Full transcript of the panel “A Fusion World Ahead? Geopolitical Implications and Strategy Options” at the 2013 Strategic Foresight Forum. Entitled Harnessing Disruption, the Forum highlighed ways the technology revolution is shaping government, business, and civil society. Many panelists focused on the effects of technology on individual empowerment and globalization, and the need by both public and private sectors to better adapt to coming change.

Welcome and Moderator:
Frederick Kempe,
President and CEO,
Atlantic Council

General Brent Scowcroft (ret.),
The Scowcroft Group;
Interim Chairman,
Atlantic Council

Peter Ho,
Senior Adviser,
Center for Strategic Futures, Government of Singapore

Peter Schwartz,
Senior Vice President,
Global Government Relations and Strategic Planning, Salesforce.com, Inc.

Location: Atlantic Council, Washington, D.C.

Transcript by
Federal News Service
Washington, D.C.

FREDERICK KEMPE: Welcome, everyone, to the final panel of the 2013 Strategic Foresight Forum. This panel is called “A Fusion World Ahead: Geopolitical Implications and Strategy Options. I’m going to explain very, very briefly where the world – most of you perhaps know the fusion world comes from. And then we’re going to talk about how we can get there in this panel.

We have in the last two days 6 million Twitter impressions. Now, General Scowcroft was saying, well, what does that mean? And I would say, if we could get 2 million more out of this panel, we have a tipping point in global understanding or something. (Laughter.) I also coached him a little bit about what he could say that would get us to 2 million; I don’t think he’ll say it. (Laughter.)

The – it’s been a fascinating conference. This has been a great day. I think those of you who have just braved this absolutely blizzardy weather outside – any of you looked outside, the – we were actually ruminating in the room next door what would happen in this city if you ever had a real crisis, but – (laughter) – which is a little worrisome.

At any rate, in the Alternative Worlds – Global Trends 2030 report, the fusion world was the sort of – the world where everything goes absolutely right and – within the realm of achievabilities while the two other worlds were an absolutely terrible world and then – a world called “stalled engines” and then a world in between. But fusion comes out of a scenario that had a spreading conflict in South Asia, and it triggers efforts by the U.S. and China to intervene and impose a cease-fire. China and the U.S. find other issues to collaborate on, leading to a sea change in their bilateral relations. This is in the year 2030 or leading up to it – as well as broader worldwide cooperation and global challenges by – between China and the U.S. So this is – a precondition for fusion is China and the U.S. getting their relationship to a whole different level. The scenario would only possible through strong political leadership that overrules cautious domestic constituencies and forges stronger international partnerships. As a result, trust between societies and civilizations would increase. In a fusion world, economic growth resumes as the initial collaboration on security is widened to include intellectual property and innovation and so on. China plays an increasingly positive role in the international system. It begins a process of political reform. And the growing collaboration among major powers allows global multilateral institutions to be reformed or made more inclusive. In other words, dream on. No, that doesn’t say that. It say, in other words, political and economic reforms move forward hand in hand. All boats rise. Emerging economies grow faster than advanced economies, but GDP growth in advanced economies also accelerates. The global economy doubles by 2030 to $132 trillion a year. The American dream returns, per capita incomes rising $10,000 in 10 years. China per capita incomes also rapidly increase, and China avoids the middle-income trap. Europe uses the eurozone crisis to be a catalyst for deep political and economic restructuring. So I won’t go on, but you get the point.

So we’re going to tell you how to get to that world. And if we can’t do that, we’re at least going to try to draw out what we think the major factors are – rising – using some of the technology stories but also rising above those to larger global trends. What are we seeing that might lie between us in that fusion scenario or might be able to empower that fusion scenario? And then what kind of decisions can one take in politics to help drive this forward?

The – our panelists are prominent strategists from very different fields and very different places and have worked within government and outside of government to make foresight actionable. General Scowcroft, sitting to my left, is our interim chair, told us when we established the Brent Scowcroft Center on International Security that he wanted us doing strategy, not policy. And I think what he meant by this is not that we shouldn’t do policy but that we really had to lead that with strategy. So we’re trying to do that through this strategic foresight initiative by and large. So it’s really a brainchild of General Scowcroft that we’re trying to make actionable.

U.S. Marines Corps General Jim Jones, the Scowcroft Center Chair, couldn’t be with us today, had to cancel last moment, so the Air Force jumped in to rescue the Marine Corps – (laughter) – and we’re happy that General Scowcroft consented to come here. And if you want to make any (right ?) comments about the Marines, feel free to do so – (laughter) – at any point during your remarks.

In your opening remarks yesterday, General, you stressed that technology is by its nature disruptive, quote, making sure that disruption is positive, is the job of government, corporations, university, think tanks and NGOs – indeed, all of us here. So we look forward to hearing from you about how these different agents can come together to ensure more prosperous and peaceful world.

I’m very pleased to welcome Peter Ho back to the council. He inspires our thinking very often. He was with us two months ago for a round-table discussion on the issue of building actionable foresight for urban resilience. He’s a senior adviser at the Center for Strategic Futures housed in the Singaporean prime minister’s office. In his 34 years of public service in the Singapore government, Peter has witnessed the transformation of so much of the world, the incredible rise of Singapore and the impact of rising complexity on government. He recently stressed that in a complex operating environment where cause-and-effect links are less clear, one has to be prepared to try things out. So we look forward to hearing what you think government needs to try out next.

And then Peter Schwartz, last and certainly not least, senior vice president of the Global Government Relations and Strategic Planning at salesforce.com. Peter is a renowned futurist, one of most renowned futurists, specializes in scenario planning, working with both the corporate and the government world to create alternative perspectives of the future and develop robust strategies for a changing world. His book, “The Art of the Long View,” has been a seminal publication on scenario planning and is a must-read in many business schools across the country. And if you want to get an idea of what the future might look like, Mr. Schwartz, Peter, has served as a consultant to the movie “Minority Report.” So maybe we’ll hear from you what you learned from “Minority Report,” or what they learned from you, alternatively.

I’m going to start with a couple of questions to General Scowcroft. I’ve asked the other panelists not to sit and wait for me to come to them, but if they hear a comment in my initial questions to General Scowcroft they would like to jump in on, that they should do so. And then I have other questions that are more designed for each of the panelists because they have such different areas of expertise, and I’ll ask the panelists to do the same in that kind of situation where they should also jump in there.

So let me start with General Scowcroft and a couple of things you’ve said before at the Atlantic Council about how you’re seeing the future of the world and how that fits into what we’ve been talking about in terms of the fusion world and how you think this might drive what decision-makers have to face between now and 2030. One of them – and you can describe this obviously better than I can – but had to do after Tahrir Square with observations you made about the politicization around the world. A second observation you’ve made is around the potential death of the Westphalian world – not totally disconnected, these two things. And I wonder if you could lead us off by talking a little bit about those observations.

GENERAL BRENT SCOWCROFT (ret.): Sure. I’d be happy to.

