Who will rule the 21st Century

This is a nice big question to ponder on the holiday beach or in the rented villa. A vast amount has already been written on the rise of China and whether the US will be replaced as the global superpower. And where exactly does Europe fit into all this?

It is easy to make a case for American weakness. The twin deficits of the balance of payments and the massive public sector gap between expenditure and income, the increasingly divided and embittered nature of policy discourse in the country, growing cultural fragmentation.

The image of a divided nation appears to be supported by what has happened to the choice of baby names. This may seem rather trivial, but it is a very important aspect of the culture of a society. For linguist Steven Pinker, the choice of a name ‘connects us to society in a way that encapsulates the great contradiction in human social life: between the desire to fit in and the desire to be unique.’

In 1960, for example, the most popular name for girls was Mary in most US states, except for Susan in the north-west and north-east. By 2010, none of the 1960 names survived as ‘winners’ in any state, and some of the most popular names in 2010 were not even in the top hundred in 1960. But far from reflecting the weakness of a divided nation, this shows the tremendous acceleration in the rates of innovation which are taking place throughout American society.

This ‘desire to be unique’ is the driving force behind the spectacular global success stories of the past 30 years, such as Microsoft, Google and Facebook. All of them based on absolutely cutting-edge technology, by people wanting to be different, and all of them American.

The networks which make up American society are fluid and dynamic. They have the sorts of structure which both encourage innovation in the first place, and stimulate its widespread adoption.

The network of government, the network of companies, the network of universities, all of them are strongly coupled to each other. The US has learned how to make public-private partnerships work, not by reams of turgid legal contracts à la Gordon Brown, but by honing the structure of connections between these three crucial sectors of the economy.

Washington has not been afraid to fail. Its research has already given us radar, semiconductors and the Internet, to name but a few. And contrary to conventional wisdom, the US is solving the energy crisis by technological innovations. American emissions have dropped by nearly 8 per cent since 2006 and remain on a declining trend. In contrast, the networks of Chinese society are much more rigid and hierarchical — the Communist Party being the prime example. Chinese culture in general is far more inclined to defer to authority, to the established wisdom. These sort of command or top-down networks are great for turning a peasant economy into a basic industrial one, but they are less effective in generating innovation and transforming society even further. The former Soviet Union is a case in point.

The 21st century will belong to those who are best at technological innovation. The open, fluid dynamic structure of the networks of American society put the US still in prime position.

And where does poor old Europe fit in? To be fair, the European Commission has tried to stimulate innovation, and is currently considering some major research investments. But the networks of government, the corporate world and universities are just not connected enough. They remain dug in their own silos.  Europe, unlike China, is an open society, but a major effort is needed to break down the barriers between these key networks. In the UK, we need to emulate the American ‘desire to be unique’.

Paul Ormerod, as featured on the Spectator online, 7th August 2012

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