The World Economy’s Urban Future
Today’s major cities are often islands of stability and good governance in oceans of uncertainty, partly because they are better able to adapt to changing realities than entire countries. In this sense, they can serve as role models, if not vanguards, for the new political-economic models the world needs.
SINGAPORE – Since the global financial crisis began a decade ago, the major countries of North America, Europe, and East Asia – which together represent the vast majority of the world’s economy – have been searching for sustainable political-economic models that can weather the considerable challenges they face. They have largely failed to find them.
Now, economic and political alarm bells are ringing around the world. A growing number of economists predict that the next global economic slump is just around the corner, probably to be triggered by surging government and corporate debt. After all, America’s budget deficit is on track to surpass $1 trillion by 2020; many European banks appear to be wavering again, owing to a lack of eurozone debt restructuring; and China’s debt-to-GDP ratio is approaching the dizzying heights seen in Japan.
Economic concerns are compounded by persistently dysfunctional politics. In the United States, President Donald Trump’s trade tariffs will potentially tip America’s economy into recession, while the upcoming midterm elections all but guarantee policy paralysis.