Let me start with the Arab Awakening, Arab Spring, whatever you want to call it. And I think it sort of is an excellent example of what we’ve been talking about, the impact of technology, broadly in this case communications technology, and its impact on the world because what happened in the Middle East when a poor fruit peddler immolated himself in protest spread to the whole region immediately, that wasn’t possible before. There was unrest in Egypt for a long time; Mubarak was able to keep it under control and so on. It was hard to protest. How do you turn people out for rallies in the public square and so on without the police picking you up as you go door to door knocking for it. Now all you have to do is pick up your cellphone and say, there’ll be a rally at 10 o’clock tomorrow morning in Tahrir Square; turn out – and you can get a million people. That’s a fundamental change.

And along with that is the fact that now people are politicized who never before thought themselves as part of a government, country, anything else. They just lived the way their families had lived from time immemorial. You inherited whatever you’re doing from your father. You passed it on to your son. There was an immutability about life. It was just continuing. Now they look at modern communications and they say, it’s not that way around the world, it’s not that way. So all of a sudden they’re politicized, and they say, we’re being treated like chattel, not like human beings. I’m not saying this is necessarily democracy, qua democracy, but it’s saying, we are people, and these guys up here can’t treat us as if they own us because we have certain fundamental rights as human beings.

And I think that is the kind of thing which is at work in the Westphalian world. And the Westphalian world is one we’ve had for about 500 years, and that is the world is divided up into these sovereign states who are completely independent, know no obligation to anybody else, and they fight among themselves. And frequently, especially in the 20th century, which is probably the epitome of the Westphalian system, it was a zero-sum game. Alliances were built to counter alliances, and if I’m stronger, it means you’re weaker. And you see the stories all the time: Is the United States losing its power? Well, the whole nature of power is different now, and it’s fundamental change.

And Egypt is a good – is a good case in it. Mubarak is gone. How does Egypt govern itself? The only other power that was really organized in a semi-democratic way to take the sinews of power was the Muslim Brotherhood. It behaved like a political party. It had its sinews out into the public. It did good works. It did all those kinds of things. So when Mubarak’s machinery collapsed, the only thing left to reach out and deal with the people was the Muslim Brotherhood. So it’s not surprising that they ended up in control of the government.

But the question is, is the Muslim Brotherhood just a political party, so is it an Islamist party that means when they get in power, they transform the whole thing into an autocracy? The problem, though, is the democratic forces are not organized, and it takes a long time to build a political party. You have to find people in all parts of the country who believe in you, who are prepared to raise money and proselytize and so on. So they’re way behind. And so what is Egypt falling back on? The military.

And that’s the kind of a world that we’re in now, and it’s we’re in this sort of space between a fusion world down the road where these modern forces of technology are transforming everything we do and our roots deeply embedded in this Westphalian system. And we do such interesting things. For example, one of the results of this new system is terrorism and the worldwide impact of terrorism because of communications; you can get people unassociated before to work together.

And how do we deal with it? Well, what the United States did is declare war on terror. Now, how do you do that? Terror is simply a way, a particular way of killing people. But that’s the agony we’re in now. We’re trying to fight a war on terror, and it leads us to these anomalies of how we treat people, how we treat states and so on because we’re in this complex world between the old, rigid Westphalian, I’m strong, you’re weak, you’re strong, I’m weak system and the impact, especially of communications technology. That was a long answer to a short question.


MR. KEMPE: Yes – fascinating opening comments –

PETER SCHWARTZ: Can I just add something to that?

MR. KEMPE: Please. Please. Yes. Please.

MR. SCHWARTZ: In 1993 I had the opportunity of having dinner with Mikhail Gorbachev soon after he had been expelled from office. And I asked him, why now? Why did the Soviet Union end now? The economic erosion had been going on for a long time. What created the collapse at that moment? And he said it was the satellite dish and the PC. He said, when our people – when we could no longer control what people believed and saw, the game was over. And you may remember when the near-coup happened, they tried to take the Soviet television station, and it didn’t make any difference because people were watching CNN, the Internet had already penetrated illegally, and so people were seeing the real world for the first time in ways that the Soviet leadership couldn’t control. And so I think it even began with the collapse of the Soviet Union.

MR. KEMPE: Yeah.

PETER HO: I’d like to throw –

MR. KEMPE: Please.

MR. HO: – something into this discussion on the future of the Westphalian model, and that is globalization because the globalization which we see today, and it’s only become really evident in the last 50 years or so, has been enabled by technology. And this is the thing that is breaking down the barriers between nation-states. It’s not just the Internet or the World Wide Web; it’s also how people now interact with each other. You know, trade now is enabled because of air travel, because of container traffic. And the manufacturing system respects no borders. There’s a global supply chain, so when there are floods end of 2011 in Thailand, it disrupts entire global supply chains.

So the kind of world we are entering is not just reflected in questions about the politics of sustainability of the Westphalian model; I think it’s also a different type of economic structure that is emerging, which is why questions about the future of the WTO Doha round are important things because these are the questions which are going to determine the direction whether we’re going to achieve the kind of fusion world which I think the NIC report talked about of whether it’s going to be a world divided in two silos.

So it’s I think not just technology but I think it is also a fundamental trend of globalization, which is creating either a fusion type of world or a fission type of world where you have terrorism, politics of envy. So I think we are really on the cusp of having to decide which direction we want to go. And I think this is where we have to start really talking about leadership, who’s going to lead the world and in which direction. Do we – do we surrender the ground to the terrorists, or do we have a serious adult conversation about what we want to do?

MR. KEMPE: Well, let –

GEN. SCOWCROFT: I think that’s exactly right. And globalization is eating away at this Westphalian world because less and less of the things that a country feels it has to do for its people can be done unilaterally now. Take climate control, for example. If the United States was to put on complete and utter climate control systems and nobody else did anything, it wouldn’t matter. So you have to work together to get things done. And that is sort of intuitively different. And I think when we talk about the United States and China, they’re always going to struggle – that’s old thinking, and it doesn’t take account of the impact of technology broadly, globalization, whatever you want to call it.

MR. KEMPE: Well, let me raise a question on that and then have all three of you answer and perhaps starting with Peter Ho and General Scowcroft, and Peter can jump in where they want to. You’re talking about the fusion world and then the danger of the fission world, which I – which is a term I hadn’t heard before, so that’s a really interesting – (inaudible) – alternatives to fusion.

There are sort of two questions in the things you’ve been raising, General Scowcroft, in your opening comments. One of them is really, are we really entering a Westphalian phase of history? The nation-state’s a pretty stubborn operating system. And, you know, and will the rising power of the individual begin to eclipse the power of – I have a little trouble getting my head around that.

But most of all, and I think this is particularly for the, you know, Peter, perhaps thinking about the government of Singapore and other governments and General Scowcroft in terms of the role of the national security adviser of president of the United States is, how do government leaders respond to this middle state that General Scowcroft has talked about, you know, between the fusion world and where we’ve got roots, as you said, roots deeply embedded in the Westphalian system, and we’re a space somewhere between fusion and this Westphalian system? How do – how do government leaders respond to this? And are we over-predicting the fall of the Westphalian system? Maybe Peter and then General Scowcroft (and Peter ?).

