Three scenarios: Islands, Orbits, and Communities — explore how critical trends and choices might intersect to create different paths to the future.

Three Scenarios for
the Distant Future:
Islands, Orbits, Communities

Thinking about the future beyond the next five years involves so many contingencies that it is helpful to consider how selected trends, choices, and uncertainties might play out over multiple pathways—as told through a set of short stories, commonly known as scenarios. While no single scenario can describe the entirety of future global developments, scenarios can portray how the foremost issues and trends might characterize the future, much like the terms “Cold War” and “Gilded Age” defined the dominant themes of past eras. For us, the three primary uncertainties shaping the next 20 years revolve around:

  1. Dynamics within countries. How governments and publics renegotiate their expectations of one another and create political order in an era of heightened change, marked by empowered individuals and a rapidly changing economy;
  2. Dynamics between countries. How the major powers, along with select groups and individuals, work out patterns of competition and cooperation; and
  3. Long-term, short-term tradeoffs. To what extent will states and other actors prepare in the near-term for complex global issues like climate change and transformative technologies.

The three scenarios—”Islands,” “Orbits,” and “Communities“—explore how critical trends and choices might intersect to create different paths to the future. These scenarios postulate alternative responses to near-term volatility—at the national (Islands), regional (Orbits), and substate and transnational (Communities) levels. The scenarios also consider alternative US responses to these trends—for instance, ranking US domestic and economic issues over foreign relations, engaging globally to defend US interests overseas, or adjusting governing practices to take advantage of the proliferation of influential actors. While no single outcome is preordained, the following scenarios characterize the types of issues that will confront policymakers in the years ahead.


Methodology of Scenario Analysis

Good scenarios are far more art than science. The stories need to be grounded enough to feel plausible, while imaginative enough to challenge our assumptions—because the world regularly twists and turns in surprising ways. None of these outcomes, however, are predetermined. The choices people make—individually and collectively, whether by intent or chance—will remain the biggest variables driving the course of events. Many more scenarios could have been generated from the trends we discuss in this report, but we hope the scenarios we have crafted stimulate thinking and discussion about the future.

  • Thinking creatively about the future is often difficult because of the tendency for the recent past and current events to prejudice assessments. Developing alternative scenarios helps to challenge unstated assumptions about the future, revealing new possibilities and choices that are otherwise difficult to discern.
  • Our scenarios, and the challenges and opportunities they represent, are not necessarily mutually exclusive. The future will probably include elements from each, but at different levels of intensity or in different regions of the world. For example, the future described in the “Islands” scenario might prompt some states to react to increasing economic instability and the inward focus of the West by taking actions to secure their own interests, moving the future in the direction of our “Orbits” scenario. Alternatively, the inability of national governments to effectively manage economic and technological changes might generate a greater role for local governments and private actors, creating the conditions for the “Communities” scenario to emerge.
  • We encourage readers to use these scenarios to challenge their current planning assumptions and to begin a strategic conversation about preparing for the challenges and opportunities that might lie ahead. The scenarios should be reevaluated as new developments emerge.

Three Scenarios for the Distant Future: Islands

This scenario investigates the issues surrounding a restructuring of the global economy that leads to long periods of slow or no growth, challenging the assumption that traditional models of economic prosperity and expanding globalization will continue in the future. The scenario emphasizes the difficulties for governance in meeting future societal demands for economic and physical security as popular pushback to globalization increases, emerging technologies transform work and trade, and political instability grows. This scenario underscores the choices governments will face in adjusting to changing economic and technological conditions that might lead some to turn inward, reduce support for multilateral cooperation, and adopt protectionist policies and others to find ways to leverage new sources of economic growth and productivity. Here is an economist reflecting on the 20 years since the 2008 global financial crisis:

The past 20 years of coping with downsides of globalization, financial volatility, and increasing inequality has transformed the global environment. Mounting public debt, aging populations, and decreased capital investment exacerbated downward pressures on developed economies. Public and business demands for protection from market swings, disruptive technologies, disease outbreaks, and terrorism drove many countries to turn inward. Political instability increased as public frustration rose in countries that failed to manage change. Many governments struggled to maintain services to their populace, as tax revenues failed to keep pace with growing obligations. The segments of populations that had obtained “middle class” status prior to the financial crisis were most at risk and many fell back into moderate levels of poverty. Globalization slowed as governments adopted protectionist policies in response to domestic pressures. Most economists identify the following developments as key factors slowing global economic growth and accelerating the reversal of much of the globalization trends of the previous decades:

