A global context for business

In the best tradition of ‘think global - act local’ this report starts with a global context. One effect of a global economy is that industry shifts to the places where workers are cheapest because it is driven by multinational industries acting for profit. As a result in ‘first world’ countries, manufacturing industry has been on the decline for a while. Industry is leaving the first world for the third world where workers are cheap.

‘Offshoring’ is this decade’s recession buster and it no longer applies to just manufacturing: finance sector jobs, call centres, legal work and research, education services, they are all cheaper in Bangalore. The real effect of this outsourcing, especially in the industries mentioned above, is only just beginning to bite.

Cornwall’s past has been based mainly on fishing, farming and mining and what remains of these is just an echo of former glories. Cornwall has never had the manufacturing industries found elsewhere. On a ‘first in first out’ (of the Industrial Revolution) Cornwall is not going to have to de-industrialise to the extent of other regions, which does offer some advantages, not least our stunning and unsullied natural environment and the quality of life this offers. Cornwall’s past peripherality as an industrial zone is now a positive factor, as people want to live here.

Western culture is realising that the drive towards GDP (Gross Domestic Product) increase does not improve our wellbeing, but other countries are gagging for the want of our externally attractive consumer culture. For example Chinese President Jiang Zemin recently exhorted China to quadruple its GDP by 2020, mainly through consumer spending.

The G7 countries (America, Britain, France, Japan, Germany, Italy and Canada) have recently developed an ‘agenda for growth’. Specific policy actions were set out for each country, including measures to raise skill levels and productivity in Britain. All mainstream political parties continue to make economic growth the central tenet of their electoral manifesto. Our prosperity is linked to GDP and material possessions.

Prosperity in real terms also includes things like clean air and water, good health, or a thriving natural environment. People are flocking to Cornwall where these things are abundant.

Despite astonishing technological advancement and a far higher standard of living in the first world we are much more likely to be depressive, compulsive and violent when compared with the 1950’s (see appendix 1). The economic system we have had since then requires that our needs keep multiplying. Economic growth has accelerated on an almost unbelievable scale, but is based on keeping us in a permanent state of wanting things we have not got.

Economy values what is scarce and what makes money. It devalues what is universal - what every human being has - the ability to care, love, share, rear children, take care of loved ones, be a good neighbour, be a citizen striving for a better world. In other words the core characteristics of our humanity are worthless in market terms. Yet these are the characteristics that have enabled us to survive as a species, that evolution determined were the characteristics that enabled us to avoid extinction in a hostile world.

The contradictions implicit in a conspicuous consumer culture are evident to increasing numbers of people. The shortcomings of an economic system that uses its assets (the Earth’s resources) as income, are plainly visible and utterly unsustainable. To maintain our economic system we have stored up damage in the environment, in effect pushing our problems onto our grand children and their grandchildren for several generations.

Despite increased economic activity, on average each household in this country presently owes £45,000. Our macro-economic system hides a black hole at its heart in the form of derivative trading. This is essentially when you make a deal and pay for it later. The most recent value put on outstanding derivatives is $130 trillion, which is four and a half times the annual income of the world.

Our governments are recognising that legislation is needed to control the breakdown associated with rampant consumer capitalism and are developing strategies. At the Earth Summit conference at Rio de Janeiro in 1992, 170 nations signed a worldwide action plan called ‘Agenda 21’. The effects of this agreement are increasingly visible at national, regional and local levels.

‘Sustainability’ (as first used in the 1987 Brundtland Report) originally meant ‘development that meets the needs of the present without compromising the ability of future generations to meet their own needs’.

Another definition is: “improving the quality of human life while living quietly within the carrying capacity of supporting eco-systems”. Its use has corrupted to ‘something we can keep going’ in general business terms. Sustainability, in its original sense, is an issue that is central to any modern day business development, and particularly important for Cornwall at this time.

Report compiled by Simon Mitchell Dipl.HE, BA(Hons), Cert.Ed.FE