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Multilateral Organizations and the Architecture of Global Governance
Conference IV: Political Power and Ethics in the New Society
Walden Bello
Prepratory document for Porto Alegre 2002
Also availalble in Spanish
Proposal for a Pluralistic System of Global Economic Governance
There is a crying need for an alternative system of global governance. We disagree with the view that thinking about an alternative system of global governance is a task that for the most part is still in a primeval state. In fact, we feel that that many or most of the basic or broad principles for an alternative order are already with us, and it is really a question of specifying these broad principles to concrete societies in ways that respect the diversity of societies.
Work on alternatives has been a collective past and present effort, one to which many North and South have contributed. Allow us to synthesize the key points of this collective effort under the rubric "deglobalization". While the following model addresses principally the situation of countries in the South, many points have relevance as well to societies and economies in the North.
Deglobalization
What is deglobalization?
We are not talking about withdrawing from the international economy. We are speaking about reorienting our economies from the emphasis on production for export to production for the local market;
- about drawing most of our financial resources for development from within rather than becoming dependent on foreign investment and foreign financial markets;
- about 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;
- about deemphasizing growth and maximizing equity in order to radically reduce environmental disequilibrium;
- about not leaving strategic economic decisions to the market but making them subject to democratic choice;
- about subjecting the private sector and the state to constant monitoring by civil society;
- about creating a new production and exchange complex that includes community cooperatives, private enterprises, and state enterprises, and excludes TNCs;
- about enshrining the principle of subsidiarity in economic life by encouraging 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, the pursuit of cost efficiency to the values of security, equity, and social solidarity. We are speaking, to use the language of the great social democratic scholar Karl Polanyi, about re-embedding the economy in society, rather than having society driven by the economy.
Pluralist Global Governance
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, US 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. Incidentally, the idea that the need for one central set of global rules is unquestionable and that the challenge is to replace the neoliberal rules with social democratic ones is a remnant of a techno-optimist variant of Marxism that infuses both the Social Democratic and Leninist visions of the world, producing what Indian author Arundathi Roy calls the predilection for "gigantism".
Today's need is not another centralized global institution but the deconcentration and decentralization 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 1980's were not ideal, nor were the Third World economies that resulted ideal. They failed to address a number of needs illuminated by recent advances in feminist, ecological, and post-post development economics. All we wish to point out here is that the pre-1994 situation underlines 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. All we want to stress is that 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. Of course, 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 either a) decommission them; b) neuter them (e.g., converting the IMF into a pure research institution monitoring exchange rates of global capital flows); or c) radically reduce their powers and turn them into just another set of actors coexisting with and being checked by other international organizations, agreements, and regional groupings. This strategy would include strengthening diverse actors and institutions as UNCTAD, multilateral environmental agreements, the International Labor Organization, and evolving economic blocs such as Mercosur in Latin America, SAARC in South Asia, SADCC in Southern Africa, and a revitalized ASEAN in Southeast Asia. A key aspect of "strengthening", of course, is making sure these formations evolve in a people-oriented direction and cease to remain regional elite projects.
But above all, it would support the formation of new international and regional institutions that would be dedicated to creating and protecting the space for devolving the greater part of production, trade, and economic decision-making to the national and local level. The primal role of international organizations in a world where toleration of diversity is a central principle of economic organization would be, as the British philosopher John Gray puts it, "to express and protect local and national cultures by embodying and sheltering their distinctive practices". (1)
More space, more flexibility, more compromise-these should be the goals of the Southern agenda and the international 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 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.
References
1. John Gray, Enlightenment's Wake (London: Routledge, 1995), p. 181.
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