Matthias Catón

My highlights from the Annual Meeting of the World Economic Forum in Davos

matthias@caton.de — Thu, 04 Feb 2010 11:53:00 +0100

On Sunday the 40th Annual Meeting of the World Economic Forum ended in Davos. The motto this year was "Improve the State of the World: Rethink, Redesign, Rebuild" and the Global Redesign Initiative (GRI) played an important part in the programme. We organized six IdeasLabs on a range of topics (Values and People, Risks, Security Challenges for the 21st Century, Economic and Social Welfare, Resources and Sustainability, New Institutional Approaches) in which thirty ideas to improve global cooperation and global governance were presented and discussed. IdeasLabs are highly interactive formats which start with brief, five minute presentations and then actively engage participants in break-out groups. The presentations will be available on YouTube soon. In the closing session on Sunday ("The Global Agenda 2010: The View from Davos") partipants discussed issues around the nine clusters of the GRI. The session was moderated by Nik Gowing from the BBC.

Insights from some of the sessions I attended

During a session on Wednesday morning on security issues the panelists discussed the idea of offering NATO membership to Russia, which some participants considered an intelligent way of solving the current conflicts between the West and Russia, even though (or maybe precisely because) it would be very unlikely for Russia to accept such an offer. The IdeasLab on New Institutional Approaches on Friday afternoon included Paul Romer's controversial idea of "Charter Cities", where well-governed, developed countries would build a new city in an underdeveloped part of the world and run it under its tutelage. Naturally, the discussion was controversial and charges of neo-colonialism where quickly raised. In a dinner on geo engineering on Friday night experts discussed whether there are feasible techniques to stop global warming other than through the conventional way of reducing CO2 emissions. They generally agreed that current technologies were not very promising, with unclear results and huge potential side effects. In the session on the global economic outlook on Saturday Dominique Strauss-Kahn, managing director of the International Monetary Fund, announced an innovative initiative of his organization to use Special Drawing Rights (SDR) to fund investments in low carbon growth. A paper would be published in a few weeks, he said. If you want to know more about what happened at the Annual Meeting, here are a few links:

Videos of on-the-record sessions (on YouTube)
Photos (on Flickr)
Session summaries
Session transcripts

New book on lessons from catastrophes

matthias@caton.de — Sun, 24 Jan 2010 16:59:00 +0100

One of the notable and timely recent publications is a book called "Learning from Catastrophes: Strategies for Reaction and Response". The book looks at how we handle all sorts of crises and minimize their impact. It has been published by Howard Kunreuther and Michael Useem, two professors at the Wharton School of the University of Pennsylvania, one of the world's leading business schools. I got to know Howard and Mike when they co-chaired the World Economic Forum's Global Agenda Council on the Mitigation of Natural Disasters in 2008/09, which I was managing on behalf of the Forum at that time. The book is a direct result of the Council's work, with most members represented among the twenty-two authors. The book is based on the assumption that societies frequently underestimate risks that are very improbable to happen but have huge consequences if they do occur. To enhance our risk preparedness the authors focus on the connection between risk assessment and risk perception and the willingness to act ahead of a potential catastrophy. In their introductory chapter Kunreuther and Useem outline seven guiding principles that can be applied to any kind of risk. The principles center around the critical connection of the right assessment (analytical capacity) and appropriate action (leadership capacity). In the second chapter, Harvard's Dutch Leonhard and Arnold Howitt introduce a comprehensive framework for risk-management. They analytically split a catastrophy into three phases: prevention and mitigation (before an event), crisis management and response (during an event) and recovery (after an event). They argue that careful thoughts about the right investments in all three phases are required well in advance and that resources should be allocated to minimize the expected net present value of damages. Part II contains six chapters that link risk assessment, perception and management looking from different angles. Part III focuses on application, featuring some case studies looking, for example, at financial issues, terrorism and pandemics. The book concludes with two chapters on leadership and long-term issues. Of course, nobody knew that the publication date would coincide with the terrible earthquake in Haiti, but the issues raised in the book are fully relevant to the situation there and it will be a useful source of information when discussing how the consequences of such disasters can be made less severe, if not fully averted. Howard Kunreuther and Michael Useem (eds.) 2010: Learning from Catastrophes: Strategies for Reaction and Response. Philadelpia: Wharton School Publishing.