MR. HO: I mean, I think it’s nice to have a polemical position on this, but my own belief is that we are not going to see the demise of the nation-state, certainly not in my lifetime and well beyond that. I think what we are beginning to see is not so much the demise of the Westphalian type of nation-state but the emergence of a new significant entity. And I’m not even talking about the masses of people who do Twitters, but I’m talking about the rise of the global city.

And we had some opportunities to discuss it this morning, this afternoon and yesterday. What’s the significance of the global city? It’s I think increasingly important because people are moving from the countryside into the cities. By 2030 I think some studies say 60 percent of the population will be living in cities. And the cities are going to be either the creators of the global problems because there’s – they’re so large or they’re going to be the sources of the solutions to these problems. And I think they’ll be – they’ll be both.

So I think the issue is global city, nation state, they’re going to co-exist in a very strange way because global cities in a social-economic way will be divorced from the nation-state, but in a physical sense, they depend on the – they depend on the nation – they depend on the nation-state. So I think a lot of the challenges I think going forward, how do we define the relationship between the global city and the nation-state.

And when think about global cities, global cities are not like ordinary cities; there are any number of cities because of the rise of urbanization, but the significant ones are going to be those which somehow have positioned themselves to become hubs, hubs of something, hubs of ideas, hubs of creative energies, hubs of finance, hubs of business. This is – this is what is driving the world today. And it is not the nation-state that is driving it; it is these hub cities, these global cities that are driving the nation-state today.

So a country like Singapore is also both a country and a city. We say we want to be a hub. And we’re not saying we’re a hub country; there’s no such thing. But we are a hub city. And what (are we ?) trying to do? We make ourselves the number two container port in the world, very significant air hub, hub for medicine, hub for tourism, hub for research – you name it, you know. This is what hub cities try to do. So the best cities in the world will try to achieve that status. And it is these which will set the pace for the world.

But that doesn’t remove the need for the nation-state. In Singapore, the connection between the nation-state and the city-state is a very complex one because the nation-state likes to tell a single narrative – you know, it’s we, we’ve got one identity, we’ve got one history. But a global city is different. A global city is a city with multiple identities, embraces a lot of diversity, and there’s no single narrative. But they have to co-exist. And in a city-state, it’s even more complex, how do these opposing narratives co-exist.

MR. KEMPE: The – and maybe you can pick up on anything you’ve heard here, General Scowcroft, but at the same time, put yourself in the White House looking at this world, and what do you do about it?

GEN. SCOWCROFT: Well, I think, you know, the world is moving. It’s moving away from the Westphalian system. Btu I don’t think we’re going to trade one for another. There’s going to a blending because – take the Islamist movement, terrorist movement, whatever you want to call it. It is eating at the nation-state system. It – you can appeal across national frontiers to people with similar grievances. But what are they after fundamentally? They’re after a return, culturally, to the early days of the Muslim religion. That’s backwards. You know, that’s going back. That’s not going forward. So there are all kinds of this – these admixtures of looking forward and what’s technology doing to us and how is it changing us, and we’re still instinctively very conservative and even reactionary about how we deal with this.

MR. KEMPE: So sometimes using modern means to take ourselves backwards.

GEN. SCOWCROFT: Yeah, absolutely. And I think the Islamist movement is a great example of that. They are resisting modernization, and they think Western civilization is decadent and they need to be protected from it.

MR. HO: Although I would add a counterpoint to that, which is a lot of the activity which you see in the real big global cities, blends, eclectic blends of the best you find from around the world – I mean, you can say East and West, but I think that’s what’s happening. So there will be a tier of – tier of cities which will set the pace for the whole world which will go around looking and finding the best in Asia, in Europe, in Latin America and finding these ideas, these technologies, blending them together to create that competitive advantage. But in the process, they are setting the pace for the – for the whole world. So, I mean, I’m sorry to bring you back the Singapore example, but this the only thing I can think of. We have –

GEN. SCOWCROFT: I think Singapore is a quintessential example of what’s going on.

MR. HO: Yes. So we have things like Yale-NUS College, which is a liberal arts college, but using the liberal arts program of Yale, but combined with an Asian setting and using Asian traditions. Western general hospital, Singapore General Hospital setting up a traditional Chinese medicine operation, a big one within the setting of a Western-oriented hospital. So I think these are the things that –

MR. KEMPE: Fusion.

MR. HO: Fusion. These are the things you see happening around the world.

MR. SCHWARTZ: I want to provide a concrete example of I think what exactly General Scowcroft was talking about. Btu I want to say one thing first, if I may, just a thank-you to the Atlantic Council for putting me on the stage with these two gentlemen. I think General Scowcroft is one of the great strategic thinkers of our time, and most of you who don’t know Peter Ho as I do know that Singapore is one of the great political achievements of the last 50 years. And we all know about Lee Kuan Yew, but the guy who actually makes it real – Peter Ho. (Laughter.) So I’m really honored to be here.

Something you may not know, and most of the world doesn’t know about this yet, just a small hint in the press a few weeks ago – the government of China and the United States have been stymied in dealing with each other over climate change because of domestic considerations. If you talk to President Obama or if you talk to President Xi in China, you will find they’re both similarly concerned about climate change, but they will both say, yeah, but I have constituencies at home and people at home; I can’t really negotiate with you about climate change; we’re just simply not going to get anywhere.

So what we did in California is when President Xi came to meet with President Obama at Sunnylands, Governor Brown, who has been a leader on climate change for actually 40 years – in California, if you don’t know, we use 30 percent less electricity than the rest of the country per capita because of policies that Governor Brown put in place back in the 1970s that led to much greater efficiency, et cetera, greater use of renewables and so on. A lot of good things have (flowed ?) and is now even doing more: We have a cap-and-trade system in California, renewable targets and so on. In fact, we’ve got most of the West Coast to go along with us. So what Governor Brown proposed to President Obama and President Xi was, look, you guys can’t deal with this, but we in the states can, and you in the provinces can. So why don’t we learn from each other?

And so in fact, beginning in February of this year, there will be a series of dialogues, collaborative dialogues between the provinces of China and a number of the key states where – the reality-based states – (laughter) – that will actually tackle the climate change problem and begin to share and collaborate and develop joint programs of research. For example, the highest priority where we’re collaborating is carbon capture and sequestration, where we have huge research capabilities. You see Berkeley, Stanford and so on. They have a huge problem. So we’re beginning to work together. So the – below the nation-state, slightly above the city level but equivalent – I think the point is very much similar – we are now finding means of collaborations almost invisibly to actually begin to tackle global problems that the nation-states for political reasons can’t tackle.

MR. KEMPE: The – that’s a – that’s a – these are great examples of fusion. That’s a terrific example.

