Economy - There are no economic problems

Speech by Professor Mark Eyskens, former Prime Minister of Belgium, during the conference of the International Association of University Presidents on 12 July 1999.


1. The only constant in our contemporary history is the phenomenon of change. We are experiencing a change in the nature of that change, which causes contemporary history to resemble ‘the second derivative’ of itself, to use a mathematical image. This gives rise to uncertainty about what is to come and anxiety about the future in an unpredictable environment. The present fin de siècle is ‘an age of anxiety’. ‘Le futur n’a plus d’avenir’, as the French say. The past provides no examples, the present offers no guarantees, the future generates no confidence.

2. The post-industrial revolution (PIR) is creating a network of information and knowledge which elevates human creativity, powerfully supported by the computer – the magical prothesis – and the information and communication technology to the most important production factor.
With the ongoing scientific and technological revolution our network society is very evidently contributing in a major way to what Pierre Teilhard de Chardin fifty years ago termed the creation of a global noosphere – a worldwide community of knowledge and ideas and processing of information.
The demise of Communism and the need to create a large single European market are two totally different phenomena, yet both were determined in part by the implications of the sustained scientific and post-industrial revolution, as I try to argue in the written paper which will be circulated..
Let me just emphasize that it is not only the decline of Communism that can largely be attributed to the post-industrial revolution. The swelling tornado of scientific and technological innovations is also replacing Capitalism as an economic system with what we might term informatism. It is no longer the machine and capital which dominate the socio-economic arena and thus the entire societal system, but knowledge and information.
According to some political scientists, such as F. Fukuyama, the collapse of Communism and the changing nature of Capitalism are bringing about the end of history; the end of ideology.). This may well be an over-hasty conclusion, but the university as an institution must acquit itself adequately in the multidisciplinary study of the far-reaching system changes and their consequences which are taken place before our very eyes..
The present post-industrial revolution reduces the national sovereignty of states, because the communications revolution is of course an international phenomenon and because multinational companies operate in an international market. Only a ‘union of States’ in something like the European Union can offer a sufficiently democratic and efficient counter to this.
In the mean time the world has become our village.The reactions to this avalanche of changes however are equally pronounced and this places the intellectual and therefore the university community before a major challenge. The symptoms of rejection of post-industrial revolution are called nationalism and particularism, cultural and economic protectionism, religious fundamentalism and, in its paroxysmal forms, xenophobia and racism right through to ethnic cleansing, as we have seen most recently in the tragedy of Kosovo. The dynamics of change and internationalisation produce a reaction based on fear, which causes them to hanker for security, the warmth of the nest, group egotism, ethnic clannism. ‘The world isn’t our village; our village is the world’ is the despairing cry of the frustrated and the complex-ridden. Such a ‘reactionary’ attitude is understandable, but is nevertheless unjustifiable for anyone with a future-oriented and ethic view of the new world community which must arise in the XXIst century. Providing the building blocks for a structured international democratic community , based on an international rule of law will be one of the great intellectual tasks facing the democratic intelligence - and thus also the university community - throughout the world during the coming decades.
The consequences of the post-industrial revolution are extremely diverse, tangled, unclear and still largely unpredictable. Only a partial and extremely summarized analysis is possible within the scope of this talk.I can only list a few often paradoxical consequences.

