Back to the Future

We are on the 14th of July 2020, the weather is beautiful and the French president, Emmanuel Macron, is celebrating the French national day on the Champs Elysees. Most European leaders have been invited for this celebration. We are not just celebrating the French national day, but also the end of the Covid-19 pandemic that took the whole world by surprise at the beginning of the year.  

The spread of the virus is now under control following the development of a treatment by the European Covid-19 research program “Discovery”, we do not die anymore from this virus and a vaccine is at the final approval stage. The containment measures had been progressively eased at the beginning of May and life is now returning to normal. The terraces of restaurants, bars and parks are full of people who enjoy spending time together, a feeling of freedom floats over Paris.

The health crisis is now behind us, but not the economic crisis.  Business cash flow is exhausted while car manufacturers and airline carriers have already been nationalized. The European leaders under the initiative of the France, Germany and the president of the European central bank (ECB) are due to announce a massive three year economic stimulus of three trillion Euros to boost the recovery of the eurozone which is much more ambitious than the 500 billion Euros stimulus that was originally planned. This unprecedented investment plan that represents more than 20% of the eurozone GDP will be financed and monitored by the European central bank through mutual bonds issued by the ECB. Guardians of budgetary orthodoxy finally gave up by agreeing to mutualize the debt which has demonstrated a great pledge of solidarity between the north and the south of Europe. This stimulus is driven by two main objectives; creating a more environment-friendly economy which is less carbon dependent and reorganizing the supply chain of key sectors that must be re-localized and where 70% of procurement at least should come from the European Union. Furthermore, the Maastricht criteria such as the 3% maximum government deficit will be increased to 5% allowing national governments to put in place social measures and invest massively in health care systems and education.

Beyond capitalism, humanistic values are reaffirmed; development of individuals through education should prevail before capitalism. The “Invisible Hand” of Adam Smith is far from perfect after all and requires collective governance to maintain a harmonious society.

Humanistic values are re-affirmed, but already face a new challenge: the big data revolution.

One of the lessons of this health crisis is coming from China where they demonstrated to the world the efficiency of their model of governance in tackling this virus. China was much more successful than Europe and the US in containing the spread of the virus across their country by monitoring their population thanks to the data they have accumulated on their citizens in recent years. China is already surpassing the USA in the development of artificial intelligence (AI) along with algorithms able to integrate the vast amount of data gathered on China’s population. While big data associated with AI proved to be dramatically efficient in handling a health crisis such as the Covid-19, it looks like a new form of authoritarian society is under way. The Chinese form of governance is hardly consistent with our Western values where freedom of people cannot be assumed if they are continuously monitored by the state. The US-led international liberal order that has prevailed in the West since the end of World war II is now under threat. The core guiding principles such as liberal democracy, multilateral institutions and open markets are now seriously questioned by the population.

Beyond the recovery of our economies and the continued existence of our liberal democracies, the West faces an even greater challenge; taking advantage of the big data and AI revolution to improve the efficiency of our societies without chipping away at fundamental liberties and giving up on individual freedoms. Optimistic “Tech Gurus” from Silicon Valley keep promising that a better society, thanks to big data and sophisticated algorithms associated with western values, is around the corner, so why should we not believe them?

To be continued…