  • The rise of inequality as wealth became more concentrated fed tensions within societies and led to popular pushback against globalization.
  • The spread of artificial intelligence and automation technologies disrupted more industries than economists expected. This trend sparked a backlash from large numbers of displaced workers, creating a political constituency that forced some governments to stop participating in global trade institutions and agreements they had previously committed to support.
  • Trade patterns shifted as governments favored employing regional trading blocs and bilateral trade agreements over comprehensive global arrangements. The wide adoption of new technologies, such as additive manufacturing (3-D printing), often provided local producers a competitive advantage vis-à-vis foreign suppliers reducing global trade in manufactured goods.
  • Slower global economic growth depressed energy prices and placed additional pressures on the energy-dependent economies of Russia, the Middle East and South America while also increasing competition among energy producers.
  • China and India remained stuck in the “middle income trap,” suffering stagnant economic growth, wages, and living standards, because they were unable to generate sufficient domestic demand to drive higher economic growth when foreign trade flagged.
  • Domestic and economic challenges drove the United States and Europe to focus inward. The United States and the EU adopted protectionist policies to preserve domestic industries. European economies suffered because of declining exports and underdeveloped service industries. Germany and France found enough common ground to hold together the Euro Zone; however, renewed fiscal stimulus did little to reinvigorate economic growth in the periphery states of Europe,and insufficient willingness to ease labor restrictions undermined EU member states’ ability to maintain or boost their international competitiveness.
  • Rising intellectual property theft and cyber attacks drove some governments to introduce stringent controls that hampered information sharing and cooperation across the Internet.
  • Changing climate conditions challenged the capacity of many governments to cope, especially in the Middle East and Africa, where extended droughts reduced food and water supplies and high temperatures suppressed the ability of people to work outdoors. Large numbers of displaced persons from the region often found they had no place to go as a series of dramatic terrorist attacks in Western countries drove those governments to adopt stringent security policies that restricted immigration.
  • The global pandemic of 2023 dramatically reduced global travel in an effort to contain the spread of the disease, contributing to the slowing of global trade and decreased productivity.

The combination of these events led to a more defensive, segmented world as anxious states sought to metaphorically and physically “wall” themselves off from external challenges, becoming “islands” in a sea of volatility. International cooperation on global issues, such as terrorism, failing states, migration, and climate change eroded, forcing more isolated countries to fend for themselves. Furthermore, declining defense budgets and preoccupying domestic concerns drove the West to spurn military force when its vital interests were not threatened. This led to an atrophying US alliance system. Instability increased in parts of Africa, the Middle East, and South Asia.

Economic challenges still exist 20 years after the 2008 financial crisis, but several developments indicate we are now entering a new era of economic growth and prosperity. Technology advances, such as, artificial intelligence, machine learning, additive manufacturing, and automation—although disruptive to traditional job markets—have the potential to boost economic efficiency and productivity, leading to new areas of activity and economic growth for a broad range of countries. The realization that the most creative and innovative solutions are often achieved through manmachine cooperation rather than through machines alone is helping to reverse earlier job losses, although providing opportunities for individual displaced workers through training has not been universally successful.

Furthermore, the slowing of globalization and trade is sparking a new generation of experimentation, innovation, and entrepreneurship at local levels. The increasing costs of food imports as countries have imposed carbon taxes have also spurred local agriculture production. These developments are most prominent in societies that provide access to online education resources as well as scientific and technical knowledge that is shared among communities of like-minded entrepreneurs and hobby-technologists. Some governments, however, are ill prepared to handle the security aspects raised by the proliferation of new technologies, which also has resulted in the rise of tech-enabled criminal gangs and terrorist groups and new methods for circumventing government controls.

Developments in biotechnologies and health care also are leading to new industries and improved productivity, as greater access to care is creating healthier workforces. Expanding working-age populations through better health care has the potential to provide an economic boost to countries with aging populations. A proliferation of robotics and artificial intelligence in basic medicine and diagnostics is also helping to make affordable care more widely available and has reduced the cost burden of caring for aging citizens on cash-strapped governments.

Improving economic growth will continue to depend on new technologies, local innovation and entrepreneurship. There remains an acute need for government programs to cushion future economic disruptions and ensure the welfare of those in society who are least able to adapt. Addressing these issues, however, requires overcoming the political polarization that has prevented many governments from achieving the necessary budget compromises. Continued government support for these endeavors through the reinvigorated trading of technologies, expertise, and resources also might help bridge the economic gaps that exist within and between countries.