1. The white world is losing its monopoly of technological and industrial innovation
2. Heliotropism gets outmoded.
The famous heliotropism, the westward shift of technological civilisation and of civilisation in general , starting somewhere in the Indus valley in the ninth millennium BC, is an idea in which Western Europeans gladly luxuriated during the last centuries.
Today, the westward migration of progress – at least expressed in economic terms – is being replaced by a ‘ein drang nach Osten’, a ‘push to the Orient’, which in this case means the Asia and Far East.
3. Since the end of the cold war geo-politics is more and more overshadowed by geo-economics
and geo-finance, dominating world political relations.
4. A cybernetic society is emerging, dominated by the binomial ‘market economy+democracy’
Market economy and democracy are proving to be closely related and are evolving almost everywhere in the world, certainly in the longer term, into a binomial phenomenon: the market democracy, the most adapted economic and political vehicle for the spreading of the knowledge and network society. Unfortunately at the same time human values are too frequently commercialised and marketed. Democracy is becoming ‘cybernetic’ and the law of entropy – of decay – dominates market economy to the extent that competition is eroded by the formation of monopolies, oligopolies and exaggerated concentrations of power as a result of multinational companies. Entropy also threatens democracy through demagogy, corruption, inefficiency, lack of security and the capriciousness of voter preferences. There are signs of crisis in the representative democracies in many countries with a long parliamentary tradition. This crisis is being heightened by one of the paradoxes of the computerised society: the knowledge society also generates ignorance and incompetence. This paradox faces universities with an unexpected challenge.
5. Another essential consequence is the need for a different employment and a revised functioning of labor markets. This to is a topic on its own for which I refer to my paper.
6. The paradox of discontent and dissatisfaction
However understandable it may be, in an ‘age of anxiety’ the prevailing discontent and malaise is a huge paradox. Because the average citizen of Western Europe and North America has never had it so good, at least if we look back to the previous generation, barely 50 years ago. During the XXth century, the average level of prosperity (real disposable income) of the population has increased sixfold, while working hours have fallen over the course of the average career by a third. Poverty in the societies of Western Europe has been reduced to 6% (in Belgium and the Netherlands), a revolution compared with the situation at the end of the XVIIIth century. And, as the cherry on the cake, it must also be noted that the life expectancy of the ‘mortals that we are’ has increased by almost 20 years thanks to the impressive achievements of the medical profession. Not to mention the unbelievable improvement in the quality of goods and comfort of life, the increased travel possibilities and enhanced the educational and information resources.
7 . And the post-industrial revolution is neither ethical nor unethical. Rather, it is amoral. The key question is what it is used for.The most important and most essential question facing society in the years ahead has to do with the ethics of change.
The most fundamental task for the future is to provide an answer to the following question: ‘How can the changes which are overwhelming us be converted into real human progress?’ It is a question which also challenges the universities in their existential motivation. There is a greater need for an ethics of change than for a change of ethics. The question of what ‘human progress’ means at the start of the XXIst century is situated at the crossroads of belief and hope, but also of knowledge and thought.


It is precisely this crossroads of thinking and knowing, located at the epicenter of the knowledge society and the network society, which through a strange sort of dialectic also leads to unwanted crowding-out effects. For example, it can be claimed that the knowledge society also produces a great deal of ignorance. Here, the university, as the centre of knowledge acquisition and the development of understanding, faces an unnerving challenge.

1. The first element I would like to stress is the appearence in our societies of what I call ‘The law of diminishing relative knowledge’
The emergence of the network society as a result of the worldwide exchange of information is indeed leading to an unprecedented accumulation of knowledge. The known increases in a linear way – to use a mathematical image – but the knowable – what we could and ought to know – evolves in accordance with a geometrical series, i.e. exponentially. The result is a ‘gap’ between what is known and what is knowable. This gap produces a very frustrating feeling which also leads to very far-reaching misunderstandings in all kinds of fields, and which also lies at the basis of the emergence of the dual society with a growing discrimination between the ‘knowers’ and the ‘non-knowers’.

2. Moreover the‘complexification’ of society and social phenomena increases the societal illiteracy of many people. The average citizen, understands an ever smaller part of the reality around him, and as a result acquires a distorted vision of that reality.

3. A related phenomenon is what I would like to call ‘they-ification’ or ‘one-ification’. The ‘cyber society’ is a great network within which the individual is depersonalised. They govern and administer: authority acts as an impersonal administration, almost abstract, without a face or profile, above the heads of the citizen. This social ‘they-ification’ occurs in all organisational structures, in hospitals, in large social organisations such as a trade union, in our universities, and so on.

4. In addition, the largely visual ’mediafication’ of social phenomena usually shows only the superficial and negative aspects of reality. Only bad news is news. Over-information and telecracy lead to disinformation, which increases the collective ignorance and lack of understanding, and which moreover makes it easy to confuse the essential with the accidental.

