"Traditional indicators of non-competitive performance still apply....
As change has internationalized and accelerated, however, new predictive tools have emerged. They are as simple as they are fundamental, and they are rooted in culture. The greater the degree to which a state--or an entire civilization--succumbs to these "seven deadly sins" of collective behavior, the more likely that entity is to fail to progress or even to maintain its position in the struggle for a share of the world's wealth and power. Whether analyzing military capabilities, cultural viability, or economic potential, these seven factors offer a quick study of the likely performance of a state, region, or population group in the coming century."

[1] Restrictions on the free flow of information.
[2] The subjugation of women.
[3] Inability to accept responsibility for individual or collective failure.
[4] The extended family or clan as the basic unit of social organization.
[5] Domination by a restrictive religion.
[6] A low valuation of education.
[7] Low prestige assigned to work.

Well, that's 5/7 right there for the Palestinians. Not exactly encouraging. Each factor gets more in-depth treatment in his article, and to do them justice you should read it. I might add an 8th factor, however, based on my experiences in Canada:

[8] Cliquish and/or closed socio-economic networks.

When social mobility and economic power are highly concentrated, innovation has fewer alternatives in order to get started. To make matters worse, tight groups of people who know each other well tend toward groupthink. Which makes them more likely to reject the new and the different. It's a deadly and frustrating combination, with underperformance as the very logical consequence.

This is part of the reason for rule #4 re: extended clans as the basis for organization. Those Central American states where so much can be run by just a few families are a good example. But this dynamic can show up even in western countries where clan is not a factor. As long as there is one practical economic centre to the country, or another reason for major concentration,the "closed networks" handicap can still apply.

I've heard variants of this exact same complaint here in Toronto now from social workers, entrepreneurs, and even political types... which leads me to believe that the "closed networks" phenomenon is both real and worth paying attention to. Unfortunately, even though Vancouver and Calgary are great places there are few real alternatives to Toronto as a Canadian economic centre. Consider it the flip side of Sinatra's famous lyric: "if you can't make it there, you're shut down everywhere...."

That's a problem.

Contrast this with the many economic centres in the USA, and the real mobility between them. New York doesn't get it? Do what Robertson, Hambrecht et. al. did in the 60s: open up shop on the west coast near San Francisco and get Silicon Valley started. Or try Dallas, Chicago, Denver, et. al.

This isn't nearly as easy in many European countries, even with The Euro and EC passports. Just one more reason I don't see the EU's promise being fulfilled any time soon. India shows some promising signs on this indicator, though they need to deal with a number of other "failure factors" before one can be confident that their rise toward economic eminence will really stick. China has some of this going too, but all those local failure factors means that the Chinese Diaspora is a better place to see it in action.

Try this lens out for yourself, folks, and tell me whether I'm on to something here or just blowing hot air.

UPDATE: Dave "Redwood Dragon" Trowbridge, who worked for a Toronto-based company once (Hummingbird), says yes I am on to something here.