From Trump to Merkel, the question for global leaders is how can we create inclusive growth?

By accident or design there was some neat statesmanship choreography at last year’s UN General Assembly meeting. It was President Obama’s final address to the annual global summit and Theresa May’s first, having recently become the UK’s prime minister in the wake of our own seismic event – Brexit – that was just the start of 2016’s international political shake out. Both leaders spoke to the same theme: inclusive growth.

The path to prosperity, the President said, “does not require succumbing to a soulless capitalism that benefits only the few, but rather recognizes that economies are more successful when we close the gap between rich and poor, and growth is broadly based.” Theresa May similarly argued that global institutions and political leaders “must recognise that for too many…men and women the increasing pace of globalisation has left them feeling left behind.”

Over the last twelve months the RSA Inclusive Growth Commission has sought practical ways to enable as many people as possible to contribute to, and benefit from a new kind of inclusive economic growth. Although UK focussed in its inquiry, the Commission drew upon evidence from across the world, joining a delegation of UK city leaders and academics to visit three northern European cities (Helsinki, Malmö and Rotterdam), as well as sharing insight with partners such as the OECD and Brookings Institute.

From the RSA Inclusive Growth Commission's final report.

As Bill de Blasio, Mayor of New York said at the inaugural OECD Champion Mayors for Inclusive Growth initiative event, that the failure of our economies to create inclusive growth is “not an abstract issue, but one with a real human price”. The sheer scale and complexity of that price was brought home by the poignant absence of one of the OECD’s inclusive growth champion mayors, Anne Hildago, Mayor of Paris, who was still dealing with the aftermath of the November 2015 Paris terrorist attacks. Inclusive growth is partly about hard economics, productivity and the narrowing of inequality. But is also about belonging and identity, whether people feel part of their place, secure in their work and in their communities.

Globally, inclusive growth is perhaps the most urgent issue facing policy makers (the other being climate change). The Commission’s final report, ‘Making our economy work for everyone’ sets out five principles for inclusive growth that not only can apply to UK government – national and local – but to other nations, cities and global institutions (as well as other intractable policy problems):

1. Create a shared, binding mission, involving business, civil society and communities;
2. Align incentives by measuring the outcomes we value at the most appropriate scale;
3. Understand the system, identifying political, social and institutional barriers to, and opportunities for, change;  
4. Mobilise flexible, long term resource to invest at scale; and,
5. Entrepreneurial leadership to respond dynamically, maintain momentum and capitalise on opportunities for change, particularly at a city-level.

Alongside the final report the Commission published ‘Inclusive Growth: Principles in Practice’ a collection of case studies mapped against each of the five principles (more examples are also available on our global case studies map). From Louisville and Salt Lake City in the US, to Freiburg in Germany, the best mayors are already showing how they can achieve a new kind of ‘whole-place’ leadership that makes the most of their convening power – shaping a conversation with local people, businesses and civil society leaders as to the type of economy they want to create, and how – together – they can achieve this.

The UK’s decision to leave the European Union – to embark upon ‘Brexit’ - brought the Inclusive Growth Commission’s agenda to our political fore. Since then we’ve had a change of government and watched as Donald Trump was elected President of the United States. On Wednesday we look to the Netherlands and in a few weeks to the French Presidential elections. The politics of the ‘left behind’ is the only game in town. That’s why the question facing leaders from May to Corbyn, and Trump to Merkel, is, how can governments create inclusive growth?  

Charlotte Alldritt is Director of Public Services and Communities at the RSA and was Director of the RSA Inclusive Growth Commission. You can find her on Twitter @calldritt.