5. Even more important is that our society is evolving to a state in which job training, income differentials and social strata are aligning ever more closely with the distribution of the intelligence quotient. The gifts of creative intellect are the most important factor in determining the future jobs of young people in society. The university, too, fulfills the role of a selection mechanism which selects the cleverest minds for the best positions in society. And after all, society needs the most able people for the most important and most difficult tasks. However, the dominance of such a selection criterion threatens to give rise to a sort of dictatorship of IQ.
The social differences and discriminations are increasingly the result of the IQ distribution among the population. People with a high IQ ‘make it’, find interesting and well-paid jobs, often with international responsibilities. Those with lower IQs end up in manual jobs, while those with the lowest IQ fall into the lowest social strata and populate the underbelly of the ‘dual society’.
The ‘technocritisation’ of civilisation and society perhaps make the image of the world too mechanical and deterministic. Human beings at the end of the twentieth century sometimes feel themselves as exiles in their society and as orphans of God. And how does the university student feel in all this?


The present evolution of the cognitive processes and their application in the knowledge and network society force the universities to review the relationship between specialisation and general training, between analysis and synthesis and, even more fundamentally, between a scientific problem definition which focuses only on the how, and an intellectual approach which also asks why and which does not reject a value assessement of thought and action.
The only statement in my PHDl thesis on economics, which I wrote many years ago, which proved to be really important was not one of my own sentences but one written by John Stuart Mill. This British economist, who lived from 1806 to 1873 stated that, ‘A man is not likely to be a good economist if he is nothing else’.
This declaration of principle has followed me, surrounded me and besieged me for the last 36 years. Because either you try to look out over the parapets which surround the ‘vegetable garden’ of your knowledge, in which case you are derisorily termed a ‘generalist’, a dabbling dilettante, someone who knows less and less about more and more. Or you dig ever more deeply into the soil of your own vegetable garden, and then you are referred to sarcastically as a narrow-minded specialist, someone who knows more and more about less and less.
And the young researcher, driven by ambitions of pushing back boundaries and breaking new ground, faces a terrible dilemma. Either he formulates something new and arrives at an original result or innovative insight; in that case there is the maximum risk that his research result is completely wrong and false. Or he builds a scientific argument whose conclusion convinces through pertinence and hypothetical-deductive and mathematical-logical correctness, and then there is a maximum probability that his research is not original, and that he is parading old ideas as new ones. As a consequence, the young researcher faces a forked road where, whichever choice he makes, will plunge him into a bottomless fatum: either his thesis is correct but sadly banal, or it is original but hopelessly false.
Allow me to build up my reasoning now from the basis of my experience as an economist. From that experience, I perceive how great the need is to become aware that economics are only one aspect of reality, which forms a holistic whole and in which the different aspects must be viewed in their mutual interrelationship if we wish to obtain a more or less reliable insight into that reality.
For many years I gave talks under the provocative title ‘There are no economic problems’, in which I sought to protest against this economic reduction of reality, because mutilates that reality. It is my conviction that only complex human and societal problems and phenomena occur, in which, however important it may be, the economic aspect is only one aspect alongside many others.
The economic and the social aspects for example are two facets of reality which we can distinguish intellectually but cannot separate in real terms. I use to say that a social paradise cannot be maintained in an economic graveyard, but just as obvious is the saying that no economic orchard can thrive in a social desert. This reasoning, demonstrating interconnexity, can be applied mutatis mutandis to all scientific disciplines.
But there is more. It seems to me to be absolutely essential to go beyond economic thinking, since it is becoming ever more clear that no science is free of values, particularly when it comes to its application or when it is located in the social arena. This observation applies for all human and positive sciences: there is a need to go beyond a purely legal, psychological, historical, physical or biological approach to reality. Is there a more striking expression in this connection than ‘meta-physics’? Even though those familiar with the history of science know that this term simply refers to the ordering of the works of Aristotle. The ‘meta’concept creates scope for a necessary normative perspective, an ethical questioning, in which conviction and responsibility, images of the world and philosophical paradigms, ethics and morals become an unavoidable dimension.
Moreover it is becoming ever clearer that, in addition to the analysis and deconstruction of reality through the various sciences and sub-disciplines, there is ultimately a need for synthesis, cohesion and coherence. What it comes down to, therefore, is reconstructing the jigsaw puzzle which has been pulled apart into hundreds of pieces by the various sciences, in order to create a global picture which only appears once the puzzle has been wholly or at least largely put back together again.
Here, I believe, I have put my finger on one of the greatest challenges facing universities in the coming period.
This raises a fundamental question: how can the various sciences contribute to the creation of a reconstructed and synthetic insight into reality? The answer to this question is a dual one: by developing multidisciplinary research and thinking on the one hand, and by promoting synthetic insights in an interdisciplinary context on the other.
A multidisciplinary approach assumes that a problem or phenomenon is explored from different disciplines. An interdisciplinary approach, by contrast, goes a step further in integrating the contributions of the various disciplines into a global, synthetic view.
The need felt by many intellectuals to break out of the confines of their discipline and to inoculate themselves against the pernicious sickness of narrow-minded specialism is growing. The success of the ‘Lessons for the XXIst century’, launched by the Catholic University of Leuven (KULeuven) in 1993, demonstrates this amply, now that students from all 12 faculties at the university can include the ‘Lessons for the XXIst century’ in their study program as a full option.
But the ten thousand dollar question remains how this synthesising skill can be honed in an education system which from top to bottom (compare the renewed secondary education system in Belgium) is geared to the acquisition of specialist knowledge using analytical methods?
What can be done to cultivate a sense for the important and a spirit of synthesis, especially among the coming generation of university students, whose task it will be to lead the society of tomorrow? Two disciplines lend themselves especially well to this task: history and philosophy. Not the history of a series of dates or a history of battles and royal family trees, but rather a comparative history of civilisations, in which as well as the political dimension, attention is also given to the economic, cultural and social aspects. The recruitment of capable teachers is not a simple task for a job which is very demanding both intellectually and educationally, and that in a society which greatly undervalues the teaching profession.
In addition to the comparative history of civilisation, philosophy is also of crucial importance because it is a discipline which encourages students to ask the right questions and thus to make a distinction between the essential and the inconsequential. It may be that our education system in the past has planted too many exclamation marks and sown too few question marks, with the result that students need to be taught how to scatter question marks. The truth emerges from questioning and enquiry. And belief arises thanks to doubt about its own doubts.


