Columbus, The Bahamas and the Flat World of the 21st Century

by Larry Smith

It's strange when you think about it, but the fact is that globalisation began right here in the Bahamas - when Christopher Columbus landed on San Salvador 500 years ago.

That event shrank the world and opened trade between the continents. So it's all the more odd that we are now being told the world is not round but flat - in the sense that technology has placed us on the brink of an entirely new era in human history.

This flat earth metaphor is used to good effect by a New York Times columnist named Thomas Friedman, who - in less than 16 months - has published two hardcover editions of his best-selling 575-page book, The World is Flat: a Brief History of the 21st Century.

Friedman is a Pulitzer Prize-winning author of several books on globalisation and his columns reach millions of people. He is best known as a populariser who can lucidly explain complex economic ideas and processes to the rest of us.

The flat world he talks about was created in less than two decades by several developments - beginning with the end of communism in 1989, the coming to life of the world wide web in 1995, the standardisation of workflow software, and the global spread of the Internet made possible by dot.com era over-investment in fibre-optics.

Although these trends have been traced by many writers over the years, Friedman puts the pieces together for us easily as he recounts his personal voyage of discovery, through conversations with international entrepeneurs, corporate and political leaders, financial consultants and trade experts.

The "platform for the flattening of the world" that he writes about has enabled new forms of economic collaboration through outsourcing, offshoring, community-based software, global supply chains, information access via Internet search engines, cell phones, wireless connectivity and video conferencing.

"The flattening started around the year 2000," he wrote, "when millions of people on different continents sensed that they were in touch with people they'd never been in touch with before, were competing with people with whom they had never competed before, were collaborating with people they had never collaborated with before, and were doing things as individuals they had never dreamt of doing before."

According to Friedman, what they were feeling was a new global web-enabled platform that would henceforth be at the centre of everything: "Wealth and power will increasingly accrue to those...who get three basic things right: the infrastructure to connect with this flat-world platform, the education to get more people innovating on, working off, and tapping into this platform, and, finally, the governance to get the best out of (it) and cushion its worst side effects."

Experts say the recent past has just been a warm-up for the main event - when technology will transform every aspect of life in every society: "The great challenge for our time will be to absorb these changes in ways that do not overwhelm people or leave them behind," Friedman says, offering his book as a "framework for how to think about this task."

Interestingly, the point is also made that most politicians today - especially those who are lawyers - don't know the difference between a server and a waiter, which brings us right back to 21st century Bahamian reality, where it takes two weeks to move mail from one post office box to another.

Our economy is rather puzzling to a non-expert. Tourism produces more than half of our gross domestic product, caters to millions of foreigners and is completely open to international investment. And financial services is, by its very nature, a true flat earth industry - one that offshores private wealth to low-tax centres like the Bahamas.

But about a third of our economy is protected - that is, the distributive trades, real estate, the media, entertainment, fishing and public transportation (not to mention the civil service) are all reserved for Bahamians under the National Investment Policy drawn up by the Pindling government 30-odd years ago and reaffirmed by both the Ingraham and Christie administrations.

And there is strong resistance from most quarters to any opening of these sectors, in terms of both investment and employment. This was most recently demonstrated by the government's aborted attempt to sign on to the Caribbean Single Market & Economy. Although the previous government had avoided economic integration with our friends down south, the Christie administration stirred up a hornet's nest when it proposed to reverse that policy.

Membership in the CSME would have allowed West Indian investors to set up businesses here and bring in their families as well as their own supervisory and technical staff to run those businesses. And although the government said it would seek exemption from the free movement of labour, that is one of the region's key goals - a single economic space with a single labour force, irrespective of nationality.

Now that the CSME argument has died down, the government seems to have digested the political message and reverted to the Hanna-Roker-Pindling Bahamianisation axe as an election tool. Hatchet man Shane Gibson is out to make life difficult for Haitians and their employers, without actually doing anything to solve the very real problems we face from Haitian immigration. And he is also wielding the policy in a clumsy effort to discredit the Tribune as an information source.

The contradictions are self-evident. Despite the government's stated goal of promoting economic growth, farmers complain about the lack of field workers to maintain their production levels, professionals find it hard to compete for big projects, and media owners face declining standards should foreign experts be withdrawn. We don't even have an official immigration policy - it is all ad hoc. The financial services industry's recent attempt to rationalise the work permit system aroused a storm of protest from Bahamians claiming discrimination in the job market.

This resistance to foreign expertise in an economy that desperately needs more knowhow in order to grow is remarkable considering the brain drain we have suffered over the past few decades. According to the International Monetary Fund, many Caribbean countries have lost as much as a quarter of their labour force due to emigration - including 70 per cent of those with a post-high school education.

