Global Policy Forum

By Michael Albert

PART I

Anti-globalization activists understand that sympathetic and mutually beneficial global ties are good. But we want social and global ties to advance universal equity, solidarity, diversity, and self-management, not to subjugate ever-wider populations to an elite minority. We want to globalize equity not poverty, solidarity not anti-sociality, diversity not conformity, democracy not subordination, and ecological balance not suicidal rapaciousness.

Two questions arise. Why do these aspirations leave us critical of corporate globalization? And what new institutions do we propose for meeting these aspirations?

Current international market trading benefits overwhelmingly those who enter today's exchanges already possessing the most assets. When trade occurs between a U.S. multinational and a local entity in Mexico, Guatemala, or Thailand, the benefits do not go more to the weaker party with fewer assets, nor are they divided equally, but they go disproportionately to the stronger traders who thereby increase their relative dominance. Opportunist rhetoric aside, capitalist globalizers try to disempower the poor and already weak and to further empower the rich and already strong. The result: of the 100 largest economies in the world, 52 aren't countries; they are corporations.

Similarly, market competition for resources, revenues, and audience is most often a zero sum game. To advance, each actor preys off the defeat of others so that capitalist globalization promotes a self-interested me-first attitude that generates hostility and destroys solidarity between individuals, industries, and states. Public and social goods are downplayed, private ones elevated. Businesses and nations augment their own profits while imposing losses on others. Human well being and development for everyone is not a guiding precept. Solidarity fights a rearguard battle against capitalist globalization.

Moreover, in current global exchange structures, whether they are McDonaldsesque or Disneyesque or instead derive from worthy indigenous roots, cultural communities and values disperse only as widely as their megaphone permits them too, and worse, are drowned out by other communities with larger megaphones who impinge on them. Capitalist globalization swamps quality with quantity and creates cultural homogenization not diversity. Not only does Starbucks proliferate, so do Hollywood images and Madison Avenue styles. What is indigenous and non-commercial struggles to even survive. Diversity declines.

In the halls of the capitalist globalizers, only political and corporate elites are welcome. The idea that the broad public of working people, consumers, farmers, the poor and the disenfranchised should have proportionate say is actively opposed. Indeed, the point of capitalist globalization is precisely to reduce the influence of whole populations and even of state leaderships save for the most powerful elements of Western corporate and political rule. Capitalist globalization imposes corporatist hierarchy not only in economics, but also in politics. Authoritarian and even fascistic state structures proliferate. The numbers of voices with even marginal say declines.

As the financiers in corporate headquarters extend stockholders' influence, the earth beneath is dug, drowned, and paved without attention to species, by-products, ecology, or humanity. Only profit and power drive the calculations. Anti-globalization activists oppose capitalist globalization because capitalist globalization violates the equity, diversity, solidarity, self- management, and ecological balance that activists pursue.

Supporting Global Justice

What do anti-globalization activists propose to replace the institutions of capitalist globalization, the International Monetary Fund, the World Bank, and the World Trade Organization?

The International Monetary Fund or IMF and World Bank were established after World War II. The IMF was meant to provide means to combat financial disruptions adversely impacting countries and people around the world. It employed negotiations and pressures to stabilize currencies and to help countries avoid economy disrupting financial machinations and confusions. The World Bank was meant to facilitate long-term investment in underdeveloped countries, to expand and strengthen their economies. It was to lend major project investment money at low interest to correct for the lack of local capacity. Within existing market relations, these limited goals were positive. Over time, however, and accelerating dramatically in the 1980s, the agenda of these institutions changed. Instead of facilitating stable exchange rates and helping countries protect themselves against financial fluctuations, the IMF began bashing any and all obstacles to capital flow and unfettered profit seeking, virtually the opposite of its mandate. Instead of facilitating investment on behalf of the local poor economics, the World Bank became a tool of the IMF, providing and withholding loans as carrot or stick to compel open corporate access, and financing projects not with an eye to benefits for the recipient country, but with far more attention to benefits going to major multinationals.

