Our future’s easy to forecast if nothing happens (but it will)
Written by Michael Lewis on December 23, 2014
Two weeks ago – before the Obama-Castro deal – a friend at dinner asked how I saw Miami in five years. Not having a crystal ball, my forecast began “I’m good for five minutes, but not for five years.”
I explained it like this: if he could tell me what would happen with interest rates and the global economy, Ebola and other epidemics, rising sea levels, terrorism, war and peace, our local transportation crisis and what was coming in Cuba, then I’d be able to at least guess what might happen to Miami in five years.
Immediately after that dinner, I decided to write about the thought: what variables might influence Miami’s future? I’d just list what I said at dinner and be done with it.
I did get the Cuba wild card into the mix, along with interest rate concerns and world economic conditions, which cover the ruble’s deflation that will surely impact Miami. But I forgot cyber-terrorism, such as we’ve just seen shut down a movie before it even opened and could easily target utilities and more. And I blindly missed the fall in oil prices. All that in just two weeks.
So when we asked a Cuban-American friend Sunday how he sees the long-term impact of the agreement with Cuba, I liked his candid answer: “I don’t believe in futurizing.” What, he said, if we’d been assessing the future the day before 9/11? How wrong we’d have been.
His point was clear. We don’t know when the next event as impactful as 9/11 will occur, what its nature will be, or even if it will be negative or, hopefully, positive.
What, for example, would happen now that we have opened the doors to Cuba if that island were suddenly to change both leaders and direction? If that seems unthinkable today, what would you have said two weeks ago about what has already transpired?
Set aside if you can the wisdom and the morality of what our president has done with Cuba – and, agree or violently disagree with that action, he is still our president, for all of us.
Be he a hero or goat, we now need to quit arguing about what has already happened and move on to what comes next regarding Cuba and how that will affect us. We don’t know for certain if reverberations will be positive or negative, but we know that they’re coming.
Those effects will alter Miami’s tourism, trade, investment and population shifts – and movements of people can, don’t forget, go both directions. The changes will also be psychological, both on the island and here, and political, both on the island and here.
Those effects will also be felt among our trade partners and friends. The English-speaking Caribbean worries about the economic fallout if Cuba one future day might align more closely with the US – stranger things have happened.
For years corporations and think tanks have been quietly modeling futures based on changes in Cuba. Now they can plug in new facts and do it all over again.
Please don’t take this wrong: models are vital because organizations must plan based on best guesses about what the world in five or 10 or 25 years will be like. You can’t plan in a vacuum, so assumptions about future local, national and global conditions are vital.
But think how sophisticated those models must be to get it right.
Go back 25 years or so and forecast today’s information and technological revolution. Who would have forecast hand-held technology as our future – and if they’d thought of it, who would have bet a corporate future on it?
In that same era, who would have put terrorism and cyber-terrorism atop the list of wild cards dangers? Some people spotted terrorism well before that, but it wasn’t the reigning global threat – communism was at the time.
Without completely ducking the issue, yes, the future of Miami five years out looks exceptionally bright – if nothing significant changes locally, nationally or globally.
While our economic gains are spotty, today more people are employed here than ever before. The building boom shows no sign of stopping on a dime, though proliferating extra-high condo sales commissions signal sales difficulties. Global trade infrastructure like port dredging should help Miami. Health and education are thriving industries.
But a wild card – maybe many of them – will disrupt the social, political and economic conditions that modulate Miami’s progress. And try as we might, we cannot pin down what those wild cards might be.
In the two weeks between being asked about Miami’s future and committing these thoughts to paper, we’ve felt the ruble’s collapse with its impact on our condo sales, the plunge in oil prices that will ripple through economies everywhere, the Cuba deal that probably was hastened or guided by the impact of falling oil prices in Cuba’s ally Venezuela, and Federal Reserve waffling on interest rates with its effect on economic climates everywhere. Plus cyber-terrorism globally.
These five almost simultaneously altered economic and political climates both globally and in Miami – by how much we have yet to see.
I can’t envision a similar wave of back-to-back changes. But of this I am certain: one is coming sometime in the next five years, one that will affect Miami greatly. The question is, good or bad?
Even a five-minute-ahead forecast is risky.