In his first address after the election, US President Biden focused on the importance of embracing the diversity of modern society. In one of the speech’s most powerful phrases Biden urged “Let this grim era of demonisation in America begin to end here and now”.
It is an admirable aim. It is also unlikely to be easily achieved.
Dramatic structural change is already evident in the world economy. The changes of the fourth industrial revolution have been accelerated by the pandemic. How we work, where we work, how we consume, and what we consume are all changing. The net effect of this in the long term should be a higher standard of living, with less damage to the environment.
There is a tendency to get caught up in the novelty and excitement of the technological change – just as with the previous three industrial revolutions. But the technology is just a catalyst. Industrial revolutions are, rather obviously, revolutionary – they turn the economic and social order upside down. This is what makes Biden’s aim so difficult to achieve. The wider changes risk fuelling the irrational discrimination of prejudice.
We live in a world of complexity that hides beneath a thin veneer of simplicity. As waves of structural change break over the economy, some people will see their neighbours going up in the world at the same time that their own status and economic security is threatened. The complex causes of these changes are not easy to understand. It is tempting for those adversely affected by change to turn to a simple explanation – this has happened in every previous industrial revolution. Scapegoat economics identifies a convenient group to blame for the changes. It provides a reassuring narrative for those who have been adversely affected by change: “It’s not your fault you lost your job – it was taken by that immigrant, or ethnic group, or religious group”.
Politicians can turn the simplicity of the scapegoat into a catchy campaign slogan. They promise to limit the minority group, and by doing so claim that they will be able to turn back the clock to a better (entirely mythical) past. Being told you are “better than,” and another group is “less than,” can also build a reassuring sense of belonging or community. None of this is true, but it does not have to be true. The process produces the simplicity we all crave. It allows for hope as the complex changes of the world work against us.
The rise of prejudice risks undermining the economic benefits that the fourth industrial revolution can bring. There are two reasons for this. First, economic efficiency is maximised when the right person is employed in the right job at the right time. Prejudice stops this from happening. This cost of prejudice is especially damaging for those sectors of the economy that depend on imagination and innovation. It is these sectors that need to make the most of the human capital available. It is also these sectors that are likely to offer the most potential in the fourth industrial revolution.
Second, prejudice prevents diversity in decision making. In extremis, prejudice results in a monoculture of thinking. In a world where existing norms are being challenged and new opportunities arise, a monoculture is not just bad business, it is dangerous. A lack of diversity in decision making risks missing not only the new opportunities, but critically the new risks that a rapidly changing world will create.
The technology of the fourth industrial revolution gives us the ability to fight back against prejudice. Prejudice needs to dehumanise a group. In different societies around the world immigrants, racial minorities, or different sexualities are presented as being less than human. If we know people from these groups, we know that they are just like us. Prejudice is encouraged by ignorance and defeated by understanding. The democratisation of communication and culture helps with that process. As barriers to entry in film and television have fallen, so representation is increased. Social media provides further visibility for minority groups, and with that greater opportunity for interaction and ultimately understanding.
Technology also allows the targets of prejudice to find each other and to organise. It does not matter if a group is spread out across a country (as is often the case with sexuality or disability, for example) – a community can be formed online. Technology can help minorities exercise economic power, through boycotts. The impact of the camera phone on political power should not be underestimated, as the Black Lives Matter movement has shown.
But alongside this, we should not forget that the more extreme forms of prejudice are practiced by small subsets of society – white supremacists, for example. The technology that helps the persecuted minority will also help the persecuting minority, who can organise and communicate online as easily as the people they hurt.
President Biden faces a difficult task. Reducing prejudice today is not enough. Policy must also aim to tackle the potential for an increase in prejudice as the world is transformed over the next twenty years. Failure to do so risks weakening the economic benefits of that change and creating a vicious spiral of further increases in prejudice. Politicians are not alone in this struggle – companies, especially larger companies, are well aware of the benefits of fighting prejudice. But we should not underestimate the scale of the challenge ahead.
The views expressed in this article are the personal views of Paul Donovan.