Transnational Risks - A New Challenge for Global Civil Society

First please let me thank the organizers, the Irmgard Coninx Stiftung and especially Sabine Berking for bringing me here and giving me the opportunity to participate in this important and timely conference. I'm both grateful and honoured.

From knowing something of their work-although I've not consulted with either of them-I imagine my two colleagues on the platform are likely to address major contemporary risks which no thinking person can ignore. I expect, for example, that Dr Hermann Scheer may speak to us about global warming, a risk I worry about even more than I used to since I learned about the recent scientific work on terrestrial and marine sedimentary deposits laid down 250 million years ago. What possible relevance can such an arcane geological subject have for us today? A lot! These sediments show clearly the consequences of the huge volcanic explosions in Siberia that occurred during the Permian Era. They saturated the earth's atmosphere with sulphur dioxide and especially carbon dioxide. Melting polar icecaps released massive quantities of methane, creating runaway positive feedback, a snowball, or rather a fireball effect.

Ninety percent of the abundant, hugely varied life forms that then existed on the planet were literally smothered or starved to death as oxygen disappeared. And what was the temperature change that provoked this disaster? Scientists have measured it with great accuracy as well-plus six degrees centigrade; exactly what the experts of the International Panel on Climate Change suggest may be the case for earth by the year 2100. We run a genuine risk of repeating the Great Permian extinction which took place in an amazingly short period, geologically speaking. This is just one example of the kind of enormous risk whose likelihood can be reduced only through transnational action. If we as a species are so stupid or so perverse that our activities trigger another mass extinction, we can only admit we got exactly what we deserved, except that no humans will still be around to say it.

I hope Dr Scheer may prove to be more optimistic on this risk than I am.

Perhaps Dr Amitai Etzioni will speak about another huge risk we confront-particularly in the affluent West--the risk of terrorism. He even confesses to first-hand knowledge of the subject. When the British still occupied Palestine, he and several young Jewish friends....but he can tell you that story himself if he likes. Don't think I'm betraying any secrets here as Dr Etzioni has himself revealed this one in a major American newspaper.
Since I expect these two major risks-radical climate change and terrorism-to be brilliantly discussed here, I shall myself try to determine whether these and other risks we face do not have a common, identifiable origin.

In the broadest sense, yes, they do, because all technologies are risky. Let me borrow from the French architect and philosopher Paul Virilio who looks at every technology man develops as a sure source of risk. For him, the accident is built in: if you invent the airplane, you simultaneously invent the crash; the computer implies catastrophic loss of information, nuclear fission means Chernobyl and Three Mile Island and so on. Although Virilio himself doesn't take the concept this far, I would add that crime is also built in and can be traced all the way back to stone-age technologies. Any instrument that can be used as a bludgeon or honed to a sharp point carries with it the risk of murder just as the propagator of computer viruses is co-extensive with the information society and the hijacker is aviation's version of the pirate.

The inevitability of built-in risk of accident and crime is the principle reason we need the State. In my view, no one has yet persuasively refuted the logic of Thomas Hobbes who recognised in the seventeenth century that, left in the "state of nature" which is the "war of all against all", men would cry out for protection and willingly accept even the most oppressive State, the Leviathan, because they simply cannot live with such constant and all-pervading levels of risk.

It strikes me that in the early twenty-first century, particularly since 11 September 2001, we are once more experiencing something like the fear Hobbes attributed to his imagined pre-State creatures. We, too, are crying out for protection. This is most clear in the United States where, under the Bush administration, Americans have surrendered basic Constitutional freedoms in hopes of being protected from future attack. But as Benjamin Franklin said, "Those who renounce liberty for security deserve neither".

Terrorist attacks, global warming--even the calling of this conference-are indicators that we have indeed entered the era of transnational risk. Does this mean we must take Hobbes' logic a step further, that we must necessarily establish a transnational State as well, or perish? Although my position on this question may seem contradictory, I don't think a transnational State is the answer, at least not yet. Nor do I believe that the private sector can be entrusted with the prevention of global risks, and I'll return to these points.

First, however, I'd like to step back and argue that contemporary capitalism, also known as "globalisation" or "neo-liberalism", is not merely increasing the risks we face as individuals, as members of a given community and as a species but also lies at their very heart.

