Global Policy Forum

A Corporate Believer's Turnabout


By J. Suzanne McCoy

November 25, 2001

Young David C. Korten would be shocked to see himself now.

He can still remember how, as a politically conservative undergraduate at Stanford in the 1950's, he believed that American capitalism would save the world from poverty. Now he organizes protests and seminars against what he calls the evils of global corporate expansion.

Dr. Korten, 64, has become a leading figure in the antiglobalization movement, the diverse groups who first grabbed the public's attention in a big way when they disrupted world trade talks in Seattle two years ago.

But he is no bomb thrower. (In fact, during most of the Seattle protest, he said, he was ill in bed and never marched in the streets.) What distinguishes him among the movement's thinkers, friends and critics say, is that he has an extensive background in how business is done in the developing world.

For three decades, after receiving his M.B.A. and a doctoral degree in business from Stanford, he taught at Harvard Business School, trained business managers in Africa and Central America and helped dispense financial aid in Asia. His metamorphosis into a globalization opponent, he said in an interview, came gradually. But even he is startled by the before-and-after contrast. At Stanford, he said, ''I was an active Young Republican.''

Critics call Dr. Korten a misguided idealist whose view of how companies should operate is unfair and outdated. His 1995 book, ''When Corporations Rule the World,'' contends that multinational companies behave with little accountability and hold tyrannical power over the future of undeveloped countries.

The book has become a bible of the movement -- protesters at a World Bank meeting in Washington last year carried a banner urging people to read it. More than 100,000 copies have been sold, and it is required reading in many college business and political economy courses. Largely because of that book, Worth magazine listed Dr. Korten in its October 2001 issue as one of the ''100 people who have changed the way Americans think about money.''

Dr. Korten now devotes much of his time to the International Forum on Globalization, a group that helped to organize the Seattle protest. He also founded two groups, the Positive Futures Network and the People-Centered Development Forum, that advocate changes in global trade policy and corporate conduct. Dr. Korten spoke about his proposals at a conference in New York's Rutgers Presbyterian Church a few weeks ago, as global trade talks were under way in Qatar.

As a psychology major at Stanford, Dr. Korten said the subject of economics interested him because it influenced people's behavior. As a senior, he enrolled in a seminar called ''Modern Revolutions'' and decided that poverty, not political ideology, caused rebellions. ''I concluded that the best thing I could do was go to business school and bring the secrets of modern American management to the third world,'' he said. ''And from there unfolded a compulsive need to ask questions.''

He established a management school in Ethiopia while he earned his Ph.D., then joined the Harvard Business School faculty to work at the Harvard-backed Central American Management Institute in Nicaragua. In 1978, he and his wife, Frances F. Korten, whom he had met at Stanford, moved to Southeast Asia and administered aid programs for the Ford Foundation and the United States Agency for International Development.

He said the aggressive expansion of American corporations into impoverished countries, going wherever labor was cheapest, increasingly troubled him. He recalled looking out his office window in Manila, where he worked from 1988 to 1992, watching as enclaves of executives flew in helicopters and clogged the streets with cars while the air filled with diesel exhaust. Outside that same window, he could watch people living in shacks atop a garbage dump.

Those disparities were the catalyst for a life change. In 1992, he decided to move to New York, where he thought he could more directly influence industry leaders. He devoted himself to writing his book, giving speeches and encouraging the nascent antiglobalization movement.

His speeches, mostly to environmental groups and antiglobalization teach-ins, drew increasingly large audiences, including representatives of businesses. After a speech in St. Louis in 1997, he was invited to visit Monsanto, a developer of genetically modified foods and a prime target of globalization critics. Dr. Korten began corresponding with Robert Shapiro, then Monsanto's chief executive. They even sent books to each other. But the friendship ended there.

Dr. Korten said that he still regarded Monsanto as ''one of the most evil corporations'' and that Mr. Shapiro, pressured for profits and a strong stock price, had deluded himself into thinking that genetically modified foods would help the world's poor. Asked for his opinion of Dr. Korten, Mr. Shapiro said in an e-mail message, ''I think he's a thoughtful man with fine intentions and values, but I continue to disagree with some of his premises and most of his conclusions.''

John Cavanagh, a friend of Dr. Korten's and director of the Institute for Policy Studies, a research center in Washington, said Dr. Korten had helped to blunt a major criticism of the movement -- that it lacks a clear analysis of globalization's consequences.

''Amongst economists the line was, 'Globalization is inevitable, get with the program,' '' Mr. Cavanagh said. ''David has helped change the debate with the argument that this version of globalization isn't inevitable. ''But many economists reject Dr. Korten's view that globalization is self-destructive and is incapable of paying attention to side effects like environmental damage.

''People were talking in the early 19th century about the collapse of capitalism,'' Dr. Alice H. Amsden, professor of political economy at the Massachusetts Institute of Technology. ''But during these periods, changes are made, institutional rules are amended and new organizations appear that, in a sense, strengthen capitalism for the next period of economic growth and development.''

Dr. Korten describes his vision of the future as a network of locally and cooperatively owned businesses. The Kortens live on Bainbridge Island, Wash., a spot in the Puget Sound near Seattle that Dr. Korten calls the ''land of ecotopia.'' He can practice some of his suggestions here, he said, like buying wine from producers he knows personally.

He acknowledged his need for some accouterments of the American economy -- flying in airplanes and using computers and e-mail. He thinks a scaled-down economy won't be so dependent on them. ''I have no illusion about any of the change process being easy,'' he said.

Photo: In spreading his anti-globalization message, David C. Korten envisions a world of locally and cooperatively owned businesses. He attended a conference at a church in Manhattan.


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