Bernard King: Staring into the abyss

In AUSTRALIA this year, looking at that country’s food security policy and its influence on environmental strategies, I picked up a review of a new book on the Roman Empire and read with fascination that, for centuries, the majority of voting citizens of that pseudo democracy were under-employed. The only options for the average Roman citizen were to join the army  or compete with a low-wage slave economy. There were no other jobs.

Fast forward to Barbara Castle’s worker’s democracy “In Place of Strife” in the late 1960s, arising from which it was hoped that automation would allow a world of leisure for western factory workers, including a four-day working week with a three-day paid weekend, giving a new and nicer meaning to under-employment. It never happened. Instead, we had globalisation, a focus on service industries, offshoring, and competition with low-wage economies in the East and South, all hugely damaging our manufacturing base and limiting options for our workforces.

Fast forward yet again to February this year with the Davos summit, entitled How can business help society? (and we know that when business wants to help society, business is in trouble) and we hit the World Economic Forum’s report Global Risks 2012, which describes the world of 2012 and beyond as “dystopian” (the opposite of utopian), a place devoid of hope and full of hardship.

The forum looked at 50 major risks facing the world over the next ten years and bleakly pointed out that a number will have a devastating impact and a near certainty of occurring, including food and water shortages, volatility in agricultural and energy prices, severe income disparity and chronic fiscal imbalances both at intra- and inter-state level.

The latter, especially, have impacts on currency stability, inflation and national and global governance, even resulting in the production of “fragile states”, formerly stable ones that are no longer able to meet their social and fiscal obligations and which descend into lawlessness. Other risks include cyber-crime, terrorism and pervasive entrenched corruption.

And as for the global economy, that world of increased wealth, consumer choice, lean manufacturing, just-in-time supply chains, market and stock exchange hyper-connectivity, globally distributed workforces and the death of the command economy, it simply does not require skilled manufacturing workforces of the scale and size required by previous industrial revolutions. Perhaps the human condition for all urban environments since Roman days is “underemployment” and this is likely to be exacerbated rather than diminished as society and technology evolve.

A currently unsustainable global population peaking at either end of the age spectrum with an urban population predicted to double from 3.1 billion now to 6.2 billion by 2050 (United Nations figures), some 70 per cent of the world’s population and the youth component of which may be largely unemployed, is an additional complication. That population growth will place even greater pressure on food supplies, urban and agricultural water and energy demands (the supplies of the last two are already diminishing) all of which have concomitant effects on greenhouse-gas emission and climate change – the control of which have major impacts on agricultural prices.

The forum points out that all these risks are highly intertwined, interconnected and interdependent and of such complexity that a change in one does not lead to a simultaneous and proportionate changes in others and in which the increasing velocity of change is likely to overwhelm companies, countries, cultures and communities. The chair of the forum’s view is that the world’s foremost challenge is to master this complexity.

So, what has all this to do with us here in Scotland and the UK? Distant parts of the world have always been drought-ridden, but the south-east of Britain has also suffered water shortages for the past three years, due to naturally high urban water demands, despite heavy rainstorms and flash flooding. Here in Scotland the cost of potatoes has risen due to high rainfall and reduced crop yields. (If you don’t believe in the effects of climate change, just ask recent Republican US presidential candidate Mitt Romney about Hurricane Sandy). Corn output in America has been so reduced by drought this year that feedstock costs have soared and hogs are being slaughtered because farmers can’t afford to feed them. Accordingly, food commodity prices here are rising because of crop failures in the breadbaskets of the world. It is even estimated that Christmas dinner here this year will cost 10 per cent more than it did last year.

The same applies to energy costs: what are your gas and electricity bills like this year and how much does it cost to fill up your car? “Sovereign debt” has entered all our vocabularies and if we think that fragile states are far away in Europe (Greece, Spain) or Arab Spring states, the destructive riots in London and other parts of the UK last year told of a disaffected youth of all classes here, too, with a propensity for civil unrest. And understandably so.

The debt burden we have imposed on our young people is such that for many, they will never be eligible for mortgages or join property ladders and will, as predicted by the forum, suffer a permanent debt and income disparity throughout their natural lives. And with a rising aged population to sustain, that burden will become increasingly greater, again leading to potential societal unrest. So, forgetting about corporate banking, auditing, corporate governance and currency failures that currently exist and further complicate matters, what is there to do?

First, and I say this having once been described as a “pathological optimist”, accept the fact that, potentially, the world has a dystopian future – unless we recognise it and do something about it.

Second, recognise that in a world of instant communication and extreme technological sophistication, the interdependence and interconnectedness of risk is amazingly complex, with hugely unknown knock-on effects for knee-jerk, simplistic solutions.

Third, we need new conceptual models to understand and interrogate complex systems and learn how to build resilience into potential solutions, especially when the products of interconnectedness are unknown.

Fourth, Scotland – and this has a special contemporary relevance – should undertake a “Scottish Risks 2013” with a ten-year horizon, akin to “World Risks 2012”, to map the interconnectedness of its world and to identify the clusters of, and find solutions to, the economic, societal, environmental, technological and geopolitical hazards that lie ahead.

Fifth, if we are to have an age of underemployment, we need to have appropriate educational systems in place to empower our young people to navigate that future world of complexity. A university world designed for the past will not prepare our young people for the future. An elite university world designed for a few enlightened generalist mandarins when the world of the many is that of advanced technology, instant communication and hyper-complexity is simply not good enough; we really need to think again.

And finally, perhaps a food security policy for Scotland in a world of shrinking agricultural productivity might not be a bad idea either.

• Bernard King is Emeritus Professor and former principal and vice-chancellor of the University of Abertay, Dundee