One more question for the group here. And Peter, I’ll lead with you on this, and then I’ll go to the audience for your comments and questions. In this fusion world 2030 or fission world or whatever else, how do technologies work with democracy, individual liberty? I have attended some of the sessions we’ve had on these questions at the Atlantic Council and also working with the National Intelligence Council. And there is a group that says, well, the technologies ultimately favor greater liberty for the individual. But we are also seeing that there is a future for tyranny as well. And we’re investigating right now what it is, but the state and tyrants have also found ways to use technology. And it’s not altogether clear to me which is going to be dominant. And I wonder how you look at this because technologies give the state greater power to monitor citizens, to spy, et cetera, et cetera. Chinese firewall is bigger than ever before. But on the other hand, we’re also seeing the politicization that General Scowcroft is talking about and the ways that ideas spread and become viral. So Peter, maybe you can take that on. And also, I’d love to hear from the other two panelists as well on this.

MR. SCHWARTZ: Well, today I didn’t bring my microdrones with me. And I’m not kidding; I have a small fleet at home. It’s just – one of my closest friends is a guy named Chris Anderson, who wrote the book “Makers” and is also CEO of a company called 3D Robotics. And he and I spy on each other quite regularly with our drones. (Laughter.) His are better than mine, I might say. I built mine – one of them – on a – my 3-D printer, I would also say that too, or big parts of it; the wings and stuff like that came off a 3-D printer.

MR. KEMPE: Will you promise to bring them on your next trip to the Atlantic Council?

MR. SCHWARTZ: They’re actually a little too big to put on a plane. They’re about this big. They’re not the spider size we heard about the other day.

I think unequivocally the power is moving toward the individual in this respect. The tyrannical states can try and keep trying, and it’s not that they will stop trying. The desire for control and power is profound and isn’t going to go away. But the tools that challenge those powers are becoming vastly more ubiquitous, easily accessible and far more powerful than they’ve ever been before. And I think information tools, tools like – we call them microdrones – the tools that were only in the hands of the state now are increasingly in the hands of individuals. And I think that power shift is quite fundamental.

Now, that doesn’t mean that that isn’t going to be a constant struggle. But it does mean that once where the individual had very little power, they now have much greater power. And that, by the way, is not limited to the state. It’s true in organizations. My company, that’s what we do is we empower individuals in organizations to participate in new ways. And I think that sense of the technology enabling individuals to know more, express more, act more powerfully, connect with other in ways, mobilize power in ways that they couldn’t before all changed the balance of power from central authority toward the individual.

MR. KEMPE: Thank you. Do you agree?

GEN. SCOWCROFT: And I think that could be one of the most dangerous aspects of all because that’s –

MR. SCHWARTZ: I didn’t say it was going to be better ordered.

GEN. SCOWCROFT: But – no, but –

MR. KEMPE: Yeah, the super-empowered individual (disrupt it ?).

GEN. SCOWCROFT: That’s – yes, because that’s really why we establish government, to curb the individual powers in the sense – in the interest of society. But I’m not sure; you’re the technologist, I’m not. I’m not so sure that the government will not be able to move faster than the individual. If you look at the whole Snowden kind of thing, the government’s way out in front on this one, and they may succeed in staying out in front with even worst effects than if the individual does. And that’s –

MR. KEMPE: Explain how the government’s way out in front.

MR. SCHWARTZ: Yeah, I’m not sure I understand that.

GEN. SCOWCROFT: Well, the government listens to everybody now.

MR. KEMPE: Right.


GEN. SCOWCROFT: And I don’t know how much, in fact, but if you read the papers, the government can find out what anyone of you, who you’re communicating with, what you’re saying and so on and so forth. That is the power of government that we haven’t ever even approached in history before. And that gives the government huge powers. Aha – you’ve been doing stuff that’s illegal.

MR. SCHWARTZ: Yeah, we live in a world of radical transparency. I think that is true. I think that it true.

GEN. SCOWCROFT: And I think it’s a two-way sword. And that gets back to the fundamental question we have.

MR. SCHWARTZ: Ed Snowden turned it on its head.

GEN. SCOWCROFT: How do you make – how do you make this a force for good rather than a force for evil?

MR. KEMPE: So you had a super-empowered government uncloaked by a super-empowered individual, Snowden.

MR. SCHWARTZ: Walked off with a laptop.


MR. HO: I – yeah, I got a slightly different take, and perhaps we should look at technology and its relationship to the nation as well its relationship to the government. I think we talk about technology as if it’s today either the panacea or the source of all our problems. In fact, I think there’s a danger that governments see technology as the fix. You know, you got a problem, use technology and you solve the problem.

I think in future, the smart governments will be ones in which they understand that technology both has upsides and downsides, but technology must be put within a particular setting. That means not just the technology, but how does it work with people, how does it work with regulations, and then put it all together because this is very complex system. You – if you just say the Internet will solve all my problems or social media will solve all my problems, you forget that there are also consequences in terms of how the people will use that technology. So they have to look at it in a much more holistic way.

And I think this is going to be a big challenge for governments going forward, how to use technology, not in and of itself but in connection with other tools that they have at its disposal, the ability to manage behavior. You know there’s been in the newspapers talk about behavioral insights groups and nudge, you know, how to use that. And you have to combine these things. I think the problem is we think technology is a fix, and if it – if it – there are problems, we just throw more and more technology or we say technology has failed. Technology is just an enabler.

MR. SCHWARTZ: But Peter, look, you have the experience of Singapore of the last general election, OK? And it was a remarkable event that happened in that general election. Singapore has been driven by great political leadership, great bureaucratic leadership, but leadership that thought that it knew best for what the people – what was really good for the people of Singapore and delivered it. Well, Singapore is now almost 50 years old, people are beginning to say, you know, I have some idea about that. And yes, it was democratic, but it was a constrained democracy, right? You know, organizing opposition was a bit difficult and getting right to demonstrate and rally was a bit difficult, and the state controlled the newspapers and the television. And they were open and benign. It wasn’t authoritarian in any nasty sense.

But what happened in the last election? What happened in the last election, they said, look, this time you can use all the social media you want. You can organize on Facebook and Twitter, anywhere you want in the streets. And what happened? The results went from 85 percent for the government down to about 65 percent for the government. Now, they still get 65 percent of the vote. Many American politicians would be very happy with that outcome. But the real result of that is what I’m observing – I have spent a lot of time in Singapore and with the leaders – is they are now listening in ways that they never listened before. It isn’t that they weren’t attentive to people before, but they’re listening.

And what has now happened is that Singapore has become much more democratic in a really much more conventional sense. I said to the prime minister after that last election, I said, look, this was a family-run business before, and now you’ve gone public. (Laughter.) And, you know, you’ve got shareholders who are watching and demanding results in ways that they never have before. And I think, in a sense, even in a place as benign and forward-looking as Singapore, these technologies have opened the game.

MR. KEMPE: Any response to that? I think – and we’ll go – yep.

