Being left behind

The aftershocks of Lehman-2008 created multiple peripheral crises and tumbled economies around the globe. Now, as recovery is picking up worldwide (at least statistically), there are numerous organisations, countries, and groups of countries that seem to be stuck in red. Here’s who, how, why, and what can be done. Two rather separate issues with somewhat a link between them in this post.

I choose to believe that sustainable growth must always come within. In the case of a company, they must focus on their human capital, which ought to be collectively engaged and constantly look out for effective methods of doing things. For economies, just extrapolate that desired behaviour. Industry leaders must be motivated to develop the best people and firms, while regulators ought to focus on productivity. A firm should not put too much focus on marketing and revenue expansion, just as external economies will never work out in the long run.

Financial Institutions

The financial sector is an industry of interest in this case. While some economists and thought leaders have subconsciously put the blame (and shame) for this crisis on bankers on Wall Street, the US government made life a little tougher with regulation, to both they cringe. Inevitably, all these have made bankers on Wall Street feel a little disorientated and disillusioned. They start to question themselves. A few more literary ones have penned down their thoughts.

The uphill factor here is the engagement of bankers and brokers in the financial sector. If the industry is to do well, these individuals must re-find dignity in what they do – they must be engaged, motivated, and ready to make a difference, this time in a socially responsible manner. In my opinion, bankers are inherently altruistic – they want to help people and firms, and with economic backgrounds, they understand  the gravity of the situation, and what is at stake for those they are meant to help – except that many a time intuitive human greed gets into them, and they end up with the wrong decisions. Now we understand how a single decision bankers make can affect our daily lives. They understood it from the start – many were just careless.

With unmotivated employees and little confidence, it is no wonder why financial institutions are recovering a tad slower than other professional services firms housing white-collared employees. Yet, it would be a little far-fetched for me urge all of us out there to put some confidence in the industry (after all, it is your money you are putting in), or to bring out some ubiquitous policy suggestion that would provide bankers with a better working ecosystem. The only way out is for the industry itself to slowly regain confidence through mutual and internal affirmation, and make both its providers and recipients understand its weight, and the impact they have on both life and the economy.

Countries

As mentioned, healthy growth ought to come from within. Countries that are struggling with their economy, more often than not, face one of such factors:

• Policy conflict – The monetary and fiscal policies cannot act in tandem, and policies are stuck in deadlock.
• Political dilemma – Certain controlled variables are not shifted to allow a healthy tilt for the selfish rationale of vote counts.
• Overreliance – Either on the external or internal economy. Necessary anti-directional policy adjustments would compromise years of sustained growth.

In order for their economies to overcome growth hurdles, governments ought to enable it from the inside, and not drive the external economy when the internal components to sustain it cannot cope. This happens to be the case for failed industrialisation attempts across half of Africa, and other regions including Asia and Latin America. Typically, investors find the workforce not productive enough, which is in fact the case. There is no point in boosting the demand function if supply cannot cope.

So what if education and infrastructure development takes a longer time? Let it be, if that means healthy, robust and sustainable growth is to occur in an additional 30 years. As easy as it sounds, it takes a lot of political will and follow through, apt leaders, and minimal corruption in order for such to happen. That’s the hurdle that humanity has the key to overcoming, but some components of it refuse the release.

The people must be empowered, be it in corporations (engaging them) or economies (educating them). And because people are the centre and the core for all things human, that is what coming from within means.