Episode 80: Hamish McRae on How to Think About the Future

Episode 80: Hamish McRae on How to Think About the Future

The International Risk Podcast is a weekly podcast for senior executives, board members and risk advisors. In these podcasts, we speak with risk management specialists from around the world. Our host is Dominic Bowen, originally from Australia, is one of Europe’s leading international risk specialists. Having spent the last 20 years successfully establishing large and complex operations in the world’s highest risk areas and conflict zones, Dominic now joins you to speak with exciting guests from around the world to discuss risk.

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Our guest this week is Hamish McRae an economic commentator for the Independent who writes weekly columns on economics and finance.  He has been financial editor of Guardian and the Independent and has won numerous awards, including Business and Finance Journalist of the Year at the British Press Awards.

His most recent book, The World in 2050, How to Think about the Future, was described by the Economist as thoughtful and sensible. Dominic discusses with Hamish the changes that will affect our global society in the short, and long term.

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International Risk Podcast interview transcript with Hamish McRae

Dominic Bowen 01:13

Good morning. My name is Dominic and I’m the host of the International risk Podcast. Today we’re joined by Hamish McCray. He’s an economic commentator for the independent and writes weekly columns on economics and finance in the Mail on Sunday and the Iowa newspaper. He has been the financial editor of guardian and the independent has won numerous awards, including business and finance journalist of the Year at the British press awards. His most recent book, the world in 2050, how to think about the future was described by The Economist as a thoughtful and sensible book, which is always a great place to start. Welcome to the International risk podcast. Hamish,

Hamish McRae 02:03

Thank you for having me on.

Dominic Bowen 02:05

Hamish, I work every day with senior business leaders and government officials to build risk resilience, improve strategic forecasting and helping to build organisations that can be successfully navigate the complex and rapid change. And you know, that’s across your work. The topics that you talked about, which I found so interesting and insightful. Can you share with our listeners today how you think the complex forces of change, including demography, the environment, finance, technology, and ideas about governance will affect our global society in the short and the long term?

Hamish McRae 02:32

Well, it’s a huge area. And the problem, as always, with all these things, is to break it down into bite sized chunks. We know quite a lot about the way the world economy will develop from the past. I find it very helpful sometimes just to look back over the past few 100 years of economic history, and see the themes that have moved the world over this very long period. And that feeds into both the risks and the opportunities now, for example, if you look back 500 years issued about 2000 Here, look back 500 years, the world’s largest economy was India. And the second largest was China. And Western Europe was relatively small by comparison, and North America hadn’t gotten going. Go back to the time of Christ, and the world’s largest economy was India. And the world’s largest was the second largest was China and the Roman Empire was a poor third. So I think that now, this vision of the world we live in, where what we call the West, leapt ahead from the Industrial Revolution onwards, colonised much of the world, took over effectively North America, and ended a rather different way Latin America, really not very good news. So the people were already there. I think that, that we are in some measure, returning to that world, the power balances of before the Industrial Revolution. And so you can talk then, about China, the rise of China, you can talk about India, which next year becomes world’s most populous country, passing China, it may not be next year, maybe the year after, but around now. And which will become by far the most populous country in the world, in another 2030 years time as China’s population falls. So I think that my starting point in all this is to look at the very big pictures of where, where are the people? How old are they? How much economic activity will they generate? And overlaying all this is the big power shift that’s taking place will be called the emerging world?

Dominic Bowen 04:34

No, I think that’s really relevant. That was actually something I spent so much time and I must have been I actually put your book down and pulled out the wonderful encyclopaedia that is Google and started looking and to be honest, you know, fact checking and looking at some of the data about what you were talking about, about China and India’s place historically over the last 2000 years, and I remember actually sitting back and going oh, Ah, that’s quite interesting. You know, you know, we use terms like emerging economies and new economies and developing economies. But you know, if we take a larger look, you know, really, as you said the West really is that new economy or the emerging economy, perhaps not the other way around. So I think that’s particularly interesting. But when you when you look at and you know, we’ll unpack America, we’ll unpack countries like Australia later in their in our discussion, but what is the rise of countries like India, and China? I mean, is it something that is it fair to companies, it’s something that just has to be accepted as something that business leaders that are building companies that they hope last for multiple decades, shouldn’t be orientating and gearing and steering towards these markets?

