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Should corporate-led institutions be reformed or disempowered? It's not off the wall to think of dismantling corporations [Part II of The most crucial task facing the world's NGOs]
by Waldon Bello The CCPA Monitor, February 2001, pp 14-16
The battle against the global corporate agenda will be largely decided by the tactics adopted by the world's non-government organizations (NGOs). And these tactics in turn depend not only on the balance of forces, but will turn even more fundamentally on our answer to the key question: Should we seek to transform or to disable the main institutions of corporate-led globalization?
Institutions should be saved and reformed they're functioning, while defective, but nevertheless can be reoriented to promote the interests of society and the environment. They should be abolished if they have become fundamentally dysfunctional.
Can we really say that the International Monetary Fund can be reformed to bring about global financial stability, the World Bank to reduce poverty, and the WTO to bring about fair trade? Are they not, in fact, imprisoned within paradigms and structures that create outcomes that contradict these objectives? Can we truly say that these institutions can be re-engineered to handle the multiple problems that have been thrown up by the process of corporate-led globalization?
The answer to all these questions, realistically, is NO. So, instead of trying to reform these institutions, would it in fact be more realistic--and "cost-effective," to use a horrid neoliberal term--to abolish or at least disempower them, and create totally new institutions that do not have the baggage of illegitimacy, institutional failure, and Jurassic mindsets that attach to the IMF, the World Bank, and the WTO?
Disabling the corporation
Indeed, I would contend that the focus of our efforts these days is not to try to reform the multilateral agencies, but to deepen the crisis of legitimacy of the whole system. Gramsci once described the bureaucracy as but an "outer trench behind which lay a powerful system of fortresses and earthworks." We must no longer think simply in terms of neutralizing the multilateral agencies that form the outer trenches of the system, but of disabling the transnational corporations that are the fortresses and earthworks that constitute the core of the global economic system.
I am talking about disabling not just the WTO, the IMF, and the World Bank, but the transnational corporation itself. And I am not talking about a process of "reregulating" the TNCs but of eventually dismantling them as fundamental hazards to people, society, the environment, to everything we hold dear.
Is this off the wall? Only if we think that the shocking irresponsibility and secrecy with which the Monsantos and Novartises have foisted biotechnology on us is a departure from the corporate norm. Only if we also see as deviations from the norm Shell's systematic devastation of Ogoniland in Nigeria, the Seven Sisters' conspiracy to prevent the development of renewable energy sources in order to keep us slaves to a petroleum civilization, Rio Tinto's and the mining giants' practice of poisoning rivers and communities, and Mitsubishi's recently exposed 20-year cover-up of a myriad of product-safety violations to prevent a recall that would cut into profitability. Only if we think that it is acceptable business practice to pull up stakes, lay off people, and destroy long-established communities in order to pursue ever-cheaper labour around the globe--a process that most TNCs now engage in.
NO, these are not departures from normal corporate behaviour. They are normal corporate behaviour. And corporate crime against people and the environment has, like the Mafia, become a way of life because, as the British philosopher John Gray tells us, "Global market competition and technological innovation have interacted to give us an anarchic world economy."
To such a world of anarchy, scarcity, and conflict created by global laissez-faire, Gray continues, "Thomas Hobbes and Thomas Malthus are better guides than Adam Smith or Friedrich von Hayek, with their Utopian vision of a humanity united by "the benevolent harmonies of competition." Smith's world of peacefully competing enterprises has, in the age of the TNC, degenerated into Hobbes' "war of all against all."
Gray goes on to say that, "As it is presently organized, global capitalism is supremely ill-suited to cope with the risks of geo-political conflict that are endemic in a world of worsening scarcities. Yet a regulatory framework for coexistence and cooperation among the world's diverse economies figures in no historical or political agenda."
Recent events underline his point. When the ice cap on the North Pole is melting at an unprecedented rate and the ozone layer above the South Pole has declined by 30%, owing precisely to the dynamics of this corporate civilization's insatiable desire for growth and profits, the need for cooperation among peoples and societies is more stark than ever. We must do better than entrust production and exchange to entities that systematically and fundamentally work to erode solidarity, discourage cooperation, oppose regulation except profit-enhancing and monopoly-creating regulation, all in the name of "the market" and "efficiency.'
It is said that, in the age of globalization, nation states have become obsolete forms of social organization. I disagree. It is the corporation that has become obsolete. It is the corporation that serves as a fetter to humanity's movement to new and necessary social arrangements to achieve the most quintessential human values of justice, equity and democracy, and to achieve a new equilibrium between our species and the rest of the planet.
Disabling, disempowering, or dismantling the transnational corporation should be high on our agenda as a strategic end. And when we say this, we do not equate the TNC with private enterprise, for there are benevolent and malevolent expressions of private enterprise. We must seek to disable or eliminate the malevolent ones, like the Mafia and the TNC.
Deglobalization
It is often said that we must not only know what we are against, but also what we are for. I agree, though it is very important to know very clearly what we want to terminate so that we do not end up unwittingly fortifying it, so that, like a WTO fortified with social and environmental clauses, it is given a new lease on life.
Let me end, therefore, by giving you my idea of an alternative. It is, however, one that has been formulated for a Third World, and specifically Southeast Asian, context. Let me call this alternative route to the future "deglobalization."