MR. HO: Yeah. No, I mostly agree with Peter, and I’m not disputing that point. I’m only saying that governments have to know how to use the technologies in an intelligent way. And mind you, after the – after the challenges which were quite evident following the elections in 2011 – a big effort to engage in consultations with people. And it was not using technology. It was really face-to-face consultations. It was 18-month process called Our Singapore Conversations: civil servants, bureaucrats, politicians, people from the street who want to get their views put across, academia, journalists all coming together and talking and having a series of conversations about what bugs them, what they want, what their expectations are – not using technology to solve the issues but using the traditional methods. So this was a point I’m making. You have an environment, you have the technology, but you have to acknowledge what the environment is, and technology is only part of the solution to dealing with some of the issues at hand.

MR. KEMPE: And General Scowcroft, you had close relations with Lee Kuan Yew for a very long period of time. We can turn this panel into a global Singapore (panel ?).

GEN. SCOWCROFT: No, I will – I will restrain myself there. But he is the epitome of proper judgment in these times. And I think the fear is that we will not follow proper judgment and that modern technology, for example, makes us all vulnerable in our credit card pockets, theoretically. Well, suppose that becomes endemic. The government will say, we can stop that, and they’ll stop it by an intrusiveness that will take away our liberties. Those are the kinds of things that we have to worry about. And, you know, we’re not – mankind isn’t made up of all good-thinking people. There are bad-thinking people who want to take advantage of this technology for their own narrow aims. And that’s the nature of the problem.

MR. KEMPE: Jonathan, why don’t you get us started. And then I see a couple of others who have already raised hands around the room. And there are already a lot of questions, so I’ll get to you as quickly as I can. Short questions. Say to whom you want to target them, and identify yourself, please.

Q: (Inaudible) – Jonathan Paris, nonresident senior fellow here at the Atlantic Council. Also, I lived in Singapore from 1980 to ’83, so I do know a little bit about Singapore.

The question really follows on Fred’s introduction. The first paragraph you read from the Global Trends was about China and the U.S. getting together to cooperate. And my question is, as China gets more powerful, won’t it want to change the rules of the game, the rules that have governed the so-called decadent West? And in this post-Westphalian system, if we have to work together, and China wants to change the rules, isn’t that going to make fusion an awfully difficult prospect?

MR. KEMPE: General Scowcroft?

GEN. SCOWCROFT: I don’t think necessarily so. I believe that’s correct. You know, Bob Zoellick said China needs to be a responsible stakeholder. Well, they don’t consider this system their system. And so that is a real danger. But they’re living in this system now. Sure, they would like to make some changes to it. And it could stand some changes; it depends what the character of the changes are.

But opposite to that, as I look around the world at various trouble spots, I don’t see areas leading us inevitably to conflict with each other. There aren’t any Hitlers out there right now. There aren’t any Stalins out there right now. And it seems to me that we don’t have (unalterably ?) opposed views on the big things that we have to deal with.

But do we have to be careful? You bet. Do we have to realize that China has a different intuitive framework? And it’s not Westphalia, it’s the central kingdom. And in China, you can’t be Chinese if you’re not Chinese. In the United States, you can be American or doesn’t matter who you are. Those are very different intuitive ways to think about how we deal with all these problems.

MR. KEMPE: Peter, I see you want to pick this up. And as you do, perhaps you can also deal with a related question, which is whether technology is going to be more an enabler or inhibitor of greater international cooperation. Is – or is it neutral?

MR. SCHWARTZ: On the whole, I think it’s net positive, but I’ll come back to what the issue is there.

I think with China, I think we have to recognize this is the single-biggest geopolitical question in some ways of the next 50 years, how the U.S. and China manage, come together, and within the context of the institutional framework that was created post-World War II. So that has to evolve. That was a U.S. order. We created it.

The Chinese have now come out of their shell, their Maoist shell. They see this as a 500-year challenge, not just a five-year challenge, not a 10-year challenge. They want to see the next 50 years as the opportunity for China to really develop. They’re very pragmatic. At every opportunity to get it wrong, they keep getting it right.

And so I think the risks I think are real, and they’re more likely to be risks of misperception and, you know, the kind of errors that happen – that get fed back and forth, of misperception in the media and so on that can amplify conflict.

But I think General Scowcroft is absolutely right. You see something underway right now. China needs resources. In the old days it would have sent armies. Today it sends businesspeople and buys access to resources in China – I mean, in Africa and Latin America and so on. And it plays hardball and it doesn’t always play nice. I don’t mean to say that it’s all sweetness and light. But it ain’t sending its armies. It’s sending yuan. It’s – you know, it is buying its way in. It’s playing by the rules of the game of a modern economy. So I’m actually reasonably optimistic.

And I had the opportunity to ask I think another great general not long ago – suddenly his name escaped me –

MR. : Colin Powell?

MR. SCHWARTZ: What? Thank you, Colin Powell, thank you very much – Colin Powell about the question. And Colin, who’s an adviser to our company, basically made the point – he said, look – he’s dealt with the Chinese for many, many years, and his view is exactly the same, that is, that the pragmatism of the Chinese and their profound desire to not blow it by creating a conflict with the United States is such that they will do everything in their power to manage the economic development of their country, their place in the world, which they want to be treated with respect, in such a way as to avoid conflict with the United States. That is the worst possible outcome from their point of view would be a war with the United States.

MR. KEMPE: By and large, for most questions, I won’t want all three answering so we get more questions in. But given your proximity, Peter Ho – (inaudible) –

MR. HO: No, I agree with General Scowcroft’s characterization of China. When you look through the lens of a civilization with thousands of years of experience, what do you think they have learned? They are not a hegemonistic power. They have always operated more or less within their boundaries as we understand it today. And those who have tried to conquer China have ended up being absorbed into China.

But what have they learned from the thousands of years of existence is that when the center is weak, they have a lot of trouble – millions of people who died of the famines. When the center is strong, that’s when there’s a flowering – everybody becomes possible. So they’re going through a particular phase where the possibilities are there – (inaudible) – they are contending also with new forces which they’ve not had to deal with, which include the forces of the social media, plus some new challenges of globalization. Yet I think the basic instinct is that keep the center strong, then everything is possible. They’re not interested in creating trouble anywhere in the world. They just want to solve their own problems because if they solve their own problems at home, they will have a strong center. But that’s the first – that’s the first precondition. Many ascribe motivations to the Chinese which don’t exist because they are looking at – through the lens of a different culture, different historical experience. So I agree. You know, the Chinese are not going to try to create trouble and have conflict if they can at all avoid it. Of course, there are possibilities of accidents, but I think generally, the trend is let’s focus on our domestic challenge, which is social harmony and growing the economy. Those are the two requirements. And that’s all.

MR. KEMPE: And so when one looks at a new defense space, it’s growing out of those issues.