Islands Implications

This scenario explores the ramifications if governments fail to manage the changes in global economic conditions that have led to increasing inequality, lower growth rates in developed economies, job displacements, and societal divisions. The scenario highlights the need for the rich countries to address the negative byproducts of past economic policies and to manage the tensions between populism and inclusion. The most successful states will be those with governments that encourage research and innovation; promote information sharing; maintain high-quality education and lifelong learning in science, technology, engineering and mathematics; provide job retraining; and adopt tax, immigration, and security policies to attract and retain high-tech talent. Such developments would encourage greater experimentation, innovation, and entrepreneurship to help boost domestic manufacturing and create employment.

Alternatively, states that choose to place controls on access to information, fail to honor intellectual property rights, and discourage the import of high-tech talent will likely be excluded from the economic benefits offered by emerging technology advances. Security will be another key issue as these developments also create challenges in the forms of technology-enabled terrorist attacks and criminal activity.


Three Scenarios for the Distant Future: Orbits

This scenario explores a future of tensions created by competing major powers seeking their own spheres of influence while attempting to maintain stability at home. It examines how the trends of rising nationalism, changing conflict patterns, emerging disruptive technologies, and decreasing global cooperation might converge to increase the risk of interstate conflict. This scenario emphasizes policy choices that would reinforce stability and peace or exacerbate tensions. These choices are explored through the memoirs of a National Security Advisor reflecting on his assessment of the international environment near the end of President Smith’s second term in office in 2032:

Over the course of the Smith presidency, I witnessed a number of developments giving me hope that the next President will find the world in a much better place. It was not that long ago, however, that increasing geopolitical tensions led to the brink of interstate conflict. It was the combination of competing values among rival states, military build-ups, rising nationalism, and domestic insecurity that created an era of increased geopolitical competition among the major powers. In the early 2020s, polarizing politics and fiscal burdens constrained US engagement on the world stage, prompting foreign assessments that the United States was moving toward a prolonged period of retrenchment. China and Russia, in particular, viewed this time as an opportunity to seek greater influence over neighboring countries within their respective regional economic, political and security orbits. Iran also attempted to take advantage of instability in the Middle East to expand its influence in the region.

By the mid-2020s, these developments led to the international system devolving toward contested regional spheres. The powers at the center of the spheres attempted to assert their right to privileged economic, political, and security influence within their regions. China increasingly used its economic and military power to influence the behavior of neighboring states and to force concessions from foreign business seeking access to its markets. India, Japan, and other states adopted more assertive independent foreign policies to counter Chinese encroachment on their interests, increasing regional tensions in East and South Asia. Russia also asserted itself more forcefully in Central Asia to keep that region under Moscow’s influence and to counter China’s growing presence.

Regional tensions increased as China undertook extensive engineering projects to change local environmental conditions, such as diverting major rivers to the detriment of neighboring states. As environmental conditions in China continued to degrade, Beijing considered more ambitious geoengineering projects, such as injecting tons of sulfate aerosols into the atmosphere to lower temperatures. These efforts ignited an international debate over the ethics of a single state taking action that affected the global ecosystem, prompting some countries to threaten China with punitive actions if Beijing unilaterally pursued climate modification.

When President Smith came to power eight years ago, there was a general consensus among national security experts that while geopolitical competition was intensifying, both economic and political interests would stop states from direct military conflict. This seemed to be the case as China, Iran, and Russia separately eschewed direct military conflict in favor of lower levels of competition—diplomatic and economic coercion, propaganda, cyber intrusions, proxies, and indirect applications of military power—blurring the distinction between peace and war. The most frequent victim was “the truth” as propaganda from these states—distributed through a variety of social, commercial, and official outlets—distorted, misrepresented, and shaped information about what was really happening. The culmination of these actions, however, undermined international norms about sovereignty and peaceful resolutions of disputes and perpetuated perceptions of US disengagement.

The President decided early in his first term that the United States could no longer stand by and allow these developments to continue unabated. He moved to shore up US alliances and increasingly employed US military forces in exercising international norms such as freedom of navigation operations. Efforts, however, by China, Iran, and Russia to prepare for traditional military conflicts—by deploying greater numbers of advanced weapons such as long-range, precision-guided, strike systems to threaten rival military forces operating in their regional sphere— intensified global perceptions of increasing security competition between these countries and the United States and its allies. We did not fully realize at the time, however, that Beijing, Moscow, and Tehran were increasingly nervous about their standing at home due to economic stress and social tensions, leading them to believe they could not compromise on external challenges to their interests for fear of appearing weak. The collision between a Chinese underwater autonomous vehicle and a Japanese Coast Guard ship patrolling off the Senkaku islands, the cyber attacks against European financial centers attributed to Russian hackers, and the Iranian threat to employ its increasingly accurate ballistic missiles to strike Saudi energy and desalination facilities were a few of the flashpoints that narrowly missed escalating into broader conflict.