Let me stress that I am not speaking here of risk as it is commonly associated with capitalism; I'm not referring to the classic economic model in which capitalism and risk-taking are inextricably joined and the hope of material reward is the motor of the system.

Innovation occurs because people are willing to gamble. No one can set up a business or even buy securities on the stock market without taking a risk. Columbus would undoubtedly not have risked sailing westward without the incentive of discovering riches as well as a new trade route to the Indies. According to a recent piece in the New York Times, Boeing became great because its leaders were passionate about aviation and ready to bet the company on a new concept like the 747, but it is now governed by a Board interested only in financial results [and thereby, paradoxically, placing the company at risk]. Capitalism in this sense is based on risk freely accepted, on gambles, on taking chances. Our word hazard derives from the Arabic al zahr, which means dice.

So rather than expand on capitalist risk in this classic sense, I want to look at the numerous new risks forced upon people whose lives and well-being increasingly depend on someone else's throw of the dice. They have little or no choice in the matter; they are victims of capitalist globalisation's frenetic search for profit, its disregard for nature and for human beings and its drive to transform all human activities into marketable commodities. The resulting individual and collective risks are imposed, not freely accepted. The transformative power of transnational capital--what Joseph Schumpeter called "creative destruction"-has grown exponentially over the past two decades, particularly since the end of the Cold War. For most people, however, it has destroyed far more than it has created. Risk-taking has, in this sense, become compulsory.

The neo-liberal programme, also known as the Washington Consensus, is not just economic: it has become the supreme arbiter of political decision-making as well. This programme pushes privatisation, deregulation and increased corporate control over labour and the environment. Governments and international institutions have allied with transnational corporations and financial market operators to impose the Holy Trinity of capitalist freedoms: freedom of investment, freedom of capital movements, freedom of trade in goods, services, agricultural commodities and intellectual property. The private sector is not merely allowed but is expected to make social and political decisions as well as economic ones. Hard-core neo-liberalism is naturally most advanced in the United States but is rapidly gaining ground even in countries which had taken the Welfare State furthest, like France and Germany. This extreme right-wing worldview stands in stark contrast to the first thirty or forty years of the post-World War II period when everyone was some stripe of Christian or Social Democrat, a Keynesian or a Marxist. The construction of more just societies, based on solidarity, then seemed the only natural and honourable path. The goal of these societies was to protect citizens against glaring risks such as illness, unemployment, disability, old age and the like.

What is the connection between present corporate-led, neo-liberal intellectual hegemony and heightened risk? Whenever and wherever social protection and the Welfare State are dismantled, as they must be according to Washington Consensus doctrine, millions of people automatically face much higher levels of risk. Read, for example, Barbara Ehrenreich's book Nickled and Dimed in which you will learn how millions of poor Americans-even including people working at two jobs--are forced, in the richest country on earth, to live exposed to lack of health care, homelessness and accident. The problem for poor people in poor countries is naturally much worse as the statistics clearly demonstrate.

Evidence showing the growth of inequalities over the past twenty years, both within and between countries, has become overwhelming and I don't intend to spend much time here giving examples. Anyone who has opened a newspaper in the past few years presumably knows about the increase in hunger, the number of people living on less than the equivalent of a dollar a day, the collapse of health and education systems, the spread of AIDS and so on.

I dislike the expression "social safety nets" because, like fish, most people who fall into such nets are unlikely to escape them and will remain trapped in poverty. But even those meagre nets are becoming frayed. In the North, the goals of the neo-liberal programme are to roll back the gains of social and labour movements over the past one hundred years, to cut State and public services to the bone and to make individuals responsible for their own fate, no matter what the circumstances. Private transportation, private education, health care, insurance, etc. are the norm.

In the South, The World Bank and the International Monetary Fund, working hand in hand with the US Treasury, have imposed structural adjustment packages in over a hundred indebted countries, making risk-provoking neo-liberal doctrine the rule. For years, people like me denounced the human consequences of these austerity programmes to no avail, but now the criticism is also coming from people at the core of the system like Professor Joseph Stiglitz, former head of President Clinton's Council of Economic Advisors and former Chief Economist of the World Bank; as well as the present Chief Economist of the Bank, François Bourguignon. Neo-liberal goals also directly contradict the principles enshrined in the Universal Declaration of Human Rights, but we'll leave these risk-exposed people aside now, even though there are billions of them, and ask how mass poverty in both rich and poor countries can exist when, in the aggregate, the world has never been richer than it is today.

