Edge of Chaos

Liberal democracy, history’s greatest engine of growth, now struggles to overcome unprecedented economic headwinds—whether it’s aging populations, scarce resources, or unsustainable debt burdens.

Hobbled by short-term thinking and ideological dogma, democracies risk falling prey to nationalism and protectionism that will deliver declining living standards.

When economic growth wanes, everyone suffers. Stagnation exacerbates numerous social, health, environmental, and political problems.

The very essence of culture, community, and people’s individual expectations about the kinds of lives they can lead become dimmer, coarser, and smaller in the absence of growth.

Conversely, the absence of growth in the wider community can have a profound effect on the individual. Economic contraction can foster political and social unrest and a breakdown in social cohesion.

Simon Kuznets, the godfather of GDP measurements, opined that there are four kinds of countries in the world: developed countries, underdeveloped countries, Japan, and Argentina.

While it is becoming increasingly difficult to determine where growth will come from, there is ever more clarity on the factors likeliest to derail global growth.

The relationship between debt and growth is not linear. Taking on more and more debt does not translate into higher future growth ad infinitum. In fact, the combination can prove lethal.

The global cohort of unemployed youth between the ages of eighteen and twenty-four has now surpassed 71 million. This represents a constant threat to political stability and hampers prospects for economic growth across the world.

For every gadget that enables us to process data and information faster and more cheaply, there is a burgeoning social and public policy challenge of rising unemployment that has dire consequences for growth.