Picking Martin Wolf's brain

matthias@caton.de — Wed, 13 Jan 2010 12:56:00 +0100

I recently had the privilege to participate in a dinner in Singapore with Martin Wolf, the chief economics commentator of the Financial Times. Entertaining as always, he gave his views on the most important economic issues we will face in 2010. Of the many things he raised, a few particularly caught my attention: On the question of a global reserve currency, Martin Wolf clearly expressed his preference for using Special Drawing Rights (SDR), as "you can't run a global economy with a national currency". On a global transaction levy, the famous Tobin Tax, Wolf said that while he thought it was not useful for currency markets (as originally proposed by Tobin) he could see it for asset markets. He argued that a reduced liquidity of asset markets would make shareholders get more informations about a company before buying its shares because they would know that they might not be able to sell them again easily. This could create more informed markets. In any case, raising money for development goals should not be done with a transaction tax, according to Wolf. A pollution tax would be more suited for this purpose, he said. Not too surprisingly, Wolf foresaw a major problem with public debts arising, including some potential sovereign defaults. He also said that rating agencies would in principle have to downgrade both the UK and the US, but didn't do so because of the political fallout. Asked about a possible solution for excessive public debt, he mentioned two: inflation and exchange rate changes. Finally, on the issue of global trade imbalances he emphasized that among the countries with huge surplusses the emerging economies would have to consume more. Mature surplus economies, such as Germany and Japan, would not be able to absorb the quantities required to balance trade.

What is Asia's role in global governance?

matthias@caton.de — Tue, 22 Dec 2009 22:51:00 +0100

Some thirty experts met on 1 and 2 December in Singapore at the third Country Hearing of the Global Redesign Initiative to discuss Asia’s contribution to the redesign of global governance. The World Economic Forum organized this event together with the Singaporean Ministry of Foreign Affairs and the Lee Kuan Yew School of Public Policy.

What does Asia want?

Participants agreed that Asia as a whole had become more assertive, demanding to be heard and being given more power in international fora. The leadership of the West is not accepted unconditionally any more and there is a consensus among Asian nations that they are insufficiently represented in global governance. At the same time the region doesn't seem to have a clear idea of what to do with its increased weight. This leads to the paradox that while "Asia's century is arriving", as one speaker put it, the region's leaders are incapable or unwilling to develop a vision for global governance. Surprisingly unambitious and uninspired, Asia seems happy with evolutionary steps that give it more power within the existing global framework without challenging any of its institutions or processes. Asia seems to want change and continuity at the same time. Apparently, most Asian countries are quite satisfied with the current system of global governance---ironically unlike the West, which, after all, created it. The reason seems to lie in a preference for consultative, non-binding fora that don't touch national sovereignty. The question that remained open is how this structure can help solve today's challenges. Although most of the discussions focused on Asia as a region, several participants emphasized that the region is by no means homogeneous; in fact, it's probably the most heterogeneous continent. A strong sense for pragmatism rather than ideology and a characterization as "sovereignty traditionalists" and "security realists"---as one participant said---is what unites them. A weak sense of a shared Asian identity makes it hard for the region to claim global leadership. Several Asian participants lamented that their region lacked "soft power", that is, a capacity to develop convincing innovative ideas for global governance. To do so, the countries need to integrate first and agree on some set of Asian values, but part of it may also be a cultural issue that makes it more difficult for Asians than for others to take the lead in developing ideas. Several participants expressed their doubts whether Asian leadership would mean more than a few big countries (China, India, Japan, Indonesia) calling the shots. For the smaller and poorer countries, whose focus is primarily on development, a forum below the G20 level should be considered, some speakers suggested.