It took a mushroom cloud in a desert in South Asia to shake us from our complacency. I remember how the crisis between India and Pakistan started: the Second Indus Waters Treaty was abandoned by both sides, followed shortly by a series of explosions in New Delhi that the Indian Government quickly attributed to Pakistan-based extremist groups. Islamabad denied involvement, but both sides began mobilizing their military forces. After a few confusing days of cyber attacks that disrupted the ability of both sides to understand what was happening, the situation escalated quickly. According to a subsequent investigation, artificial intelligence systems supporting the military decision makers made the crisis worse by misinterpreting signals meant to deter instead as signs of aggressive intent. The result was the first use of a nuclear weapon in a conflict since 1945.

With China’s help, the United States quickly moved to defuse the crisis—we were lucky. The conflict barely missed escalating to a full nuclear exchange. President Smith shared the Nobel Peace Prize with the President of China that year. More importantly, however, the Indo- Pakistani war of 2028 reminded all the major powers of the dangerous game we were playing. A series of confidence-building measures and arms control agreements with China and Russia followed, placing limits on the most unstable escalatory weapon capabilities. Putin’s successor also made great strides in repairing Russia’s relations with Europe to the benefit of the Russian economy. These experiences allowed the United States and the other major powers to build a foundation of trust that enabled cooperation on other security issues, such as instability in North Korea and the Middle East.

The next US President will have to deal with a world where geopolitical competition still exists, but where the major powers learned, for selfpreservation, to cooperate with each other in areas of mutual interest. If not for the shock we all felt by the close call in South Asia, the choices President Smith and others might have made could have led to a very different outcome.


Orbits Implications

This scenario examines how increasing geopolitical competition could raise the risk of interstate conflict and threaten the rules-based international order. It highlights the importance of reassuring allies and preventing “gray-zone” conflicts from undermining international norms and from escalating into a war between major powers. Furthermore, the deployment of new capabilities, such as hypersonic weapons, autonomous systems, counterspace weapons, and cyber operations, introduces new—and not well understood—escalation dynamics that increase the risk of miscalculation. Growing geopolitical tensions that produce destabilizing events and increase the dangers for all involved might provide incentive for rivals to find common ground and negotiate confidence-building measures to reduce risks. For example, the prospect of a “close call”—in which a major military conflict is barely averted or a large natural disaster illustrating the negative global impact of climate change—might compel nations to work together for self-preservation, leading to a more stable international order. Such an outcome, however, is not assured, highlighting the importance of managing increasing geopolitical competition in ways that reduce the risk of miscalculation and escalation while leaving open the possibility for greater cooperation on issues of shared risk.


Three Scenarios for the Distant Future: Communities

This scenario explores the issues that arise as the enormity of future economic and governance challenges test the capacity of national governments to cope, creating space for local governments and private actors and thus questioning assumptions about the future of governance. This scenario emphasizes the trends associated with the changing nature of power and advances in ICT that are enabling a broader array of influential actors and identifies how such trends might lead to choices that create both opportunities and hurdles for future governance. It is written from the perspective of a future mayor of a large Canadian city in 2035, reflecting on the changes she has witnessed during the previous two decades:

The increasing role in governing of groups beneath and across national governments seems inevitable in retrospect. National governments simply proved less adept at managing some public needs in a rapidly changing environment than local governments, which were better attuned to increasingly powerful societal groups and commercial entities. In addition, as public trust in national government leaders and institutions continued to erode, more critical public services were privatized. Point-to-point commercial transactions that did not rely on government intermediaries became more common, and people grew increasingly comfortable working through nongovernmental channels. This further diminished governments’ ability to provide oversight—and to generate revenue through fees and taxes.

While critical state functions such as foreign policy, military operations, and homeland defense remained the province of national governments, local populations increasingly relied on local authorities, social movements, or religious organizations to provide a growing array of education, financial, commercial, legal, and security services. At the same time, businesses gained far-reaching influence through increasingly sophisticated marketing, product differentiation, and incentive programs to build intense customer loyalty that transcended borders. The involvement of private-sector companies in the lives of their employees grew as these companies expanded services, such as education, health care, and housing, they provided to their employees. Large, multinational corporations increasingly assumed a role in providing public goods and funding global research.

