The new picture of our world
The fact that the world is globalised means that more affairs are now international rather than national, or personal. Probably no one would be delusional enough to believe that if we insist on buying local produce and products we are stopping money from flowing out of the country. The increasingly scattered production sites across the globe, the speed and breadth of information revolution, and the unprecedented cross-boundary flow of capitals are all pointing to the fact that globalisation not only unstoppable, but in fact a snowballing movement.
It is an amoebic movement, too. Between 2002 and 2012, the world GDP roughly doubled, gross capital flows once peaked at US$11.8 trn. Internet users worldwide rose 566.4 % between 2000 and 2012, reaching 34.3% of world population. What it means is that not only tangible products and assets are hopping between countries, assets on paper and even assets on one’s mind are also flying across oceans and continents in a fraction of a second. The implication is profound. Not only has it borne sweeping movements such as the Arab Spring, it catalysed international political developments.
All these trends imply that more negotiations and liaisons on the highest level are required to transcend the national level. A strike in a small town of Venezuela is no more simply a matter of local GDP, or national unemployment figures. It could result in a complete breakdown of a supply chain that spans across Bangladesh, Vietnam, China, Poland and the US and a trail of externalities concerning both domestic and international politics. In the event of such breakdown, or in order to prevent it, there should be an international agency that all parties can fall back on.
On the other hand, we see these unbounded flows of goods and capitals, as well as information, are concentrated in the hubs of megacities (MCK estimated that there will be at least 15 of such megacities of a population over 25 million by 2050). There are local economies that have higher leverage than others, so how should the world organise around these megacities? How to govern these megacities with high fluidity – both materially, financially and informatically? – These will be the next big challenges for forward-looking leaders around the globe.
Increased dynamics, increased fear
Present day societies derive their strength from their diversity, complexity and dynamics. However, they can also be the cause for weaknesses. When diversity, complexity and dynamics increase, individual actors become more perplexed, finding it increasingly difficult to fathom the world.
In the old days, consumers knew that the pork they bought came from farms a mile away; they knew what the pigs were fed on; they even knew the name of the farmer, and the boy who fed the pigs.
Today, nobody knows where the pigs are farmed, how they are farmed and what they are fed on. Agricultural technologies has developed so much that consumers don’t even know what goes into the meat they eat everyday. So when food security scandal breaks out in a North-eastern China, people in South-western China panic; people in HK panic, and even people in the US panic – they simply don’t know what goes into their food.
“The diversity, complexity and dynamics of the inter-relations between parts characteristic for systems make for uncertainties and unpredictability in system behaviour. There is nothing secretive about these qualities; they simply are the consequence of actors, elements or parts of systems acting or interacting without having the possibility of knowing what the results of their actions or interactions are for systems behaviour as a whole.”
Imagine the days when only politicians (and perhaps journalists) inside the uppermost echelon of international players could get wind of the latest development in say, Northern Africa and the Middle East, the relative ignorance of the general public would make decisions much easier without all the lobbying groups, the pressure from the mass media, which now has spread all the way to the grassroots via social media.
Without sounding authoritative, we do need to think if a populist democracy is in fact delaying, if not hindering, the implementation of some policies that arches over the entire political atlas. On the other hand, we also need to consider if it is even possible, given the degree of information transparency in this day and age, that common people is not participatory in any high-level decision making. The ultimate question is: who and how should steer the development of this highly interlinked world?
A new concept of government
Because no single government has sufficient oversight and action potential required to solve complex and dynamic problems that come in all forms and shapes, they have to devolve or delegate some of their functions to the local levels.
The new idea of a ‘lean’ government is suitable for dealing with this new global landscape, but a lean government also means a more expansive, deeper and elaborate network of agencies, be they businesses, professional bodies, guilds, interest groups, NGOs or families – each of which has its own international network.
Though these agencies are technically non-governmental, they are as implicated, or even more implicated than government departments in the whole dynamics of societies, for the sole reason of being of the societies. The private sector accounts for around 60%–70% of the world economic activities, and of them around 75%–85% are family businesses. Corporate Social Responsibilities (CSR) for them is not an extra branch of corporate governance and public relations but an integral part of their survival – as business and as members of society.
So rather than one governing institution – the government – we have now three: the government, markets and civil societies to shape the running of the world. The implication is that these three institutions, or subsystems, are now more integrated than ever before; their boundaries harder to draw, and their fates more intertwined than most of us would think.
In fact, some scholar compared the new transnational policy spaces where global public policies occur as agora – the Ancient Greek marketplace where products and ideas are exchanged, gossips passed on, and political decisions made.
The natural extension of such idea is that part of the functions of governments are now seen as production of public ‘goods’, in the embedded transnationalism that subject to the same influences of globalisation, and the forces of the markets.
From Agora to New Public Management (NPM)
There are pros and cons of ‘marketising’ the policymaking space, outlined as follows:
The introduction of business management approach lends the system to more competition, possibly increasing efficiency and cutting cost. Administrative reforms in the Hong Kong bureaucracy during the late 1990s have helped ‘lean up’ the governmental structure and speed up services.