These anti-poor, anti-environment policy shifts are no accident. They can be traced to the strategic decision of a few private American foundations to finance massively the production and dissemination of neo-liberal ideology, in the United States and abroad. These funders have ensured that this ideology is now the medium in which national and international policy-making takes place. Intellectually speaking, neo-liberalism now seems to most people as "natural" as water does to fish--they don't even know they're swimming in it. This ideological tectonic shift has been bought and paid for by foundations like Bradley, Olin, Scaife, Koch, Smith-Richardson and a few others. Their founders made huge fortunes [steel, oil, chemicals, munitions, etc.] and often belonged to ultra-right American organisations of the early post-war period like the John Birch Society. Over the past quarter century, they have collectively spent over $80 million yearly to finance conservative thinkers, writers, policy-shops, think-tanks, university research centres, law schools, scholarships, conferences, books, magazines, radio and TV programmes and so on. Altogether this neo-liberal philanthropy amounts to well over a billion dollars but the ideological triumph has been amazingly cheap at the price. These are the people who have prepared the Presidential agendas from Reagan to Bush, including the new concept of pre-emptive war, and their disciples are active abroad as well.

At this conference we've been asked to discuss the role of the media in relation to risk and I should just like to add here that most of the media have been exceptionally complacent with regard to this mercantile, foundation-sponsored intellectual production. They have allowed the right-wing foundations' protégés to dominate editorial pages, critical reviews, best-seller lists, radio and television talk shows and in a general way to set the terms of the entire social, economic and political debate. Although most glaring in the United States, this ideological bias is not confined to the American corporate-owned media. More and more, the media everywhere refuse genuine dissent and even exclude objective reporting on sensitive subjects. The citizen's movement is attempting to establish alternative media to cover its own activities which the mainstream won't touch, and the internet is a useful tool, but these are no substitute for lively debate in mass-media with a mass audience.

If neo-liberalism exposes individuals to heightened risk, what about the collective risks society faces? Here too one can point to globalised free-market capitalism as the culprit.

As soon as reduction of greenhouse gases was even suggested in the United States, a powerful coalition of energy, mining and automotive transnational corporations formed a lobby with the environmentally-friendly name "Global Climate Coalition". They lobbied fiercely over a decade for limiting action to "voluntary" measures to reduce greenhouse gases. When I looked at their website recently, I found they had "deactivated" the Coalition, because all their goals had been met by the Bush administration's policies. Who can argue that transnational capital reduces transnational risks?

Or take the example of the production and dissemination of Genetically Manipulated Organisms, GMOs. Although scientifically speaking one can't swear that GMO foods are potentially harmful to humans, scientific evidence and practical experience do show that the GMO plants themselves pose real dangers to the environment when grown outside the laboratory. They can't be confined to the place they're planted, they interact in unpredictable ways with other flora and fauna and once cultivated in natural surroundings, they cannot be recalled. Whatever genetic pollution they cause is irreversible. Some have called the proliferation of GMOs a kind of biological Hiroshima.

Yet we're told that "You can't stop scientific progress" or that being against GMOs is being "anti-scientific"-as if our research laboratories were full of idealistic scientists seeking Truth instead of technicians working for large corporations seeking only their own profits and power. I did a little research on the GMO varieties approved for cultivation over the past decade by the US Department of Agriculture. I discovered that half of them were owned by Monsanto. Eighty percent of these authorised varieties were controlled by three giant firms while over 90 percent were patented by the top five companies. GMOs are sold to farmers as part of a package of inputs and they are bred to be herbicide-tolerant or to produce their own insecticides. The scientists who create them proceed as if Darwin had never existed. They ignore the obvious fact that weeds and insects will develop resistance and require larger doses of chemicals for effective control.

