The new year dawns with no shortage of reasons for foreboding clustering on the horizon. The global economic downturn will continue throughout 2009, and in all likelihood well into the following year as well. In mature economies that will spell mass job losses and the attendant human misery. The fast-growing economies of China and India will face a sharp slowdown too, exerting painful social pressures on those still-fragile polities. Energy exporters, from the Gulf states to the former Soviet Union, will suffer as global demand for their wares declines. From the richest to the poorest, no country will be immune.
The global financial system remains in a fragile state. The banks will continue to cut back their lending and the shadow banking sector will continue to collapse, accelerating the downturn. Governments have thus far been haphazard in their response to the financial crisis and the recession. If this lack of co-ordination continues, the results could be dire indeed. The biggest risk of all is an upsurge in beggar-thy-neighbour protectionism as nations seek to save domestic jobs and industries. New barriers to trade would impoverish us all. It is no exaggeration to say that the global economy stands at its most perilous juncture since the 1930s.
There are, of course, vast military as well as economic perils in the year ahead. The violence in Gaza is a depressing episode on which to enter the new year. To the east, Pakistan is edging closer to the status of failed state as the grip of Islamabad over the country slips and terrorists continue to operate freely on its territory. Afghanistan, too, is on the verge of implosion and Iran continues its destabilising pursuit of nuclear technology.
Africa is suffering from resurgent civil strife in Congo, Sudan and Somalia. Then there is cholera-ridden Zimbabwe and the starving prison states of Burma and North Korea; nations crushed by isolated and criminal regimes; 2009 would seem to offer little hope of salvation to their benighted populations.
An existential threat to human civilisation will grow larger in the coming year too. Some scientists fear that runaway climate change might already be irreversible. Doubts are growing as to whether conventional politics can provide a solution. Britain is a case in point. On the one hand, 2008 saw the enactment of the pioneering Climate Change Bill. But at the same time, ministers are preparing to authorise the construction of a new coal power station and a new airport runway.
Yet a counsel of despair will not do. There are certainly colossal challenges ahead, but the very scale of the potential disasters waiting in the wings could provide the impetus for action that has so far been missing. Chief among the reasons for hope is the identity of the new President who will enter the White House later this month. Some of the hopes that have been placed on the shoulders of Barack Obama are ludicrously overblown. But it does seem that the 44th US President will bring a much more multi-lateral approach to threats such as climate change and terrorism than that of his predecessor. This is significant because the threats we face – terrorism, economic chaos, global warming – do not respect national boundaries. They can only be met through international co-operation. As Benjamin Franklin once put it, we must hang together, or hang separately. This is the year in which institutions such as the United Nations, the European Union and the International Monetary Fund need to come into their own.
In so many areas what the world lacks is not a plan, but the strength of will to carry it out. Regarding Israel and the Palestinians, for instance, there is rough agreement between the various political players on the desirable final destination of a two state solution. What is needed is concerted pressure from the global community to push them towards that goal. Likewise, it is as much in the interests of Asif Zardari's administration in Islamabad, as that of neighbouring Delhi and Kabul, that Pakistan's domestic militants be suppressed. The question is what the outside world can do to help the Pakistani President purge those elements in his security services who continue to provide covert support for the terrorists.
On the most fundamental human levels there are grounds for cautious optimism too. While on one level ancient hatreds between and within nations seem as strong and destructive as ever, there is another, less-frequently told story. Globalisation and technological development have brought a subtle alteration in attitudes in recent decades. We are more interconnected as a planet thanks to trade, travel and new forms of communication such as the internet. A greater proportion of mankind is aware of how others live in different parts of the planet than in previous eras. That makes us less easily manipulated by propaganda. Those who would divide us face a much more difficult job. As we enter strained times, that affords at least a glimmer of hope.
The prospect of an upsurge in national protectionism is certainly not to be discounted. But who among us would forgo the benefits that free trade has delivered? That is the major difference between the present era and the 1930s. There will be political pressure on today's leaders to retain the fruits of globalisation.
Meanwhile, the adjustment that recession will force upon us need not be entirely unwelcome. If we prune out some of the weeds of the years of financial excess in the West, our societies will surely emerge stronger. The spell of the high-rolling financiers has been broken. There will be less respect for the lobbyists of Wall Street and the City in future. And rightly so.
The final reason for hope lies in the resourcefulness of human nature. In tough times, people, generally, find ways of coping. Providing our political leaders resist panic, the hard work and intellectual resources of the free world will pull us through this period of strife and set us on a path to brighter times ahead. So, in spite of the daunting challenges before us, let us strike a defiantly optimistic note and wish all our readers a very happy New Year.
Comments