In addition, the World Trade Organization or WTO that was desired in the early post war period actually came into being only decades later, in the mid 1990s. Its agenda became to regulate trade on behalf of the already rich and powerful. Instead of only imposing on third world countries low wages and high pollution due to being able to easily coerce their weak or bought-off governments, as IMF and World Bank policies accomplish, why not also weaken all governments and agencies that might defend workers, consumers, or the environment, not only in the third world, but everywhere? Why not remove any efforts to limit trade due to its labor implications, its ecology implications, its social or cultural implications, or its development implications, leaving as the only legal criteria whether there are immediate, short-term profits to be made? If national or local laws impede trade-say an environmental, a health, or a labor law-the WTO adjudicates, and its entirely predictable pro-corporate verdict is binding.

The WTO trumps governments and populations on behalf of corporate profits. The full story about these three centrally important global institutions is longer, of course, but improvements are not hard to conceive. First, why not have, instead of the International Monetary Fund, the World Bank, and the World Trade Organization, an International Asset Agency, a Global Investment Assistance Agency, and a World Trade Agency. These three new (not merely reformed) institutions would work to attain equity, solidarity, diversity, self-management, and ecological balance in international financial exchange, investment and development, trade, and cultural exchange.

• They would try to ensure that the benefits of trade and investment accrue disproportionately to the weaker and poorer parties involved, not to the already richer and more powerful.

• They would not prioritize commercial considerations over all other values, but would prioritize national aims, cultural identity, and equitable development.

• They would not require domestic laws, rules, and regulations designed to further worker, consumer, environmental, health, safety, human rights, animal protection, or other non-profit centered interests to be reduced or eliminated, but they would work to enhance all these, rewarding those who attain such aims most successfully.

• They would not undermine democracy by shrinking the choices available to democratically controlled governments, but they would work to subordinate the desires of multinationals and large economies to the survival, growth, and diversification of smaller units.

• They would not promote global trade at the expense of local economic development and policies, but vice versa.

• They would not force Third World countries to open their markets to rich multinationals and to abandon efforts to protect infant domestic industries, but would facilitate the reverse.

• They would not block countries from acting in response to potential risk to human health or the environment, but would help identify health, environmental, and other risks, and assist countries in guarding against their ill effects.

• Instead of downgrading international health, environmental, and other standards to a low level through a process called "downward harmonization," they would work to upgrade standards via a new "upward equalization."

The new institutions would not limit governments' ability to use their purchasing dollars for human rights, environmental, worker rights, and other non-commercial purposes, but would advise and facilitate doing just that. They would not disallow countries to treat products differently based on how they were produced-irrespective of whether they were made with brutalized child labor, with workers exposed to toxins, or with no regard for species protection-but would facilitate just such differentiations. Instead of bankers and bureaucrats carrying out policies of presidents to affect the life situations of the very many without even a pretense at participation by those impacted, these new institutions would be open and democratic, transparent, participatory, and bottom up, with local, popular, and democratic accountability.

These new institutions would promote and organize international cooperation to restrain out-of-control global corporations, capital, and markets by regulating them to make it possible for people in local communities to control their own economic lives.

• They would promote trade that reduces the threat of financial volatility and meltdown, enlarges democracy at every level from the local to the global, defends and enriches human rights for all people, respects and fosters environmental sustainability worldwide, and facilitates economic advancement of the most oppressed and exploited groups, and at the request of smaller trade partners would intervene to prevent violations of these guiding norms.

• They would encourage domestic economic growth and development, not domestic austerity in the interest of export-led growth.

• They would encourage the major industrial countries to coordinate their economic policies, currency exchange rates, and short-term capital flows in the public interest and not for private profit.

• They would establish standards for and oversee the regulation of financial institutions by national and international regulatory authorities, encouraging the shift of financial resources from speculation to useful and sustainable development.

• They would establish taxes on foreign currency transactions to reduce destabilizing short-term cross-border financial flows and to provide pools of funds for investment in long-term environmentally and socially sustainable development in poor communities and countries.

• They would create public international investment funds to meet human and environmental needs and ensure adequate global demand by channeling funds into sustainable long-term investment.

• And they would develop international institutions to perform functions of monetary regulation currently inadequately performed by national central banks, such as a system of internationally coordinated minimum reserve requirements on the consolidated global balance sheets of all financial firms.