Leaving aside the potential health risks, isn't it risky enough to plant these irreversible environmental contaminants and to allow our food chains to be controlled by a few giant corporations? Neo-liberals don't think so, even if the public does. The United States, claiming its agricultural exporters are losing over $300 million a year, is suing the European Union for imposing a moratorium and establishing labelling and traceability laws on GMO imports. The Dispute Resolution Body of the WTO will hear the case and since the WTO does not recognise the precautionary principle, the US is likely to win, just as it did in the case of the EU refusal to import hormone treated beef.

Capital-intensive agricultural production can't wait for nature's timetable and wants animals to mature faster. The result is mad cows and C-J disease for humans or excessive, resistance-creating use of antibiotics in animal feed. Chemicals used in both agricultural and industrial production are clearly correlated with the incidence of cancer. Epidemiological studies of the Texas-Mexico border in the maquiladora manufacturing zone show that cancer rates in these areas are the highest in both countries. Depleted uranium used in munitions [during the Gulf War, the Bosnian or Kosovo conflicts] has caused birth defects of epidemic proportions. Statistically speaking, people-again mostly poor-are far more likely to suffer illness and death due to such environmental factors.

Transnational capital wants freedom of trade and multilateral or regional trade agreements like NAFTA, negotiated under pressure from business interests, have displaced millions of small farmers and reduced food security for them, their families and their countries. Mexico, for example, under pressure from the United States, embraced foreign investors and open borders. Not only has its small-farming sector been decimated by cheap imports of US subsidised corn but the maquiladora factories are gradually closing down and moving to China. In the first eight months of 2003 alone, more than 370 factories closed, causing job losses in the tens of thousands.

Transnational capital also wants freedom of capital movements and the IMF has made sure than indebted countries-well over a hundred of them-respect this wish. The consequences have been one devastating financial crisis after another. To take only the past decade, beginning with Mexico in 1994, IMF policies have encouraged speculation and its bail-outs have rewarded the speculators rather than the governments, much less the populations, of the affected countries. Speculators have realised huge profits, while local businesses have failed in droves, leaving thousands of employees on the pavement. Joseph Stiglitz has also clearly explained how the game works. Typically, a powerful speculator or consortium will take out a huge loan in, say, Thai baht from a Thai bank. With the borrowed Thai currency, they buy dollars. The massive quantity of baht sold all at once in order to purchase the dollars causes the Thai currency to lose value precipitously. Now the speculator can pay back his loan to the Thai bank in devalued baht. The remaining dollars are his to enjoy. This is form of legal embezzlement, approved and abetted by the IMF which has also systematically made post-crisis, billion- dollar loans to these governments. The money was immediately sucked out of the country by foreign banks and local elites.

Because governments like that of Thailand have signed structural adjustment agreements with the Fund, they are powerless to close its borders to outflows of capital. During the Asian financial crisis of 1997-1998, only Malaysia and China, which did not have structural adjustment programmes, were able to prevent capital outflows. They surmounted the crisis with relative ease despite the destabilisation of the entire region.

But the action of the Fund doesn't stop with wrecking the currency and siphoning public money into private hands. Next, it insists that the Thai [or other] Central Bank jack up interest rates in order, they say, to "control inflation". Indebted companies, unable to reimburse their creditors at the new rates, without enough cash flow to pay their suppliers, quickly go bankrupt. When enough companies are bankrupt, the banks themselves start to go under. Then, as the International Herald Tribune put it, American and Japanese transnational corporations arrive and "snap up" the bankrupted companies at a fraction of their real value. The IMF repeated the process in Russia, Brazil, Turkey and Argentina. Argentina was the Fund's shining example, doing everything it was told. Its reward is renewed hunger, unemployment rates of some 40 percent and a hemorrhage of hard currency leaving the country, while debts increase.

Risks for ordinary people, who had nothing whatever to do with provoking the crisis, are naturally compounded. In Mexico, 28.000 small businesses failed and average Mexicans are worse off now than they were in the early 1970s. Well over half the population lives under the official poverty line. In Indonesia, thirty thousand bank employees lost their jobs in a single week. In Korea, workers who could no longer feed their families committed what came to be called "IMF suicides", sometimes taking their families with them into death.

