CLOSING THE GOVERNANCE GAP Governance

Level Present Status Trendline Drivers

Subnational Spread of new

communications technologies has broadened individual’s sense of community, bridging national, regional, ethnic, and gender divides. More networks of cities are shaping policy debates and leading national and even global responses to governance challenges.

Cities will tap into growing public calls for more local control and decentralized government.

Some “global cities” will overshadow their central governments. Well-run cities will manage resources effectively; less efficient ones could fuel instability.

National The governance gap is most pronounced at the domestic level. Currently 50 countries are in the “awkward” range between autocracy and democracy. Highly developed East Asian and Middle Eastern/Gulf countries have a

“democratic deficit”: a style of governance that does not match their economic levels.

Many countries are primed to move toward greater democracy by 2030, but the process is often destabilizing. China’s democratization would have immense repercussions.

Rapid economic

development—inasmuch as it leads to greater per capita income and higher educational levels—often accelerates democratization. A high correlation also exists between more mature age structures and a country’s ability to achieve full democracy.

Regional All regions have made great strides in regional institution- building, but integration has progressed at varying speeds and levels of comprehensiveness.

The likely growth of

intraregional trade points to greater regional integration.

Whether a regional

collective security order can be established, particularly in Asia, is less clear.

Continuing distrust and economic competition and jockeying is likely to limit the extent of sovereignty-sharing.

Multilateral Institutions

Many are questioning their legitimacy because they do not reflect the changing economic hierarchy.

Even if global institutions better mirror the changing power setup, whether they can tackle growing global challenges is unclear.

A new concert among newer and established powers would enhance the workings of institutions and their effectiveness in tackling global challenges.

• The shift to cloud architecture will improve utilization rates of computing infrastructure and optimize network use. The cloud also will put increased computing capability and meaningful analysis in the hands of 80 percent of the world’s population.

• Mobile devices are becoming increasingly rich sensor platforms, enabling nearly all communication mediated by technology to be tracked and analyzed at a fine level of detail. More than 70 percent of the world’s population already has at least one mobile device; global mobile data traffic in 2010 was three times the size of the entire Internet in 2000. By 2015—only three years away—in Sub-Saharan Africa, Southeast Asia, South Asia, and the Middle East more people will have mobile network access than with electricity at home.

• Cheap digital storage means nearly all data will be archived indefinitely. Information will be

“smart” about itself—indexed, categorized, and richly tagged upon collection so that it can be easily analyzed later.

• Bots—programs that run automated tasks in the Internet-connected world—could become as prevalent as robotics in the industrial world.

Although bots are best known for their use in hacking and disruptive activities, they can be used for any purpose. When combined with massive data, bots could manage complex and persistent tasks on behalf of individuals and networked groups.

This new environment of widespread and enabled IT use also will benefit illicit networks involved in crime, terrorism, human and drug trafficking, and the theft of intellectual property. IT devices will play an increasing role in the fight against corruption and government malfeasance and incompetence. However, at least for the moment, such illicit activities are outstripping the capacities of most countries and multilateral institutions to contain them.

A number of Central Asian countries are on the democratic deficit list or close below the top 20.

More generally, the region is another area beyond sub-Saharan Africa where countries (other than Afghanistan and Pakistan in South Central Asia or South Asia) seldom make the highest positions on risk lists when perhaps they should.

NEW TECHNOLOGIES SHIFTING ROLES OF CITIZEN AND STATE

The spread of IT use will give individuals and groups unprecedented capabilities to organize and collaborate in new ways. Networked movements enabled by IT already have demonstrated the capacity for disruption and the ability to quickly draw global attention to the need for political and social change. IT use enables individuals to organize around shared ideas in the virtual world and carry out sustained action. (See pages 86-90 for more on the future of IT technologies.) Sub-Saharan Africa, rural India, and other traditionally isolated regions are being globally connected with positive economic impacts. Social networking will continue to be a potentially potent political weapon.

The pressure of social networks, particularly on governmental power, almost certainly will grow even stronger. The fact that the immense choices on the Internet have not always led to a broadening of perspectives, but rather to a narrowing points to a potentially negative impact of social networking, such as increasing partisanship and nationalism.

The exponential increase in data, combined with emerging capabilities to analyze and correlate it, will give unprecedented capabilities to individuals and connected networks in nearly every part of the world well before 2030. The use of IT will accelerate due to three projected trends: a 95 percent drop in computer memory costs, a reduction in raw data storage costs to one hundredth of the current price, and a network efficiency increase by more than a factor of 200. In addition, four technological developments will provide individuals and groups with new capabilities as the use of IT proliferates:

boundaries, and technological dependence—increase the potential for more frequent discontinuous change in the international system.

INCREASED FOCUS ON EQUALITY AND OPENNESS

Newly empowered citizens will demand equality, open access, transparency, and fairness. Authoritarian regimes, particularly, will face increasing pressures for greater accountability, openness, and citizen participation. Despite having some more powerful tools of their own, governments that fail to liberalize and open up are likely to face a losing battle.

