Apr 25, 2010

Opportunities in Crisis - Defining New Avenues of Growth

So Future Challenges is now launched and looking back on last week, the Washington experience was truly insightful. I am thankful to Future Challenges and the Bertelsmann Foundation for giving me the opportunity to be a part of this platform.

It was fun getting to meet/know our German counterparts from Bertelsmann Foundation and colleagues/writers from other parts of the world. It was great to be a part of the learning process through "Opportunities in Crisis."

I went there as a writer/blogger from Bhutan and to write about the Opportunities in Crisis - defining  new avenues of growth, and relate it to South Asia,   the Himalayas and Bhutan.

There was a lot of information and it was hard to process all of that, live stream, so I left most of it for home to reflect on, to sift through. I needed to digest it all and see how all that information relates to an Asian experience, particularly for my country or someone like myself who comes from a small agrarian society with none of the complexities of the western money market and therefore, none of the complexities of these problems either.

However, that being said, given my understanding that we are living in an increasingly interconnected world than we were before; that the problems we once confronted as individual countries are increasingly becoming more global; and that what happens in one place eventually impacts another, it is important to care about each others problems.

The focus of "Opportunities in Crisis," as Ms. Annette Heuser, Executive Director of Bertelsmann Foundation in Washington DC said, was really to come away with positive lessons from the Financial Crisis that started in America.

At the very opening of the conference we heard Andrew Kohut, President of the Pew Research Center tell us how "angry" the Americans were. Polls revealed that the government in America was looked upon extremely unfavourably by the American public and wall street even more so because of the events of a Republican President and then the crisis.

Ronald B. Richard President and CEO of Cleveland Foundation also talked about how the public school system in many states in the U.S was in shambles with the drop out rate of children of Black and Latino backgrounds at 50 percent and if they graduated from school they did so without being able to do simple math or read properly.

While this relates to America, I think it says a great deal of how the world's greatest nation is not so great after-all and that it too is rife with festering social, political and bad public policy problems.

I think that while America is still great in many ways, some of their problems are worse off than countries in the third world (given the wealth and resources they have in comparison to these poor countries) and that it is purely because of a lack of ethical policies in place. For isn't that really what brought down banks to its knees and the country to its current crisis?

I thought that Ronald B. Richard President and CEO of Cleveland Foundation observations about his country and the problems in education and social welfare were very true. While it may be the greatest country in the world, I think America's problems arise because (in his words) "unlike Europe and Asia, there is a reluctance in this country [the United States] to accept collective responsibility. In the U.S everything is individual oriented - it worked with certain things like internet etc - but when it comes to the environment, health-care, and education, individualism doesn't work."

That being said, let me speak for Asia and say that we have many things we need to rectify in the way we do things too, maybe in Asia the focus is at the other extreme - too much collective responsibility with no focus on the individual? 

So after listening to panel after panel we came to the end of the day "Reformatting the Global Economy: Should the G20 be the new platform for world governance?" Sitting at the panel were Shaikh Ahmed bin Mohammed Al Khalifa, the Finance Minister of the Kingdom of Bahrain, James M. Flaherty, Canadian Finance Minister, Robert Hormats the United States Undersecretary of State for Economic Energy and Agricultural Affairs, and Maria J.A. van der Hoeven, Minister of Economic Affairs from the Netherlands. It was moderated by John Authers, Editor of Lex,  of the Financial Times.

After listening to their discussions about how relevant the G20 was and how it could help the world cope with another crisis, I felt that I had listened to a whole day's discussion with only a focus on the "Financial aspects" of the problem/crisis and were speaking only about a "Financial regulatory solution" for it.

So I felt compelled to ask them a question which was prompted by this thought:

I come from a small country, one that does not have the size of the American economy nor the complexities of its markets, nor an ounce of its wealth. But it seemed to me that the whole problem started with a simple thing - Greed, excessive Greed. In Bhutan, we care about the economy but we care more about the well being of people, something called Gross National Happiness (the definition and the content of which is still being debated) but which is the driving force for all things. It is a development philosophy by which our government tries to abide by while making any decision in any sector.

Our 4th king who was the propounder of this philosophy let this influence all decisions he made when it came to modernizing a small, isolated and poor country like Bhutan.  It did wonders. Today amongst many things to boast about, Bhutan's economic growth rate is at 8 percent, one of the highest in South Asia and it has 70 percent of its forests under natural and wild forest cover.  Not to mention that our people are "content" and "contentment" is what drives happiness.

After I asked my question - which in essence asked what they thought about GNH and whether a philosophy like that could influence policies in the U.S, Robert Hormats the U.S Undersecretary of Economic, Energy and Agricultural Affairs responded by saying said that "new ideas were always coming from smaller, unknown countries." He said that as policy makers they always desired to put themselves in the shoes of those people that were affected by their decisions. He implied that something like GNH needed indicators and that it was important how to measure success and failure. Maybe, he wasn't aware or has yet to learn more about GNH, but this process of indicators for GNH has already been formulated.

Perhaps Maria J.A van der Hoeven, Minister of Economic Affairs of the Netherlands said it best.
"There are two sides to this crisis. One was financial and the other was ethical. There needs to be new public awareness of fiscal and economic aspects but there is also something else that needs to be put on the table that needs to be discussed." But we had come to the end of the day, and that would take time and so she suggested that maybe the Bertelsmann Foundation organize another conference to address the ethical side of this problem! she said.

Huan Chen (Deputy Director, Clean Development Mechanism Fund) Steve Case (Chairman and CEO and co-founder of Aol,  Dave McCurdy, President CEO of Auto-Alliance, Bruce Stokes, International Economics Columnist, Andrew Cohut President Pew Research Center, Darrell Issa - US Congressman California, Caio Koch-Weser Vice Chairman Deutsche Bank

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