Wednesday, November 10, 2010

Casting a Vote Against the Winds of Change

I have heard from some people who voted in last week’s U.S. elections that they had hoped their vote would slow the pace of change that the country is experiencing. There are similar reports in the news media. To the extent that this is the reason for people’s votes, it is a miscalculation.

The government is not the source of changes that are affecting the world right now, but it is trying to manage those changes. Selecting officials who will ignore or resist the changes that are on the way will not stop the changes from taking place. Similarly, choosing legislators who disagree with each other may paralyze the government, but it will not stop the world from turning. It is like eliminating the hurricane forecasting office (a cost-cutting measure that is actually being considered) and hoping that this will result in a smaller number of hurricanes. The winds of changes will not slow down, but when they hit, people might not be prepared.

Already, government, business, and organized religion stand united in trying to slow the pace of change. This institutional resistance to change can’t stop change from happening, but it can push it outside the institutional framework — out of the towers and onto the streets.

The big issue that people talk about is health care. People want to slow down the “rush” to extend access to health care to more people, but in the meantime, the health care delivery system is collapsing, with more and more people every day not able to get routine medical care. But the result will not be that people just give up and die from their illnesses. They will discover or invent some form of health care — but it will not come from doctors. The results of this are far less predictable than if the evolution of medical care were happening within the formal health care system — and without any institutional constraints, much more rapid change is possible.

When the world changes and institutions do not, the institutions get pushed to the sidelines. Then, changes cannot be coordinated, something that Alvin and Heidi Toffler warned about in Revolutionary Wealth. If there is no institutional power to keep the changes that happen in one area in sync with changes that are happening in another area, then changes will happen when people aren’t ready for them.

We are already seeing this, of course. Uncoordinated changes are happening all over the place because of weak or marginalized institutions.

  • Consumers are moving away from milk, in part because of its high price, at the same time that governments (in countries around the world) are encouraging dairy farmers to produce more milk than ever. The result is a massive oversupply of milk, and the largest cheese inventory in U.S. history, while dairy farmers fall into poverty.
  • Some government authorities are trying to encourage the construction industry in the hope that this will lead to an improved economy. At the same time, other government officials are changing the rules of home financing so that fewer people can borrow money for a house, and social norms are also moving away from these financial arrangements. The result is a housing market that is out of sync, with lots of homes being built and no one to buy them.
  • Government efforts to clamp down on the content of television programs over the last seven years have coincided with a decline in the television audience, and an increase in Internet video.
  • Two of the United States’ largest automakers went bankrupt trying to build more SUVs faster at a time when drivers were cutting back on their vehicle purchases and switching to much smaller vehicles.

Lifestyle changes are happening on a massive scale and, in many cases, going almost unnoticed. The world is drinking less beer, for example, but we can’t really say why. Eventually, these changes will bubble up to the level where they topple large institutions. Nothing will stop this from happening; it is hard enough to predict where and how fast these changes will occur.