure. Development is a measure of the capacity of people to make choices. If individuals are free to think what they want, live where they want, choose the occupations they prefer, obtain the type and quality of education they aspire for, and meet their consumption needs as they define them, then they are more developed than those who do not have this freedom. If the individual has all the choices, a cornucopia of choices, unlimited choices, that is development. When individual choices are limited, when individuals have few choices and are locked into situations they would choose not to be locked into, that is underdevelopment.”

Inexhaustible Resources

The science of economics was founded during a period when human development depended to a very large extent on land and other limited material resources. In an age of scarcity and famine it was not surprising that early thinkers conceived of production and consumption in terms of severe limits. The foregoing discussion suggests that in very great measure the accomplishments of the 20th Century are the result of forces that are neither material nor limited. Peace, freedom, information, human aspiration, social energy, individual initiative, technological innovation and organization are human resources, products of human development, which are not subject to any inherent or ultimate limits. These resources, in turn, vastly increase the productivity of even limited material resources and multiply incalculably the potential for development.

As Cleveland observed, “I’ve been struck by the use of the term ‘limits to growth’ by several people, which I thought had justifiably gone out of fashion because it really applies only to limits of physical development. In the information arena, in which most economic phenomena now are controlled by what you might call the information environment, the only limits, the really alarming limits, are the limits to imagination and creativity which come back to the individual. So it seems to me that one of the great certainties about the next century is the absence of knowable limits to what the human brain and the human spirit can make possible. We make a mistake if we get so caught up in current issues of physical limitation that we miss this ‘insurmountable’ opportunity.”

A change of attitude is compelling humanity’s progress, a growing urge that no longer accepts any ultimate limits to what can be accomplished. A mental urge in humanity for greater knowledge has stimulated the development of education, technology and information. A vital urge for peace, security and prosperity insistently strives to create the conditions needed for their fulfillment. With each advance, humanity becomes less dependent on external compulsions and more aware of its inner capacity to choose its own destiny. So we are discovering that human beings are the real source, the ultimate resource, for social progress. And if we succeed in pushing back the limits far enough, it is quite possible that the greatest discovery of the next century, which will be remembered far into the future, will be the practical discovery of the infinite potential of the human being.