Opening session with Richard Samans (Managing Director, World Economic Forum), Kishore Mahbubani (Dean, Lee Kuan Yew School of Public Policy) and Raymond Lim (Second Foreign Minister, Singapore)

Can Asia serve as a model?

Asia has several regional and sub-regional organizations, most notably the Association of Southeast Asian Nations (ASEAN). The organizations have helped dampen nationalism and conflict between member countries, but have had little impact beyond the region, unless one considers inner-Asian stabilization as an indirect contribution to global governance. Most participants at the Hearing doubted that Asia would have much to offer in terms of models for a new system. The role of non-governmental organizations, such as the International Institute for Strategic Studies (IISS) in the security area, was recognized but no specific lessons were drawn. As for newer endeavors such as the Shanghai Cooperation Organization the experts deemed it too early to assess their potential impact. Asian pragmatism seems to concentrate on processes rather than results. Western domination in international affairs and Asian complacency are therefore mutually dependent. Despite the general inconclusiveness of the debate around Asia's contribution to the redesign of global governance there were two more concrete proposals that emerged from the discussions. One is to establish an Asia-Africa organization for development cooperation which would include a forum for donor countries as an Asian complement to the OECD's Development Assistance Committee. The other proposal is to establish a new global energy agency, uniting both consumer and producer countries. Asia includes both important consumers and producers and could play a leading role in this undertaking. The decisive question of what Asia will do with its increased weight remained unresolved, however. A full report will be published soon, most likely in January 2010. The views and opinions expressed here are those of Matthias Catón and do not necessarily coincide with those of the World Economic Forum.

Global Redesign Hearing on Energy Security in Doha

Fri, 20 Nov 2009 13:41:00 +0100

The Global Redesign Initiative of the World Economic Forum held a two-day "Country Hearing" on Global Cooperation and Energy Security in Doha (Qatar) on 18 and 19 November. The event was co-hosted and co-organized with the Qatari Ministry of Foreign Affairs and is part of a series of meetings held in each of the three patron countries of the initiative, Qatar, Singapore and Switzerland. Thirty-five experts from business, academia and international organizations discussed possible reforms of global governance for energy security, the future of oil and gas, water security and nuclear energy. The insights from the hearing will be used to develop and refine proposals for better global cooperation in the next months. The Country Hearing in Switzerland was held in Geneva on 16 October 2009 (on global institutions and global governance). The hearing in Singapore will take place on 2 and 3 December 2009 (on Asia’s contribution to the redesign of global governance).

Videos

Opening of the Country Hearing with Abdulaziz Alansari (Director of Industrial Security Affairs at the Ministry of Energy and Industry of Qatar), Richard Samans (Managing Director at the World Economic Forum) and Mohammed Abdulla M. Al Rumaihi (Assistant Foreign Minister of Follow-Up Affairs of Qatar):

Lord Malloch-Brown, a former UNDP Administrator and UN Deputy Secretary-General, who is now the Senior Advisor to the Global Redesign Initiative, explains the objectives and the purpose of the inititiave:

After the elections in Germany, both winner and looser face a dilemma

matthias@caton.de — Tue, 29 Sep 2009 16:24:00 +0200

Last Sunday, Germany elected a new Federal Parliament. The result will be a change in government, with the governing Christian Democrats (CDU) and its smaller Bavarian sister, the Christian Social Union (CSU) forming a new coalition with the Liberal FDP. Both the big winner of the elections, the FDP, and the big looser, the Social Democratic SPD, will face strategic difficulties.