Hamish McRae 05:49

I think that there is an overall background point here, that it is almost inevitable that China will become the world’s largest economy. It just so many people 1.4 billion, though that will be falling through probably from fairly soon through to the end of the century, which is a function of the one child policy. Now reverse, that should reverse it after 40 years, that’s 40 years and one child that kind of cuts the population in other 40 years’ time. I think the and the second point is that, of course, India, rising and becoming, by far the most popular is another big theme. But does that mean that you should invest in China? Does it mean you should invest in India? It means you should think about that and be aware of what’s going on, you should be aware of it. In terms of GDP per head and general living standards, North America and Europe will remain and Japan will remain much richer than China and India. Quite a lot richer than China and very much richer than India. It’s difficult to see China advancing to the sort of complex standard of living, complex economies delivering the standard of living that the West now does. And that’s a separate issue. We could perhaps even talk about why that might happen. But I think that as a background point, you have to accept that this is where economic activity will be. And then you make a separate set of decisions that is this something I should be engaging in with my business? Or is this something that is very important from a humanitarian point of view, and very important from a vision of how power will develop very important for where technology will do more, but maybe this isn’t what I should be doing in my business, because there are risks, and there are huge risks. And we they’re kind of obvious. But of course, they’re always the less obvious risks that come and bite you up the backside.

Dominic Bowen 07:46

You know, we know, and we speak about this a lot on the international risk podcast, that with any future with any uncertainty, there’s two components. And one side of that is opportunities. And often they’re huge opportunities and opportunities that are hard to ignore. But the other side of that is risk. And you can’t forget one without the other people want to shy away from risk. But you’re also shying away from opportunities. But conversely, there’s great opportunities you want to pursue those, you can’t ignore the risks that are there. So I think your way of explaining that was very helpful. I also liked how you talked about hindsight as forecasting. And that’s actually a tool that we use a lot of work a lot with analysts on, actually using hindsight to go back and look at our forecasting, look at how things have evolved, not to assume that the past is going to be a linear continuation into the future. So we can try and learn trends and try and learn about what indicators were available then that we can that we know what happened, because it’s the past that we can look at new similar indicators when trying to predict the future. And we do as you said, we can tell a lot about the future because of the past. Your books title, which I think is a great title implies there is at least one way to think about the future in your columns in the male and the independent are read by really a wide group of leaders across the UK and Europe. And I think your book is going to be a big success. And in one part of your book you say if I can quote “the key decision makers of the next 30 years are alive today. Perhaps those that are still starting in schools or universities or maybe starting out in their chosen careers, and their ideas will shape the world. With so many unknowns a mission, clearly a complex and volatile world”. What is your advice to this talent to tomorrow’s leaders about how they shouldn’t be considering and how they should be analysing the potential future?

Hamish McRae 09:32

I just like them to look back into the past. And be aware of that the ideas that they have now, as young people may seem really strange, in 30 years time, just as the ideas of someone of my generation, that those who were young in the 1960s. And I know the joke about, if you couldn’t remember the 1960s, you weren’t really there. I think that ideas about how societies should be organised will change. And I would say to young people now cling on to the quality of ideas that you have got, cling on to your beliefs, but always be adaptable. And don’t be alarmed, if you have to think of different ways about how society might be organised at some stage in the future. Sometimes looking back to things in the past that work better, but also being aware that things can always be improved. And, and just the further wrinkle on that thought is that we should also have some bedrock values, which have not changed. And for me, one bedrock value is the admiration of democracy, of messy democracy, chaotic. Always, two steps forward, one step back. But I do think that is something that I have confidence in. And I would say to young leaders of tomorrow, look, you know, you can see the huge flaws of the democratic system in the developed world. And the rather different democratic says, in India, this is the best thing we’ve got, let’s improve it, let’s not junk it, and it will be your job to improve. 

