Last week’s summary: Everstate (An ideal-type for our very real countries created to foresee the future of the modern nation-state, to which we now attribute values to be able to develop the scenarios) is a middle-range power located on the Eurasian land mass and part of the international liberal order. It is ruled under a democratic parliamentary regime and obeys an array of norms and their institutional administrative offshoots at international, regional and national level. Its governance is thus complex. Lately, it started being less efficient and as a result began to fail to ensure the security of Everstate’s citizens.
(Click on each picture to see a larger version in a new tab).
An increasingly inefficient economy
Meanwhile, the economy was starting to be less efficient. True enough, Everstate, with its still fair governance, inheriting a past positive economic situation was still receiving its share of foreign direct investments (FDI), while also investing in other countries, thus being fully part of the enmeshed globalised world.
Yet, the growth, upheld by the normative order as main objective, panacea and ideal, tended to increasingly stall and chronic unemployment had slowly started to settle in. Meanwhile, poverty had not been eradicated and was again on the rise, while inequality decupled. However, the normative model still justified the resource repartition and, for example, those who were poor tended to be seen as lazy, worthless and as social misfits, who did not want to enter the system and work.
Most analysts and analyses were focusing on old ways to understand economics, which had been so useful in the past, revisiting debates and quarrels over Keynes, Hayek, Marx, and others for example. Yet, most failed to find explanations and solutions to the current degrading efficiency and slowing growth. Meanwhile, obvious factors were most often overlooked.
The evolution of society towards more complexity affected not only governance but also economy and its efficiency. Its impact on the initial resources available was also playing a part: for example, science, production models, socio-political models, changes in ways of life, and demography had profoundly altered not only agriculture but also available resources such as land, water, seeds, and food resources. Furthermore, the evolution of society coupled with the evolution of resources had strongly impacted the ecological milieu, for example through biodiversity impacts and climate change, which in turn affected directly the efficiency of the economy. New resources could emerge that had been unheard of previously, e.g. biofuels, or massive influx of jellyfish that altered the whole life of Everstate’s seashore. More generally, resources also displayed a trend towards an increasing complexity, with consequences on the economy. Similar dynamics were at work in any sector, including the emergence of the very new (in terms of human history) virtual world.
Changes in the economy’s efficiency had effects on the security provided to citizens, would it be only directly through a more uncertain material security. Indirect effects, in as much as governance seemed unable to favour a return to the security ante, were also to be expected, with time. However, those consequences were still deemed as temporary and relatively minor in terms of scope (the number of people being affected) and intensity. Citizens had started expressing the fact they felt those effects, but only through relatively mild discontent (mostly without any violence).
Another impact, initially mainly unnoticed, was that the demand for liquidity had started to grow. Indeed, the still existing economic growth needed liquidity, as well as the usual functioning of the economy. More importantly, the gap between lowered efficiency and stable or increasing needs had to be bridged by something and it was by liquidity.
The powerful Everstatan elite* under threat?
As for all elite groups, Everstatan elite power stemmed initially from their search to protect and increase their status and privileges, their resources and income. Then, obtaining and maintaining this power promoted the search for even more power, in a relentless dynamic.
Becoming part of elite groups is obtained throughout time and space by holding mastery or power over something that is needed by one’s polity. Three major areas can be identified that generate and then maintain elite power: understanding, knowledge and skills, specific (material) resources (e.g. land for a long period of human history), and, last but not least, liquid assets or liquidity.
The dynamics, in essence, run as follows: a polity needs specific resources (e.g. energy), understanding and skills (e.g. how best to see the economy function, or how best to manage the state apparatus according to the ongoing socio-political model), and liquid assets, with variation in terms of content, quantity and timing. When the need appears or increases, then those who possess the corresponding resource find themselves in the position to become crucial to their polity. The less numerous those who master this resource, the higher the power and related status they will get in return.
Status itself can also be considered as a symbolic resource of a specific kind that is hard to obtain but, once reached, favours mastery over the rest. Similarly, elite groups derive income from their various masteries that help them, if wisely used, to maintain their mastery then power. Finally, elite groups also develop coercive powers – when coercion is not the primary resource over which they have mastery – that help them achieving and maintaining their power.
The stronger the elite power, the stronger the elite bargaining position when negotiating with the ruler of the polity for those resources they master, which, in turn, leads to a rampant and hidden appropriation of the public domain, as is the case for Everstate. Furthermore, Everstate being a modern nation-state, organised according to a democratic regime, the tension occurs directly between elite groups and the nation, the real ruler of Everstate.
In Everstate, the rising demand for liquidity, notably, had enhanced the elite power of lenders and of the various financial actors, while the rising economic inefficiency had similar effects on economic actors including pundits.
Most notably, in Everstate as in most other countries, new elite groups had started rising, for example those linked to the virtual world.
Any new demand that would emerge would lead to the rise of a new elite group.
However strong the position obtained by entrenched elite groups, they may also disappear. Indeed, what creates them may lead to their demise, as resources become plentiful or disused, as skills and knowledge once scarce become widespread or as understanding suddenly fails.
Yet, elite group will not willingly accept their own disappearance, and will use any means to keep their power and status. At best they will promote changes in a bid to uphold their mastery over crucial resources. At worst they will block changes and fully involve their remaining means of power (income, coercion, status) in contests spurred by the discontent of the nation, playing an active role in polarisation and radicalization of society, favouring escalation towards conflict and finally most often ready to engage in wars.
The situation had definitely not reached this level of tension in Everstate as our story begins. Yet, the changes at work could let expect that some elite groups’ power was challenged, and could eventually lead to their demise, but no full awareness of this phenomenon had yet taken place. Notably, pro-active elite involved in economic efficiency, governance-related administrative and political elite, and knowledge and understanding institutions meant to provide explanation and models and related elite groups were most probably at risk.
The various mild degradations and tensions had been felt and registered by the population, sometimes involving protests under various forms, from abstention during elections to strikes and demonstrations, by the various elite groups, the government and the state. However, most Everstatan actors were most often considering them as temporary crises and difficulties that would be shortly solved, while everything would go back to normal. At worst, some envisioned a serious crisis that would last a few years, maybe a decade before everything went back to normal.
Are they right? What does the future hold for Everstate? Whatever happens on the shorter term, will it have impacts on the medium then longer term, and which ones? How will Everstate fare if or when confronted to tragic events, considering decisions taken during the first years?
To be continued next week…
Anderson, Benedict, Imagined communities: reflections on the origin and spread of nationalism, (New York: Verso 1991).
Ertman, Thomas, Birth of the Leviathan: Building States and Regimes in Medieval and Early Modern Europe, (Cambridge, Cambridge University Press, 1997).
Robert Taylor, The State in Burma, (London: Christopher Hurst, 1987) – notably for the separation between public and private domain, see p.66.
Zellman, Ariel, “Birth of the Leviathan by Thomas Ertman” Blog post