by Esir Pretne
“It’s the economy stupid!” is a phrase we will hear alot this year – 2019. Why? Climate change and carbon taxes? Volatility in the energy industry? Angst among youth re the future of work? Regional economic disparities and trade disputes? Yes, all of the above reflect an economy in transition and cries for vision and leadership.
We are well into the NEW economy. If you do not believe it just feel the ever increasing rate of change and the associated disruption. Maybe it has affected your job or your business. It has certainly had an impact on the economies – from rural Alberta to virtually anywhere in the world. These changes may fell local but they are indeed global. The NEW economy features the emergence and ever increasing evaluation of intangible assets and devaluation of hard assets, universal access to knowledge and the loss of privacy, and the personalisation of public services.
Consider also …
Industrial hard assets – carbon commodities: wheat/meat, fibre/timber, oil/gas, remain foundational, but they are abundant, accessible worldwide an now fading in value. And as Alberta is experiencing, access to market is critical – even key, in a cost competitive, global market. As distance to market increases, asset value decreases, further compounded by limitations in the transportation infra-structure, i.e.: rail and pipelines. Value-added processing as an option has appeal but does not resolve market access issues.
Access to knowledge and government have been fundamental to development and maintenance of the carbon-based, agricultural and industrial economies. Public sector health and education, protection of the professions, and privacy have been key to the distribution and expression of knowledge. Each required regulatory efficiency by government. But since the arrival of the internet each have been compromised.
Freedom of access to knowledge – the internet, the amassing of data, and the emergence of algorithms are disrupting established industries and professions. Governments in particular are being challenged as unable to manage the rate and direction of change?
The public – government, is rapidly losing the capacity to control the distribution of knowledge. The loss of privacy is one of the consequences. As public trust declines, so goes support for the enormous public service systems, institutions, and professions on which the knowledge economy briefly depended. Associated taxes and fees become suspect such as transition subsidies including carbon taxes. Continued debt financing to mitigate the impact of the transition increases the threat of public sector defaults particularly in economies experiencing to low birthrates and constraints on immigration plus increased costs to serve an ageing population.
As the transition takes hold faith in these systems has declined with little hope for a resolution. Conflicting forces each seek help. First, populism among the neglected is rising with appeals to government for help. Similarly the established beneficiaries of public services: institutions and agencies, professions and corporations are also affected, and they in turn are also asking for help. Both on seemingly opposite ends of the change spectrum argue about what role governments should play in regulating the sources and forces of change, such as the internet, data, and data usage. Democratic forces dither and are unable to resolve the standoff – the transition to the NEW economy continues, and while volatility is largely contained, public trust declines.
Enter the NEW economy fueled by calls for more innovation and accounting for the value of intangible assets. Capital investment is already targeting: Cleantech, Nanotech, Biotech, and Infotech in it’s many forms. Each are aspiring to secure data and data processing including the design of algorithms, for customizing service, for gaining a competitive edge. The subsequent apps and machines threaten to supplement and make redundant jobs involving repetitive industrial and knowledge based activity. One clear implication is already apparent, we need more data managers and administrators and we need to improve our relational skills and creativity. We are already seeing this in the admission criteria for professions by elevating the relevance of relational skills. And from those with any semblance of power, we need guidance through a unifying VISION and an alignment of interests – LEADERSHIP. Most of all we need authenticity and well-honed listening skills.
Source: ABC Tech