Beyond the Global Suicide Economy
Korten Presentation to the Global 6 Billion People’s Summit, June 22, 2002, University of Calgary
"One people. One planet. One chance." So few words to speak such truth with so much power.
It’s a special privilege to have this opportunity to share with you my thoughts on the world that can be. Thank you for this opportunity. And my thanks to Rev. Dr. Chief John Snow and to Stephen Lewis for the candor and wisdom of their comments last night. They gave me courage to go back to my room and revise my notes for this talk to include some words I might not otherwise have had the courage to say. They are, however, words that must be said if we are to fulfill the spiritual and democratic purpose for which we gather here. I share them in a spirit of hope, compassion, and love for the life of the whole.
We meet here as the Global 6 Billion — motivated by a shared vision of a vibrantly healthy planet populated by just and democratic nations and communities in which every person — irrespective of color, origin, religion, or class — enjoys freedom; an adequate, meaningful, and secure means of livelihood; and the opportunity to realize his or her full physical, mental, social, and spiritual potentials. We are united by a theory of progress that says, “Once the most oppressed and marginalized among us are doing well, then we will surely all be doing well.” Thus we give special attention to Africa and to children, for securing their well-being becomes the measure of our own progress and humanity.
Next week the Group of 8 will convene nearby. It will be a different sort of meeting — centered on eight elderly men who have enjoyed lives of privilege —all but one of European origin. They will issue statements with nice words about peace and democracy, and offer promises of aid to the poor, yet their true allegiance will be to the interests of the world’s corporate and financial elites. This allegiance will be must fully manifest in George W. Bush, the man who claimed power through a stolen election to become president of the United Corporations of America. The G8 will be motivated by a vision of a world of robust and growing stock markets and powerful corporations extending their dominion over the wealth of the earth. And they will be united by a theory of progress that says, “If the richest and most powerful among us are doing well, then the world is doing well.”
The G8 has announced a three point agenda dealing with terrorism, growth, and Africa. If Bush has his way, discussions of the war on terrorism will center on enlisting world support for the suppression of democratic dissent, the consolidation of global U.S. military hegemony — including the militarization of space, and a U.S. policy of unilateral pre-emptive military strikes including the possible use of nuclear weapons against any nation suspected of harboring evil intentions against interests of the United States.
There will be promises of some debt relief here and a bit of funding for primary education and HIV AIDS there, but in the end they will conclude that the best hope for ending poverty is to accelerate growth in the demand of the rich and the powerful for the labor and resources of the poor. Africa will be told that to prosper it must open itself to the global economy and pursue policies friendly to financial speculators and corporate monopolists from the North. Of course they will frame it in prettier language.
As a practical matter we must assume that the G8 leaders will seek solutions that reinforce, rather than challenge, the foundations of their own power. Trapped in the worldview of a dying era of colonial domination and exploitation, they represent the past. Their deliberations will lead at best to half measures — at worst to the more aggressive pursuit of policies and institutions that are already destroying democracy, society, and the planet.
We must think and act boldly and holistically in our gathering here in Calgary, for it falls to global civil society, through gatherings such as ours, to come forward with new ideas, a new vision, and new commitment to a just, sustainable, and compassionate human future.
Let’s start by reviewing some realities the G8 leaders are unlikely to address.
- Agenda Item 1: Terrorism. These are frightening times. Peace, freedom, and democracy are at grave risk. The greatest threat comes, however, not from a few thousand terrorists living in caves and refugee camps in places like Afghanistan and the West Bank. It comes from men who live in White Houses in Washington, DC. It comes from a ruthless and brutal axis of evil named Ashcroft, Cheney, and Rumsfeld — three deeply troubled men driven to do and say whatever they believe will advance their personal power and wealth — and George W. Bush is their front man. It comes from the institutions of a predatory and suicidal corporate global economy that is destroying the foundations of its own existence and of human survival on this planet.