Dominic Bowen 11:24

Oh, I think that’s so important. Like, it’s so important. Democracy is flawed. Anyone that studied international relations, or politics will say with democracy are the flawed, but they’ll also say, it’s the best we’ve got, it’s the best of a bad bunch of options. And our job is to make it as good as we possibly can. And we’re seeing different forms of democracy. We’re seeing it in Sri Lanka, we’ve seen over the last couple of weeks. Very, very sad and upsetting and unsettling forms of democracy in Sri Lanka, for different types in India. And of course, you know, we all know about America, and then the British leader, Boris Johnson, what’s happened in that democracy. So they’re all very, very different. But all progressing or moving forward, and as you said, might be two steps forward, sometimes two steps back, but generally, it is it is moving forward in a positive direction. And I’m going to ask you about the future Hamish about the opportunities and the risks we face. But if I may, I’d like to explore the past few of you a little bit first, in particular, some of the tectonic plates that have shifted in recent years that we should be learning from before we look forward into the future. So what do you assess you released the world in 2020? But if you release that back in 1994, so what do you assess as being some of the most significant events in the world that we should learn from since you published the world in 2020?

Hamish McRae 12:34

Well, let’s start with the NIS. I had three bull’s eyes. One was, the Britain might well leave the European Union. The second was that there would be some kind of populist revolution in America against the against the liberal elite. And I even got by typing right the second century, the second decade or the next century. And the third was that there was a danger of a pandemic. So, you know, those are three bull’s eyes or near bull’s eyes, what I got wrong. What I guess wrong is always more important and interesting than what you get right. What I got wrong was not seeing that the Internet would be the way we would use the communications technologies that were emerging to communicate with each other, I could see that there would be a world where we would use computers to talk to each other. But though the internet existed, the browsers were already just coming in. And there were no search engines. So I didn’t use the word internet in that book, even though it existed, because I sort of vaguely knew there was something going on there, but I couldn’t see I’ll be useful. And that, I think, is a very big lesson for the future, that there will always be lots of technologies floating around, and most of them disappoint. You can make a nuclear power station as you could 60-70 years ago, 56 centerfire. So you could make nuclear power. What you then thought was, this will be free energy for everybody. And so cheap that it won’t. And the technology was just too difficult, too complicated with all sorts of other environmental concerns. And so it’s been in my book of profound disappointment, you could build a nuclear power station. But that is not the future. It’s still whatever it is 10% of global electricity generation. So I think that the interesting things, lesson I’ve learned, probably the biggest lesson is that there are lots of technologies around, but picking the one that will be the winner is very, very hard. And technologies do not become winners, until lots of other associated technologies are built roundabout. And we know this, I mean, we know that I don’t know the motorcar didn’t really become a mass product until they invented the self-starter is too much of a pain to have to go out and crank the thing in front. We know that we know that supermarket, somebody had to invent the supermarket trolley. And in the case, I think of, of present communications. Even Steve Jobs could not envisage the full uses that the iPhone would be when he presented it. And remember, before the iPhone, other people had a go at trying Nokia, Nokia communicator, tried Blackberry, other people tried to create it. But his genius was the one that actually created the product that, as he said, changed everything. So I think what I’ve learnt is that you can see all sorts of technologies floating around, but you can’t really see the winner until it until it’s glaringly obvious until it happens. And even then, Steven Jobs did not envisage that the selfie because the first iPhone did not have a front facing camera.

Dominic Bowen 15:36

Oh the selfie, if we could only go back and fix that and remove that from history books. But you’re totally right. I was the senior adviser to the governor of Victoria. And I remember one meeting and I’m there with the governor and his other staff. We’re discussing some issues. And then his chief of staff walked in, he walked into the meeting leaders and the Chief of Staff can do, and he sits down and he’s doing something on his phone, but his phone was bigger than everyone else’s. And this is showing my age a little bit but his phone was bigger than everyone else’s. And someone sort of commented on it. And he said, Oh, yes, yes, yes. He had this beautiful British accent. And he said yes, yes, yes. It’s a Blackberry. And we’re like, Okay, what’s his like, I can check my emails from right here. I’m like what it’s like, I can check my emails on my phone. And keeping in mind, you know, I was a senior advisor. We had other advisors in the room, we were continually moving with the governor travelling all the time, really at our desks, and the governor would be continuing as the governors do, you’d be like, what’s that person? What’s the GDP in Japan? What’s the rainfall in this city in 1997? You can be asking the most random questions you were continually having to get information. And yet we had mobile phones, but they weren’t smartphones. And even at that point, when the Chief of Staff talked about this smartphone, this new BlackBerry invention that he had, no one in the room went, Oh, we all need those. We need to roll those out across. I still remember just shrugging my shoulders and going, whatever, and then go in. I mean, oh my gosh, you know how things have changed they are very hard to predict. Hamish, I don’t think anyone will hold anything against you for missing that one. But you mentioned unrest in America is one of your successful predictions. And you actually quote, Barack Obama in your book when he said that the world has never been healthier. It’s never been wealthier. It’s never been better educated. It’s never been less violent, more tolerance than it is today. With American education, culture and immigration huge, and defining strengths now and differently for at least a couple more generations. But as you mentioned, there is that growing political and economic challenge and influence coming from countries like China and India. And then you’ve got countries like Canada, a country you describe in your book is a country that’s easy to love, no enemies, it’s welcoming to immigrants, huge land area, massive natural resources. Canada is a calmer, kinder, less extreme version of the United States. What a lovely way of describing Canada. If you can choose where you were born, in 2050, where would you be born?

