The State of the World (and its impact on business)

At this year's Festival TIME supported the Brand Marketers' Creative Summit, hosting a session that looked at the pivotal cultural, economic and political events in the world at large and their impact on business. In a series of essays TIME unpack some of these key trends and assess their influence on global business going forward.

America, 2040

By Charlotte Alter

America as we know it is run by 20th century leaders. Three of the last four presidents were born in 1946, with the notable exception of Barack Obama. The Speaker of the House, the Senate Majority Leader, and the top three Democratic presidential candidates were all born in the 1940s. None of them got the polio vaccine when they were little, not because they were anti-vaxxers, but because it hadn’t been invented yet.

For decades, our national priorities were determined by people who grew up during the Cold War, who could afford college relatively easily, whose financial stability was tied to a pre-digital economy, people who had used rotary phones and fax machines and who knew, on some level, that the worst effects of climate change would happen after their lifetimes. They have been dedicated and honorable public servants of the 20th century. But that century is over now.

The last three years have crystallized the inadequacy of approaching 21st century problems with 20th century attitudes. Trump, who was born before the bikini was invented, became our oldest term President at 70. He was elected overwhelmingly by mostly-white voters over 65 who responded to his message of 20th century American “greatness,” and embraced the nostalgic nationalism that has been sweeping the globe. As president, he was supported by a Republican Congress whose median age had gone up 10 years since the 1980s, and he appointed a Cabinet that was significantly older than Obama or Bush’s.

But it’s a fact: this generation will not be in charge forever. Generation X - now in their 40s and 50s - are poised to take over many positions of power in the next few years. But Millennials - now in their 20s and 30s - are the largest living generation, the largest sector of the workforce, and now the largest bloc of eligible voters. The politics of the next 10, 20, 30 years will be shaped around the values and priorities of this rising generation: here’s what I predict America will look like when they’re in charge.

In order to understand the values that animate millennial political priorities, you have to understand the events that shaped their lifetimes. Millennials grew up in the aftermath of 9/11, when the U.S. was embroiled in pointless overseas wars that never seemed to end. As post-Columbine school shootings swept the nation, their school years were punctuated with active-shooter drills. After high school, many of them took on thousands of dollars of student debt in order to afford a college degree that was both exorbitantly expensive and a mandatory prerequisite for any lucrative adult career. After college, they graduated into a financial crisis, and watched 20th century-style financial stability abruptly evaporate. They protested after young black men were shot by police officers in the street. They watched Katrina destroy New Orleans and Sandy destroy New York and Harvey destroy Texas and Maria destroy Puerto Rico. They are more diverse than any previous generation, and more likely to be openly LGBTQ.

So it shouldn’t be a surprise that a millennial America will tilt significantly leftward on social issues, like criminal justice reform and LGBTQ rights. By large majorities, millennials believe that police violence against African-Americans is a problem, support same-sex marriage, and favour marijuana legalization. Sexual behaviour has changed, as millennials widely embrace ideas of consent and sexual equality that had been pioneered in previous generations. Millennials are still evenly divided on abortion, and white millennials - a smaller group than in previous generations - are still more conservative than millennials of color. But the conservative Christian culture wars that defined the 1990s are over, and future culture wars will be more about free speech than family values.

Growing up in the early 21st century has given millennial Americans different fiscal attitudes as well as social ones. As children of the financial crisis, they are saddled with debt, with less wealth than their parents had at their age. Homes and cars - the staples of middle-class life - are out of their reach. Stable jobs with health benefits are few and far between, as the digital economy disrupts the old companies and as automation and outsourcing threaten American jobs. Therefore, millennials increasingly expect the government to provide the financial security that companies once did: they tend to support Medicare for All, more than half support the idea of a universal basic income, and Democratic Socialism is increasingly popular among young people. A millennial-led America will likely see some type of major government investment to address income inequality, another New Deal to shore up the middle class.

And when it comes to foreign policy, millennials care much more about the climate than about geopolitical battles. The endless post-9/11 wars have made many young people wary of American intervention abroad, especially for hazy objectives like “promoting democracy.” But Millennials on both sides of the aisle believe the scientific consensus on climate change - they may disagree on the right ways to address it, but nearly everyone under 40 agrees that this is happening. Foreign policy in a millennial-led America will be more about fighting climate change and dealing with the food of climate migrants than about battling for particular ideologies.

Of course, not all millennials are progressive - in 2017, about 12% millennials said they were conservative, and white millennials seem more likely to identify as conservatives than other groups. But the rifts between millennial conservatives and progressives take on a different tenor: they argue about whether controversial speakers should be able to speak on campus, not about whether racism exists. They argue about how best to address climate change, not about whether climate change is happening. They don’t argue about same-sex marriage, because young conservatives have largely given up that fight. 2020 will be a test of how close that millennial future might be. There will be 16 million young Americans who will be eligible to vote in 2020 who were not eligible in 2016, and Trump is overwhelmingly unpopular with young Americans. But even if Trump wins again in 2020, the turnover is happening. The physics of time and the biology of human cells tell us that Boomers will not be around forever.