Responding to terrorism with more violence and repression worsens the conditions that give rise to terrorism. The more productive approach to securing ourselves against terrorist attack is to eliminate the sources of the exclusion and sense of hopelessness that lead people to find more meaning in death than in life. Rather than engaging in an arms race with ourselves and turning democracies into police states, we must rebuild community and create inclusive, life serving economies that provide just and sustainable livelihoods for all. The G8 is unlikely to discuss any of this, but we surely will.
- Agenda Item 2. Growth. The neoliberal ideology of the G8 maintains that economic growth generates the economic resources needed to end poverty and protect the environment — a claim that is both theoretically and empirically flawed. From 1950 to 2000, total world economic output in inflation adjusted dollars increased more than 6.5 times. Output per person increased by more than 2.7 times. During this period of extraordinary economic growth. The rich have prospered and their lifestyles have become ever more extravagant. But the poor still live in desperate deprivation. And environmental systems are collapsing all around us. Historical experience tells us that economic growth serves primarily to increase the economic power and consumption of the rich. Any credible effort to end poverty must focus not on growth, but on increasing the economic and political power and consumption of the poor.
- Agenda Item 3: Africa. Rather than further opening its economies to exploitation by the descendants of slave traders and colonizers, the challenge for Africa is to reverse the trends and consequences of centuries of foreign domination and exploitation, regain control of its own resources and destiny, and reorient its economies from specializing in the provision of cheap labor and resources to support the extravagance of rich foreigners to specializing in the provision of food, clothing, shelter, transport, health care, and education to African people.
Our world is in deep social and environmental crisis. Africa is its most visible and tragic manifestation, but the crisis is by no means limited to Africa.
World wide, 200 million children under five are underweight due to a lack of food. Fourteen million children die each year from hunger-related disease. A hundred million children are living or working on the streets. Three hundred thousand children were conscripted as soldiers during the 1990s and 6 million were injured in armed conflicts.
On the environmental side, critical systems are being stressed beyond their limits of tolerance. Climate change is only one of the more immediate and universally visible examples. Human activity has increased atmospheric concentrations of carbon dioxide to their highest levels in 20 million years. Natural disasters during the decade of the 90s — including weather related disasters such as storms, floods, and fires — affected more than two billion people and caused in excess of $608 billion in economic losses worldwide — more than in the previous four decades combined. In 1998 alone, three hundred million people were displaced from their homes or forced to resettle because of extreme weather events.
Humanity has reached the end of an Era of Empire characterized by coercive hierarchy, competition, violence, the exploitation of people and nature, and a division of humanity into haves and have nots.
The human future depends on living into being a new Era of Community in which life is the defining cultural value, cooperation and partnership are society's organizing principles, and networking is the predominant organizational form. Among other things, it will require replacing the culture and institutions of the global suicide economy with the culture and institutions of a planetary system of living economies that mimic the behavior of healthy living organisms and ecosystems.
If we wait for positive leadership from the G8 and other power holders, we shall surely wait in vain, for they live in a different world than the rest of us. They live in the world of the corporate globalists, whose power and privilege continue to grow — leading them to see progress at every hand, even as the world’s social and environmental systems collapse around them. The deregulation of economic life and the removal of economic borders does expand their freedom and clears away barriers to their amassing still more wealth. They desperately want to believe that corporate globalization is an inevitable and irreversible process.
They embrace the global corporation, a major source of their power and privilege, as the greatest and most efficient of human institutions. They celebrate the Bretton Woods institutions — the World Bank, IMF, and World Trade Organization — for their roles in deregulating markets, increasing safeguards for investors and private property, and removing restraints to the free movement of goods and services. They live in a world of illusion in deep denial of the realities of life on planet earth.
By contrast, those of us who live in the real world of people and nature experience a deepening crisis of such magnitude as to threaten the fabric of civilization and the survival of the species. Where corporate globalists see the spread of democracy and vibrant market economies, we see the power to govern shifting away from people and communities to financial speculators and global corporations dedicated to monopolizing the worlds markets and resources in the blind pursuit of profit. We see corporations replacing democracies of people with democracies of money, self-organizing markets with centrally planned corporate economies, and spiritually grounded ethical cultures with cultures of greed and materialism.