Although Bahamian emigration is lower - on the order of 12 per cent of our work force from 1965 to 2000 - that still represents some 60 per cent of those with more than 12 years of schooling. And the loss of these highly skilled workers has a dampening effect on productivity among those who stay behind and wastes the public money spent on education in the first place. This translates into a loss of about 4 per cent of GDP, analysts say.

In the meantime, we are finally coming around to the realisation that our education system is shattered and producing social misfits rather than future leaders. According to the Inter-American Development Bank, "The co-existence of acute skills shortages, notably in trades, and unemployment rates consistently above 7 per cent raise questions about the relevance of education, particularly for males."

As Central Bank economist John Rolle said recently: "Economic success in a competitive world requires greater productivity, which is achieved by diligently applying skills we have been taught. If we are not learning the fundamental skills of literacy, numeracy and technological literacy – we are only digging a big hole for ourselves."

In short, experts say, our standard of living is related to the productivity of our workforce and the value that it adds to economic output. And that value is related to the average educational level of our workforce - if that level drops, so will our standard of living.

Mr Rolle argues for a flat world agenda like that proposed by Friedman and many others. He says we should focus immediate attention on extending school hours and changing the curriculum to devote more time to maths, communications, languages and computer science: “Our goal should be to advance (these) skills by at least two years beyond those targeted for the BGCSE."

Others call for greater accountability, arguing that we should run schools like airlines, which are governed by international safety standards: Pilots must be qualified and certified to fly the aircraft type. There must be ongoing pilot training and pilots who don’t perform can be fired, whereas planes that don’t meet the safety code can’t be used.

But the government is only just beginning to configure reform - using funds allocated by the IADB years ago. The goals are to expand the number of pre-schools and implement a new technical-vocational programme by 2010. That's more than three years away and it doesn't take any account of the problems in our schools today. As Mr Rolle said, the students that we are churning out now will be running things in a few years - does that make you think?

The main point here is that there is no sense of urgency among policymakers confronted with our education problems - even though they sometimes casually refer to it as a national crisis. Things just seem to carry on in the same indolent way, with petty politics trumping everything.

According to Friedman, we have to find ways to educate all of our young people to a high standard, because if we don't upgrade their skills, the only way the low-skilled can compete is by driving down wages, which can generate social unrest. And we should remember here that Friedman was talking about American youngsters.

Today, you can source the best product, service or skill from anywhere in the world thanks to the evolving global infrastructure. The costs will be cheaper and the productivity and quality level will be greater. The only limiting factor is our readiness to make use of that infrastructure.

But our politicos and educators are not leading the Bahamian people down this new road. Rather, they are putting up obstacles and acting as if it is business as usual. And the private sector cannot be counted on to make up for the failure of the state to deliver good governance.

As Owen Bethel said recently: "We must avoid creating unnecessary bureaucratic measures and self-serving kingdoms where politicians, bureaucrats and regulators perceive their designated tasks as being hindrances or hurdles rather than facilitators to the investor and participants in economic development."

In Friedman's words "we need to help the poor by improving local government, infrastructure and education so they can acquire the tools to participate in the flat world. What the poor resent most is not having a pathway to get rich themselves. - to cross the line into the middle class - that is what we should be about."

What is needed is for Bahamians to engage in a national debate about where we are, where we want to be in the next 10 to 20 years, and how we will go about getting there. If we do not have this debate as a matter of urgency, we will all be left behind - stuck with a statue of Columbus on a pedestal in the centre of town.

Comments

[Etienne Christen]

Another excellent article. I have been a huge fan of Friedman's columns and books for several years now. I think that every high school student should be made to read 'The Lexus and the Olive Tree' and the 'The World is Flat' before leaving high school. Your application of his ideas to the Bahamian context is seamless and insightful - if only our politicians had an inkling. Their reactive mindset is as outmoded as the 70's fashions of that era. It is a brave new world now. The Bahamas has to choose between an idea of itself that resembles Switzerland, Singapore or Lichtenstein or one that resembles Haiti. Business as usual is a recipe for the latter.

[robert dalbenas]

Just a note to say I found your Tough Call article today a good one! Keep up the good work!

[Ken Bobrosky]

I enjoyed your opinions on globalisation and the future of the Bahamas. I think, however, that you are painting a far too optimistic picture of the Bahamian situation with regards to developing a 21st Century mentality.

I would suggest that they should first enter the 20th Century before beginning their ascent into the high speed, global world of 2006.

After living in the Bahamas for only one year, I have been astounded with the lack of direction, leadership, government accountability and vision or plans for the future. There are, needless to say, pages and pages of rhetoric, argument, finger pointing and laying blame, but very little in the way of concrete plans for improvement that include specific goals, specific timelines, and identification of accountables in any area.

The newspapers are filled with hollow words, politically expedient comment, and occassionally threats or warnings of dire consequences. To date, I have witnessed a regular cycle of events that seem to make media headlines as if they just came up on the newspaper rolodex.