The crisis you can't see: New ideas rescue package needed
Source: Courtesy of INSEAD Knowledge , Author: Sami Mahroum
Posted: Wed December 28, 2011 3:54 pm

 UAE. At the core of the current global crises – be it the U.S., the Middle East or the EU - is the sudden and rapid erosion of safety, and the loss of the 'known.' The ideologies that have shaped our perceptions of the world for much of the 20th century, such as socialism, capitalism, democracy, and social justice, have all taken major blows recently.

From the fall of the Berlin Wall in 1989 to the protestors of Tahrir Square and Wall Street in 2011, the failure of ideologies has been marked by attacks on the institutions that represented them.

Human beings seek refuge in ideas that help make sense of the turbulent world around them. Ideas are tools for creating order, making assumptions, planning, and generating expectations. In other words, ideas help reduce uncertainties, create common goals, and thereby increase the feeling of safety.

People create institutions that are modelled on to the ideas they hold about the world around them. Thus, capitalistic ideas gave rise to institutions such as private banking, anti-trust institutions, commercial courts, etc. while socialist ideas gave rise to social security institutions tasked with wealth distribution and the provision of a safety net.

When these institutions fail, either in their purpose or altogether, the very ideas that gave rise to them come under attack.

That is what is happening around us today: we are witnessing the demise of established ideological paradigms.

In the Middle East, the post-colonial ideological paradigm of ‘nation states’ that has emerged as a response to European and Ottoman domination and which was meant to provide national pride, personal freedoms and socio-economic safety, has failed.

In the West, there is a perceived failure of the 20th century socio-economic paradigm and its institutions.

In the Middle East, personal safety has become severely undermined by the state’s (ironically) security institutions, in an attempt to curtail further distress to the system; whereas in the West, economic and social safeties have been rendered unstable - first, by the collapse of the banking system, and then (also ironically) by the ‘rescue’ packages from EU institutions.

The issue of reduced safety is not being well addressed by politicians, as it is not well understood. The prevalent feelings of uncertainty and fear are jeopardising all attempts at reviving the old systems and their institutions. And perhaps this is because their time has passed; these institutions no longer suit the uncharted waters that lie ahead of us on a global scale.

What is needed is the replacement of old institutions with new ones. The recent attempt of the EU (minus the U.K.) into a new treaty is therefore a step in the right direction.

The transfer of power in Egypt and Tunisia from the ‘President’ to the Prime Minister is another step in the right direction. The creation of new institutions both in the form of treaties and actual organisations are important moves towards re-gaining trust in the system.

But when institutions fail, the ideologies behind them (rightly or wrongly) succumb too. So it is not sufficient to create new institutions only; a new ideological paradigm needs to be constructed.

In the Middle East, the failure of the ‘secular nationalist state’ has driven a majority of voters into the safety of the romance of religious politics. People are seeking refuge in the safety of well-rehearsed ideas propagated by theologians-turned-politicians.

In much of the West, there is an obsession in the blame-game, be it within countries or between them, and hence you find Republicans vs. Democrats, France vs. Germany, the U.K. vs. the EU, and so on.

The solutions offered by politicians and bureaucrats so far are practical steps only: ‘technocratic’ ideas represented in financial ‘rescue packages.’ They are not an ideological vision around which a democratic populace can rally.

They do help alleviate what I call the ‘safety crisis.’ What is lacking in both parts of the world, East and West, today is ‘thought leadership.’

There is a dearth of new ideas, a lack of visionary thought leaders who have the ability and credibility to provide ideas which motivate people, which give them some hope and confidence. People are in need of new ideological frameworks or paradigms that help them navigate their world.

In the absence of such ideological frameworks, we are stuck in an ideological impasse and consequently in a prolonged crisis of confidence and safety.

What we need now is an ‘ideas rescue package’ – a World Thought Forum, akin to the World Economic Forum, that brings together Nobel Prize winners, well-respected religious figures, NGO champions, artists, innovators and thought leaders organised each within their regions and tasked with the creation of new ideological paradigms.

These should result in producing the minimal consensus required for a new social pact in each world region. The outcome at the very least will create consensus around new roadmaps pointing the way out of the crisis and on into the future.

Most importantly, the emergence of new ideological paradigms - that is, ideas supported by beliefs - will help give us a sense of control over our destiny and relieve the fear of uncertainty that has us in its grip.

Ideas are important tools for mobilising people to act in certain ways - including making sacrifices – and can fill the growing ideological vacuum that risks being filled up by destructive forces unless thought leaders around the world come together to act now.

Note: Sami Mahroum is the Director of INSEAD’s Innovation & Policy Initiative, based at the school’s Abu Dhabi Campus.

This article is republished courtesy of INSEAD Knowledge

Copyright INSEAD 2011

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