People increasingly defined their relationships and identities through evolving and interconnected groups outside of national government channels. Information and communication technologies are now key to defining relationships and identities based on shared ideas, ideologies, employment, and histories, rather than nationality. Furthermore, advances in biotechnologies led to class distinctions in some countries between those who could afford human modifications from those who were not artificially “enhanced.”

As the ability to control and manipulate information became a key source of influence, companies, advocacy groups, charities, and local governments were often more adept than national governments in exerting the power of ideas and tapping into emotions to sway populations to support their agenda. In some cases, governments willingly ceded some of their power to these networks of social and commercial “communities” in the hopes of defusing political divisions and public frustration—and of providing local services that national governments were unable to offer. In other cases, subnational entities, and alliances between them, asserted greater authority in defiance of national institutions.

In the Middle East, a “lost generation” of dissatisfied Arab youths, whose foundational experiences had been shaped by violence, insecurity, displacement, and lack of economic and educational opportunities—especially for women—emerged through information networks to challenge the traditional centralized governing structures. Arab youth in many countries demanded more services and political reforms to allow them to have greater say in the policies of their governments. Further, there was broad societal rejection of the violent religious extremism of the terrorist groups that emerged on the world stage in the early part of the 21st Century. Once started, these movements quickly spread throughout the region.

The experience of the Middle East repeated elsewhere, but not always with the same results. For example, amid a rocky leadership succession, Moscow found maintaining central control harder and harder as Russians banded together to protest rampant government corruption and the power of the oligarchs, and to urge local economic and political reform. Some regimes successfully engineered powersharing arrangements with local authorities and some leveraged the resources of transnational foundations and charitable organizations to meet the needs of their societies. Others resorted to force to quell internal protests and employed advanced information technologies to identify and silence dissidents. China’s Communist Party initially took this approach but was forced to adjust its strategy and make compromises as retaining power through force alone became increasingly difficult. Other governments succumbed to internal pressures and fragmented along ethnic, religious, and tribal lines.

What resulted was messy. Governance globally evolved through a trial and error to address changing public needs and demands. The more agile and open states, like the United States, adapted their governing approach to public engagement and policymaking by harnessing the power of subnational and nonstate actors, increasing the importance of cities and other forms of local governance. City leaders, like myself, increasingly worked with our counterparts from around the world, with the encouragement of our national governments, to share information and resources and to develop new approaches to common problems, such as climate change, education, and poverty reduction.

Adjusting to this new style of governing was easier for Canada, the United States and other liberal democracies that had a tradition of strong, local public and private sector leadership, in contrast to countries with centralized governments. Authoritarian regimes that resisted the increasing diffusion of power and tried to limit and control the activities of nongovernmental organizations, for example, continued to experience widespread popular movements that sapped their authority. In the worst cases, extremists, criminal gangs, and warlords flourished in areas where national government lost control of parts of its territory.

Over time, commercial and religious organizations, as well as civil society groups and local governments, became multi-stakeholder coalitions of various sorts—some including national governments. These new approaches to solving global challenges gradually coalesced around common values, including human rights. States, city and civic leaders, and commercial and civil society organizations now routinely participate in regional and interregional processes and issue-based networks to create alternative venues for driving positive change. Social movements, religious organizations, local governments, and publics propel the political agendas of national governments. Removed from its old “Cold War” context, the term “Free World” now defines the networked group of state, substate, and nonstate entities that work cooperatively to promote respect for individual freedoms, human rights, political reform, environmentally sustainable policies, free trade, and information transparency.


Communities Implications

This scenario examines issues associated with the future of governing. In it, governments will need policies and processes for encouraging public-private partnerships with a wide-range of actors—city leaders, non-governmental organizations, and civil societies—to address emerging challenges. Large multinational corporations and charitable foundations, in particular, might increasingly complement the work of governments in providing research, education, training, health care, and information services to needy societies.

While states will remain the primary providers of national security and other elements of “hard power,” their ability to leverage communities of local, private, and transnational actors would enhance their “soft power” attributes and resilience. Liberal democracies that encourage decentralized governance and private-public partnerships will be best suited to operate in this world. In these societies, technology will enable interactions between the public and government in new ways, such as collective decision making. Other governments, however, might not fare as well, leading to a variety of outcomes, including increased authoritarianism and state failure.