The curse of Liberal strength

The FDP, a party advocating free markets and low taxes, won its biggest victory in the history of the Federal Republic. This may sound surprising, given the current economic and financial crisis. The answer lies in the last four years of a "Grand Coalition" between CDU/CSU and SPD. In 2005, now Chancellor Angela Merkel ran a clearly liberal campaign, but after she narrowly lost to a surprisingly strong SPD she moved to the center. As a consequence, a considerable part of conservative and libertarian voters chose FDP this time. Christian Democrats like to refer to these votes as "lent votes". FDP leader Guido Westerwelle was right in pointing out that it was the voters who actually owned their votes, but nevertheless the biggest problem of the FDP will be that it can basically only shrink at the next election. If it sticks to CDU/CSU as its only feasible coalition partner a lot of voters will move back to the conservatives---in particular if the CDU sharpens its conservative profile. If it tries to stay open to coalitions with SPD and the Greens it may loose even more votes to CDU/CSU.

Accepting a new division of labor on the Left

The SPD suffered its worst defeat in the history of post-war Germany. After eleven years in government it will now become the main opposition party. The party's main problem is The Left, a party consisting of the former East German state party and disgruntled Social Democrats and union members. This party gained a remarkable 12 percent of the vote and is probably there to stay. So far, the SPD has ruled out coalitions with The Left on the federal level. This will have to change if the party has bigger ambitions than being the junior partner in a Grand Coalition. This opening is easy and already underway. The challenge for the SPD will be to resist the temptation to simultaneously adopt the policies of The Left. This would be futile, because the party would always be outdone by even more utopian demands of The Left. Instead, the SPD will have to accept a division of labor. The Left appeals to die-hard leftists and the SPD represents modern, professional urban voters in the center-left and moderate workers. This includes being proud of the social security reforms enacted under Chancellor Gerhard Schröder, the so called Agenda 2010. The center is currently occupied to a large extent by Merkel's CDU, but the SPD has to reconquer this space rather than abandon it if it wants to return to power in the foreseeable future. Alas, the party seems more likely to move to the left. The current frontrunner for the party's chairmanship, outgoing Environment Ministers Sigmar Gabriel, would be a good choice, though. He is a centrist and a political animal par excellence, probably the best campaigner the party currently has. The question is whether he will be strong enough to resist the pull towards utopian policies that would condemn the SPD to the benches of the opposition. In short, both the winner and the looser of the German federal elections will find themselves in tricky situations. For the Social Democrats, the problem is acute and fundamental, for the Liberals it's a longterm strategic dilemma.

Salzburg Trilogue on the future of humanity

matthias@caton.de — Wed, 02 Sep 2009 17:49:00 +0200

Recently I was invited to the "Salzburg Trilogue", an annual conference organized by the Bertelsmann Foundation and the Austrian Ministry of Foreign Affairs. The event took place from 13 to 15 August during the Salzburg Festival under the theme "Voices for the Future: Global Crises and the Human Potential". This year's motto of the Festival, "The Game of the Mighty", seemed a good match.

Twenty-nine eminent personalities and thirteen "Future Global Leaders" attended. Among the participants where conductor Daniel Barenboim, theater director Jürgen Flimm and Austrian Foreign Minister Michael Spindelegger. The Salzburg Trilogue is chaired by former Austrian Chancellor Wolfgang Schüssel.

I gave a presentation about my current and former projects at the World Economic Forum---the Global Redesign Initiative (GRI) and the Global Agenda Councils (GAC)---and about how we need a paradigm shift in global governance to tackle global issues now and in the future.

A recurring theme was the need for more systemic thinking to overcome the frequent silo mentality, which is exactly what the World Economic Forum is trying to achieve both through the Network of GACs and the GRI.