The idea of ‘serving the people’ is more defined and pronounced under the guiding principle of ‘service delivery’, and there are clearer guidelines and benchmark for assessment and evaluation.
Moreover, by contracting some of the responsibilities to businesses and the civil society who have the expertise and first-hand knowledge of the matter involved, public goods can be better designed and delivered for the target consumers. This could mean that politicians and policymakers have less levers to pull in their dealing with the public and reduces the chance for rent-seeking and corruption.
But it is also precisely this incapacitated public sector that causes its biggest problem.
The standard mode of conducting ‘business’ – as the public sector is run now – is bargain to consensus, and this way to conducting public service makes the system vulnerable to compromise on matters of principle. Just look at the thousands of bills vetoed in the US Congress, or the rational-irrational outcomes ensued in collective action traps, and we can have a glimpse of the impeding results of the public ‘market’.
It also delays the process of decision-making as a network of such scale of incorporation needs massive mechanism of coordination, which is more difficult in the case of agencies than traditional governmental departments with a central administrative hierarchy.
Moreover, it is often wrongly assumed that public action and political organisations are less tightly connected now. As a result, the feedback loop is weakened and the system’s self-correcting capability lowered. Though public monitoring
From Popular Democracy to Vetocracy
There is a longstanding debate on whether the type of direct, popular democracy can best represent the long-term interests of a large group because the collective impact of personal choice can harm the common good, or the ‘larger good’ of the community.
It is because this approach is based on the assumption that the interests of all parties (i.e. all agents – individuals, families, societies, nations) have to be taken care of, the idea of which is untenable as there will always be different conceptions of human wellbeing, which in turn will encompass a variety of interests that will not dovetail. Of course, it also rests on the assumption that the there is also a certain degree of tension, if not outright conflicts, between individuals and the community.
The traditional liberals would easily solve this problem with a complete free market, where they believe a balance can be struck, automatically, between all players. However, no one has yet to see this balance struck in a real market setting – just as yet.
Another problem is that when interest groups are entangled in a gridlock of negotiations, unwilling to let go of their vested interests, no decisions can ever get made. Popular democracy becomes vetocracy and leads to collective action traps where quibbles over a variety of things can deter the progress of a deal – no matter how pressing that is. For example, in the agora, petty arguments with the sophists had to resort to trials, where the ays and nays of citizens got to decide whether someone’s arguments represented the truth or not – the kind of trial that sent Socrates to death and Pericles ostracised – only to be recalled at the eve of the Persian war in 179 bce.
But in a modern governance setting, that is shifting the burden of administrative to the legal system, regressing to a kind of legalist liberalism that is unsustainable for its lack of flexibility in dealing with a variegated world. Endless fights were fought over the definition, the cogency, and the applicability of a technical point, and nothing is actually done to alleviate or help the matter at hand.
This is the exact picture of what is happening in the international arena right now – each party is afraid of losing popular vote and no party is willing to negotiate – because there is a plurality of bottom lines that seem unresolvable; and as long as they give the appearance of fighting, they would not lose the popular base that is essential to their legitimacy.
Agora too small to live
It is fair to ask if this way of marketplace governance is best for the 21st century international order-keeping. Agora may work best when a country is small and homogenous enough where patronyms still make sense like it had in the city-states of ancient Greece. And even so, we have seen its limitations in the ancient setting.
But we have moved on both economically, ethnically and culturally, to a society of richer tapestry and of grander scale – one that philosopher John Gray compares with that of the late Middle Ages, which also happened to be the dawn of globalisation.
The problem facing us now is that the past is too small to live but the future is too vast to govern. We have seen that the bottom-up approaches of liberal democracy and new public management are not enough to cope with this new challenge. It is not because they are no good at all, but that they are only good up to a point – that is where proximity between ruler and the totality of ruled makes it most legitimate – beyond which point the feedback loop in the system starts to malfunction and coordination falters.
The increased complexity also sees governments, businesses and civil societies increasingly intertwined, creating multiple layers of governance in a world of overlapping domains and sectors. A simple feedback system simple cannot cope.
Viewed in terms of network theory, we need a system that is both open and closed – cope with the expansive nature of societal lives (businesses, families, groups etc.) that spread in a scale free manner; and one machinery that perfectly coordinates. That piece of machinery, albeit a closed system, cannot be vested with too much power lest it threatens the peaceful operation of other subsystems.
How to enhance coordination on the top level in the new globalised world is the next big question.
Network theory may offer clues, history may offer clues; but it is the political will of international leaders to cooperate that will push the world forward. They will have to because no country is an island – perhaps geographically so but definitely not economically.
 Jan Kooiman, “Governance and Governability” in Stephen P. Osborne ed., The New Public Governance? Oxford: Routledge, 2010, p. 75.
 Diane Stone, “Global Public Policy, Transnational Policy Communities, and their Networks” in The Policy Studies Journal, 36:1 (2008), pp. 19–38.
 John Gray, “Modus Vivendi: Liberalism for the Coming Middle Ages” in New Perspectives Quarterly, Spring 2001.