MR. HO: N, the new defense space I think has a bit more to do with, you know, I’m a – I’m a(n) economic superpower already. There are certain things, there are certain trappings that must go with power (in ?) some respect. And I don’t think, you know, they will use it. For example, I think they’ve got big interest in protecting their sea lines of communications. So that alone I think becomes a justification for building up a blue water navy. I’m not saying they are not going to use it in other ways, but there are always multiple reasons why things are done. And in China, certainly there is an economy of effort: You do things for many purposes, not a single purpose.

MR. KEMPE: Thank you for that insight. In the back. And I’ve got – I’ll – I’m going to get to people as close to the order that I’m seeing them as I can, if I can remember. So –

Q: Yeah. Thanks very much. Andrew Paterson, nonresident senior fellow here. I want to get the two Peters into it on development models because I think there are development models even within the same country, the United States, that differ markedly. Peter Schwartz was left off the hook I think too easily by Peter Ho when he talked about the California model, particularly applied to climate change and energy. The California model (and ?) the southeast is treated with derision because Governor Gray Davis was recalled, and there were massive bankruptcies by PG&E and the merchant power collapse. You didn’t mention those. The southeast is more, I would submit, like the Singapore model. It’s directed from the top down. It has surplus electricity margins. And they’re very comfortable with that, different development models with the same country. Isn’t that direction where we’re headed rather than one or the other.

MR. SCHWARTZ: Well, as far – the specific case that is being referred to was that governor Gray Davis, who helped oversee the deregulation of the electricity industry, got caught out when a very flawed model of deregulation was put in place that was built on a view of the past of the electricity industry rather than its present or future. And it was a flawed piece of legislation, frankly, that created the opportunity for Enron and others to play a really nasty game that produced electricity spikes that undermined actually a reasonably corrupt governor in the form of Gray Davis – and Gray was not among the most component.

Having said that, that in fact, the electricity deregulation opened up the game in a rather fundamental way that is now actually doing reasonably well. Having said that, it was a serious mistake the way in the way it was put together. But it wasn’t Governor Brown. And you’re right, it was Gray Davis, and that was the issue. But I don’t think that says anything about the development model. I think it was a flawed example.

MR. HO: I’d like to add something about – I’m not sure whether this is so much a debate of whether this development model or that development model is right. In the end, the governments have to make certain decisions. Do they want to leave to the private sector to organize things? Fine. If they want to take charge and control it from the top, that’s also fine. But I think one of the big challenges for all governments going forward is this: We are entering a phase of great volatility, great uncertainty and great complexity. And this means that whatever we plan today, whatever policy we make today, whether the California model or the Singapore model, inevitably reach a point where they no longer function as they were intended to function.

And this then requires certain skill sets in government. One is a skill set to recognize when what you did is no longer working and then make cost adjustments. Secondly, to avoid being plunged into this kind of situation, better start thinking long term. Think about what kind of future you might be facing. That’s why we admire Peter Schwartz; because of his scenario planning, which we have embraced because we think we face uncertainty, we better know what kind of uncertainties the future could possibly bring.

The third point I’d like to make is experiment. When you’re not sure, you still have to make a decision. And when you make a decision, well, there’s a risk. Manage that risk in a strategic way, and be prepared to experiment. Try things out, see what works. If it works, then continue to roll it out. If it doesn’t work, well, put it down to experience. So I think that is I think some things which governments have to learn – and also to bring the people on board when you start doing these experiments because if not, governments will be blamed for failing and wasting public money.

MR. SCHWARTZ: Can I ask General Scowcroft a question?

MR. KEMPE: Yes, you certainly may.

MR. SCHWARTZ: You know –

GEN. SCOWCROFT: Don’t I have something to say about that?

MR. KEMPE: You also may answer. (Laughter.)

MR. SCHWARTZ: I want to talk about international institutions. If one looks at the postwar era, what one saw was, you know, if you compare 1900 to 1950 – and 1900 to ’50 was just a – worst period of human history – one big war, World War I or World War II, you can put it together. But post-World War II, with United States leadership, we created a framework of relative peace and stability. The first half of the 20th century, we killed 180 million people in war; in the second, 20 million. Now, that’s not – that’s – you know, that’s not good, but it’s a whole lot better than 180.

Having said that, that framework of institutions seems very badly frayed in the context of the current world, in the kind of breakdown of the Westphalian system, the varieties of issues we’re dealing with, climate change being a good example. What kind of evolution do you imagine for this system that we’re seeing here, the framework of institutions – the U.N., NATO, World Bank, IMF – all those things that have been important to produce relative peace and prosperity over the last 50 years?

GEN. SCOWCROFT: I wish I knew. You know, we’ve been trying a whole bunch of things. And, you know, we had the Group of 8, Group of 9, Group of 20, so on and so forth – different ways to deal with it.

My own personal choice would be to try to do something about the U.N. The U.N. was built in a hurry, in a way. It has some good parts, and it has some very bad parts. For example, United Nations secretary-general is not the director of the U.N.; he’s the chief clerk. He doesn’t control the budget. He doesn’t control personnel. A government couldn’t run that way.

But I think the forces of globalization are pushing us all together. The institutions of globalization are nowhere. And that we need to think about seriously.

MR. KEMPE: Thank you.

I’m going to pick up a couple of questions here as they’re piling up. The woman right here in the third row back I think – fourth row – did you have a question? Yes, please. Yeah. Thank you.

Q: Patti Morrissey, NIC Strategic Futures Group. Oh, sorry. Patti Morrissey, NIC Strategic Futures Group. We’re going to be doing the next Global Trends, 2035.

So there are a couple themes that really struck me. And one of them was the issue of not seeing technology as the solution. And it reminded me of sort of an internal methodological struggle that we’re having regarding this whole idea that big data is sort of the answer. We can just look at so much data that these things will pop out, and we’ll understand the future.

And I guess the problem I have with that is the future is not something that we’re trying to figure out like a puzzle. It’s something that we’re trying to create conditions for a future that we decide as a community we want. And that is not a puzzle; it needs to be based on evidence that we see today and trend lines that we understand and human interaction and brainpower thinking through how these things intersect.

So I really resonated I think it was Peter that said don’t see technology as a solution. And it wasn’t in this exact same context, but it’s something that we’re struggling with in the intelligence community because the easy answer is, let’s just suck up all this data and figure out an algorithm that’ll tell us what the future is going to look like. And I would suggest that is the complete wrong mindset to approach development of foresight in a world where the security challenges are global, and we need to work on them together as an international community and develop a common knowledge base that we can provide to our policymakers so that they make decisions based on sort of a sheet of music about future possibilities that we’ve developed together. So I just want to get your thoughts on that.

MR. KEMPE: So let’s park that for a second. Really a question of whether the intel community is going about this in the right way and whether big data and this sort of thing provides solution or not or something in between.

Steve Grundman and – yeah.

Q: Thank you. Steve Grundman. I’m a Lund fellow here at the Atlantic Council. I’ll try to be as brief as possible. What I’m after is your sense of whether realization of the fusion world will be better encouraged by leveraging this information and communications revolution in the direction of big scale or small and distributed scale.