Among the many interesting discussions and presentations two particularly caught my attention. One was a simulation exercise of the upcoming UN Climate Change Conference in Copenhagen where the participants were divided into groups representing the developed countries, the emerging countries and the developing world. The groups had to pledge reductions of CO2 emissions and a software calculated the effect over time. The second was the "2009 State of the Future" report done by an organization called The Millenium Project. Its director, Jerome C. Glenn, presented the key findings at the Trilogue. Switching agriculture to salt water irrigation and growing meat without animals were just two of the ideas he mentioned. Certainly futuristic proposals! The Bertelsmann Foundation has produced a short video (in German) about the event:

Have a say in what will be discussed at the World Economic Forum on Africa

Tue, 02 Jun 2009 23:40:00 +0200

The World Economic Forum on Africa will take place from 10 to 12 June. Leaders from business, government and civil society from all over the continent will gather in Cape Town to discuss the future of Africa. You can have a say by participating online. Vote on the most important issues that leaders should address in Cape Town and add your own:

Vote and upload your video response on the question "Will the whole of Africa benefit from the FIFA World Cup 2010 in South Africa?"

Comparative study on the effects of electoral systems

Mon, 18 May 2009 16:56:00 +0200

The effects of electoral systems on party systems cannot be determined without considering certain contextual factors that influence the causal relationship between electoral system and party system. What effects does an electoral system have in a concrete context? Which electoral system fulfils which function best? Matthias Catón has just published a comprehensive study on this topic (in German). This analysis deals with the most common types of the three main categories of electoral systems: plurality (First-Past-The-Post), proportional representation in medium-sized and large constituencies and segmented majoritarian systems. Using an innovative selection method a total of 21 cases was chosen, which covers the broadest possible combination of different contextual settings. This enables a systematic comparison of the combined effects of electoral system and context on the party system. The analysis goes back to the introduction of universal suffrage in each of the cases. 239 pages with 47 tables and 12 figures.

Catón, Matthias 2009: Wahlsysteme und Parteiensysteme im Kontext: Vergleichende Analyse der Wirkung von Wahlsystemen unter verschiedenen Kontextbedingungen [Electoral Systems and Party Systems in Context: Comparative Analysis of Electoral Systems in Different Contextual Settings], Heidelberg.

You can download the study here.

Deutsche Akteure in der internationalen Politikberatung

Tue, 17 Feb 2009 11:30:00 +0100

In der aktuellen Ausgabe der Zeitschrift für Politikberatung veröffentlichen Matthias Catón und Rolf Steltemeier einen Beitrag über die Formen und Möglichkeiten der Einflussnahme von international tätigen deutschen Akteuren der Politikberatung im Hinblick auf Demokratieförderung und Institutionenaufbau. Nach der Vorstellung der Ziele der internationalen Politikberatung werden deren deutsche Akteure vorgestellt und systematisch gruppiert. Anschließend werden die Formen und Methoden der Politikberatung dargestellt und Evaluationsansätze erläutert. Den Schluss bilden eine kritische Einschätzung der Möglichkeiten und Grenzen von Politikberatung und ein kurzer Zukunftsausblick.

Kernaussagen

Internationale Politikberatung ist ein wichtiger Bestandteile der Entwicklungspolitik.
Akteure der Politikberatung sind fast ausschließlich auf der Ebene der Nationalstaaten angesiedelt.
Das Spektrum der Akteure ist breit und umfasst staatliche und nicht-staatliche Organisationen mit sehr unterschiedlichen normativen Zielen.
Politikberatung folgt den drei Phasen Stabilisierung, Institutionenaufbau und Konsolidierung.
Die Methodik der Politikberatung umfasst die fünf Ebenen Schulung, Dialog, Informationsversorgung, spezifische Beratung und Bereitstellung von Material.
Größter Schwachpunkt der Politikberatung im Rahmen von Demokratisierung und Institutionenaufbau sind Schwierigkeiten bei der Evaluation und - damit einhergehend - Probleme beim Erbringen eindeutiger Wirksamkeitsnachweise.

Bibliographische Angaben

Catón, Matthias & Steltemeier, Rolf 2008: "Deutsche Akteure in der internationalen Politikberatung: Funktionsmöglichkeiten und -grenzen bei Demokratisierung und Institutionenaufbau" Zeitschrift für Politikberatung. Policy Advice and Political Consulting 1 (3-4), 383-399.