In this world, growth increasingly depends on the ability of yourself, your community, your town, your factory, your school and your country to be connected to more and more of the flows of knowledge and investment — and not just rely on stocksof stuff.
Over centuries, notes John Hagel, who currently co-heads Deloitte’s Center for the Edge, business has “been organized around stocks of knowledge as the basis for value creation. The key to creating economic value has been to acquire some proprietary knowledge stocks, aggressively protect those knowledge stocks and then efficiently extract the economic value from those knowledge stocks and deliver them to the market. The challenge in a more rapidly changing world is that knowledge stocks depreciate at an accelerating rate. In this kind of world, the key source of economic value shifts from stocks to flows.
“The companies that will create the most economic value in the future,” Hagel says, “will be the ones that find ways to participate more effectively in a broader range of more diverse knowledge flows that can refresh knowledge stocks at an accelerating rate.”
And yet Britain is ruled today by a party that wants to disconnect from a connected world. The notion that the U.K. will suddenly get a great free-trade deal from Trump as soon as it quits the E.U. is ludicrous. Trump believes in competitive nationalism, and the very reason he is promoting the breakup of the E.U. is that he believes America can dominate the E.U.’s individual economies much better than when they negotiate together as the single biggest market in the world.
The second thing the best leaders understand is that in a world of simultaneous accelerations in technology and globalization, keeping your country as open as possible to as many flows as possible is advantageous for two reasons: You get all the change signals first and have to respond to them and you attract the most high-I.Q. risk-takers, who tend to be the people who start or advance new companies.
In the U.S., who is the C.E.O. of Microsoft? Satya Nadella. Who is the C.E.O. of Google? Sundar Pichai. Who is the C.E.O. of Adobe? Shantanu Narayen. Who is the C.E.O. of Workday? Aneel Bhusri. Hello London? The best talent wants to go to the most open systems — open both to immigrants and trade — because that is where the most opportunities are. Britain is about to put up a big sign: GO AWAY.
The wisest leaders also understand that all the big problems today are global problems, and they have only global solutions. I am talking about climate change, trade rules, technology standards and preventing excesses and contagion in financial markets. If your country wants to have a say in how those problems are solved — and your country’s name is not America, Russia, China or India — you need to be part of a wider coalition like the European Union. The U.K. membership in the E.U. has given it an outsize voice in world affairs.
And there’s just one more thing the best leaders know: a little history. Trump is fine with a world of competitive European nationalisms, not a strong European Union. So is Vladimir Putin. So, it seems, are the Brexiteers. How quickly they’ve all forgotten that the E.U. and NATO were built to prevent the very competitive nationalism that ran riot in Europe in the 20th century and brought us two world wars.
Sorry to be so despondent, but I went to graduate school here on a Marshall scholarship from the British government, was married here and started as a journalist on Fleet Street in London. I like the place. But this is not the reasonably competent British government I grew up with.
It’s being led by a ship of fools — a Conservative Party bloc that is now radical in its obsession with leaving Europe and a Labour Party that has gone Marxist. If the people here can’t force their politicians to compromise with one another and with reality (there’s still a glimmer of hope that this might happen), there is going to be a crackup of the British political system and some serious economic pain. This is scary.
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Thomas L. Friedman is the foreign affairs Op-Ed columnist. He joined the paper in 1981, and has won three Pulitzer Prizes. He is the author of seven books, including “From Beirut to Jerusalem,” which won the National Book Award. @tomfriedman • Facebook
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