We see nothing inevitable about a suicide economy created through the intentional actions of human beings, corporations, and a political system awash in corporate money. We see the World Bank, IMF, and World Trade Organization as leading instruments of this assault against life.
If there is to be a human future, it will depend on leadership from those who live in the real world. Leadership must come — it will — come from “We the people.” We are the ones we’ve been waiting for.
Global civil society came into its own as a force for transformational change in the 1990s and is evolving rapidly in its sense of power and understanding of its role. We began as a protest movement that has found its most visible expression in the protests that have brought millions of people to the streets in India, the Philippines, Indonesia, Brazil, Bolivia, the United States, Canada, Mexico, Argentina, Venezuela, France, Germany, Italy, the Czech Republic, Spain, Sweden, England, New Zealand, Australia, Kenya, South Africa, Thailand, Malaysia, and many other countries.
Our movement is now moving to a new stage. Two international meetings held simultaneously this past February foretell a deep power shift already underway. For some twenty years the world’s richest and most influential power holders gathered annually in the luxurious setting of Davos, Switzerland for the World Economic Forum to exalt and advance the processes of corporate globalization — until Switzerland asked them to hold their meetings elsewhere. This February they met in New York City in a state of siege behind police barricades to contemplate the growing popular resistance to their program and even to acknowledge that it has brought little, if any, benefit to a major portion of the world’s people. Simultaneously, 60,000 people met at the World Social Forum in Porto Alegre, Brazil as representatives of global civil society to discuss the theme “Another World Is Possible,” to build global consensus and solidarity, and to celebrate their progress toward creating a world that works for all.
The initiation of the World Social Forum in 2001 marked an important step for the movement —a shift from resistance to leadership. A global dialogue is now underway on the world that can be — an inclusive and sustainable world of peace, justice, and compassion for all that aligns with the values of the vast majority of the world’s people. We are becoming a confident emerging majority forging a new mainstream consensus.
Economic change is an essential foundation of our agenda. We must replace the materialistic culture and predatory institutions of the global suicide economy with the spiritually grounded culture and life-serving institutions of a planetary system of living economies.
Much of the pathology of the suicide economy can be traced to the pathological institutional form of the publicly traded, limited liability corporation. Enron, Monsanto, Exxon, General Motors, Shell, Microsoft, Citibank, WalMart, and most all the other corporate giants are publicly traded, which means their ownership shares are freely traded in public markets that function as sophisticated gambling casinos. Through internal growth, borrowing, and the public sale of shares, they are able to amass virtually unlimited concentrations of economic and political power under a centralized authority for the exclusive purpose of making money for absentee owners who bear no responsibility or liability for the actions taken in their name. The legal form of the publicly traded, limited liability corporation invites the abuse of power on a breathtaking scale. It has no more place in a healthy community than does a cancer in a healthy body.
The Enron scandal provided a rare public window into the depth of the corruption of the ruling institutions of the suicide economy. It is well known to corporate insiders that the fraud and misrepresentation revealed in the Enron case, much of it perfectly legal under rules written by politicians on corporate payrolls, is far from the exception. According to Business Week (March 25, 2002), the Enron case exposed,
"...a mess that has been accumulating for years — an alarming erosion in the honesty and reliability of financial information about companies, data on which America’s markets depend. Companies have played numbers games with increasing abandon — exaggerating profits, understating debts, hiding costs — and indulgent auditors have O.K.’d it all, for fear of losing juicy consulting contracts with their clients. Overblown earnings inflated the bonuses of corporate insiders, many of whom reaped big profits cashing in stock options ahead of earnings restatements. Meanwhile investors were left clueless about what was really going on inside once-admired outfits such as Enron."
These are the same companies that ask us to trust their voluntary standards and reporting in matters related to labor, health, and environmental standards. Apparently, they assume we are either stupid or naïve.
We are conditioned to believe that capitalism — alias the suicide economy — is a synonym for a market economy and is the only alternative to the failures of socialism in the Soviet Union. In truth, the capitalist economy is a pathology to which market economies are prone in the absence of adequate governmental regulation and citizen oversight. It ignores public interests and gives free reign to the economy’s biggest and most ruthless players.
