The new collective contract
Over the course of thousands of years of recorded history, the intersection of government, business and society has determined the fate of each of them and our collective future. Not only have governments, businesses and societies/not-for-profits been in perpetual motion, the forces that underplay the tectonic movements in these have also been in continuous and dynamic transition. In The Raging 2020s, Alec Ross takes us on a tour de force of how “The Social Contract”, as he calls it, is evolving (and, indeed, breaking), across countries and what this means for all of us. The brilliant, indeed rare, argument is how there has been a constant, steady decline in the effectiveness of governmental power in the United States and around much of the rest of the world. Just as shareholder capitalism boomed and wealth increased manifold for a few in particular, the effectiveness of governments collapsed.
The book is a modern-day version of the age-old debate over the role of government versus the role of market and who should be doing what, when, and where — and of course the how of it. Economics and management literature is replete with thousands of papers and books on the subject and Dr Ross peers into the decade ahead with insights that frequently make you say “a-ha”.
One of the most extraordinary messages of the book can be summarised thus: “It became accepted wisdom that all problems were best left to the market to solve. The result was that many functions of government were either gutted or handed over to the private sector in the name of “efficiency”. Yet while there are distinct ways in which checks and balances can become inefficient, there was a clear loss in all of this, and that loss created a kind of self-fulfilling prophecy. If you constantly batter government as ineffective, defund its institutions, and cripple its impact, people lose confidence in these institutions and vote for less of them, even though they are what the people need most”.
Private actors are filling an evergrowing and mystifying void — doing what they can in an era where government seems to have been stupefied into inaction. Yet there is a danger in relegating such responsibilities solely to the largesse (or philanthropy or goodwill) of individual or corporate actors. Their efforts hit at the very root, the raison d’etre of what government is for and what its role ought to be in the lives of citizens.
The book has several evocative examples of how government, business, and not-for-profits work (and don’t work). Consider this about when Hurricane Maria hit Puerto Rico where he contrasts the efforts of the World Kitchen by Chef Jose Andres vs. the US government. Hurricane Maria was one of the deadliest disasters in US history, on a par with the 9/11 terrorist attacks and the 1906 San Francisco earthquake in terms of body count. Most of those deaths resulted not from the storm itself, but from the inadequate access to health care, electricity, and clean water in its aftermath. Had the government acted faster and more effectively, countless lives would have been saved. In the past, the US government ran the most effective logistics network on the planet but that has been eroded over the years. The very idea that a nonprofit led by a chef would outperform a federal agency with a $20 billion budget and 14,000 employees is just outlandish but true. Likewise, how the US federal minimum wage has been stuck at $7.25 since 2009 and despite countless petitions to the Congress nothing happened. Contrast this with workers and activists directly petitioning Amazon who increased it to $15 per hour, in a far quicker timeline.
With several astonishing examples and case studies, Dr Ross demonstrates how “vetocracy” leads to ossification of government and prevents legislation from walking away into the sunset. How gridlocked governments are unable to push through any meaningful reforms and end up ceding space to others. Eliminating an old policy becomes just as hard as enacting a new one. And he elaborates on Steven Teles’ brilliant term, kludgeocracy. As policies overlap and intertwine, they become more difficult for government agencies to administer, something akin to a policy variant of the “kludge,” the clumsy patches that programmers use to temporarily fix a piece of software.
Dr Ross’ book points to a disturbing trend, of how much of the expertise to design and execute on policy now exists outside government. And the private sector woos and scoops up these officials paying top dollar both for their knowledge, their insights, and their networks.
The one major drawback in the book — a natural expectation given his previous tome on the industries of the future — is that there should have been a full chapter on how technology, and the growing internet economy, will shape the social contract and its constituents. He alludes to it here and there but a more comprehensive analysis of whether technology will make the state wither away faster or make it more relevant, whether it will make corporations more omniscient and omnipotent or less so, and what will happen to the not-for-profit world, remains a puzzle unanswered. This is a brilliant book with a rare central argument and insights that concern us all. A mustread for those who want to understand the next decade and beyond.
The Raging 2020s: Companies, Countries, People – and the Fight for Our Future Author: Alec Ross Publisher:penguin Pages:336 Price: ~699