Hamish McRae 17:57

Oh, gosh, well, Obama’s point is that now is a good time to be born knowing nothing about you. Who’s going to be now a woman, you know, rich or poor, whatever. And that must be right. Where would I choose to be born? Oh, look, I would be very happy to be born anywhere in the Anglosphere. And I think that United States, Canada, US, UK or Ireland, I was brought up in Ireland I was a half English half squat brought up in the Republic of Ireland. So there you go. I’ve been around these islands and spent five years of my life on the Isle of Man. So I think that now the challenge to be saying, well, wait a minute, why do you say the Anglosphere because, you know, China? Would that not be more interesting to be born into the world’s largest economy? Would it not be more interesting to be born somewhere in continental Europe? I think frankly, my answer is no, because I think the Anglosphere becomes more important over the next 30-40 years than it is now. And that’s not because it’s the Anglosphere, it’s just because the individual countries within the Anglosphere look like growing more swiftly than the rest of the developed world. The UN has just come out this week with its new global forecasts for population. With the US going on growing with the UK, this was not a much reported thing. The UK, passing Germany to become Europe’s most populous country in 2084. I mean, note the spurious precision it was in 2084. And it may not happen the UK may not. But the bigger point is that Anglophone countries, and this goes for US and Canada and New Zealand very much there seem to be places where people want to go there they are magnets for global talent. The UK making a pitch now for Hong Kong, Hong Kong migrants which are Australia, the place that everybody wants to go to. And the more fearful and eccentric or maybe the other ones need to go to New Zealand. My point is this that if you are a global migrant, your first choice is the English speaking world. You don’t want to go to China. You may want to go to India but probably only if you have some sort of Indian background. If you’re clever Nigerian, your first stop is the UK and your second is America. So you see my point countries less likely to prosper. And so I would be very happy living in any country that is seeking to attract human capital.

Dominic Bowen 20:35

Yes, human capital is unquestionably one of the key elements. And you just spoke about the Anglosphere, and I’m an Australian who travels the world and you know, in a different country nearly every week, but I was understandably drawn to your writings on Australia. And if I can quote what you wrote in the book, Australia is the world’s largest exporter of iron with nearly 60% of the global market are the main exports of coal, gold gas, and we all in heavy demand from Asia, but it would be misleading to focus just on physical exports. Australia has also built up impressive service industries tourism and education and in fact, Australia’s third only to the US and UK in terms of universities ranking in the top 100 globally. And as you identified in your book, Hamish, you said that Australia is also the driest continent, and as such faces some of the most extreme threats from climate change. Now, this is something that the Australian population and our wonderful politicians in Australia need to prepare for and need to mitigate. Now, common sense science and innovation will all be needed. And you talk about this in several parts of your book. But do you think that Australia and other countries in a similarly positive and successful position today are ready for the challenges of tomorrow?