There is another rarely mentioned alternative to global capitalism —a planetary system of locally rooted, market-based, living-economies comprised of human scale, stakeholder owned enterprises that function within a framework of community relationships, ethical cultures, and democratically determined rules.
Markets are an essential mechanism for achieving the equitable and socially efficient allocation of resources, but they require public oversight to maintain the essential conditions of socially efficient allocation. These conditions include: an equitable distribution of income and ownership; freedom from monopolies and oligopolies; protection of worker rights and safety; the internalization of full social and environmental costs in market prices; and protection of firms that play by fair market rules from predatory competition from those that do not. There is also a need for public oversight to assure that the common heritage resources essential to the survival and well-being of all — like land and water — are protected and equitably shared.
Living economies are comprised of living enterprises that function as communities of people engaged in making a living. They are built on human relationships and maintain themselves at a human-scale —rarely more than 500 people. They are owned by engaged stakeholders — workers, community members, customers, and suppliers — who have a personal involvement in their operation and a living interest in their healthy function. Since they are owned by their stakeholders, authority is distributed. And their owners and officers bear the same responsibility and liability for their actions as any other citizen.
Living enterprises may take on a variety of organizational forms. They may be organized as consumer cooperatives, worker owned corporations, community corporations, partnerships, or family businesses. The only excluded legal forms of enterprise are those that give a controlling interest to absentee owners, define organizational purpose primarily in terms of financial returns to shareholders, or confer special rights and immunities on owners and officers not available to ordinary citizens.
A living enterprise is values based. It seeks a fair and balanced return to all its stakeholders --- providing safe, meaningful, family wage jobs for its employees; good service and useful, safe, quality products for its customers; and a healthy social and natural environment for the community in which it is located — in part because many of its stakeholders are also owners. The guiding question for those who lead a living enterprise is not "What action will give me the biggest boost in stock price this quarter?" but rather "What is the right thing to do and how can we do it in a way consistent with financial viability and a fair return on financial investment?"
One of my favorite prototypes of a living enterprise is Philadelphia's White Dog Cafe, founded by owner and proprietress Judy Wicks. As Judy explains it, the White Dog attracts the unsuspecting with good food and turns them into social activists by providing them with an education in citizenship through forums and field trips to places like Chiapas, the maquiladoras, and Cuba. Judy buys her food from local organic farmers, serves only humanely raised meat, pays her workers a living wage, devotes 10 percent of profits to local charity, and has mobilized her restaurant competitors to join in rebuilding the local food system in the Philadelphia area.
The ideal of a living economy might well seem an impossible dream, except that so many of its elements are already in place. There are in fact millions of enterprises and initiatives around the world consistent with the values and structures of living economies. They include local independent businesses of all sorts from bookstores to bakeries. They include land trusts, local organic farms and farmer's markets, enterprises producing and marketing innovative environmental services and products, community supported agriculture initiatives, local restaurants specializing in locally grown organic produce, community banks, local currencies, buy local campaigns, suppliers of fair traded coffee, independent media, green business directories, and many more.
So how do we get from a few million living enterprises to a planetary system of living economies?
The first step is to get clear that transformational change is not going to come from within the institutions of the suicide economy.
The suicide economy is what organizational consultant Margaret Wheatley calls an “emergent system.” No one planned it. Those responsible for corporate interests grew it into being in their day-to-day effort to increase profits and market share. Step-by-step over a period spanning hundreds of years they reshaped the politics, the legal system, and the culture of humanity to create the interlocking system of interests, laws, and mutual obligations that make the suicide economy virtually impossible to transform from within.
Those who promote serious reforms with the suicide economy are almost invariably marginalized or expelled. To change an emergent system that no longer serves you must displace it by growing a more powerful emergent system. According to Wheatley:
“This means that the work of change is to start over, to organize new local efforts, connect them to each other, and know that their values and practices can emerge as something even stronger.”
The key to transformational change is to create cultural, economic, political, and even spiritual spaces in which to explore new ways of being with one another toward the emergence of new cultures and institutions.
