The Next 20 Years Comdex, Chicago, IL
April 21, 1998
Electronic commerce and financial cyberspace helped create today’s $1.5 trillion daily global casino.
Now outflanking nations and central banks. Volatility accelerating due to increasing global interactivity (taking down the “firewalls” between national economies)
Good News
High-tech barter can become almost as flexible as money-based transactions. Developing countries will need to earn less foreign exchange and can trade with each other.
Money-based exchange systems still very useful–but now being outflanked and overtaken by pure information-based exchange (e.g., direct barter between companies in the USA
was $9 billion annually in 1993–probably triple that today, between 15 and 25 percent of all world trade is in barter). Local scrip currencies proliferating to clear local markets.
The barter, “Love Economy” (still prevalent in developing countries and up to 50 percent of all production and transactions in OECD countries) will force central banks, the World Bank, the IMF, and eventually private banks to democratize, become more transparent,
and make credit available not just to governments and their cronies– but to villages and microenterprises. The World Bank is already moving in this direction.
Bad News
Banks will fight to retain control continue the mega-merging trend and automating and downsizing thousands of employees to hype their bottom lines. Initially this will be to the detriment of local communities through loss of jobs and incomes with such mergers
withdrawing hundreds of billions annually from local economies.
Electronic commerce, credit and debit cards are increasing the money supply in unpredictable ways.
Taxation issues are becoming more urgent as Internet-based businesses end-run “bricks-and-mortar” local businesses, as well as state and municipal governments. How to level the tax playing field will be vital to such local businesses and countries. Global electronic commerce continuing to dent national budgets and increasing capital flight to tax havens. Taxation issues are becoming more urgent as Internet-based businesses
Meanwhile, banks are still busy trying to reintroduce scarcity on the Internet–monopolizing transactions with money, credit and debit card systems, encryption, etc,. to end-run high-tech barter possibilities and pure information-based trading–and the emerging economies of abundance.
Discovering the “New Economy” really means many new kinds of capitalism–all based on different “cultural DNA code” (i.e., values, goals, and cultures of diverse societies). This is the opposite of traditional economic growth theories as measured by GNP- growth, which are “one-size-fits-all”–but no longer fit the facts.
The Attention Economy emerging in all information based post-industrial societies where time becomes as valuable as money. Wired, Arthur Andersen and others now are using this “Attention Economy” model that I proposed in 1996.
Quality of Life is becoming the key to “attention-deficit societies” and their information-verloaded consumers. For example, my Country Futures Indicators© (CFI), first version in the USA is the Calvert-Henderson Quality-of-Life Indicators (my co-venture with the Calvert Group, Inc., family of socially responsible mutual funds, Washington, D.C.)
Lastly, Internet governance issues will dominate the next decade.
Fragility of the Internet, e.g., its Domain Names system and other protocols still controlled by a handful of well-motivated but unaccountable people, unknown to most, who are not virtual dictators of the system.
Paradoxes of the Internet.
Contrary to the naive beliefs of cyber-libertarians and their view of its freedom and democracy, the Internet has always been a taxpayer-supported public good, i.e.,
a commons where eventually rules for governance must be made in order to prevent overuse0 exploitation, and catastrophic vulnerability (as in the well-known “Tragedy of the Commons” scenario).
Governance of the Internet must be made open, transparent, and democratic. At last we know the truth: the net has been revealed as the ultimate totalitarian technocracy!
I expect to see in the next five years an international treaty among most of the 186 UN-member nations setting up an International Internet Standards and Oversight Agency
(IISOA), which will work with World Intellectual Property Organization (WIPO) and International Telecommunications Union (ITU) to deal with all of these urgent issues.