MR. SCHWARTZ (?): What do you mean?

Q: Because I’ve heard in this conversation – I’ll take another paragraph just to explain what I mean – I’ve heard in this conversation that there are two – and I would regard them as diametrically different or opposing implications – of the information communications revolution. One is it creates reach and capacity for managerial control, but the diametric of that is it also gives – I put it this way – enables efficient organization at much, much smaller scale. In some sense, in my view, the nation-state, the Westphalian world, is that, you know, the industrial – the technologies of the industrial revolutions kind of made that scale efficient for people, politics, economics, et cetera. The information revolution has enabled something different.

And what I want to get to is the policy implication. Should we, if we want to create a fusion world, be as a matter of public and international security policy be allowing for and maybe even encouraging fragmentation if we think that is a more stable underpinning, given the technologies at hand, or actually concentration and bigger-scale solutions to problems?

MR. KEMPE: And let me just pick up one more, so the author of “Global Trends 2030,” Matt Burrows.

Q: How do you do political leadership in this world? I mean, if you give advice to leaders – I mean, it seems to me that all the things we’re talking about, globalization and the post-Westphalian world, is not really good news for how you act as and can act as a real leader.

MR. KEMPE: Let’s pick that one up first and – General Scowcroft, and then the more technological-oriented – obviously, the two of you can pick up this as well. And on the political leadership in this world, it’s everything we’ve discussed so far plus the fact the U.S. is at 18, 17, whatever, percent GDP versus 50 percent in 1945 if I’m not mistaken. General Scowcroft.

GEN. SCOWCROFT: I think that’s a problem to which we don’t know the answer because it’s fine – communications is empowering the individual, but it’s also I think leading to a diffusion of thought, and my blog’s just as good as your blog, I don’t have to read yours, I just read mine and people who agree with me. And we’ve got an atomization of receipt of information. And I think that’s reflected in the Congress. It’s harder and harder to come to agreement because people want their world, not any part of anybody else’s. And so the notion of compromise has really become a dirty word. And that sort of force plus the force of nationalism, which is likely to be impacted by all these. And China may be as benign as can be, but some of the things they do run the danger of increasing nationalism and in a force that the Chinese government can’t control.

MR. KEMPE: And not to be too stubborn on getting the answer, but really hard word – world leadership is taking the world you’ve got and doing the best you can with it. So how does – how – what does the president have to act differently in this world than in the world where you were national security adviser?

GEN. SCOWCROFT: I think things are not nearly so sure as they were. Everything is more cloudy, more diffuse, and the options seem less obvious. More multitudinous, less obvious. I think we are feeling our way in a manner that for this country we’ve never had before. That’s the way I think. And I think that this technology we’re talking about is not necessarily helpful – (inaudible) – our way through it.

MR. SCHWARTZ: Can I add something to that? I think Matt has asked I think a rather profound question. And that’s not to denigrate the other two questions, and I – let’s go back – (inaudible) –

MR. KEMPE: Which we’ll also get to.

MR. SCHWARTZ: Yeah, we’ll get to those. But I think, Matt, you’ve asked an extremely apt question. And I think it is I think difficult, but I think we have a hint. I think we have not an answer, but a hint as to where it can go.

And that is I don’t think in this world that I think Peter described as incredibly complex, very diffuse, very fast-moving you can have kind of the conventional top-down control leadership – let me tell you where we’re doing, let me tell you how we’re going to get there, and let’s get moving. I think you aim for coherence rather than control. And do you achieve coherence? You define context. You define language that enables others within that system to act quasi-independently in the context that you have defined. That is, I think the task of leadership now is to help define the context for action and to enable individuals, some organizations, states, cities, whatever, companies, NGOs to be able to act in concert in the context that you have defined. And that’s very different than the kind of command and control that one aspired to in the past. And that requires lots of good information, a high degree of transparency, a great deal of effective communication, constant communication and so on. And I think that’s the nature of leadership. It is now trying to achieve coherence in society rather than control. And I think that – and that has to do with the language, the communication and the mechanisms that enable people to participate and gain a sense of legitimacy in that process. And I think that’s a different kind of model of leadership.

MR. KEMPE: Interesting.


MR. KEMPE: Please. Please.

GEN. SCOWCROFT: May I – just to comment. I agree with you. I think President Obama is trying that kind of leadership.

MR. SCHWARTZ: I agree.

GEN. SCOWCROFT: But what I would say in response is he’s not an executive.

MR. SCHWARTZ: That’s right.

GEN. SCOWCROFT: He has a big idea, and he throws it out, and he thinks he’s done his job. That’s not the job of the president. And that’s the dilemma that you have aptly posed.

MR. SCHWARTZ: I agree.

MR. KEMPE: Great exchange.

Peter, you want to solve the world’s leadership problems? (Laughter.)

MR. HO: No, I think, you know, I worry that we are passing through a very critical phase. And we have talked about the need for reform of global institutions addressing challenges like climate change and even big questions like, you know, big data, who owns the big – who owns the big data, who controls it – these are global – these are global questions.

And for that to happen, I think not only must you have context, but how do you get context? How do you organize people to get coherence? And I think it just keeps on returning to the – to this point of leadership – where is the leadership coming from? And are we unfortunately in a phase of global development which we are a G-zero world – this is Ian Bremmer’s term – where nobody has either the inclination or the predisposition to want to lead to solve the world’s problems? I think in the old days you could say, well, the U.S. is going to do that, but now it doesn’t seem to be so. But China doesn’t have that inclination either. Nobody has. Europe is still preoccupied with its own internal problems. So then everybody is in it for himself. And then what happens? Then you get suboptimal solutions, maybe no solutions at all. And maybe that’s the challenge of this particular period.

I think things will change, you know. At some point, you know, things ought to improve politically as well as economically. Then maybe we’ll be on a different level. But I foresee for the next three, four, five years, we will be in this kind of situation. So it makes it that much more difficult to get from here to the fusion world. We are talking about the fusion world we’re aspiring to. But this is a critical question. I got no answers, by the way.

MR. KEMPE: So I see lots and lots of questions. We’ve already gotten a little over time. We started 10 minutes late. So I’m going to take two more questions. Keep your answers brief. Then we’re all done. Everybody, there is a reception out there. And I’m going to take them in the order I saw them earlier. So there is one question here and there is one question in the very back row there. So I’m sorry about the others I didn’t get to; I really apologize.

Q: Tim Campbell, Urban Age Institute. I spoke about cities earlier – on an earlier panel. And so my question is how – we’ve had kind of a bipolar talk here about the nation-state and Singapore, OK, and where does technology fit into that.

MR. KEMPE: And California.

Q: OK, so California region adds a little – adds a little wrinkle there. But my question is, you know, we’re beginning to see these city hubs, Peter, that you talked about talk to each other and form alliances and think that they have influence together, and they’re being asked by corporates around the world, you know, what is your feeling? They’re – they have a voice now, OK? I don’t know how much influence they have, but we see a tissue of institutional below the national level, above the hub level. How does that change your analysis of both leadership and the role of technology?