These new institutions would also work to get wealthy countries to write off the debts of impoverished countries and to create a permanent insolvency mechanism for adjusting debts of highly indebted nations. They would use regulatory institutions to help establish public control and citizen sovereignty over global corporations and to curtail corporate evasion of local, state, and national law, such as establishing a binding Code of Conduct for Transnational Corporations that includes regulation of labor, environmental, investment, and social behavior.

And second, in addition to getting rid of the IMF, World Bank, and WTO and replacing them with the three dramatically new and different structures outlined above, anti-globalization activists also advocate a recognition that international relations should not derive from centralized but rather from bottom-up institutions. The new overarching structures mentioned above should therefore gain their credibility and power from an array of arrangements, structures, and ties enacted at the level of citizens, neighborhoods, states, nations and groups of nations, on which they rest. And these more grass-roots structures, alliances, and bodies defining debate and setting agendas should, like the three earlier described one, also be transparent, participatory and democratic, and guided by a mandate that prioritizes equity, solidarity, diversity, self-management, and ecological sustainability and balance. The overall idea is simple. The problem isn't international relations per se. Anti globalization activists are, in fact, internationalist. The problem is that capitalist globalization alters international relations to further benefit the rich and powerful. In contrast, activists want to alter relations to weaken the rich and powerful and empower and improve the conditions of the poor and weak. Anti-globalization activists know what we want internationally--global justice in place of capitalist globalization.

PART II

Anti-globalization activists have a vision problem even after we describe alternative global economic institutions (as in part one of this two part commentary). Everyone knows that international norms and structures don't drop from the sky. It is certainly true that once in existence they impose severe constraints on domestic arrangements and choices, but it is also true that global relations sit on top of and are propelled and enforced by the dictates of domestic economies and institutions. The IMF, World Bank, and WTO impose capitalist institutions such as markets and corporations on countries around the world. But the existence of markets and corporations in countries around the world likewise propels capitalist globalization.

So when anti-globalization activists offer a vision for a people-serving and democracy-enhancing internationalism in place of capitalist globalization, we are proposing to place a very good International Asset Agency, Global Investment Assistance Agency, and Global Trade Agency, plus a foundation of more grass-roots democratic and transparent institutions on top of the very bad domestic economies we currently endure. The persisting domestic structures inside our countries would continually militate against the new international structures. Persisting corporations and multinationals would not positively augment and enforce these new international structures, but at best temporarily succumb to pressures to install them, perpetually emanating pressures to return to more rapacious ways.

So when people ask activists "what are you for?" they actually aren't asking only what are you for internationally. They also mean what are you for in place of capitalism? If we have capitalism, they reason, there will inevitably be tremendous pressures for capitalist globalization and against anti-capitalist innovations. IAA, GIAA, and GTA sound nice, but even if you got them put in place, the domestic economies of countries around the world would push to undo them. Capitalist globalization is, after all, markets, corporations, and class structure writ large. To really replace capitalist globalization and not just mitigate its effects, you would have to begin to replace capitalism too. Efforts to improve global relations couldn't be an end in itself, but would have to be part of a larger project to transform the underlying root capitalist structures. If you have no alternative to markets and corporations, many feel, your gains would be at best temporary. This assessment is widely held and fuels and is fueled by the reactionary slogan that "there is no alternative." To combat this we need an alternative regarding international agencies and global economics, but also an alternative regarding markets, corporations, and domestic economies.

Capitalist economics revolves around private ownership of the means of production, market allocation, and corporate divisions of labor. Remuneration is for property, power, and to a limited extent contribution to output causing huge differences in wealth and income. Class divisions arise due to property and due to differential access to empowered versus obedient work. Huge differences in decision-making influence and quality of circumstances exist. Buyers and sellers one-up each other and the broader public reaps what self-interested competition sows. Anti-social trajectories of investment and personality development result. Decision-making ignores or exploits ecological decay. Reduced ecological diversity results.

To transcend capitalism, suppose we advocate the same values as used above for global assessments: equity, solidarity, diversity, self-management, and ecological balance. What institutions can propel these values in domestic economics, as well as admirably accomplish economic functions?

