I tend to avoid short-term predictions, but these days, six months really IS the mid-term future. So after the response to yesterday’s pithy analysis of the coming year, here are our OFFICIAL PREDICTIONS FOR 2009.
Take it from a guy who talks about the future all day long: there’s going to be precious little interest in the year 2029, and total interest in getting through the next six to eighteen months. That doesn’t mean we shouldn’t plan for the longer term, but most all long-term planning will be through the lens of the next year.
It’s OK. 2009 wil be a nice year to clean house.
The bank annihilation of 2008 will show the world something it was learning in a much more abstract way through climate change. While the effects of national policies are truly global, we have no way of really working together. Climate change is an alarming development that has a vaguely defined effect, and thus our initiatives (Kyoto, et al) are equally vague.
The collapse of banking will cause real, immediate economic pain around the world in 2009 – factories closed, jobs lost, countries leveraged to the remaining power brokers. It will require a global partnership, but that’s still difficult in a world of nation-states.
The world will drive more toward some sort of global governance, regulation, or at least monitoring to avoid such problems in the future. This may result in ceding more national power to organizations like the WTO or even the United Nations. The results may not be satisfactory, but institutions will seek some sort of insulation from one country’s lack of financial regulation annihilating eight or ten central banks around the world.
Your uncle who keeps sending those emails about “One World Government” will lose his mind.
I won’t stultify non-Washingtonians with the details about OMB, CBO, GAO, career versus-political appointees, and other phrases that indicate you’ve lived within the Beltway for too long.
Most of the world is familiar with the problems of the United States government: two interminable wars, collapsing financial infrastructure, skyrocketing debt, etc. But they never hear about the mechanics of federal agencies, which will take much re-engineering after the last eight years. The Obama Administration will spend the majority of 2009 rebuilding the federal infrastructure, especially attracting talent to key agencies and organizing the teams that will carry out the policies of the remainder of the term.
The details of this will be WAY more boring than any conscious human being can handle, so plan on plenty of juicy scandals involving the naming of the White House puppy.
Policymakers, mostly American, are bending over backwards to keep the world-record high prices for housing from collapsing and detonating the whole economy. Still, there remain two choices: inflation of all prices to match the doubling of housing or deflation of the housing. Because the houses were never as much as people were pretending. As I have said for five years now, you can’t keep wages stagnant and then increase home prices 38% a year.
Economies will choose between the slow, stagnant suffocation if home prices don’t re-adjust, and quick, terrible pain from returning these houses to their appropriate value, in line with wages.
Neither of these are fun choices, but then again, we thought that paying $780,000 from a two-bedroom condo with granite countertops was never going to turn out well.
Labor unions the world over will come under suspicion, rightly or wrongly, for its association with the collapse of the American automotive industry. Labor unions will be weakened for being as inflexible as their managerial counterparts.
And ironically, more people than ever will be looking for ways to negotiate fair wages and a healthy standard of living with their employers, particularly as developed economies see their social security programs tested. The inequity of wealth distribution is at its highest level since the Gilded Age of robber barons in the 19th century. Standing on the shoulders of 20th century labor and armed with the social media of the 21st century, people will continue to communicate with the institutions of big business, those that remain anyhow. Labor will need to be every bit as agile and open-minded as business and government, not an intractable institution susceptible to the sane weaknesses as all such institutions.
We’ve heard tale of a great number of pension funds that were designed expecting a 5 – 8% return to keep everything in the black. If you can name a fund guaranteed to get 5 – 8% in the next few years, I suspect the next time we see you, you’ll be at your villa in the South of France.
That’ll be 2011.
This is because small businesses are much better at quickly proposing useful services in response to the panoply of tangible problems we will all face next year.
Also, when small businesses fail, the owners go home, complain to their spouses, feel shame, drink stiff cocktails, and mope around before starting more businesses.
When giant corporations fail, they ask taxpayers for billion dollar giveaways.
This will make small business more popular.
Hopefully the 150 mpg (!) Chevy Volt will change that. But otherwise I remain firm in this prediction.
2009 will be fascinating for the business of media. The business model for print, music, and television will be disintegrate further, resulting in more layoffs, bankruptcies, and fracturing of giant conglomerates looking to keep something profitable as more advertising revenue heads for Craigslist and Google. At the same time, broadband penetration will continue around the world, and people will have the most awesome televisions and computers in history.
Nobody will know what’s going on, many companies will lose MILLIONS, people who used to make no money will make HUNDREDS, record companies will continue to sue widows and children, television will focus on even more sensationalist nonsense, and Twitter will somehow begin to supplant CNN.
In other words, it’s going to be a lot of messy fun.
Feeling scared and confused about the world? Feel like it’s all out of control and that the old ways don’t work while the new ways haven’t yet been defined? Guess what – so do the supposed “authorities.”
In 2009, we’ll need all hands on deck – all the creative ideas, broad-thinking, open-mindedness and partnership you can muster. You’re right this new world is too complex to expect a few guys in nice suits to take care of. So, in 2009, get to work!
What else are you going to do? Worry? That’s so 2008.
This is the official trend blog of Competitive Futures, a management consultancy that provides trend research and analysis for business and government around the world. Here, we update you on interesting trends we see as part of our work for our clients.
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