Hamish McRae 21:45

Well, I think that you have to segment this. This is this is the bite size chunk. issue. I love Australia, I’ve been quite a few times. I think I’ve been to I haven’t been to Canberra, but I’ve been to I haven’t been to Hobart, but I’ve been to all the other all the other capitals. So I’m a biaised reporter of Australia. I think that Australia faces in many ways, all the challenges that developed that the world faces, the rich developed countries face, but also countries which are environmentally challenged. And I think the question here is, segment, the challenges, there is the environment. And I have a chapter in the book about the environment. And I suppose if I was subbing down the view there, the risk is that we act too late. The risk is that incremental changes will not be enough. Now. If you can make incremental changes, that’s better. The sudden changes always carry a risk, you’ll do the wrong thing. But I suppose my concern is that the world and this does apply, particularly to illustrate, we’ll just move too slowly. And there are lots of small things you can do that cumulatively have a lot of effect, pricing water properly, making sure farmers use it more carefully. You know, making quite modest changes in the household to cut down on water use lots of small things. But I then think that the world as a whole, if it does have to panic about climate change about the environment. It will pull together and through everything it has added rather as the way that it cooperated over the rollout of the vaccines. It was the rollout that it wasn’t done perfectly. But it was quite astounding the speed in which the world reacted to that. And, and pulled together universities, Big Pharma, governments, really were remarkably successful, I think, given the fact that they were coping with an entirely new challenge. So that is a small example small in inverted commas, and what the world might have to do on the environment. And I think that is a particularly big issue for Australia, but also obviously for the rest of the world.

Dominic Bowen 24:04

It’s always much more challenging, and I find this with the clients I work with, but certainly if we look at Australian politics, it’s always much harder to get someone listen to a message when everything around you is rosy when everything is green and flourishing. and fantastic. It’s so much harder to get people to prepare for an emergency for risk for a crisis. So I understand the challenges.

Hamish McRae 24:20

Well, it’s fixing the roof when the sun shining, isn’t it?

Dominic Bowen 24:25

It’s a great one, it really is a great one. And the risk of it, as you said incremental, slow, delayed, insufficient changes to the way we’re influencing and impacting the world and our environment, are very real. And if we’re looking at risk terms, there is a high likelihood of it occurring. And there is an extremely high impact if we don’t positively change and influence our contribution to the way the world is heating up, and the weather patterns that we’re already starting to feel in many places.

Hamish McRae 24:52

Australia, I think the point here is its insurance, you pay a certain amount to do things that cost you something in the short term, you know, and that will actually enable you to be somewhat better placed in the long term. You also do some things you probably ought to be doing anyway. Which is, which is do you really need? You really need cars with V8 engines? By the way, I don’t drive it very much. That’s my defence.

Dominic Bowen 25:13

Yeah, you don’t see too many V8 engines in Stockholm, but you certainly do in Melbourne in Australia. But I also liked the way that you recognise and understand your bias as a mission. I’m sure as an author and a journalist and a writer, you have to be really aware of it. I mean, we all have biases. But one of the biggest challenges when analysing information when producing reports, is understanding the biases we possess. I was quite pleased to hear you inadvertently mentioned you know that the biases that we all possess when referring to you know your biases towards Australia. But we understand the importance that education, geography and natural resources, as we just discussed, can have on a country and the populations future. But what about culture? Can you describe the influence that culture has on economic performance and what you found as part of your research?

Hamish McRae 25:58

Well, culture is multifaceted. But there are one or two core core values. Humankind is very fraught. But the mixed economy requires both people to break rules, because that’s how you drive change forward and do things differently. The great example is that the aircraft was created by to Pete, bicycle makers, bicycle repairs, actually, not by the big industries of the day. It wasn’t created by the steamship companies. It wasn’t created even by the nascent motorcar companies. It wasn’t created by big business, it was created by small business. So you need people who are outsiders, who will take risks, and do things that other people couldn’t imagine. And that is how technology has been driven forward. It’s how the development of the electric car came from one of the heroes that I mentioned, Elon Musk, who is reviled by many people, but my word if it had not been for him, the electric car did not come from the established giants of the motor industry. It came from an outsider born in South Africa, making his life in America talented immigrant, and he has revolutionised the world. The electric car would have come, but it would have come 15 or 20 years later. So I think that you need outsiders, but when you talk of culture or when we talk of culture, we also should be aware that you need rules. And whenever a new technology is developed, Facebook, then other, another sub not so much an outsider, but suddenly somebody wants you to break rules. Whenever a new technology or a new is developed, you have also to create social structures that apply rules to that. So the example here is that you have social media for all its wonderful, wonderful things, but it takes a while for laws to catch up. And it takes a while for social norms to catch up. And we are at the moment in that transition where the legal situation of social media is still not clear. Is social media, a publisher? Or is it a post office, it’s, of course, both. It’s somewhere between the two. And we haven’t yet got the social etiquette whereby you don’t slag people off writing unpleasant things, when they tweet something. So I think that, that society when it gets a new technology has to figure out how both how to get the best out of it. But also how to apply rules and codification and ethics to the way it uses it. So I think that is again, a stage of one step forward, two steps back. And, again, we can take another example, the motorcar. It was invented, it caused huge numbers of deaths, it liberated car owners to go and travel, travel around, but then created traffic jams. So then you had to put in the infrastructure, you had to put in driving tests, you had to put in rules of the road, and you had to train people actually to drive more carefully, and not to get drunk, and then jump into a car as they were used to I’m afraid in Ireland where I was brought up. So I think that the importance of ethics is, is is universal. But we have to keep tweaking it, changing what is socially acceptable, as the technology develops, and the ideas of how society should be organised develop.

