The New World Economy

Well wishers poured out across the country in a revival of hope for Brazil when president Lula da Silva was inaugurated earlier this year.

It followed four years of disastrous rule under his right-wing predecessor, Jair Bolsonaro, who fled Brazil for Florida on the eve of Lula’s inauguration.

Bolsonaro left behind a mob that rampaged government buildings before being arrested in large numbers by the police.

Mob tactics will not stop Lula, nor will they have a long-term effect in the US, where Donald Trump’s similar manoeuvres on 6 January 2021 were also shut down.

In both cases, demagogic politicians used social media to rile up a mob; in both cases, the mob was put down within the day.

The real issue, in my mind, is not the mob, but the deeper changes in the world that are generating growing tensions in world politics and the economy.

The deep changes can’t and won’t be stopped by mobs.
Our real challenge is to understand the deeper changes at play so that we can manage them for the common good.
Such an understanding is the aim of my future columns.

CONSEQUENTIAL PRESIDENCY

The biggest turmoil is geopolitical. We are no longer in a US-led world, nor even a world divided between the US and its rival China.

We have already entered a multipolar world, in which each region has its own issues and role in global politics.

No country and no single region can any longer determine the fate of others.  This is a complex and noisy environment – with no country, region, or alliance in charge of the rest.

One reason why Lula’s return to the presidency is so consequential is that Brazil will be a key regional and global actor in the years ahead.

Lula will work closely with like-minded progressive presidents in Chile, Colombia, Argentina, and elsewhere in South America
Brazil will also hold the presidency of the G20 in 2024, part of a four-year run in which major emerging economies hold the G20 presidency (Indonesia in 2022, India in 2023, and South Africa in 2025).

MULTIPOLAR REALITIES

The management of a multipolar world is fraught with difficulties.
We urgently need more dialogue with other countries, and to move beyond the simplistic propaganda of our own governments.

In the West we are bombarded daily with ridiculous official narratives, most originating from Washington: Russia is pure evil, China is the greatest threat to the world, and only Nato can save us.

These naïve stories are a great hindrance to global problem solving.
They trap us in false mindsets, and even in wars that should never have occurred and which must be stopped by negotiation rather than escalation.  

When we accept the reality of a multipolar world, we will be able to solve problems that have so far eluded us.

MILITARY ‘MYTHS’

First, we will understand that military alliances offer no answers to the real challenges we confront.
Military alliances are in fact a dangerous anachronism, not a true source of national or regional security.

Neither is China the grave threat that is portrayed in the West.
The US tries to pretend we still live in a US-led world, and that China is a dangerous pretender that must be stopped.

But reality is different. China is an ancient civilisation of 1,4 billion people (almost one in five in the world) that also aims for high living standards and technological excellence.

We will help solve our global problems not by vainly trying to “contain” China, but by trading, cooperating, and yes, also competing economically with China.

EPICENTRES

Other great global challenges lie elsewhere: The deep dangers of environmental catastrophe; the rising inequalities in our own societies; and the onrush of new technologies that can disrupt the world if these technologies are not properly harnessed and controlled.

Brazil is the epicentre of the environmental challenge.
Can the Amazon, constituting half of the world’s rainforests, be saved?  Lula came to power promising to do just this. He won the vote of the Amazon states of Brazil.

Globally, Europe is in the environmental lead with the European Green Deal.  Europe’s main geopolitical opportunity is to encourage other regions, including the African Union, China, India, the Americas and others, to adopt their own bold green deals.

That’s a far better task for Europe than expanding Nato, or fighting an endless war in Ukraine, or confronting China.

Brazil is also an epicentre of inequality, with one of the highest degrees of inequality in the world.

That inequality was originally created by European imperialism that suppressed indigenous peoples and enslaved millions of Africans.
Social justice is Lula’s calling, and our global calling, after centuries of racial and social injustice.

TECHNOLOGY

Brazil can also be an epicentre of new technologies, for example a leader in the new bio economy in which the wonders of the Amazon’s and Brazil’s biodiversity are not destroyed for more cattle ranches, but instead to produce new life-saving medicines, nutritious foodstuffs (such as açai now booming worldwide), or advanced biofuels for green aviation.

Technological change is perhaps the deepest driver of global change.
We need the new technologies to confront the crises of climate change, hunger, education and health.

Yet we also suffer from the new digital technologies when they are misused, such as to mobilise mobs, or weapon killer drones in Ukraine.

Advanced biotechnology may well have created the virus that causes Covid-19 (we still don’t know).

Every day we confront the disruptions and inequalities caused by artificial intelligence, robotics and the rapid overturning of jobs.

The confluence of global change, disruption, and danger is astounding.
Solutions lie in understanding, cooperation and problem solving.
A better understanding of the New World Economy will be the aim of this column.

• Jeffrey D Sachs is professor and director of the Centre for Sustainable Development at Columbia University and president of the UN Sustainable Development Solutions Network. www.jeffsachs.org
  – This is the first in a series of articles discussing global policy changes and the interlocking geopolitical, economic, technological and environmental forces of our time