A very happy new year?

I spent a chunk of December in the UK, traveling from London to Edinburgh to Cambridge to Cardiff (It’s a Dr. Who/Captain Jack Harkness thing; if you know these names, you won’t ask, “Why Cardiff?” and if you don’t, don’t worry since the answer’s too long to give here!). There, as here, on the surface the economy seemed fine. Oxford Street, London’s equivalent of New York’s 5th avenue, was beautifully lit up and packed with people. The department stores were hard to walk through; Harrod’s had its security staff directing and controlling traffic inside. Our effort to get seating for a traditional afternoon tea – relatively easy, even near Christmas, on past trips – met polite refusals at multiple locations; we ultimately went to the British Museum, not to see the exhibits, but for tea!

I also saw a very different side of UK. In all the cities, many stores were boarded up or had “To Let” signs. Other than Harrod’s, department stores were discounting prices even though there were no posters and banners announcing sales; we paid less than sticker price for several items. The news was gloomy – Iceland was bankrupt, Greece almost so and Spain and Portugal were not far behind; failure to resolve these would undoubtedly hurt the Euro Zone. Perhaps most tellingly, endless pubs and small restaurants were inviting customers to party with them on Christmas, using price – “Only £16.95 a person” – as their primary solicitation tool. In contrast, a few years ago, we few restaurants were open and we had to pay £150 for 3 people (one a child) at one of the few open establishments.

Almost metaphorically, the elegant, comfortable and super-fast Eurostar trains that run through the tunnels beneath the English Channel broke down. On a bitterly cold day, not one or two, but five of these trains simply came to a halt within the tunnels. Why? No one knew. The trains had operated flawlessly for 17 years – and on occasion, in comparably cold weather. Chaos reigned for days: Thousands of people were stranded, unable to go on their planned ‘holidays.’ As the trains stopped, so did truck traffic between the UK and France. Thousands of truck drivers stood around on British highways, turning them into parking lots. And for good measure, the British Airways cabin crew union decided to go on an indefinite strike to protest a work rule change. The strike was ultimately avoided when a British court voided the strike vote on the basis of a technicality, but before the court ruled, more panic gripped the public. Uncharacteristically, huge amounts of snow and bitter cold stopped other trains and blocked roads all over the country. And a financial institution made news by announcing its plan to transfer its professionals abroad to help them avoid the newly announced taxes on bonuses – even though it was unclear whether the law applied to them.

Whenever there’s panic and chaos, humans almost cannot resist pointing fingers at others. And that’s exactly what was happening all around. The people and the press wanted black and white answers – somebody’s head should roll, shouldn’t it? Someone has to pay for my inconvenience, right? And far from black and white, no one nominally in charge even seemed to know whether the problems were on the grey scale – or were a garish shade of red and orange.

This situation is a microcosm of today’s US economy (and most likely, for many others). The old rules no longer work because of network effects. Experts disagree about what the new rules should be and “My model is better than your model, you imbecile!” types of arguments abound. Politics drains what little realism there is in these models and ideology is spewed, dressed up as science. Piecemeal solutions are offered as panaceas for all evils. People who don’t know the difference between “budget deficit” and “national debt” routinely pass judgment on what should or should not be done. And seeing them in this state, many of those who can distinguish such terms – but don’t understand terms like “empathy” and “conspicuous consumption” – tell themselves that this is the best time to pay themselves their biggest bonuses ever.

I couldn’t help wondering whether the US definitely – and Western Europe perhaps – are on glide paths to a two-tier economy. Certainly Warren Bennett, who could single-handedly finance some small countries for years without breaking a sweat, has expressed similar concerns about the US; he has flatly said that this trend does not bode well for a democracy.

So, here’s my hope for 2010: That of us who are brilliant or are among the top echelons of the society (in our minds anyway) and those of us who make major decisions on behalf of our companies, resolve to do whatever we can to help turn this gloomy picture around. We don’t need specialized training to do this; all we need is (1) to consider for our own, everyday choices, not just “What’s in it for me?” but also, “How will it affect the network within which I live?” and (2) to help others do the same. If our networked economies thrive, we’ll do even better than we are doing now; if they fail, sooner or later they will drag us down.

Governments alone can’t solve a problem that companies, consumers and governments jointly created. They will need the active help of companies and consumers. And if, as corporate executives and consumers, we do think of our networks, 2010 can truly be a happy new year.

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