3.1 Change and the Consequences of Liberalism

Liberalism demands accelerated change and requires that people respond to this change.

Freedom of opinion and expression enabled people to break away from rigid medieval dogmas and pursue new ideas without fear of repercussion. Now all scientific directions could be developed without prejudice. Not only did the humanities advance into new areas, there were also countless technical innovations and inventions. The world of the middle-ages underwent change at an increasingly accelerated pace—a pace that has continued to pick up exponentially to this day.

While new discoveries were left to chance in earlier times, research has now been systemized like never before. Both universities and companies invest in research and development and therefore in change. Thanks to worldwide communication, the results are usually accessible to everyone and researchers can integrate their findings with those of others around the globe. As a result, the intervals between innovations have become shorter and shorter. In all scientific areas, the pace of progress is advancing faster than ever before.

Not only is the world of technology changing, the personal circumstances in which we live are changing as well. In the past, very few people relocated. It was normal to live and die where they had been born. Today, just the opposite is true. The psychological hurdle of picking up roots and leaving home is much lower and people have become more flexible. The same is true for relationships. We change our friends, business partners and jobs regularly whereas in the past, these usually lasted a lifetime. Even marriage, considered sacred in the Middle Ages with vows of faithfulness until death, often ends in divorce today. As a result, with longer life expectancy, many people will experience a series of longer relationships during their lifetime. “Serial marriage” has become a reality.

Rapid change has become the norm in organizations (companies, administration, the state) as well. Technology, work processes, products, market, demand or needs, and sales methods are all changing. New insights into the optimization of human interaction has led to new management structures. New products and services lead to new companies while old ones disappear. The result is continuous economic and social change.

3.2 The Consequences of Change

In addition to change, modern humans are exposed to other impressions and stimuli. Outside of their homes, they no longer move about in nature, but must be aware of other stressed commuters. People are bombarded by news delivered via modern communication methods such as cell phones, tablets and television.

Constant change and exposure to stimuli force people to react defensively. Modern humans filter out images and experiences that are not important to them. They experience these things superficially, even if they are powerful experiences. On the other hand, this flood of stimuli has strengthened modern humans’ mental capacity. Their sensitivity threshold is much higher than before. In the past, humans, who were normally exposed to fewer stimuli than today were easily overwhelmed and left perplexed by situations which created a flood of sensations. By contrast, young people today, who constantly use their smartphones or headphones, give the impression that they need a certain number of stimuli to calm their minds.

3.3 Obstructers

There are, nevertheless, people who only feel comfortable in the region where their families have always lived and with their well-established ways of life. They become frightened by rapid change so they resist it, perceiving it as a threat that they must fight. Their behavior means that change comes about in the face of opposition—in other words, slowly. Apparently, the better off people are, the more lethargic and less interested in change they become. During periods of economic boom, the number of people who are satisfied with their lives increases. These people resist change, preferring to rest on what they have achieved. This slows the speed of change. If, however, the standard of living decreases, the fighting spirit is revived by those who want to regain competitiveness, i.e. those who want to promote change through renewal. Consequently, progress comes in cycles. The willingness to accept change decreases during economic booms. This leads to stagnation and recession. During lean periods, people work harder; they catch up with structural changes; and growth increases, creating a new boom phase.

This system also has its casualties. They are the price paid for rapid progress. It is therefore important to have a social safety net. The faster the speed of change, the larger the number of people who cannot cope with it. They condemn the modern meritocracy that they cannot keep up with and cannot deal with. They become “obstructers” and continually question whether things are really needed. Most of these people will find jobs within the economy that suit their capabilities. However, there will, unfortunately, be others who will no longer be able to cope with the world and with change. They will quite simply blame society or globalization for this. Are the growing problems with marginalized people, drug addicts or high suicide rates the price we pay for a rapidly changing economically successful society?

3.4 The Goal Is Flexibility

Every person’s goal should be to remain flexible. We shouldn’t consider innovations a burden but rather view them positively and accept them as things that improve our circumstances. The goal of every company, and indeed every country, should be to develop a culture that embraces and strives for change. In an ever-changing world, those who do not keep up will be left behind.

There is the danger that a well-established profitable company will rest on its laurels and fail to renew itself by investing in either its employees or in research and development. Perhaps the employees also resist change and the new mindset associated with it simply because they are doing well. However, the competition will continue to do research and make investments. Initially, their growing lead will be imperceptible and gradual; their products or services will become cheaper and better. Meanwhile the products of the stagnating company become obsolete and the company begins losing market share and sales. This applies to companies as well as to entire economies. Over time, revenues will no longer cover costs. When reserves have been depleted, there is a threat of company closure or economic collapse. This is when employees and trade unions call for job-saving measures—and federal aid. And it is true that the company will survive for the time being if such action is taken. However, it will be increasingly difficult to fund the investments necessary for improvement. Meanwhile the competition will continue to invest in itself and improve, increasing the gap between the two types of companies. Federal aid becomes disproportionate or ineffective. There are only two options left. One is that the state takes over the business, thereby wasting taxpayers’ money on an unprofitable operation. In the process, it runs the risk of going bankrupt itself if it takes over too many such businesses, especially since the free economy is becoming increasingly more efficient in other regions. The other option is that the business could be fundamentally restructured, which is only possible through the implementation of painful measures. The lack of continuous renewal, as would have been done by a healthy, competitive business, must be offset in a single step.

Maintaining an existing company structure leads to disadvantages in competitiveness. It bears repeating that only those who continually renew and work on their products and services and continually monitor and streamline costs will remain competitive and maintain economic health. Only those who embrace innovation and create a culture where change is welcome will stay on top.

If jobs are lost as a result of restructuring, there will, of course, be an outcry from those affected. Although this is understandable, such measures are, as a rule, economically necessary to ensure that the company survives. In an economy strengthened by continuous change, many new jobs are also created. However, this is reported much less dramatically in the media.

3.5 Impact on Entire Regions

Competition stimulates the economy in other ways. Companies in the same field of operation doing business in the same location can compete in such a way that they become industry leaders. Consider, for example, the former automobile industry in Detroit (USA), the chemical industry in Basel (Switzerland), Southern Germany’s car industry featuring three global brands, both large banks in Switzerland, and many others. The oft-raised demand that such companies should join forces on the world market in order to avoid unnecessary competition with each other stems from a desire for convenience. Its proponents fail to recognize that the driving force behind the success of companies would be eliminated if this were done. Trends toward such convenience have often been followed by decline.

This is similar to the phenomenon seen in cartels, which also create a comfortable buffer, tempting them to neglect the constant striving for improvement and innovation. If a cartel fails, the companies affected are no longer competitive. They must either carry out improvements in a single step or undergo painful restructuring. When cartels fail, there are always winners and losers. The winners are those who are flexible, create better products and services, and enter new markets. In short, they take advantage of the opportunity. The losers are those who continue to sit back, complain that they can no longer exist, and then ask for federal aid. Antitrust laws have been tightened in many regions ensuring that lively competition is maintained.