Coping with Contradictions
Davos, 20.01.2016 - Federal Councillor Johann N. Schneider-Ammann, Head of the Federal Department of Economic Affairs, Education and Research EAER WEF Opening Address
Professor Schwab,
Mr. Vice-President,
Excellencies,
Ladies and Gentlemen.
In a world that never pauses, and where key decisions with major consequences are constantly being made, moments of reflection and of listening to each other are more vital than ever.
It's to share views and perspectives that you have come to our Swiss mountains. I offer you all the warmest of welcomes. Switzerland has a proud tradition of being a place of dialogue and discussion. Be it for political or humanitarian debate at the many international conferences that are held on our soil. Or be it through our role as a mediator in various peace processes. The world can rely on Switzerland's good offices. And it can continue to do so. Here in Davos it's all about dialogue. And issues that truly transcend every national border.
I know that your annual working programme is as extensive as the expertise and the authority that you have collectively brought to this gathering. So I would just like to offer you three brief points to consider in your discussions:
- the background of today,
- dealing with change,
- and coping with contradictions.
Let me tell you what I mean by:
The background of today.
As we meet here in Davos, we do so in truly turbulent times. No times are ever calm, of course. But even just twelve months ago, the global mood was more upbeat, and the world order seemed a fair bit firmer than it does today. 2015 brought us endless flows of refugees, murderous terrorism and economic crisis. And it brought further worries, too: paralyzing debt, raging wars and simmering conflicts. But: it would be a fatal mistake to react to this backdrop with resignation instead of resolve. Because if we look at the bigger picture, we also see well-functioning democracies, well-performing industries, blossoming new markets and growth.
Technological progress - and thus also industrial development - pays no regard to time, borders or other limitations. And it directly affects us all. Having as many people working as possible is the foundation of any modern society. But for this to happen, their economies must have free trade, flexible job markets and economic freedom.
They also need up-to-date facilities, high levels of education and strong social institutions, along with low debt and tireless innovation. This means that enterprise relies on having strong states and institutions. And a political system that is focused on enabling more, instead of permitting less. Enterprise needs all this to make the most of the chances available.
And responsibility is what it must offer in return. It also needs not just tried-and-trusted bilateral trade agreements, but sound and sustainable global trade accords.
All these conditions are vital to employment, prosperity and growth. But what we have today is a scepticism that is holding back free trade. A retreat into protectionism. And a failure to see that, in the longer term, open markets are the only way to raise per capita income.
The second consideration I would like to offer for your discussions is:
Dealing with change
When the Forum calls on us to ‘master the Fourth Industrial Revolution',it is asking us to accept and cope with change. Many changes generate fear, and a fear of technology in particular. The First Industrial Revolution, which brought machine production, made workers fear for their livelihoods.
The Second, which ushered in mass production, and the Third, which brought computerization, fuelled similar fears, all the way to out-and-out revolt. For many people, each of these transitions into a new age was a tough and painful process, and seemed to leave them worse off than before. It may have been heralded as progress, but it felt like a big step back.
But, as history has shown us, globalization has been much more of a blessing than a curse. Most strikingly, of course, through the worldwide declines in hunger and poverty, which have benefited billions in just a single generation. Without global economic growth, we could never have coped with the world's rising population. And without the earlier industrial revolutions, many people would still be deprived of vital social benefits, access to education and a more affluent life.
To quote Roy Amara, the former president of the Institute for the Future in Palo Alto, California: "We tend to overestimate the effect of a technology in the short run and underestimate the effect in the long run." When we talk of the Fourth Industrial Revolution, we don't just mean the "Internet of Things" or "Big Data". Not just digital crypto-currencies and combining physical and virtual processes. And not just the almost boundless possibilities (and the equally limitless security concerns!) that IT provides.
We also mean people. We mean lifestyles and professions. We mean what is feasible and makes sense. We mean massive investment in facilities, capacities and expertise.
And we mean all of this from very different starting points on the world's various continents. Mould-breaking innovations - and their repercussions - are almost impossible to foresee. And when it comes to the Fourth Industrial Revolution, this is truer than ever.
Many people are fearful right now of wage pressures and inequality. Others expect to see new jobs and industries emerge. Changes are not optional. They will happen, whether we like it or not. The working world is becoming more and more digitized. This calls for new and different skills. And it's up to us to provide them. The distinction between an engineer and a programmer is growing fuzzier by the day. The workbench is turning into a computer station.
And yet there are still no clear answers and no clear projections. As Winston Churchill observed: "It is always wise to look ahead, but difficult to look farther than you can see." Many things are possible, then. But one thing is certain: investing in education and training is a must. Education enables. And it is only those who are able who will perform the tasks required. It's the politicians who must pave the way here. The line between rushing at an opportunity and missing it is a fine one indeed. The ability to cope with change is often the ability to meet revolutionary developments with an evolutionary response.
All of which brings me to my third input:
Coping with contradictions
Ladies and gentlemen, our world has never been more closely intertwined than it is today. Yet it's rarely been so divided, either. While cultures continue to blend, we can also see a clear countertrend of fundamentalism and hate. Openness versus restrictions. People have been seeking to find the right balance for millennia. The Romans built the limites, gigantic fortified walls all over Europe, to mark the outer boundaries of their Empire.
But they proved far too big to defend effectively. Our generation has built the World Wide Web, a gigantic network that knows no boundaries at all. But it is proving far too big to generate real understanding. Extremes can give us a hard time keeping a sense of proportion. Opposites will always be fertile ground for conflicts of various kinds. And this is why learning to live with such opposites, and coping with their contradictions, is one of the greatest tasks we face. It's not always possible to let opposites coexist. But often it is. And often in vital areas.
Openness and restrictions are not absolutes. We can often have both. Just as we can maintain both freedom and responsibility. Just as we can uphold our own culture while respecting those of others. Just as we can cultivate business opportunities while living with business risks. When opposing views become fundamentalist demands, we lose all the careful weighing up of all the interests involved. After all, every weight needs a counterweight to create the balance we all desire.
To conclude, ladies and gentlemen:
Thank you for coming to Davos. And for showing, by doing so, your willingness to take on greater responsibility beyond your own specific field. Thank you, too, to all of you who maintain close ties with Switzerland. Who trade with us, who invest here and who build on the assets that our country has to offer.
And to you all I can say, on behalf of our Federal Council: you can continue to count on us! Dialogue is essential to the problem-solving process. It's out of exchanges that new mind-sets emerge. Because truly viable solutions don't come from isolated thinkers locked in little rooms: they come from discussion.
The Annual Meeting is a unique discussion forum. On my behalf and on behalf of the Swiss government, I would like to thank Klaus Schwab and his team very warmly for making it happen. Here in Davos, here in Switzerland. So let's make the most of it, for the sake of the world.
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