Growing gaps in income and wealth within countries and between countries and regions has been a side effect of the rapid economic transformation for some time. During the next 15-20 years, some of this gap will be reduced with the rise of a growing middle class, although income inequalities in many societies both in the emerging and developed world will remain large. Other forms of inequality will become increasingly important.

First, owing to the likely growth of revenues

dedicated to funding pensions, health-care, and other entitlements in the West to care for aging populations, younger generations will feel a growing sense of inter-generational inequality.

Second, the urban/rural divide, particularly in the rapidly developing world, will increase as the rising megacities become more important engines of regional and global growth. This may have an impact beyond the country in which the city is located. These new international cities will draw talent not only from the rest of the country, but also from less developed neighboring regions, complicating those regions’

efforts to develop.

Third, awareness of inequalites between different actors of society, in particular between average citizens and international private economic actors, will grow. The focus on inequality will be due to individuals’ sense of the impacts of globalization AN EMPOWERED STATECRAFT?

The new expanding IT architectures and their use—

whether by individuals and networks or states—are not deterministic. Governments and other traditional political institutions have the capacity to adapt and gain influence and clout.

Connective technologies will give governments—both authoritarian and democratic—an unprecedented ability to monitor their citizens. If threats and challenges to state control escalate, IT use in statecraft presents opportunities for middle and emerging powers to project soft power and increase their influence through new IT-enabled strategic communications relative to bigger countries. Over time, many experts we consulted believe that by 2020 or so, governments could begin to constrain the most threatening illicit activities by adapting their use of IT and partnering with nonstate actors and networks.

Countries could root out the most threatening actors by going after places and organizations that support illicit activities. The 30 corporations that control around 90 percent of Internet traffic represent chokepoints that could be used to enforce bans on illicit activity.

“Both sides agreed . . . that the

characteristics of IT use . . . increase the potential for more frequent discontinuous change in the international system.”

Experts do not know how the balance will be struck between greater IT-enabled individuals and networks and traditional political structures. In our interactions, technologists and political scientists offered widely divergent views. Political scientists remained skeptical of IT-enabled alternatives to state power, while technologists viewed the IT as a global revolution that will make states and legacy institutions less influential in the next couple decades. Both sides agreed, however, that the characteristics of IT use—

multiple and simultaneous action, near instantaneous responses, mass organization across geographic

governance challenges. The role of cities will be an even more important feature of the future as urban areas grow in wealth and economic power. In fact, McKinsey Global Institute calculates that, by 2025, emerging market cities will have more higher-end middle-income households than developed ones.

Increasingly, cities are likely to take the initiative on resource management, environmental standards, migration, and even security because of their critical importance to the welfare of urban dwellers. Already many examples exist of grassroots innovation and creativity; in fact, within the territories of failed states, city and local governance structures are often the only ones that work. The growing calls for distributed governance networks and for legitimacy around different geographic and social contexts reinforce the importance of cities as actors within governance networks.

Localism is unlikely to be an unqualified positive trend. Historically, large-scale corruption has been a feature of rapid urbanization. Badly managed urban settings have also been a cauldron for political and civil strife, including revolution. Too narrow a community or local focus will prevent coordination or investment around high-level and strategic responses. Two critical issues for the future of the urban role in helping to tackle global challenges will be whether coherence can be built into local approaches to global issues and whether cities will coordinate their efforts with broader country and regional mechanisms. Within a more decentralized system, sharing mechanisms, joint framing, and more integration in planning processes will be critical. A key uncertainty is the extent to which effective approaches will be built for sharing innovative approaches across different cities and localities (especially from emerging economies and slums where pressures create extraordinary environments for innovation). The extent to which learning and linking up can take place to create global movements of local groups and communities will be important in addressing global challenges.

in consolidating wealth at the top of the global

distribution of wealth (whether individuals, families, or corporations). Many are likely to fear that this highly mobile layer will be exempt from the same economic, political, and social constraints that affect other citizens, who are geographically constrained. Citizens will focus on misconduct and corruption of some of these actors, as well as governance gaps that arise from off-shore accounts, secrecy jurisdictions, and other aspects of the global taxation system.

The themes of equality and fairness are likely to have an impact in the international arena as well. For some time, the emerging powers have called for a more democratic process for international relations whereby the established powers are seen as setting the rules.

Elites and publics in the emerging power countries believe the Post-World War II international system has been skewed to favor the West, disputing Western perceptions of an open, liberal order which has allowed emerging powers to prosper and rise. On the contrary, the impression of many of our interlocutors was that, “America’s liberalism is selective and often in short supply.” Examples cited include Western support for authoritarian regimes, a double standard toward states that acquire nuclear weapons, or actions that are perceived to undermine international law and human rights, particularly in the Middle East. Equality, openness, and fairness are not just values to be applied to domestic setups, but also pertain to the broader international order.

NEW GOVERNMENTAL FORMS