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May 6, 2015 | by Steve Lawrence

Buckle Up, It’s Going to be a Tough Century

Why business leaders must keep a sharp eye on global volatility

A sobering view from former Central Intelligence Agency and National Security Agency director, Michael Hayden. His tough-minded look at international politics described major pressure points that will keep the world’s “basic tectonics,” as he put it, shifting unpredictably. They are shifts that business leaders must be alert to, because they can have a profound and unexpected impact on a now delicate and vulnerable global economy.

First, he pointed to the changing power of states and the nature of power itself. “It used to be we were dealing mainly, with nation states and hard power,” he said, “and the kind of problems that would generally be resolved with masses of men and metal.” Now we are dealing with very serious threats from non-state actors, like ISIS, radically inspired individuals, and failing states like Libya, Somalia and Yemen. Even Mexico with its out of control drug cartels is a serious security threat right on our border, he said. The relevance to business conditions could not be more stark. Even as we grope our way to energy independence, the U.S. economy remains sensitive to Middle Eastern oil pricing and production. And though there are clear signs that Mexico is transforming into a powerful, global manufacturing center, it’s ability to cope with drugs and corruption has to be a consideration for any business leader contemplating, or currently, working in that country.

“Pressure points…that can have a profound and unexpected impact on a now delicate and vulnerable global economy. ”

In addition we have a growing number of increasingly sophisticated cyber attacks that are “turning cyber space into a digital Mogadishu.” We now realize that “the structures and institutions we have created to keep us safe in the world are no longer adequate to fight these threats,” he said. Certainly too, that can be said of the structures far too many businesses now have in place to prevent their own security breaches.  

Another force of global friction, he said, is the rise of China, though it needn’t be. “China is not our enemy, and there is no good reason not to keep it that way.” We share too many vital economic and political interests, Hayden said. “We should fear its failure far more than its success.” We should not forget that “American business knows far more about China these days than the CIA and the rest of our intelligence community.”

His final imponderable is the United States itself and how it will wield its influence in the face of all of this. “Our role is the most important in determining which way the world will go,” he concluded, “simply because we are so big and powerful.”

 

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