I’m back from the 2007 PUSH conference in Minneapolis. PUSH, an annual event in its fifth year, is sort of what Fast Company would be if we were a floor show instead of a magazine (which is why we’re a sponsor): It brings together voices from economics, social policy, technology, demography, art, and design to construct a window on the future of work, business, and society.
PUSH is essentially an upbeat celebration of that future, replete with song and dance and passion. But it’s not naïve—and the picture of our future that emerged at PUSH ’07 was complex, daunting, and yeah, kinda scary. Over a few of these blog entries, I’m going to give you the headlines:
1. America is no longer the center of the universe.
That’s not a terribly new idea—but it’s somewhat shocking to hear it embraced by a guy who used to be Ronald Reagan’s secretary of commerce. Clyde Prestowitz advises Presidents and CEOs alike on the state of the world, and he seems to revel in the role of The Republican Who Speaks His Mind. And what’s on his mind is this:
“All of our lives, the U.S. has been the most powerful country. Oil has been priced in dollars. Water has been readily, cheaply available. Energy, pretty much the same thing. We take that for granted; we assume that’s the way life is going to be. But study the life of a corporation, or a country, and you find that changes take place. Sometimes they’re gradual, sometimes big. We as a world have come to a moment of big change.”
Some of Prestowitz’s observations on that changed world weren’t all that remarkable: in his travels, he says, he’s witnessed the emergence of a “medical tourism” industry in India, an Indian call center rep named “Meghan” who convinces disgruntled AOL customers not to abandon their subscriptions (her success rate: 80%); and the inability of major American corporations to negotiate successfully with Chinese trade officials. So, yeah, been there.
But the upshot of all this was startling, nonetheless. The day before PUSH opened, Russia’s Vladimir Putin called for a new global financial architecture in which the dollar isn’t the central currency, in which oil and Boeing jets aren’t necessarily priced in dollars.
“This isn’t going to happen tomorrow,” Prestowitz noted—but the mere fact that Putin and other leaders are broaching the possibility is important. “The U.S. has been the only country in the world that can run large trade deficit for a long time. But now, other countries have big dollar reserves. As that happens, there are concerns about the ability of the U.S. to pay; fear has begun to creep into global financial markets that the dollar isn’t as solid as we’ve all thought.”
Welcome, then, to a world marked by declining American influence. Grzegorz Kolodko of Poland’s Kozminski Business School noted that of the $68 trillion world GDP, the U.S. share is 19.7%, while the EU’s is 19.6%; next year, Europe’s share will be higher. More telling, of the world’s 5% economic growth rate, a full two percentage points is due to growth in China and India. Emerging markets have low nominal GDP, Kolodko pointed out—but if you account for relative purchasing power, that GDP actually is closer to half the world total, and growing. And those developing nations hold about 70% of all foreign currency reserves.
Which, as Kolodko says, raises an urgent question: How to managed this radically changed world economy without a world government—and without a dominating U.S. to call the shots?