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True Globalization hitting The Netherlands
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by Peter R. Luiks 02 the future of Global Economy

The reasoning behind the Dutch Government’s current, random looking cost reductions, which have not been adequately communicated, is that the future will require an improved integration in and between the agricultural, industrial and the automation age, adapting and improving upon our current knowledge base in order to stay abreast with global competition which will only intensify in the next coming decades.

For many cultures, globalization is perceived as “the West over the rest”. Ideas, politics, and technology are seen and viewed as following in the footsteps of explorers, missionaries, and soldiers. These gaps in a shared and common set of values and respect must be bridged in order to build the atmosphere for a sustained and stable expansion in the world economy. Thus the human rights norms and values that are the prerequisite of globalization must be promoted with both a sense of urgency and with an improved understanding and respect for cultural diversity.

On a global scale it remains to be seen what values will be shared and which individuals and communities will shape them. Who will participate in these decisions and who will decide them? Will free trade be tied to workers' rights, hurting Third World companies and benefiting comparatively rich Western workers? Will Third World economies be forced to adopt First World intellectual property protection, harming their infant industries? Will the new concentration of information content and conduits restrict access to fundamental enlightenment? In short, how will 21st-century humanity divide and hopefully narrow the gap between those who will prosper and those who are left trailing behind in their standard of life?

In addition to the above Western, and indeed the advanced Asian, economies also have to face the historically unprecedented fact that our populations are living longer than ever before with replacement rates which have fallen dramatically from past norms such that the number of people working to support both the young and aged are decreasing as each year passes. Combined with this is the additional factor that the age of retirement, set in the early 20th century was based closely on the average life expectancy rates of 67-70 years, such that the old age pension was limited in its applicability to a few years only. With advances in medical science (itself an expensive cost to society) persons of today’s pensionable age can expect to draw their pensions for an average of 20 years after retirement, well beyond the actuarial models of 80 years ago when they were universally established in the modern industrial societies.

How does one address these issues and communicate them in such a way that people will accept the reality that these changes can no longer be ignored and that society will have to adapt their perception and the reality of the new dynamics and what they need to do themselves to continue to enjoy a sustainable living standard for themselves and their future progeny into the future. The debate needs to begin about raising the age of retirement to 70 (why not, as the average person remains healthy well into the seventies) and people need to reduce their consumption of their present assets and save them for the future.
Bearing these demographic trends in mind, we will turn once again to the issue of globalization, but one would be crazy and negligent to ignore them when looking at Globalization in its traditional context and they will have a profound impact on the ability of the existing wealth generation nations to keep pace with the effects of the emerging younger nations participation and exploitation of the benefits of globalization.

The forces of globalization are proclaimed to carry prosperity to a civilization spanning the planet. This civilization is defined by those with access to capital, education, and advanced communications conduits and content. This is the epidermis of humanity. It does not yet run deep. The great challenge is to render horizontal trends vertical so the benefits reach those who are outcast from globalization's feast. The point of globalization is not that it is global. The point of globalization is that it is local. It is a rising common demand for human dignity amongst all involved that has to be both recognized and addressed with urgency as we move further into the 21st Century. Increased human mobility, capital flows, free trade, multinational organizations and technology, make the world’s economies more interdependent than ever. Multinational corporations manufacture products in one country, process them in another and design marketing in yet another, while selling to consumers around the world. This process spurs the movement of money and raw materials. Traffic of products and finances advances the exchange of ideas and cultures. As a result, laws, economies, and social movements are re-forming at the international level the planet over.

Politicians, academics, and experts commonly lump these trends together the term "globalization." But what does "globalization" really mean? Who are its winners and losers? Is it inevitable? How can or should it be controlled? The answers to these questions suggest that globalization is more than an overstretched "buzz word" and is actually a clear set of ideas, trends, and practices.
Advances in communication and transportation technology, combined with free-market ideology, have given goods, services and capital unprecedented mobility. Northern countries want to open world markets to their goods and take advantage of abundant cheap labour in the South, policies often supported by Southern elites.

They use international financial institutions and regional trade agreements to compel poor countries to "integrate" by reducing tariffs, privatizing state enterprises, and relaxing environmental and standards. The results have enlarged profits for investors but offered pittances to labourers, provoking a strong backlash from civil society. This position paper analyzes economic globalization and examines how it might be constrained or regulated in order to promote sustainable development.

Many of the cash rich companies on the globe will act according to their own interests and whilst some may be willing to go along others may refuse to do so, and it will be the level of this unmanaged response which will determine the new global economic decorum under which we will live and work in our organizations, wherever we live in the world.
The shifting global economic equilibrium in terms of GDP growth and dominance, which we in the West have enjoyed since the end of WWII, can no longer be sustained at its recent historic levels as we will be required to share this wealth increase more evenly in the future with the emerging world economies.

The new global GDP equalization, driven by the emerging forces and effects of the lower wage and increasing educated talent in Asia, Eastern Europe, South America will increasingly play a more and more leading role and will force us to re-invent our society locally in order for us to continue to play an active role in this new GDP equivalency of some 1,5 billion people and growing fast….!

So bearing in mind the above, is the political reality driving and preparing us for these events?
No politician today, yet has had the guts to confront the country and to present them with these harsh realities. So what we see are (apparently) confusing acts of change, focused on the issues of social welfare structure as we knew them until recently, without outlining the real message as described above, as such a message would be considered political suicide by the ruling parties!
The ultimate change process as described above needs a firm roll out of a manifest, functioning as a Scope of Work outlining the actions which need to be taken, including the full phased schedule of programs which will move society to meet the new challenges ahead and to forget the assumption that we can, without really altering our life style, continue to improve our living standards and if needs be to force feed the population and to get them to understand what really is happening outside in the bigger world!

New innovation, a knowledge economy, knowledge transfer are the current buzz words. Are they possible given the current constraints? Yes they are! We need to re-invigorate and re-build our make industry base as relying for our future prosperity and wealth creation through service industries alone will not alone provide the basis for a sustainable future competitiveness in the world markets. We will have to restructure our society to adjust their perceptions and their acceptance of living under affordable conditions both working, as well as in their pastimes, recreation and what they can realistically expect society to provide them in their old age.

The ones thinking we can stay living of the “lean back” attitude, being busy with some services industries, transportation Pension funds and insurance company activities alone are dead wrong and any form of innovation will not be sufficient in the longer term. Being globally competitive, under the most innovative ways of working and production has to be the real ongoing strategy. Our population demographics increase the urgency of addressing the core issues of what the citizen believes they have the right to expect from the State and who will pay the bill when we face, for the first time in history, the reality of an ever decreasing percentage of working people who have to support the very young as well as the aged.

The future in The Netherlands will be a mixture of the agricultural revolution, the industrial revolution, the automation revolution and, if we are lucky, our knowledge society will take a leading role in creating this drive towards a new modernized format, providing for new working conditions, living conditions, advanced traffic conditions and transport means. In addition, and above all society should accept that rather than reducing the age of retirement, it needs to be prolonged.

The need to bring the global equilibrium in world economics to a sustainable healthy state again will require an effective change in their current buying power perceptions and the attitude towards and the acceptance of a longer working life as the overall costs of the status we would like to continue to enjoy is unsustainable on the truly global basis.

More about Global Economy can be found at the conference about 'the future of Global Economy' and the sections with books, articles and links.

Peter R. Luiks speaks at the conference about the future of ICT

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