A frustrating awareness is growing that human beings cannot live from bread (market economy) and participation (democracy) alone. But what do human beings live from, then, and how can this need for a ‘plus est en vous’, for a human added value, an ideal and a utopia, be met?Post-modernism, which breaks with the ‘great stories’ and ideals spreads a qualifying scepticism which de facto gives expression to the shifting of the value scales and the erosion of a certain awareness of values.

1. The image of the world has been desenchanted (the Entzauberung already announced by Max Weber), because God is dead (F. Nietzche) and the mystery of being is a projection of our temporary – but soluble by science – ignorance. That is the standard view. There is no definitive secret. The death of God naturally affects the vertical paradigms on which the entire concept of reality is based in European and Western civilisation. And, on the rebound, contemporary mankind feels like an orphan of God and an exile in society.
Man has been dethroned as the lead player in the story of creation, because he’s not a fallen angel but an ape who has crawled upright, who is himself the biogenetic result of chance and coincidence. Evolution is a determinism.
Science has been devalued , now that it has enabled man to destroy mankind itself and to make an end to the human story on earth.

2. Informatism is creating a global network society, which is replacing the old traditional vertical paradigm of authority and order with the horizontalism of the spontaneous organisation, which evolves organically, outside pyramidal authority structures. The market economy and the pluralist democracy, thanks to their flexibility and decentralised nature, are proving to be the ideal vehicles to carry this course of events.
The network society is replacing the vertical social and thought structures with a ‘horizontalism without borders’. Pyramidal authority structures, for instance in companies, are being replaced by confederal organigrams; democracy is being introduced at grass-roots level (direct democracy); the market economy is decentralising economic decision-making and is irreconcilable with forms of economic and political dictatorship. The individual, the societal micro cell, is gaining ground from family, group and collectivity.
The network society, by definition, a cross-border, international and global phenomenon, is raising horizontalism to a world image. The earth is becoming flat once again!!! A flat village! The world is our flat village!