MR. KEMPE: And let me pick up the last question. And of course, we didn’t deal entirely with the two technology questions, so in the final round, I’ll – please, yeah. No. Well, I – OK. But very brief from both of you. Sorry. I apologize.

Q: Thank you. Maria Pineda, Naval Postgraduate School. I wanted to say that, like – (inaudible) – was saying, the future is not something that is; it is something that we do. And where we’re discussing the issue about the fusion future, I wanted to ask you, what type of skills do we have to educate for in order to create that? Because just as Einstein said, the thinking that got us here won’t get us out of here. So what type of thinking do we have to educate our new people with?

MR. KEMPE: And then very – and then I know we won’t be able to wrap everything into here, but you can listen to the questions and cherry-pick in your final comments. Please, and the very last –

Q: Yes. Joe Brouter (ph). I’m an adviser to Chong Shae (ph) Institute, a Chinese think tank. Just wanted to make an observation about the California discussion here because it’s true that California is poised to have a tremendous influence on China, but it’s not at all because of the climate change issues. The Chinese are in such an emergency situation over public health that they’re re-evaluating all of their energy investment strategies to try to figure out what they can do that will actually reduce particulate matter, not deal with greenhouse gas emissions. And there will probably be consequential reductions in greenhouse gas emissions because of their choices of technologies that have a priority for improving public health, but it’s not about climate. And the California people who are being most useful to China now are people like Alan Lloyd, the former chief scientist of South Coast Air Quality Management District, who has long been doing other things. But those are the relationships going on with China academically and with American and European companies that are, in my mind, having the greatest impact on China’s greatest problem right now.

MR. KEMPE: Thank you for that comment. So it’s a mixture of comments and questions. Two minutes or less going from left to right. And in all of this, you’ve picked out if you can help us end this panel with the one thing you think is most important to fix or solve to get a fusion world. Also – so starting with Peter Schwartz on the left, and then let’s work right.

MR. SCHWARTZ: Well, just a brief comment on that. Alan Lloyd is a terrific guy. And I completely – I share your point that it’s not just climate change, it’s other issues as well. I live in the Berkeley Hills. I can see the effect of pollution on our sunsets coming from China, you know. We call it China red sunsets, you know, and it’s – and it’s literally China red in that respect.

Having said that, I think – I want to – I have a brief comment on the methodology question and technology and how you forecast that. In the latest issue of Foreign Affairs, there’s a simply dreadful article that I highly recommend by Alan Greenspan on why he got the financial crisis wrong. And that is, he discovered post-facto that not all economic actors are entirely rational and that his model – (laughter) – his models didn’t include irrational boom-like behavior, why people would do that. And so he just couldn’t imagine it.

Now, I happen to have been in the room with Alan Greenspan in 2000 when the Council on Foreign Relations recommended to him that he ought to think about uncertainty and so on. This was after the ’97 financial crisis. And Mr. Greenspan said to the team from CFR – I was there – he said, we don’t need to think about uncertainty because we now can manage the world in such a way that we will never have another financial crisis. Not possible. And massive denial.

Now, I use this example because, in fact, it really is unpredictable. And this goes to the question of what kind of skills. It is living with uncertainty. And it is the recognition that we live in a world of incredible complexity. And so when you ask, what’s the one big thing? It is humility about control. And that is, it is that recognition that we have now set in motion at a global scale a civilization that is incredibly complex, moving incredibly fast, innovating in constantly surprising ways, creating challenges that are enormously consequential. And political leaders who believe that they can actually control the situation are profoundly dangerous. And political leaders who are somewhat humble in the face of that complexity but have the capacity to define the context for people to be actually able to solve problems at the appropriate level I think are the kind of leaders that will actually be able to move the world toward that fusion reality.

MR. KEMPE: Thank you. Peter Ho.

MR. HO: Well, since we’ve already disposed of the big challenge of leadership, I’d like to bring it down to another level, which is a term which we have not heard very much in these two days. And that is good governance because if you can’t have good global leadership, strong global leadership, I think at least cities, nation-states should aspire to have good governance. But it’s a good governance of a particular type, you know. It’s not government that knows all the answers. In fact, as we enter this period of great complexity, no government has the monopoly of wisdom. And they have to engage their people, people within the system, people outside the system, experts from around the world to get insights which will help them look at the big problems they are going to face in its entirety. And I think that is a new skill set of good governance, which the best are going to find ways to do, and the worst will just ignore these complexities; then they’ll have a lot of problems. So I would say let’s look – if we can’t get good global leadership, let’s get good governance at the nation-state level and at a city level.

MR. KEMPE: So Peter Schwartz wants humility about what we can govern, and you want better governance. And so let me turn to –

MR. SCHWARTZ: (Laughs.)

MR. KEMPE: Let me turn to General Scowcroft for a final word.

GEN. SCOWCROFT: I think the answer is judgment, but I don’t know how you teach judgment. (Laughter.) That’s one of the problems.

Let me use two examples. One is Lee Kuan Yew. And Lee Kuan Yew practiced what I would call guided democracy for a long time. And he controlled it. He could’ve turned out to be another Hitler, for example, or Stalin or – he didn’t. He used it to develop the city-state of Singapore. Nelson Mandela spent 27 years in jail. He could’ve come out full of vitriol to overthrow a hated system and so on. Instead, he reached across to De Klerk. They fused the government and introduced a modern – it’s a judgment. And I wish I knew how you teach judgment.

MR. KEMPE: Boy, I think that’s a great way to close on this day of Mandela. And we’ve been talking a lot about the rise of individual power, but perhaps what we need to talk about now is the rise of individual judgment. So thank you so much for closing on that.

So we’re going to wrap up now. I want to thank all the speakers again and all of you for being with us today. As I said, reception outside. Please join us. You online and monitoring us, go to your refrigerators.

Our panels yesterday and today were primarily based on the work of the Strategic Foresight Initiative, which we’ve created here, being well guided by the vice president of the Atlantic Council and director of the Scowcroft Center, Barry Pavel, Matt Burrows running the Strategic Foresight Initiative and his crack team, and so great work that you’ve done.

We’re looking at a number of topics over the next year. We won’t only look at these, but as you have ideas on these, please help us and help us think these through: development – (inaudible) – we’re going to take a hard look at; the future of tyranny, not just the future of democracy, but also the future of tyranny, we’ve talked about some on this panel; long-range scenarios for the Middle East and North Africa as we’re all caught in the moment, how do we actually look beyond and think through long-range scenarios; food, water, energy nexus in the global Atlantic.

And very importantly, we’ll be putting together a global trends report that we hope to release I think, Matt, next December at this time. And the idea there is to get in front of the next U.S. political election to see if we can actually influence the debate – (inaudible) – the candidates says we start getting their – and rise their perspectives to a more strategic one of – informed by global trends.

So thank you all for being here. Join us for the reception. And we hope to see you during the year and also next year at the same time. (Applause.)


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