Dominic Bowen 29:30

So you just mentioned the R word, immigration, and even just saying, makes me feel like I need to be careful about what I say and how we discuss it. Hamish, it’s such a sensitive topic around the world. And politically, immigration brings so much passion from both the left and the right. But the positive impact of immigration during and after the tragic events of World War Two demonstrated that immigration should be seen as a positive event, I think both left and right, the takes and think tanks and political commentators as well as newspapers, again, on both the left and the right, have agree that generally speaking, immigration, at worst, has limited impact on an economy. And at best, and most likely, it has a very positive impact on economic outcomes. And certainly over the last two years during the COVID pandemic, and more recently, during what is now referred to as the great resignation, we’ve seen much more flexibility from employers and companies about where their employees are based. So what role do you expect that immigration is going to have? And do you expect it to be a positive role or a negative role between now and 2015?

Hamish McRae 30:40

I think different countries are allowed to make different decisions about what they do about immigration. If Japanese society does not want to have large numbers of immigrants, then that is the right of Japanese society to do that. If Canada wants to carry on attracting immigrants and get up to whatever is going to be 50, millions by 2050, something like that, then that says, If Australia wants to choose, the immigrants that it has, that is its right of the society to do so. What I would say societies do not have a right to do is to discriminate against immigrants who come there who come there, and they’re there, then they have to be treated with as other people do. And that then has a further implication that if someone moves to another society, they must accept the broad rules abroad rules of that society. And that that’s knowing the course those rules will change, just as we accept the rules of our society, knowing that those rules that I now, you know, see around me in London are very different social rules from the real social rules that I grew up within in Ireland, or indeed when I came to London all those years ago, so I just call for sort of decency and common sense, but I think that immigration is a net benefit for all the issues that it causes. And I think we will say migration rather than immigration, because I think it’s also reasonable for people who come to a country learn the skills, if they then choose to go back to where they were originally came from, and deploy those skills, then that’s also great too. And I suppose, I like to hope that these students who come around the world and live up go to university in their late teens, early 20s, in a quite different society, if they then do choose to return to where they came from, that something of the values that they’ve learned will have rubbed off on them, and they will be broader people as a result. I like to think so.

Dominic Bowen 32:40

You know, I think that would be very difficult to know that people would try. But I think that is a very difficult argument to, to argue with. I think that’s a very valid point you raise. You also discuss in your book, Hamish how the world of today shapes the world of tomorrow. So what are your key messages for governments and business leaders, and perhaps more importantly, the new generation of leaders currently at school and university, about what needs to be done today, to ensure the most positive predictions in your book do come true.