The conference organisers have also asked us to consider the responsibilities of the social sciences with regard to transnational risk. I would submit that the Fund and its accomplice in structural adjustment, the World Bank, are populated with thousands of "social scientists", mostly economists. But are these people really "scientists" at all? Not if a scientist is someone who formulates a hypothesis, tests it and throws it out if it doesn't work. Neo-liberal social "scientists", on the other hand, continue to work on the basis of the same hypothesis no matter how many times it can be shown not to "work" for millions of people in the afflicted countries. If a bridge collapses, the engineers who made the calculations are responsible and are called to account. If an economy, an entire society collapses, the policy-makers from the Fund are never accountable; indeed they are free to pursue exactly the same failed policies for years on end. Perhaps the clue is that these policies do in fact "work" for foreign banks and speculators, and transfer vast amounts of wealth from South to North, from the poor to the rich.

One could go on giving examples of how neo-liberalism multiplies individual and collective risk but it's time to ask whether civil society can in fact effectively confront this problem. As the title of this session suggests, transnational risks are certainly "a new challenge for global civil society" but recognising that a "challenge" exists doesn't necessarily mean that it can be met.

The challenges are indeed huge and the mere fact that civil society is invoked in this context shows that somewhere, someone else-notably the State and our international institutions--has abdicated responsibility. It shouldn't be up to civil society to protect the entire planet and all its inhabitants from the massively harmful impact of world capitalism, but this is implicitly the task it has been asked to take on, and one which, to a large degree, it has accepted.

As someone who has for several decades tried to expose and fight against these risks, may I say that one can get a little tired of finding no help whatsoever in high places? May I suggest that civil society shouldn't have to do this job by itself? That we need laws and enforceable rules, not the never-ending struggle to confront first this danger, then that one? The risk for transnational civil society is to become the Sisyphus society, eternally obliged to start over, because corporations and financial markets do as they please and governments govern on their behalf.

We-meaning North American and European civil society--won one fight against transnational capital's interests when in 1998 we defeated the Multilateral Agreement on Investment, the MAI. This neo-liberal treaty was being negotiated in secret at the OECD and would have given all powers to corporations, none to citizens, none to governments. But at the beginning, even when we carefully explained the danger to them, the media wouldn't touch the subject, telling us it was "too complicated, too technical"; that the public wouldn't understand and wouldn't want to know about the MAI. In France, through a hastily assembled coalition of civil society organisations from many different sectors, we managed to educate enough people and parliamentarians, who had never heard of the MAI, and we finally made it a hot topic, hot enough for France to withdraw and cause the negotiations to collapse. But my point is that we shouldn't have been obliged to do this work to begin with. Governments should never have become involved in such blatantly pro-corporate negotiations and kept their own parliaments in the dark.

Furthermore, "civil society" almost always has to work for nothing, on tiny, self-raised budgets and the people who participate in these fights have to give their time on a voluntary basis while facing adversaries who can spend millions. It's a miracle civil society ever wins anything. Seattle and Cancun may also prove to be steps on the way to dismantling a hugely unfair world trading system. Now that would be a major victory, but changing something awful that already exists is a lot more difficult than preventing something awful, like the MAI, that doesn't exist yet.

A major problem for civil society is the total absence of democratic process and machinery above the individual State level. One has virtually no hope of influencing European Union policy, except through individual member States. It's hopeless to try to change the World Bank, the IMF, or the WTO directly. Why are people in the streets? Because they have nowhere else to go.

Toward the beginning of this contribution, I asked if we didn't need a transnational State in order to confront transnational risk. Even if such a State were possible, it would not in my view be desirable because it would be made up of, and serve, exactly the same interests against which we are now struggling. There is an invisible transnational government anyway; a visible one would only make matters worse.

Dissent from the dominant ideology and good ideas for new initiatives are always ridiculed at the beginning. Dissenters have a lot to lose and most people can't afford to lose too much. Dissenters also have to grow used to being ignored. But I am encouraged that despite the drawbacks, the pitfalls, the huge forces arrayed against us, we are still moving forward and the global justice movement is growing. Our opponents may have the money and the power, but we have the numbers, the ideas and the moral claim on justice and democracy. I am heartened too that the Irmgard Coninx Stiftung has chosen to take this struggle seriously. This may itself be a sign that the tide is turning.

Thank you for your kind attention.