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September 18, 2000—A
Jigsaw Puzzle
On a recent cruise, I joined four of our band upstairs in
the movie room to work on a jigsaw puzzle while the VCR plugged away in the
background.
The puzzle was a 2,000-piece Millennium affair that pictured a hundred or
better of the luminaries from the last 1,000 years, ranging from Galileo to
Martin Luther to Hitler. My colleagues looked at the picture on the cover
and then focused on putting together each of the superstars, one by one. Not
wanting to peek, I instead worked on the sky and other solid patches of
color. As Kant, Plato, and others have told us, you pick your problems by
picking your framework.
Methinks our attempts to master the New Economy are not unlike doing a
jigsaw puzzle without a view of the Big Picture. We have all the pieces, but
we don't have a clue as to how to put them together. So we blunder on.
That said, we still know the color of the future. It is green, not digital
black and white. Environmental, not virtual. Global, not parochial. Despite
John Welch's epiphany over the Internet, it is GE's crusade, at long last,
to make itself more global that will drive it into the 21st century, even in
spite of the economies it is wringing out of its digital purchasing system.
The new logic of global economics is forcing country-by-country deregulation
and, to some degree, increased global competitiveness. It is this
development, for instance, that is making possible the advent of the
micropower generation about which we talk this week.
We say "some increased competitiveness" because deregulation is also leading
to massive consolidation (especially in financial services) and to a host of
anti-competitive practices. Moreover, geographic areas that have difficulty
with democracy (central Europe and Japan, for instance) are having trouble
getting deregulation done. In the United States, the states that are
inherently less democratic often have more trouble ending monopolies and
artificially high costs than those where the populace decided to have an
emphatic say in matters. By the way, take a look at this week's note on
Larry Sidentop's book Democracy in Europe, which should be entitled
"The Lack of Democracy in the New Europe."
Well, if this is not the Digital Hour, but rather the Macromoment--when the
defining current in our economy comes from its global connection--then you
are very right if you think we are hearing too much about George Gilder.
Broadband George is trumpeting the microcosm, but what it's all about now is
the Macrochasm between the rich and poor nations, between big ideas and
rearranging-the-deck-chairs economics. With Internet viewership growth
dropping from the double-digits to well under 10%, we had best cast our eyes
on Ireland, Australia, and other ports of call that are flourishing because
they have found a place in the sun and in the international trade lanes. It
is the global connection that is filling national cash registers.
From August 24 through 26, central bankers came to Jackson Hole, Wyoming for
a symposium put on by the Federal Bank of Kansas City. Clearly bankers like
fishing better than wheat and barbecue. At any rate, they were supposed to
talk about global economic integration. Since it is their gab, more than
Silicon Valley chitter-chatter, that could make a difference in a billion
lives, we hope they got something done.
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