I am not talking about withdrawing from the international economy. I am speaking about--
reorienting our economies from production for export to production for the local market; drawing most of our financial resources for development from within rather than becoming dependent on foreign investment and foreign financial markets; carrying out the long-postponed measures of income redistribution and land redistribution to create a vibrant internal market that would be the anchor of the economy; de-emphasizing growth and maximizing equity in order to radically reduce environmental disequilibrium; not leaving strategic economic decisions to the market, but making them subject to democratic choice; subjecting the private sector and the state to constant monitoring by civil society; creating a new production and exchange complex that includes community cooperatives, private enterprises, and state enterprises, and excludes TNCs; and enshrining the principle of subsidiarity in economic life by encouraging the production of goods to take place at the community and national level if it can be done so at reasonable cost in order to preserve community. We are talking, moreover, about a strategy that consciously subordinates the logic of the market and the pursuit of cost efficiency to the values of security, equity, and social solidarity. We are speaking, in short, about re-embedding the economy in society, rather than having society driven by the economy. A plural world
Deglobalization, or the re-empowerment of the local and national, however, can only succeed if it takes place within an alternative system of global economic governance. What are the contours of such a world economic order? The answer to this is contained in our critique of the Bretton Woods-cum-WTO system as a monolithic system of universal rules imposed by highly centralized institutions to further the interests of corporations and, in particular, U.S. corporations. To try to supplant this with another centralized global system of rules and institutions, though these may be premised on different principles, is likely to reproduce the same Jurassic trap that ensnared organizations as different as IBM, the IMF, and the Soviet state--and this is the inability to tolerate and profit from diversity.
Today's need is not another centralized global institution, but the de-concentration and de-centralization of institutional power and the creation of a pluralistic system of institutions and organizations interacting with one another, guided by broad and flexible agreements and understandings.
We are not talking about something completely new. For it was under such a more pluralistic system of global economic governance, where hegemonic power was still far from institutionalized in a set of all-encompassing and powerful multilateral organizations and institutions, that a number of Latin American and Asian countries were able to achieve a modicum of industrial development in the period from 1950 to 1970.
It was under such a pluralistic system, under a General Agreement on Tariffs and Trade (GATT) that was limited in its power, flexible, and more sympathetic to the special status of developing countries, that the East and Southeast Asian countries were able to become newly industrializing countries through activist state trade and industrial policies that departed significantly from the free-market biases enshrined in the WTO.
Of course, economic relations among countries prior to the attempt to institutionalize one global free market system beginning in the early 1980s were not ideal, nor were the Third World economies that resulted ideal. But these conditions and structures underline the fact that the alternative to an economic Pax Romana built around the World Bank-IMF-WTO system is not a Hobbesian state of nature. The reality of international relations in a world marked by a multiplicity of international and regional institutions that check one another is a far cry from the propaganda image of a "nasty" and "brutish" world.
Admittedly, the threat of unilateral action by the powerful is ever present in such a system, but it is one that even the most powerful hesitate to take for fear of its consequences on their legitimacy, as well as the reaction it would provoke in the form of opposing coalitions.
In other words, what developing countries and international civil society should aim at is not to reform the TNC-driven WTO and Bretton Woods institutions, but, through a combination of passive and active measures, to radically reduce their powers and to turn them into just another set of actors coexisting with and being checked by other international organizations, agreements, and regional groupings. These would include such diverse actors and institutions as UNCTAD, multilateral environmental agreements, the International Labour Organization, the European Union, and evolving trade blocs such as Mercosur in Latin America, SAARC in South Asia, SADCC in Southern Africa, and a revitalized ASEAN in Southeast Asia.
More space, more flexibility, more compromise: these should be the goals of the civil society effort to build a new system of global economic governance. It is in such a more fluid, less structured, more pluralistic world, with multiple checks and balances, that the nations and communities of both the South and the North will be able to carve out the space to develop based on their values, their rhythms, and the strategies of their choice.
Let me quote John Gray one last time: "It is legitimate and indeed imperative," he says, "that we seek a form of rootedness which is sheltered from overthrow by technologies and market processes, which, in achieving a global reach that is disembedded from any community or culture, cannot avoid desolating the Earth's human settlements and its non-human environments.
"The role of international arrangements in a world where toleration of diversity is a central principle of economic organization would be to express and protect local and national cultures by embodying and sheltering their distinctive practices."
Let us put an end to this arrogant globalist project of making the world a synthetic unity of individual atoms shorn of culture and community. Let us herald, instead, an internationalism that is built on, tolerates, respects, and enhances the diversity of human communities and the diversity of life.
(During the 1970s, Waldon Bello earned a doctorate in political sociology from Princeton University, taught at the University of California and worked as a lobbyist in Washington DC for democratic rights in the Philippines. He is currently co-director of Focus on the Global South, a project of Chulalongkorn University's Social Research Institute in Bangkok. He is also Professor of Public Administration and Sociology at the University of the Philippines. He has served on the International Board of Greenpeace and currently serves on the Board of Oxfam and on the Program Board of the International Centre for Trade and SustainabIe Development (ICTSD) in Geneva, which supplies information to NGOs on the operations of the World Trade Organization.)