Three Global Revolutions that Make it Tough for States and Corporations to Stay on Top

Kate Taylor / Globe and Mail

The “more revolution” – there are more of us, and we have more resources – overwhelms power. The “mobility revolution” circumvents power by moving people and information further and faster. And the “mentality revolution” undermines it by making people less deferential.

YOU SAY YOU FIRST EXPERIENCED THE LIMITS OF POLITICAL POWER AS A GOVERNMENT MINISTER IN VENEZUELA IN THE EARLY 1990S, WHEN PROPOSALS FOR ECONOMIC REFORM WERE MET WITH RIOTS. WHY WRITE ON THE SUBJECT TWO DECADES LATER?

I thought it just had to do with Venezuela, an underdeveloped country without well-developed government institutions. But after that I went to work at the World Bank; part of my job was to talk to government ministers who would come to Washington to seek support. They were from East Asia, the former Soviet Union, the rest of Latin America. Whenever you said, “Why don’t you do this?” they would look at you: “Obviously he doesn’t know what he is talking about. Governments can’t do this.”

That was an education. I started inquiring whether the powerful are powerful. Of course, Bill Gates is powerful; of course China’s new president Xi Jinping will be very powerful, but far less powerful than outgoing premier Wen Jiabao, the guy who launched massive reforms in China.

A study showed that if a company was in the top 20 per cent in its sector in 1980, it had only a 20-per-cent chance of falling out of that category five years hence. That number is now 80 per cent.

YOU SAY POWER IS EASIER TO GAIN YET HARDER TO HOLD. THAT SOUNDS LIKE A PARADOX.

The powerful have always been shielded by barriers that have protected them from new entrants and rivals – tradition, brand names, money, weapons, technology. Those barriers are now less protective, more fragile.

THE “MORE” AND “MOBILITY” REVOLUTIONS SEEM STRAIGHTFORWARD. CAN YOU EXPLAIN THE “MENTALITY” REVOLUTION?

Once you have more people who are more educated and more mobile, expectations and aspirations change. One amazing example: Divorce rates among elderly couples in India are soaring.

Most of these divorces are initiated by women who were forced into an arranged marriage. They’re not taking it any more and are empowered by more material wealth and more independence.

IN THE WEST, WE CONSIDER DEMOCRATIZATION AND GENDER EQUALITY TO BE GOOD THINGS, BUT YOU SEE HUGE RISKS IN THE DECAY OF POWER, TOO. ON BALANCE, IS IT GOOD OR BAD?

This trend is bringing more competition, more freedom, more options. There is much to celebrate. What I warn is what happens at the political level: Governments are hobbled giants where you have a lot of political actors who have just enough power to block, but no one has the power to move forward. The American “fiscal cliff” and the sequester, climate change – you see everyone worried but incapable of acting. The massacre in Syria continues but no one seems to have the power to do anything. Or the European economic crisis, we have a situation where no one has the power to contain it.

WILL POWER IN THE UNITED STATES CHANGE? 

In a world in which everything is being disrupted by innovation, how can the way we organize society, the way we acquire and use power, not change? The U.S. is well positioned to be at the forefront of innovation, and that generates more stable, more effective, and more timely government decisions. It is way ahead of China, which still needs some semblance of democracy before that can happen.

DO YOU THINK THE CHINESE GOVERNMENT WILL RELEASE ITS STRANGLEHOLD ON ITS OWN PEOPLE?

Absolutely. The forces are there. I don’t know when, it would be foolish to predict, but imagining that it is not going to happen is just an illusion.