The World in 2050: Four Forces Shaping Civilization's Northern Future

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The twentieth century saw similar extraordinary growth in American consumption of iron, nickel, diamonds, water, softwood, salmon, you name it. To varying degrees, this rapid escalation of resource consumption has either happened or is now happening in the rest of the world.

So we see that resource consumption, much like our global population, grew ridiculously fast in a single century. But while the two certainly feed off one another, rising resource demand has less to do with population growth per se than with modernization. My UCLA colleague Jared Diamond illustrates this by considering an individual’s “consumption factor.”²⁵ For the average person living in North America, Western Europe, Japan, or Australia, his or her consumption factor is 32.

If your consumption factor, like mine, is 32, that means you and I each consume thirty-two times more resources and produce thirty-two times more waste than the average citizen of Kenya, for example, with a consumption factor of 1. Put another way, in under two years we plow through more stuff than the average Kenyan does in his entire life. Of the 6.8+ billion of us alive on Earth now, only about a billion—15%—enjoy this lavish lifestyle. The vast majority of the human race lives in developing countries with consumption factors much lower than 32, mostly down toward 1.

Places with a consumption factor of 1 are among the most impoverished, dangerous, and depressing on Earth. Regardless of what country we live in, we all want to see these conditions improve—for security as well as humanitarian reasons. Many charitable people and organizations are working toward this goal, from central governments and NGOs to the United Nations to local churches and individual donors. Most developing countries, too, are striving mightily to industrialize and improve their lot. Organizations large and small, from the World Bank and International Monetary Fund (IMF), to the Grameen Bank and other microlenders, are providing loans to help. Who among us does not want to see such efforts succeed? Who does not want the world’s lingering poverty, hunger, and disease brought to an end?

But therein lies a dilemma. What if you could play God and do the noble, ethically fair thing by converting the entire developing world’s level of material consumption to that now carried out by North Americans, Western Europeans, Japanese, and Australians today. By merely snapping your fingers you could eliminate this misery. Would you?

I sure hope not. The world you just created would be frightening. Global consumption would rise elevenfold. It would be as if the world’s population suddenly went from under 7 billion today to 72 billion. Where would all that meat, fish, water, energy, plastic, metal, and wood come from?

Now let us suppose that this transformation were to happen not instantly but gradually, over the next forty years. Demographers estimate that total world population might level off at around 9.2 billion by 2050. Therefore, if the end goal is for everyone on Earth to live as Americans, Western Europeans, Japanese, and Australians do today, then the natural world must step up to provide enough stuff to support the equivalent of 105 billion people today.

Viewed in this light, lifestyle is an even more potent multiplier of human pressure on the world resource base than is total population itself. Global modernization and prosperity—an eminently laudable and desirable goal—are thus raising our demands upon the natural world now more than ever.

The third global force is globalization. A big word spanning many things, it most commonly refers to increasingly international trade and capital flows but also has political, cultural, and ideological dimensions.²⁶ Frankly, there are about as many definitions for globalization as there are experts who study it. For our purposes here let us simply think of “globalization” very broadly as a set of economic, social, and technological processes that are making the world more interconnected and interdependent.

Most people were aware of how interconnected the world economy had become long before the 2008-09 global financial crisis laid it bare. In his 2006 book The World Is Flat, the New York Times columnist and author Thomas Friedman famously asked, “Where were you when the world went flat?”²⁷Flat is Friedman’s simple metaphor for the opening and leveling of a global playing field for trade and commerce, one that in principle maximizes efficiency and profitability for all because the cheapest ore or cheapest labor can be hunted down to the last corners of Earth.

No doubt everyone has a different answer to Friedman’s question. For me, it was in Burbank in 1998, while waiting in a queue at an IKEA home-furnishings store. It struck me that my arms were filled with products designed in Sweden, built in China, shipped to my store in California, and sold to me by a Mexican cashier. From a single store selling pens and seed packets in tiny Almhult in 1958, IKEA had grown to three hundred franchises in thirty- seven countries by 2010. At €22 billion (USD $33 billion) annually its economy was bigger than that of the country of Jordan and adding twenty-plus new stores worldwide each year.²⁸ Not only is this single company now a planetary economic force, it is globalizing Swedish culture by cultivating a taste for juicy meatballs and clean Scandinavian furniture design from the United States to China to Saudi Arabia.

Globalization kills economies too. After years of slow bleeding, my wife’s hometown in Michigan crashed when Delphi, a major supplier of automotive parts to General Motors Corporation, went bankrupt. Also, globalization’s spread is very uneven: The world is not so much “flat” as it is lumpy. Some countries, like Singapore and Canada, are integrating broadly and rapidly whereas others, like Myanmar and North Korea, are isolated backwaters.

Taking the long view, the world appears to be in the early phase of an economic transformation to something bigger and more integrated than anything ever seen before. It is more far-reaching and sophisticated than any previous alliance in human history. We will all be potential rivals, but also all potential friends. Alongside the demise of entire sectors will be new markets, new trade, and new partnerships. Gone are the days when General Motors could import rubber and steel and export automobiles. The design, raw materials, components, assembly, and marketing of today’s cars might come from fifty different countries around the world.

But what unleashed this new era of global integration upon us? Was it the blazing speed and easy reach of the Internet—or something deeper? I only noticed it in 1998, but might this phenomenon be older than we think?

Like rising world population and natural resource demand, the present global integration lifted off in the middle of the twentieth century. But unlike the first two, it happened deliberately. It all began with a big conference in the Mount Washington Resort near Bretton Woods, New Hampshire, in July 1944. Over seven hundred delegates from forty-four countries—including Britain’s John Maynard Keynes (whose ideas later found new life in the wake of the 2008 global credit meltdown)—were in attendance.

World War II was drawing to a close. Governments were turning their attention to their shattered economies and how to rebuild them after two catastrophic wars, a global depression, a long escalation of protectionist tariffs, and some crazy currency devaluations. Everyone at the conference wanted to figure out how to stabilize currencies, get loans to war-ravaged countries for rebuilding, and get international trade moving again.

The outcome of this conference was something called the Bretton Woods Agreement. Among other things, it stabilized international currencies by pegging them to the value of gold (which lasted until 1971, when President Richard Nixon dropped the U.S. dollar from the gold standard). But its most persistent legacy was the birth of three new international institutions: the International Monetary Fund (IMF) to administer a new monetary system; the International Bank for Reconstruction and Development (IBRD) to provide loans—today, the World Bank; and the General Agreement on Tariffs and Trade (GATT) to fashion and enforce trade agreements—today, the World Trade Organization (WTO). These three institutions guided much of the global reconstruction effort after the war; and during the 1950s their purpose expanded to giving loans to developing countries to help them industrialize. Today these three powerful institutions—the IMF, World Bank, and WTO—are the prime actors making and enforcing the rules of our global economy.

Up until the demise of the Bretton Woods monetary regulatory system in the early 1970s, it presided for three decades over what some have called the “golden age of controlled capitalism.”²⁹ But by the 1980s, “controlled capitalism” had fallen to a revolution of “neoliberalism”—the deregulation and elimination of tariffs and other controls on international trade and capital flows. The neoliberalism movement was championed by British prime minister Margaret Thatcher and U.S. president Ronald Reagan, but was rooted in the ideas of Adam Smith.