To start, we might choose to advocate public/social property relations in place of privatized capitalist property relations. In the new system, all citizens own each workplace in equal part. This ownership conveys no special right or income. Bill Gates doesn't own a massive proportion of the means by which software is produced. We all own it-or symmetrically, if you prefer, no one owns it. At any rate, ownership becomes moot regarding distribution of income, wealth, or power. In this way the ills of private ownership such as personal accrual of profits yielding huge wealth, disappear.

Next, workers and consumers could be organized into democratic councils with the norm for decisions being that methods of dispersing information to decision-makers and at arriving at preferences and tallying them into decisions should convey to each actor about each decision, to the extent possible, influence over the decision in proportion to the degree they will be affected by it. Councils would be the seat of decision-making power and would exist at many levels, including subunits such as work groups and teams and individuals, and supra units such as workplaces and whole industries. People in councils would be the economy's decision-makers. Votes could be majority rule, three quarters, two-thirds, consensus, etc. They would be taken at different levels, with fewer or more participants, depending on the particular implications of the decisions in question. Sometimes a team or individual would make a decision pretty much on its own. Sometimes a whole workplace or even industry would be the decision body. Different voting and tallying methods would be employed as needed for different decisions. There is no a priori single correct choice.

There is, however, a right norm to try to efficiently and sensibly implement: decision-making input should be in proportion as one is affected by decisions.

Next, we alter the organization of work changing who does what tasks in what combinations. Each actor does a job, of course. Each job is composed of a variety of tasks, of course. What changes from current corporate divisions of labor to a preferred future division of labor is that the variety of tasks each actor does is balanced for its empowerment and quality of life implications. Every person participating in creating new products is a worker. The combination of tasks and responsibilities you have at work accords you the same empowerment and quality of life as the combination I have accords me, and likewise for each other worker and their balanced job complex. We do not have some people overwhelmingly monopolizing empowering, fulfilling, and engaging tasks and circumstances.

We do not have other people overwhelmingly saddled with only rote, obedient, and dangerous things to do. For reasons of equity and especially to create the conditions of democratic participation and self-management, when we each participate in our workplace and industry (and consumer) decision-making, we each have been comparably prepared by our work with confidence, skills, and knowledge to do so. The typical situation now is that some people who produce have great confidence, social skills, decision-making skills, and relevant knowledge imbued by their daily work, and other people are only tired, de-skilled, and lacking relevant decision making knowledge due to their daily work. Balanced job complexes do away with this division of circumstances. They complete the task of removing the root basis for class divisions that is begun by eliminating private ownership of capital. They eliminate not only the role of owner/capitalist and its disproportionate power and wealth, but also the role of intellectual/decision making producer who exists over and above all others. They apportion conceptual and empowering and also rote and unempowering responsibilities more equitably and in tune with true democracy and classlessness.

Next comes remuneration. We work. This entitles us to a share of the product of work. But this new vision says that we ought to receive for our labors an amount in tune with how hard we have worked, how long we have worked, and with what sacrifices we have worked. We shouldn't get more by virtue of being more productive due to having better tools, more skills, or greater inborn talent, much less by virtue of having more power or owning more property. We should be entitled to more consumption only by virtue of expending more of our effort or otherwise enduring more sacrifice. This is morally appropriate and also provides proper incentives due to rewarding only what we can affect, not what we can't. With balanced job complexes, for eight hours of normally paced work Sally and Sam receive the same income. This is so if they have the same job, or any job at all. No matter what their particular job may be, no matter what workplaces they are in and how different their mix of tasks is, and no matter how talented they are, if they work at a balanced job complex, their total work load will be similar in its quality of life implications and empowerment effects so the only difference specifically relevant to reward for their labors is going to be length and intensity of work done, and with these equal the share of output earned will be equal. If length of time working or intensity of working differ somewhat, so will share of output earned. Who mediates decisions about the definition of job complexes and about what rates and intensities people are working? Workers do, of course, in their councils and with appropriate decision-making say using information culled by methods consistent with employing balanced job complexes and just remuneration.