Hamish McRae 33:15

Again, this is a bite sized chunk thing. Well, I’m anonymously impressed by the different pockets of excellence around the world. If you look at Europe, for example, there are outstanding universities, Oxford and Cambridge, Imperial in London. They’re in the top 10. In Dubai, notably in the top 10 in the world.  I think that if you look around the world, there is excellence everywhere. If you look at France, there is the genius of high-tech industries of high tech of some high tech industries, and also have the luxury business the world’s greatest luxury stuff. We shouldn’t be sniffy about luxury. If people want luxury, then that’s correct. It is actually in France. There’s extraordinary engineering schools in in Germany. The best lifestyle in the world, many people recommend to be Italy. So that’s just in Europe. You look at North America, you see the way in which one bit of America, the West Coast of America has utterly transformed the world with the high ticket stress. I mean, absolutely conquer the world. You look at everywhere. You look at health care in America, primary schools in Finland, you look at health care in Switzerland, very good. You look at Singapore. So wherever you look in the world, there are pockets of excellence. And what I would like to see is much more effort to learn from these pockets of excellence. And you can’t just pick up something and apply it elsewhere and figure out how this is done. Well, what can we as a society who are doing some things well, and some things not so well learn from this particular example. And I think that there is no overarching way of doing this, because it’s such a segmented world. If you want to look at better care for the elderly, a hugely important issue, you would look at Japan, and as you look at the Netherlands, which is really, really interesting, what’s being achieved there. So I think what I would urge people to do is to have an open mind and look at what is good around the world where you perceive you have a problem and say, what can I learn? And then how do I learn sensibly and thoughtfully, adapt and apply these ideas here, and just nudge up the condition of humankind a little bit further as a result.

Dominic Bowen 35:00

Would not that just be fantastic if we all could do that, identify where we’ve got some areas where we need to grow, we need to strengthen and look around and just identify, as you call it, with a great expression, those pockets of excellence around the world.

Hamish McRae 35:50

I did write a book that tried to try to pick on this it was called “What works” and I looked at the things that I thought worked very well round the round the world and I think for Australia, I chose their training for a Olympics, rather, which we copied in the UK, but then I think it rather declined after that, it doesn’t matter. It’s still it was a great achievement.

Dominic Bowen 36:20

That’s always one of the first questions or second questions when you meet someone in Australia. First question is, you know, what’s your name? And the second one is always what football team do you go for? There is a mad obsession with sport. But when I was still working for the Australian Government, I actually worked for the Australian Federal Police for a time and I was deployed as a special agent to several Pacific Islands, and doing capacity capacity work with those Pacific Islands. And what was then still crystal clear waters of crystal clear beyond anything I’ve seen anywhere else in the world just slip such a fond memory of my heart. And so I particularly enjoyed your commentary about how our future really is intertwined with whatever happens under the sea, which makes up about 70% of the planet. And with over half the world’s border located in the Pacific, it seems right that you did focus on this beautiful part of the world. So why do you think it is that we so would that we know so little about the Pacific even today? And then what risks and opportunities? Will you be monitoring when it comes to the Pacific over the next couple of decades?

Hamish McRae 37:20

Let me answer that by saying how I came to this, I was thinking about, about the world. And I had gone through the continents simply because that’s a convenient way of thinking about the world. And I then found myself getting towards the end of the book, having written about Australia, calling it Oceania. I I’m not writing, I’m writing up about landmasses. This is wrong to neglect this huge chunk of the world, I just suddenly had a spark sitting there in in the basement tapping away saying I’m missing something really, really big. And I knew very little about it. Sometimes. I haven’t like you had the advantage of going to. I’ve flown over it very long way. I wrote years ago about the Pacific Rim economies, which is an interesting concept. So I found myself just wanting to try and learn. And, you know, I’m only a journalist, I’m not a scholar. So I just started reading about it, and then tried to encapsulate realising that we are actually discovering a bit more we are putting a bit of resource into trying to do that. And I found myself wondering, is it the Pacific part of the solution to the climate, the climate problem, could we treat it better? Can we get it to absorb more carbon so I found myself just intrigued by it. And felt then that it was my duty to try and introduce readers to this journey of discovery that I’ve gone on about the Pacific. And that, by the way, leads to a further thought which I sounds a bit Californian but I really mean it. I feel that I’m a tour guide to the future. I can’t know everything. Everybody who reads my book book will know something more about some area that I’m writing about than I do. So I feel I’m leading a group of people into the future where I have done this before. So you know, I got a torch and I know a bit about it. I’m, in general terms, I’m probably better. But we’re all going along together on this journey, it’s a journey that we cannot not go on, or rather, the costs of not going on it are very disagreeable. Let’s go to the future. And we’re all going together, everybody will, I hope, guided by me look in a direction. And this will actually I know rather more about Indian politics than you do. You know, you’ve helped shape my views a bit. But I’d like I wish I could, you know, tell you where I think you’re wrong.

