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Advances in Social Sciences Research Journal – Vol. 11, No. 8

Publication Date: August 25, 2024

DOI:10.14738/assrj.118.17381.

Hanappi, H. (2024). Predictions and Hopes: Global Political Economy Dynamics of The Next Ten Years. Advances in Social Sciences

Research Journal, 11(8). 66-87.

Services for Science and Education – United Kingdom

Predictions and Hopes: Global Political Economy Dynamics of The

Next Ten Years

Hardy Hanappi

VIPER – Vienna Institute for Political Economy Research and

Technical University of Vienna, Economics, Institute 1053

INTRODUCTION

Predictions and hopes are different things. Predictions are based on past empirical

observations. They single out what seem to be essential variables and the relationships

between them and assume that their importance will prevail in the future. Hopes add a

component to a prediction, namely an evaluation, which refers back to the entity that produces

the prediction. More favourable predictions are hoped to become a reality while others, which

would see the entity in a worse position, are not hoped for. A closer look reveals that with a

consideration of what predictions are used for by an entity, predictions and hopes are less

independent. By predicting an event that one hopes for, the chances that it actually happens

might be increased. E.g. in business environments predicting that a competitor will have no

chance might intimidate the opponent and help to be victorious. On the other hand, predicting

a bad result might induce the entity under consideration to change its current course of action.

E.g. the catastrophe predictions of the Club of Rome in the Sixties were meant to be a self- destructing prediction to save the entity, human society, from running into environmental

disaster. In both cases, predictions usually exaggerate to produce a stronger impact. Therefore,

the way a prediction is formulated always to some extent carries the hopes or anxieties of the

entity that produces it. Typically, hopes and anxieties exist parallel in a social entity. If it is a

large social entity, like Europe’s population, then its structure - countries, classes, ... - will split

up the predictions following the lines of this structure. This makes the modelling of the situation

very complicated and these complications increase exponentially if the largest social entity, the

world population, is considered. The smallest social entity seems to be a single human

individual, but this view is deceiving since a social entity always needs to be embedded in a

group of individuals to exist, it carries the existence of its supporting of other individuals of the

species in its brain.

Confronted with the broad span between the largest and the smallest social entity there are two

concepts that help to simplify the situation: the limit and the feedback.

For the smallest social entity, let us abbreviate it as ‘the family’1, there are two kinds of limits

that constrain its predictive ability: purely physical limits, and information-bound limits. The

former concerns the upper limits of speed and storage capacity (memory) but also the time

available for making predictions. The latter are constraints related to the achieved level of

understanding and being able to express oneself in a given language. To be able to exist at all

1

For a more detailed discussion of this concept see (Hanappi and Hanappi-Egger, 2005).

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Hanappi, H. (2024). Predictions and Hopes: Global Political Economy Dynamics of The Next Ten Years. Advances in Social Sciences Research Journal,

11(8). 66-87.

URL: http://dx.doi.org/10.14738/assrj.118.17381

both types of limits must not be exceeded, that is a minimum of expectation formation must be

possible.

With the largest possible social entity, let us abbreviate it as ‘humanity’, the limits that are

binding look somewhat different. The physical limits nowadays are becoming all too visible,

namely how the species can exist as part of the biological and climatological changes which it

produces. Information-bounded limits are given by the limits that a sensory system concerning

the global situation with respect to the different parts of humanity, but also with respect to a

democratically organized global consciousness has to observe. Technology is one side of this

problem, institutionalized political mechanisms are the more difficult, other side.

The concept of feedback loops helps to approach a satisfactory state of affairs without crossing

the above-mentioned limits. Feedback loops in a family are established by education and

consultation of the less experienced members with the help of more experienced ones and

knowledge drawn from external sources that store approved knowledge. Maintenance and

control of these external sources are of central importance. It is via this channel that most of

the more up-to-date knowledge enters the family; filtering this knowledge - e.g. by a religious

group - is an outstanding example of exerting information power. Expectation formation in the

family thus is always exposed to two countervailing forces: increased knowledge and increased

manipulation.

The way from the smallest social entities, families, to the largest social entity, humanity, as the

way back is paved by feedback loops. It still mostly is geography, the location of families, which

explains why intermediate social entities, social institutions, emerged. The path downward,

from large to small, features knowledge transfer, education and manipulation; it is an essential

component of governance. In the opposite direction power transfer - rule setting and monetary

transfers - as well as election processes are the significant elements. Again, the forces exerting

power on the intermediate social institutions still mostly are structured along geography. The

evolving interplay between downward and upward streams is the way in which the self- contradictory concept of democracy has to be understood. Without the flesh of the rich set of

social institutions that mediates between individuals and humanity, without consideration of

the history of this set of social institutions, the evolution of mankind necessarily remains in the

dark2.

A major deficiency of the largest social entity, humanity, is that it indeed misses till today a

governing social entity, a powerful enough world government. Therefore, feedback that

concerns e.g. climate catastrophes or pandemics does not have an adequate entity that can be

addressed. This makes predictions on all levels of social entities even more complicated

because the result of a possible 3rd World War will have to be predicted too. It is not possible to

predict how many people will survive such a global war, but it can certainly be assumed that on

the scale of humanity’s hopes the prevention of such a war is highly ranked. For the scale of

hopes of humanity, the hope for survival clearly is a lower bound. But let me spare the

discussion of hope for the last chapter.

2 This is the core of the critique ofc mainstream economic theory brought forward by evolutionary political economy

and institutional economics, compare (Hanappi H. and Wäckerle-Scholz M., 2917) and (Dopfer K. et al, 2017).

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Advances in Social Sciences Research Journal (ASSRJ) Vol. 11, Issue 8, August-2024

Services for Science and Education – United Kingdom

PREDICTIONS

Turning to the topic of predictions, the complicated historical record of humanity spans over

several thousand years, while family histories rarely ever reach back more than a hundred

years. What can be observed is that in the last decades, in particular since the introduction of

the internet and the widespread use of smartphones, the paths between families and the largest

decision-making entities technically have shortened dramatically. Manipulation as well as the

principal access to sound knowledge and democratic progress were exploding. Just using the

time since the end of WW2 it is a safe guess that this technical development will go on in the

next decade. What is less clear is what the economic, political and military developments will

be that are encompassing this technological path.

Since 1974 capital accumulation - approximated as real GDP growth - has experienced two

severe slowdowns, one in 2009 (global financial crisis) and one in 2020 (pandemic).

However, the overwhelming new development in the new millennium is the enormous rise of

GDP in Asia.

Figure 1: Real GDP growth

Source: OECD

The most important social unit that became particularly prominent during the last two decades

is the so-called ‘military-industrial complex’, let us abbreviate this as MIC. This combination of

groups combining direct coercive force (military and police) with economic dominance (global

oligopolisation) is as old as capitalism3. The structure of the dominant MICs is easier to identify

than the highly complicated network layers of social institutions described in the introduction.

The four strongest MICs in the world clearly are the USA, China, Russia, and the European Union

– with the caveat that from a military point of view the EU is only a part of the US-driven NATO.

3

In the times of British merchant capitalism ship trade was already always accompanied by soldiers extending the

political empire.

-8,00%

-6,00%

-4,00%

-2,00%

0,00%

2,00%

4,00%

6,00%

8,00%

10,00%

Real GDP Growth

Americas

Asia

Europe