* Horizontalism is fragmenting the vertical image of the world, which has been embedded very deeply in the human consciousness and subconscious since time immemorial.
Since the beginning man lived on earth but looked at the heavens. Religion laid a bridge between the two. The verticalist paradigm also fed the idea of authority in all kinds of structures.
It is only very recently that the birth of the global network society has begun to ‘block’ the authoritarian and transcendental verticalism through the development of a horizontal view of people and things. Authority has been replaced by cybernetics, by spontaneously operating organisational mechanisms and systems, such as the Internet. The market economy, robotics, telematics, computerisation, all these things also have a horizontalising effect. In companies, too, the pyramidal organigram is being replaced by a system of decentralisation. A large company is often a federation or confederation of relatively autonomous business units. Democracy, too, is becoming increasingly flat and is being taken closer to the citizen by appealing directly to him through all manner of consultations, televoting and referenda. At the same time, the traditional vertical authority structures in the majority of organisations are being eroded, while the moral or ideological authority of churches, political parties, trade unions, universities is also crumbling, and we are seeing the development of a ‘crisis of representative democracy’, which is being replaced by forms of direct democracy.

* The network society also replaces the hierarchical He-idea (the father, God, the boss, the government¼ ) with the ‘we’-idea of human fellowship and solidarity. This creates scope for new forms of cooperation, peacemaking and marginalisation of conflicts (particularly on the ideological plane). The ‘we’-culture – we are the people - shouted the dissidents in the streets of Berlin in 1989 – breaks with the antagonistic Platonic dualism, which for 2,500 years has forced people in the West to make constant choices.

* Western thought has for centuries functioned on the basis of an ‘either-or’ logic, which forces to choose, to decide, to resolve conflicts, whereas the ‘we’-idea is much more closely allied to Eastern philosophies, which preach a ‘and-and’ logic, a logic of addition, of reconciliation.. The breakthrough of the network society has brought about a fundamental change in what for centuries has been the most essential aspect in the philosophical foundations of Western civilisation. This explains why the dualistic oppositions referred to above are blurring rapidly. At the same time, it shows why Asiatic civilisations, with totally different, less vertical paradigms, find it easier to adapt to the network society.

4. Finally, there is a last aspect of the hurricane of change which is raging through Western society and large parts of the world. For the first time in the history of homo sapiens, it is becoming clear that man is destined to be an auto-evolutive being, i.e. a being which determines its own evolution. Since his arrival on earth, man has constantly fought against his environment.Thanks to culture, mankind has attempted to conquer nature and subject it to his own will. This process has progressed a very long way, perhaps too far. But it is only during the last few decades that the realisation has grown that man is capable of very much more: he can recreate himself, remould the human race, create aspects of reality trough consciousness, for instance in the domain of the elementary particles ( due to the collapse of the wave function as is explained by the quantum physicists), experiment with what he calls artificial intelligence, conquer his own process of change. The exiting idea that mankind is capable of steering his own evolution as a living being has perhaps in the first place to do with the fabulous discoveries in biology and genetics. The fact that these discoveries also give rise to anxiety (all kinds of genetic manipulation up to and including cloning) is yet another demonstration of the understandable fear of change which dominates the present fin de siècle.


‘Converting change into human progress and using it to determine the future’ is an almost superhuman task for an auto-evolutive mankind.
What is the role of the universities in this breaking point of the times?

* In the first place, the university has to face the challenges and gravities of the world wide network society: the world is our village, there is growing delocalisation of the provision of education, there will be more more learning than teaching, there will occur technological elimination of language differences (speech technology), scientific research will become more complementary with that of the business world; internationalisation, globalisation, permanent education and training, multiculturalisation will develop beyond our expectations, and we will have to teach tolerance, tolerance and tolerance.