There is one very large step remaining, even to offering a broad outline of economic vision. How are the actions of workers and consumers connected? How do decisions made in workplaces, and by collective consumer councils, as well as by individual consumers, all come into accord? What causes the total produced by workplaces to match the total consumed collectively by neighborhoods and other groups and privately by individuals? For that matter, what determines the relative social valuation of different products and choices?

What decides how many workers will be in which industry producing how much? What determines whether some product should be made or not, and how much? What determines what investments in new productive means and methods should be undertaken and which others delayed or rejected? These are all matters of allocation.

Existing options for dealing with allocation are central planning (as was used in the old Soviet Union) and markets (as is used in all capitalist economies with minor or greater variations). In central planning a bureaucracy culls information, formulates instructions, sends these instructions to workers and consumers, gets some feedback, refines the instructions a bit, sends them again, and gets back obedience. In a market each actor in isolation from concern for other actor's well being competitively pursues its own agenda by buying and selling labor (or the ability to do it) and buying and selling products and resources at prices determined by competitive bidding. Each person seeks to gain more than other parties in their exchanges.

The problem is, each of these two modes of connecting actors and units imposes on the rest of the economy pressures that subvert the values and structures we favor. Markets, even without private capitalization of property, distort valuations to favor private over public benefits and to channel personalities in anti-social directions thereby diminishing and even destroying solidarity. They reward primarily output and power and not only effort and sacrifice. They divide economic actors into a class that is saddled with rote and obedient labor and another that enjoys empowering circumstances and determines economic outcomes, also accruing most income. They isolate buyers and sellers as decision-makers who have no choice but to competitively ignore the wider implications of their choices, including effects on the ecology.

Central planning, in contrast, is authoritarian. It denies self-management and produces the same class division and hierarchy as markets built first around the distinction between planners and those who implement their plans, and then extending outward to incorporate empowered and dis-empowered workers more generally. Both these allocation systems subvert rather than propel the values we hold dear. What is the alternative to markets and central planning?

Suppose in place of top-down imposition of centrally planned choices and in place of competitive market exchange by atomized buyers and sellers, we opt for cooperative, informed choosing by organizationally and socially entwined actors each having a say in proportion as choices impact them and each able to access needed accurate information and valuations and each having appropriate training and confidence to develop and communicate their preferences. That would be consistent with council centered participatory self-management, with remuneration for effort and sacrifice, with balanced job complexes, with proper valuations of collective and ecological impacts, and with classlessness. To these ends, activists might favor participatory planning, a system in which worker and consumer councils propose their work activities and consumer preferences in light of accurate knowledge of local and global implications and true valuations of the full social benefits and costs their choices will impose and garner.

The system utilizes a back and forth cooperative communication of mutually informed preferences via a variety of simple communicative and organizing principles and vehicles including indicative prices, facilitation boards, rounds of accommodation to new information, and so on-all permitting actors to express their desires and to mediate and refine them in light of feedback about other's desires, arriving at compatible choices consistent with remuneration for effort and sacrifice, balanced job complexes, and participatory self managing influence.

Is the above a full picture of an economic alternative to capitalism? Of course not, it is too brief. But it is hopefully provocative and inspiring.

• Democratic workplace and consumer councils for equitable participation

• Diverse decision-making procedures seeking proportionate say for those affected by decisions

• Balanced job complexes creating just distribution of empowering and dis-empowering circumstances

• Remuneration for effort and sacrifice in accord with admirable moral and efficient incentive logic

• Participatory planning in tune with economics serving human well being and development

Together these constitute the core institutional scaffolding of participatory economics, a systemic alternative to capitalism and also to what has been called centrally planned or market socialism. Are there fuller formulations of this particular economic vision? Most certainly there are. If interested, consult www.parecon. org for articles, interviews, whole books, and further references.

The main point of all this, however, is that while in the long term the ultimate answer to the cynical, reactionary slogan that "there is no alternative" is to actually enact an alternative, in the near-term the answer is to offer a coherent, consistent, and viable model of preferable institutions and their dynamics. We need domestic and international economic vision that everyone can understand and refine and make their own. We need it to generate hope, to provide inspiration, to reveal what is possible and valuable, and to orient and also democratize our strategies so that they might take us where we desire rather than in circles or even toward something worse than what we now endure.