In short: a post-Boomer America will move past a lot of the old battles of the 20th century. And soon, new battles will take their place. One of those battles will likely be the rise of nationalism, both at home and abroad, and the surprising durability of nationalist ideas in an increasingly fractured world.

Power Vacuum

By Simon Shuster

Here’s a prediction. In 2020, Russia will install its new Internet “kill switch,” a system that can isolate the country from the World Wide Web. The legal framework for this system was signed into law by President Vladimir Putin in May. And the technology is not hard to come by. China has been using it for years as part of its Great Firewall.

What might seem most surprising about this prediction is that Putin has taken so long to build such a system. Even the regime in Egypt was able to shut down the Internet during the Arab Spring in 2011. And the Kremlin has long had ways to block online content that it deems extremist, under the infamous law against “homosexual propaganda,” supportive of LGBT rights.

The kill switch, though, marks a new era of online censorship in Russia and, in many ways, the world. It will be a milestone in the global movement for “cyber sovereignty.” Supported by China, Russia, Iran, Saudi Arabia and others, this legal doctrine holds that national borders must extend to cyberspace, and that governments should have full control of their country’s segment of the Internet.

An attempt to enshrine this principle in international law, led by Russia and China, was voted down during a global summit in 2012, because the U.S. and E.U. refused to support it. But cyber sovereignty has gained a lot of traction since then. China has trained at least three dozen governments to replicate aspects of its Great Firewall – among them Jordan, Thailand, the Philippines and the United Arab Emirates, according to a recent report by Freedom House. Russia’s move to implement its Internet kill switch could tip the scales in favor of this coalition.

It would also show that dictatorships, when they band together, can seize the agenda from democracies. Nowhere has that been clearer than inside the U.N. Security Council. Out of the 21 vetoes that blocked the Council’s decisions over the past decade, Russia cast 18 of them, often in tandem with China. These votes related to some of the worst humanitarian disasters and war crimes of our era, from the use of chemical weapons in Syria to the war in eastern Ukraine and the revolution in Venezuela. By blocking them, Russia and China have all but paralyzed the world’s main decision making body. They have seized its agenda. And the West has struggled to take it back.

The same is going on with nuclear arms control, where Russia has torn up treaties and built more sophisticated bombs. China has provided cover for its ally in North Korea to build its own. On the future of technology, China is shaping the agenda with its advances in 5G and artificial intelligence. The West is playing catch up here, too.

But the debate over cyber sovereignty will be a tricker test, because it will force some of the world's most successful companies to take sides. This is already happening. As China has used its own tools for censoring the Internet , Facebook, Google and other Western tech giants have been forced to go along or risk losing their grip on the Chinese market. When Russia moves ahead with its Internet kills switch next year, a lot of these same companies will face a similar choice. Do they collaborate or do they refuse?

This choice will soon become a lot harder. As Russia and China continue to move in this authoritarian direction, more and more countries will adopt their methods of censorship and control. They will also feel a lot more confident demanding that the rest of the world plays along.

In 2020 and beyond, this will force Western firms to do a gut check each time they expand into one of these markets. They’ll have to ask themselves: Can they go along with it? How many customers will it cost if they don’t? And what will remain of their values if they do?

Critical Consumption

By Naina Bajekal

Brands are waking up to the changing demands of a new generation of young, socially-conscious consumers. It’s no longer enough to partner with a charity for an occasional campaign or to have a Corporate Social Responsibility department.

Millennials and Gen Z have more tools at their disposal than ever before to find out if a company is “green-washing” their reputation or whether they are truly implementing ethical business practices. For the generation who face living on a radically different planet because of the choices others have made, sustainability is not an afterthought; it’s a central concern.

They want to make sure the shoes they wear aren’t made in sweatshops, that their lipstick is cruelty-free, that the diamond engagement rings they Instagram weren’t mined by children, and that the coffee they drink is Fair Trade. They want to avoid buying from a company whose CEO has been embroiled in a #MeToo scandal or racism row or whose employees aren’t paid fairly.

From demanding sustainable products to boycotting companies who promote unfair labor practices, young people want to know that their dollars aren’t going to companies who just pay lip service to social justice. In one recent survey, 67% of young people said they have stopped purchasing a product or would consider doing so if the company behaved in a way that didn’t align with their values.

Meanwhile, social media has made it easier than ever to call out a company, with millennials leveraging that power to challenge corporations to improve. According to Nielsen, who polled 30,000 people in 60 countries around the world, a full 73% of millennials are willing to pay more for sustainable goods.That’s despite the fact they came of age in one of the most difficult economic climates in the past 100 years.

Most millennials would rather not have cheap lip gloss if it’s tested on animals, or eat 99 cent burgers that rely on factory farming. Many of them, and Gen Z-ers, are even giving up flying, inspired by the example of Swedish teen climate activist Greta Thunberg. European rail services are reporting a significant increase in passenger numbers, while many European airlines have had a tough first quarter.

There’s a clear economic advantage for businesses who adapt to this new culture. By 2020, Gen Z will account for about 40% of all customers. They’re prepared to speak with their wallets — and brands will have to listen.