Excerpted from a talk delivered at a series of engagements during the
demonstrations against the World Economic Forum in Melbourne, Australia,
6-10 September 2000. The full text is available in our Globalization 101 Issue.
In the mid-nineties, the WTO had been sold to the global public as the
lynchpin of a multilateral system of economic governance that would
provide the necessary rules to facilitate the growth of global trade and
the spread of its beneficial effects. Nearly five years later, the
implications and consequences of the founding of the WTO had
become as clear to large numbers of people as a robbery carried out
in broad daylight. What were some of these realizations?
By signing on to the Agreement on Trade-Related Investment Measures (TRIMs), developing countries discovered that they had signed away their right to use trade policy as a means of industrialization.
By signing on to the Agreement on Trade-Related Intellectual Property Rights (TRIPs), countries realized that they had given high tech transnationals like Microsoft and Intel the right to monopolize innovation in the knowledge-intensive industries and provided biotechnology firms like Novartis and Monsanto the go-signal to rivatize the fruits of eons of creative interaction between human communities and nature such as seeds, plants, and animal life.
By signing on to the Agreement on Agriculture (AOA), developing countries discovered that they had agreed to open up their markets while allowing the big agricultural superpowers to consolidate their system of subsidized agricultural production. This led to the massive dumping of surpluses on those very markets, a process that was, in turn, destroying smallholder-based agriculture.
By setting up the WTO, countries and governments discovered that they had set up a legal system that enshrined the priority of free trade above every other good--above the environment, justice, equity, and community. They finally got the significance of consumer advocate Ralph Nader's warning a few years earlier that the WTO, was a system of "trade uber alles."
In joining the WTO, developing countries realized that they were not, in fact, joining a democratic organization but one where decisions were made, not in formal plenaries but in non-transparent backroom sessions. They were joining an organization where majority voting was dispensed with in favor of a process called "consensus"-which was really a process in which a few big trading powers imposed their consensus on the majority of the member countries.
The Seattle Ministerial brought together a wide variety of protesters from all over the world focusing on a wide variety of issues. Some of their stands on key issues, such as the incorporation of labor standards into the WTO, were sometimes contradictory, it is true. But most of them, whether they were in the streets or they were in meeting halls, were united by one thing: their opposition to the expansion of a system that promoted corporate-led globalization at the expense of justice, community, national sovereignty, cultural diversity, and ecological sustainability.
Seattle was a debacle created by corporate overreach, which is quite similar to Paul Kennedy's concept of "imperial overstretch" that is said to be the central factor in the unraveling of empires.(1) The Ministerial's collapse from pressure from these multiple sources of opposition underlined the truth in Ralph Nader's prescient remark, made four years earlier, that the creation of global trade pacts like the WTO was likely to be "the greatest blunder in the history of the modern global corporation." Whereas previously, the corporation's operating within a more or less "private penumbra" made it difficult to effectively crystallize opposition, he argued that "now that the global corporate strategic plan is out in print...gives us an opportunity."(2)
Truth is eternal, but it only makes a difference in human lives when it becomes power. In Seattle, truth was joined to the power of the people and became fact. Suddenly, facts that had previously been ignored or belittled were acknowledged even by the powers-that-be whose brazen confidence had been shaken. For instance, that the supreme institution of globalization was, in fact, fundamentally undemocratic was recognized even by representatives of its stoutest defenders: the United States and the United Kingdom.
Listen to US Trade Representative Charlene Barshefsky after the revolt of the representatives of developing countries that helped bring down the Ministerial: "The processwas a rather exclusionary one," she admitted. "All meetings were held between 20 and 30 key countriesAnd that meant 100 countries, 100, were never in the room...[T]his led to an extraordinarily bad feeling that they were left
out of the process and that the resultshad been dictated to them by the 25 or 30 privileged countries who were in the room."(3)
Listen to Stephen Byers, the UK Secretary for Trade and Industry, after the Seattle shock: "WTO will not be able to continue in its present form. There has to be fundamental and radical change in order for it to meet the needs and aspirations of all 134 of its members."(4)
Reform or Disempowerment?
Our tactics will turn fundamentally on our answer to the question: Should we seek to transform or to disable the main institutions of corporate-led
Institutions should be saved and reformed if they're functioning, while defective, 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 IMF can be reformed to bring about global financial stability, the World Bank to reduce poverty, and the WTO to bring about fair trade Can we truly say that these institutions can be reengineered to handle the multiple problems that have been thrown up by the process of corporate-led globalization?
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. 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 "re-regulating" the TNCs but of eventually disabling or 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 normal 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 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 and ethics to pull up stakes, lay off people, and destroy long-established communities in order to pursue ever-cheaper labor around the globe-a process that
most TNCs now engage in.
No, these are not departures from normal corporate behavior. They are normal corporate behavior. And corporate crime against people and the environment has become a way of life.
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 quintessentially human values of justice, equity, 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 TNC.(5)
The Struggle for the Future: Deglobalization
It is often said that we must not only know what we are against but 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."
What is 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;
-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 de-emphasizing 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 subsidiary 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
We are speaking, in short, about re-embedding the economy in society, rather than having society driven by the economy.
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.
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 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. 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 state of nature.
In other words, what developing countries and international civil society should aim at is not to reform the TNC-driven WTO and BrettonWoods institutions, but 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 Labor 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 Southern agenda and 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 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 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.
- Paul Kennedy, The Rise and Fall of the Great Powers (New York: Vintage Books, 1989).
- Ralph Nader, speech at International Forum on Globalization Teach-in on "The Social, Ecological, Cultural, and Political Costs of Economic Globalization," Riverside Church, New York, Nov. 10,
1995; quoted in Joshua Karliner, The Corporate Planet (San
Francisco: Sierra Club, 1997), p. 207.
- Press briefing, Seattle, Washington, Dec. 2, 1999.
- Quoted in "Deadline Set for WTO Reforms," Guardian News
Service, Jan. 10, 2000.
- For excellent recent critiques of the corporation, see David
Korten, When Corporations Rule the World (San Francisco:
Kumarian Press/Beret-Koehler, 1995), Joshua Karliner, The
Corporate Planet (San Francisco: Sierra Club Books, 1997), and
Richard Barnet and John Cavanagh, Global Dreams: Imperial
Corporations and the New World Order (New York: Simon and
Walden Bello is Executive Director of Focus on the Global South, a program of research, analysis, and advocacy of the Chulalongkorn University1310Social Research Institute (CUSRI) in Bangkok, Thailand; and Professor of Sociology and Public Administration at the University of the Philippines. Author or co-author of 11 books on Asian economic1310and political issues, including A Siamese Tragedy: Development and Disintegration in Modern Thailand (London: Zed Press, 1998) and Dragons in Distress: Asia's Miracle Economies in Crisis (London: Penguin, 1992).
- 110 Trade Justice