Thursday, March 19, 2009

The Key Assets of Our Society

Dmitry Orlov wrote an interesting comparison of how much better the former USSR was prepared for a financial collapse than the current USA is. In short, much of the USSR was already functioning closer to a subsistence economy, with people making due with what could be supplied locally instead of relying almost completely on a complex interconnected national economy. Additionally, the USSR had large oil supplies that could be exported to relatively rich and financially stable neighboring countries in order to help finance its recovery recovery. As the USA undergoes a financial crisis, it doesn't have that luxury of unaffected rich stable neighboring economies to help pull it out.

While this report paints a rather pessimistic picture, I think the author misses some fundamental differences between the former USSR and the current USA. First and foremost, we have a collection of what is probably the largest, most creative, best educated, and most motivated group of civic and entrepreneurial leaders that ever existed. We have a culture that enables and even encourages a massive grass roots campaign to rebuild a new and revitalized economy. We have communications systems that enables rapid organizing and sharing of information on a level that is order of magnitudes greater than anything we had in the past . Nothing like this ever existed in the former USSR, or it could be argued anywhere else at any other time in history. Finally, though our leadership in Washington cannot act as a messiah to deliver us from all our problems, we are fortunate at this critical time to have some of the best new leadership for responding to these new problems that we've had in many decades.

Van Jones, a Yale educated lawyer and social activists, has been leading a grass roots drive to spur an economic rebuilding based on environmentally sustainable green jobs for many years now. When he was first asked if there would be a role for him in the Obama administration, he just laughed at the absurdity of the thought of himself being in a formal government position. Earlier this month he was officially appointed as a Special Advisor at the White House Council on Environmental Quality. This is an example of why there is some long term hope for building a new revitalized economy despite the prevailing short term pessimism.

Tuesday, March 10, 2009

The Great Disruption is Here

In what could be a landmark description of what is happening, Thomas Friedman wrote a fascinating column on March 7th in which he speculates on the question:
What if the crisis of 2008 represents something much more fundamental than a deep recession? What if it’s telling us that the whole growth model we created over the last 50 years is simply unsustainable economically and ecologically and that 2008 was when we hit the wall — when Mother Nature and the market both said: “No more.”

While this is certainly not a new theme, to see it so well expressed in a national newspaper op-ed represents a major step forward in our culture's attitude about the current situation in our society. It may be a key part of a growing rallying cry around the need for dramatic social change. He goes on to quote a number of experts, including Paul Gilding, an Australian environmental business expert, who coined a term for this period as “The Great Disruption.”

Thomas Friedman finishes by saying that both he and Paul Gilding are somewhat optimistic about our future given the changes that are starting to happen. As Gilding says, “When we look back, 2008 will be a momentous year in human history.” I'll add that in terms of a great transformation starting in 2008, let's not forget the single biggest transformative event of all that year, the November elections.