The last 12 months have been extraordinary in terms of change. An African-American in the White House. The Global Financial Crisis and The Great Recession. The collapse of the US Automotive Industry and the resurrection of GM & Chrysler as very different (and much smaller) companies. This morning, GM claimed their electric Chevy Volt may get 230 mpg (!) Microsoft laid off people for the first time in their history. Apple, Google, Facebook & Twitter are prospering. What a year!
Here in Australia (which has fared better than most developed nations), some of the changes have been more muted. At work, many have lost work and more have changed jobs. I’ve had 4 managers in 12 months. My clients of a year ago – GM, Mercedes, Toyota, Honda in Australia – are all in a very different place. My job changed – from the Automotive guy in an Industrial group to a guy in the Public Sector group. I changed my computer from a PC to a Mac. On the home front, we’ve switched from being a 20+ year BMW driver and bought an Audi (which arrives in a few weeks).
Car companies, financial institutions, computer companies are just some of the visible symptoms of the last year of change. It seems to have been a turning point of a long cycle. Not since 1930s & 40s has there been so much hardship across the developed world. Not since the reconstruction after the Second World War has there been so much talk of how to remake worldwide social, political and economic institutions. Alternative energy, micro-blogging, social-networking and a huge renaissance in government intervention are visible signs of this broader change.
Changing a globalised economy based on fossil-fuel energy sources is no mean feat. Hydrogen public transport in Iceland and hydrogen fuel-cell trials in California are both promising but very small-scale initiatives. Electric cars with either no or very small internal-combustion motors are another one which have yet to really come to market. Geothermal power in New Zealand, Iceland and a few other places is another renewable source. France’s enormous nuclear power industry seems to be the best example of non-fossil fuel energy source in widespread production use. Cellulosic ethanol use is also pushing up food prices in some parts of the world.
The needs of the emerging economies are daunting. China’s dependency on coal-fired power stations is frighteningly large. The urbanisation of both China & India are placing huge demands on the fossil-fuel sources. Tata’s Nano looks to be in tens of millions of households in a few year’s, each with a 700cc petrol motor that isn’t particularly efficient or environmentally friendly. South America (especially Brazil), Africa (to a lesser extent) and Eastern Europe are also emerging from some very tough effects of the recent troubles. They too – with their billions of people – will start consuming more and more energy.
Over half the planet now lives in cities. Going forward, more and more people will be urban dwellers. The road networks, utility networks and other systems will be similarly strained by the population influx. Making better use of existing infrastructure is one way to alleviate some of this stress. Building more infrastructure (which is almost certainly needed) is another. In the interim, there will be changes foisted upon the existing and new city folk. Public transportation, public housing, public healthcare and public education will all feel the pressure of more people too. It’s almost unimaginable that governments will either be able to or want to fund the required increases in these social services.
By contrast, life in the country has been spiralling towards an all-time low in modern times. Many rural-sector economic activities have become interwoven into large-scale businesses run from cities. Agri-business is the most visible form of this change. In China, displaced factory workers from the current global economic climate seldom have viable alternative places to go. Their villages and family (and collective) farms have been radically transformed. Some rural communities have disappeared. Some have been flooded by large-scale damming of rivers. Some have been deserted by the people moving to the cities. Some have no viable natural resource base left – their land is no longer arable, their water so polluted it poisons any living thing.
Here in Australia, there has been a drought for most of the last decade. The last year has been particularly dry. Depression and suicide among farmers is at an all-time high. Family farms have been devastated by the twin effects of the drought and global financial crisis. My own family sold a country home on the shore of an irrigation reservoir whose shore-line retreated from the property in 1996 never to return. I drove over a bridge of that weir last weekend. A trickle in the original riverbed was all the water we could see, some 15 metres below the bridge. The district – once a thriving farming community – is now a tourist destination for the city-based people who can still afford their holiday homes. The local economy is now almost entirely dependant on people from Melbourne. The local water will be piped south to Melbourne when the (politically controversial) pipeline is finished next year.
The switch from private sector to the public sector of much of this activity is staggering. Billions and sometimes trillions of dollars of government debt are being clocked up to do all sorts of things today. From bailing out Wall St to supporting Motor-town to plain-old cash handouts to stimulate consumer spending. Pipelines and river-basin rescue programs are buried in huge government appropriations that do everything from building broadband networks to building bridges, schools, hospitals and train-lines. Government “stimulus” spending has become the new boom industry, Spending on a scale that even a year ago was just unthinkable is almost universally popular.
For me, my Audi is just as fun to drive as my BMW but it’s 30% more fuel-efficient and 35% less-polluting (at about the same price). My Mac is much more fun to use and is faster and greener than my PC at about twice the price. My new job is much more satisfying than my old one because the customer is buying. I like Obama much more than Bush despite the fact that I’m centre-right politically. I’m one of those many millions of people who contributed to his election campaign last year. Despite being a paid-up member of the Liberal Party here in Australia, I take my hat off to Mr. Rudd (and Mr. Swan) for their performance in very tough circumstances.
I feel very fortunate that I live in Australia and I work for a global company that’s in great shape. I get a lot of people asking me for advise (and sometimes for a job). I can’t say I saw this all coming but I knew something was going to happen, so I made some changes in anticipation. I’m so glad it turned out the way it did. I can’t imagine what it must be like to be in other places that’ve been much more harshly affected.
Seems like I’m not the only one thinking about some of this stuff – http://gio.typepad.com/blog/2009/07/when-cities-grow-too-fast.html