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  • Writer's picturePhilip Ammerman

A Realistic Look Forward

I'm on the first Sunday morning flight to Larnaka. One sprint of two weeks takes me to 22 December. Then onward to Paris for Christmas, and then Crete for hiking before the new year. It's been a difficult journey since September, when work "restarted" after the summer vacation. This is typically our busiest time of year: ramp-up to the Christmas, which includes budgeting season. One third of our clients are trying to meet performance targets until the end of the year. One third are dealing with issues in the following year. And the remainder are doing both. After a really intense 3 months, I have a few points I'm reflecting on.

The first is that after 23 years of consulting since I founded my firm, I can confirm that every client I encounter faces increased challenges from generational change, rising costs, globalisation and technology. This is hardly new. What is remarkable is the intensity of these competitive challenges. We are approaching a state of hypercompetition where product and service lifecycles are accelerating while consumer choice is increasing, and consumer disposable income appears to be falling, no matter what official statistics say. It's really clear that serious strategic choices need to be made at all levels, because the standard business model can no longer fit all segments of activity.

The second is the absolute uselessness of the political system as a mediator of change and development. I refer both to the traditional offices of the state, as well as to the political parties that are elected to manage it. There is such a disconnect between the everyday conditions faced by citizens and businesses and politics, that this can no longer continue without serious disruption. On the one hand, state services appear inadequate in the face of demand, and the standard of most state services is far below the equivalent level required of citizens or business. On the other hand, political parties appear trapped in a system of promises-for-votes, in a fragmented electorate where, in a "good" country, the leading party can expect to poll 30% of the electorate, in elections characterised by 25-50% electoral abstention.

This inevitably creates dissatisfaction and dissonance. You can only treat an electorate as a captive cash cow, lulled by fake ideology and saccharine promises, for so long. Eventually people get angry. And today, people are angry. Neither politicians nor the political system that has produced them are adequate to the everyday challenges of life and work in 2018.

And finally, the intersection between these two points--citizen awareness and politics--is perhaps at the lowest point possible. We have at our fingertips all the world's knowledge, available at the click of a button. We have free online courses, Wikipedia, specialist blogs, free access to leading news sites, great works. But none of this seems to avail against an electorate determined to listen to the most seductive, one-dimensional answers given by demagogues to complex problems.

This is perhaps only human character writ large, for the internet age, and it's a dilemma I'm sure our Greek ancestors in the Athens of Pericles, Plato and Alciviades would recognise. But the dissonance between an age of information and the absolutely stupid way with which we conduct our affairs is, frankly, incredible.

I am not an optimist going forward. I believe Europe is at a tipping point, at which the European project that started in the ashes of the Second World War begins to fail. When I see what is happening in Paris, Budapest, Rome or London today, I have little faith that the positive aspects of human nature will prevail over the very primitive human instincts which dominate. When I see what happens in Athens. over the years, irrespective of which political party is in power, then I have given up all hope altogether.

When I further reflect that we are still not in crisis--we are dealing with everyday issues of governance and competitiveness--I can only shudder to think what happens if we face a real crisis. A plague, for instance, or a war.

The next few years are going to see the collapse of traditional United States public debt and budgeting process, the collapse of the Euro-Atlanticist political system that anchored the West after World War II, the collapse of Germany's political consensus and a range of other dominos falling. We are heading towards a series of shorter-term flashpoints including Italy's public debt; French politics after Macron; German politics after Merkel; and a few super-critical issues, such as what happens to Belarus or Russia after a leadership transition, or what happens in the South China Sea.

The trends pointing to each of these are crystal clear, just as are the trends that point to the collapse of the social democratic state economic model in an era of globalisation. What is absolutely surprising is just how little is being done to manage or prepare for any of this.

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