Dominic Bowen 39:54

When you aren’t going on that tour guide journey, but perhaps with family or friends over the dinner table, you’ve obviously spent considerable time and you write a lot about economics and the world and politics. So you spend a lot of time thinking about this. But when you are sitting around the dinner table with friends and family, what are the most significant opportunities that you’re thinking about? And one of the largest risks that you see in the near future?

Hamish McRae 40:20

Well, let’s talk about risks. I finished the book with 10 fears, the final chapter is about hopes and fears. And I have a generally positive set of hopes, and then which are more general, then their specific fears. And I wrote the final chapter. And it didn’t really work. I was worried about it. And friend who has helped me get it for me, is a slap on the nail on Sunday. He said, Hamish, I think we can fix it, what you need to do is put your fears first, get those out of the way, because that’s what you need people to be aware of first, and then you can make the much more general point that your hopes which are positive. And because he was exactly right. And it was a really thoughtful piece of editing that I had not spotted. And Adrian, thank you for that. Let’s talk about fears. Fear number one is that China and America will mismanage their relationship. I think we have a very dangerous period over the next 10 years or so. With China’s still the aggressive 20 Something you are heading towards the middle age and maybe the aggressive 30 something or else. And I think that America the troubled, dominant power. And I think that’s a difficult period. I just hope that they will manage that transition sensibly and thoughtfully. And there are all sorts of flashpoints the South China Sea, Taiwan, and so on. I think a second fear is that America will not cope as well with its demons, as I believe it will. I think America will cope with his demons and be a much more comfortable and more comfortable with itself in 30 years time. But it is undoubtedly a troubled time for America now. And it will continue I think to be troubled for a few years. My fear number three was that Russia would do something would have some kind of go berserk, he would have some kind of convulsion which would damage both itself and its neighbours. And as it happened, that conversion occurred about four days before I hit the final, the final button on the printer. So I was able to slip in, and I don’t know how much you know about the final editing of books. But on that final fifth pass, you can change a few words here and there. But if you got to take out 35 words, you’ve got to put in another different 30 by words. So what I was able to do was show awareness that this invasion of Ukraine might be that convulsion that I most feared. And I was chuffed to realise that I actually had spotted that risk. It was my number three risk. But but, you know, of course, we did not at that stage know, we don’t know now, quite how serious on a big global scale, that risk will be. And there are other risks? Can we convince the world the world’s democracies that this really is the least bad system? I think we can. But we have to acknowledge that democracy has to lift its game.

Dominic Bowen 43:11

And I think that they were really interesting, your fears and the opportunities and I think you’re totally right, the mismanagement and handling of relationships between the US and China, whether through the Obama, the Trump and now the Biden administration’s have been seen, be clear for everyone to see and clearly remain a significant risk. And as you say, in your book, you know, Russia overplaying its relationships overplaying its hand, I mean, any country that’s going to put us in its political opponents, as you say, he’s clearly willing to buck the system is clearly willing to step outside the legal norms. You know, we barely a month goes past with it’s not a story about a coup or attempted to coup Africa or former political leader going on charged for corruption in an African country. But there are many success stories. There are many success stories. I spoke to someone this morning, who just got back from a fantastic trip to Zambia, we know that there’s been some fantastic political developments in countries like Liberia that were beset by civil war for decades. And you know, there are a lot of reasons to be positive and feel confident that many African states are heading in a good direction. Well, thank you very much for unpacking just a little bit of your book and just talking very briefly about what is a such a huge topic today Hamish.

Hamish McRae 44:20

Well, it’s been my pleasure. And I say to readers who are coming along the journey, you know, come along arm in arm, we gotta go on. We can’t get off it. You know, and I have a broad faith in in the world use to do a better job than the world, middle aged and elderly.

Dominic Bowen 44:37

Well, as you said, the train that we’re all on is moving forward, and there’s nothing we can do to stop it and your book the world in 2050, how to think about the future, really is a great tour guide for that and we’ll link to link to that in the show notes. But thank you again for coming on the podcast today, Hamish McCae. And thank you for listening to the international podcast and please remember to subscribe for future episodes.

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