* The social role of the university, in the midst of an international knowledge society, is placed in a different light. More synergy between policymakers and universities, between politicians and scientific research, is highly desirable in a society in which policy is becoming increasingly depoliticised and is having to take more and more account of scientific, technological and economic factors. The ending of the great ideological debate between collectivist Communism and capitalist Liberalism makes it possible to develop the relationship between government – less State means above all a different State – and private initiative, in this case at university level, in a different way, which replaces subsidiarity with creative partnership.

* More fundamentally, the universities will only be able to remain ‘centres of excellence’ to the extent that they seek to be more than merely excellent teaching and research institutes. As stated earlier, training the development of synthetic reasoning and formulating the existential questions is an essential task for the university of tomorrow. Not only the ‘how’ questions but also the complex ‘what’ and ‘why’ questions, must be raised in the university community. The university can no longer afford to adopt a cautious and reserved stance in the face of fundamental acceptability questions, in which the finality of people and things, of action and thought, are being taken out of the taboo sphere.

* In a democratic society which is delegating more and more responsibility to the citizen, university training to create social insight and commitment is also an essential task. Ultimately, it comes down to interpreting the traditional concept of ‘general well-being’ and public interest using the possibilities offered by the various scientific disciplines.

* Man of the XXIst century, that auto-evolutive human being, less determined by his environment and more and more determining his own being and his own future no longer learns what he must do from the open book of nature: human culture has conquered deterministic nature, for better and for worse.. It is only to the extent that mankind dares to ask questions about good and evil that he has an opportunity to protect his own evolution against dehumanisation and thus tragic failure. ‘To be human or not to be human? That is the question’.If the universities were not to raise their voices in the face of this urgent problem, they would be de-universalising, de-actualising and de-responsiblising in the most regrettable way.

* By posing the question of how change should be shaped into genuine human progress and what the ‘general and individual well-being’ means at the beginning of the XXIst century, the university is putting forward a challenge which adds verticality to the sometimes exaggerated horizontalism of the network society. The public interest is more than the sum of individual interests. The definition of what is good or bad cannot be left to what the majority think or to the arbitrariness of personal feelings and evaluations. The supra-individual dimension of ethics gives it a vertical dimension which cannot be tested empirically.

* It has to be realised that the value commitment of every university worthy of the name also impels it to supplement its own scientific attitude with – horesco referens – a normative dimension. This ethic dimension turns the economy into a meta-economy, politics into meta-politics, and physics (perhaps) into meta-physics.

* But as soon as we ask who decides what is good and bad, we create a problem which affects the whole of society. Just as the majority does not decide what is beautiful or ugly, what is true or false, so the majority can also not make definite pronouncements about ethical issues. This latter statement is however not popular in the democratic era in which we live today, where it takes courage to de-democratise ethical issues. But if the majority cannot decide about good and evil, who or what can? Individual conscience? But will that not lead to situational ethics, in which human beings are accepted as they are in their historical and cultural context, even if they believe they have to eradicate the members of the rival tribe (cf. Rwanda)? The conscience is a compass, but can it function without a signpost? And if not, who will provide that signpost? It would be going too far for me to analyse this fundamental question any further here. Allow me to say that, at the start of a new millennium, I believe that the university cannot escape a reflection on the foundations of ethics.

We have to realise that, with a little effort, there are enough goods and services present in the world – and especially in our society – to meet people’s needs, but that there will never be enough to satisfy their greediness.
In the knowledge society utopia – literally ‘not being placed’ – is more than ever the modus existendi of the university, in the realisation that we do not necessarily need to replace our society by a totally different alternate but that, together, we most definitely have to change society. This sustained critical reformism of the intellectual university community also assumes tolerance, in the knowledge that thinking differently does not necessarily mean thinking wrongly.
Only in the defence of liberty is extremism not a vice. Only in the defence of justice is moderation not a virtue. In all other aspects of societal and personal life, it is better to build bridges than to throw up obstacles - although obstacles and even obstructions are necessary in order to sustain the dialectic of the societal debate in a democratic way and to break through the self-willed attitude of those who believe they have a monopoly on truth and rightness. But without bridge-builders, the train of mankind is in danger of plunging into the abyss. In this sense and in that spirit, the universities can become bridgeheads which make a powerful contribution to the unification of the world community in an atmosphere of solidarity. There can be no greater task for them.