This is why the existence of millions of living enterprises is so important. Presently most exist at the fringes of and dependent on the institutions of the suicide economy. The possibility remains, however, for them to gradually walk away from the institutions of the suicide economy and begin to growing webs of relationships among themselves to bring into being newly emerging living economies. The greater the number of members and links in the web the greater the life energy that participating enterprises may potentially attract and recycle within the living economy, thus increasing the strength and viability of both the web and its individual members. Community members can be encouraged to give preference to local living enterprises in their shopping choices, and eventually in their employment and investment choices.
So what does this mean for international relationships, in particular between high and low income countries?
The wealthy nations of the North are living far beyond their own means — especially my country, the United States. We maintain extravagantly wasteful levels of consumption by expropriating the resources of other peoples and countries. It requires maintaining a vast and hugely expensive military establishment — which is the real reason George W. is engaging in a U.S. military buildup in the absence of any identifiable enemy.
Our expropriation of the rest of the world’s resources is also what our massive trade deficit and international debt to the rest of the world are about. We are buying up the world’s resources and the products of its labor to live beyond our means on borrowed money. We are on a consumption binge financed with a credit card balance we owe to the rest of the world. It is perhaps the largest and most successful con game in the whole of human history. It rests on convincing the world that economic growth is progress, that it depends on exports, and that we in the United States are doing the rest of the world a favor by our extravagant and profligate consumption of their wealth. We have so far pulled it off with such remarkable success that if we exclude any of their products they call us names like selfish and protectionist.
Here I want to share some of the basic lessons I learned from my thirty years as a development worker in Africa, Asia, and Latin America. Contrary to the prevailing neoliberal wisdom, poor countries are not poor because they receive too little aid or foreign investment from the North, or have too little access to Northern markets for their exports. They are poor because their economies are dominated by Northern countries and major portions of their labor and resources are devoted to supporting the extravagance of wealthy foreigners rather than to producing the things their own people need. This domination is in part a consequence of foreign aid that has left them burdened with massive international debts that trap them into selling their economic assets to foreigners at give away prices to obtain the foreign exchange to repay their debts.
There is presently much talk of the barriers Northern countries maintain against agricultural imports from the South. A couple of nights ago I attended a gathering in Seattle where a representative of family farmers in my home state of Washington spoke of his conversation with small farmers from a Central American country who told him that the best way for people in the United States to help them would be to buy food produced in Washington, rather than imported food from abroad. The logic is as follows. When you buy imported food it creates pressure in the South to convert small farms producing for local people into corporate farms producing for export. The small farmers get displaced and forced into low paying jobs as sweat shop laborers in export processing zones — also producing for export things that local people need, but are unable to buy.
Another lesson I learned as a Third World development worker is that whenever you are unsure about what is the right thing to do, find out what the World Bank and IMF do — and then do the opposite.
Judged by their actions it seems the World Bank and IMF believe that the ideal Southern economy is one in which most domestic consumption needs are met by importing goods from abroad paid for with loans from foreign banks; all of the country’s economic assets and resources are owned by foreign corporations producing for export to generate foreign exchange to repay the loans; public services are owned and operated by foreign corporations as private monopolies for private profit; and government takes no action to limit financial speculation or to protect vulnerable domestic jobs and industries by regulating flows of goods and money across its borders. You don’t have to be a rocket scientist to figure out whose interests such policies serve.
The International Forum on Globalization, a North-South alliance of activists sometimes referred to as the intellectual brain trust of the anti-globalization movement, has just completed a report on Alternatives to Economic Globalization. It is the product of a consensus building dialogue between its Southern and Northern members that began in January 1999. It sets forth an institutional and policy framework for a just and sustainable world that pretty much stands the perverse logic of the World Bank and IMF on its head. The report takes the position that the sovereign right of a people to set their economic priorities and determine their economic destiny is a foundation stone of democracy.
This means people, communities, and nations should own the productive assets on which their livelihoods depend, be free from illegitimate foreign debts, and have the right and ability to manage the flow of goods and money across their borders essential to setting their own economic priorities and to maintaining high social and environmental standards consistent with community well-being. In a just and sustainable system, stronger and more affluent countries will not be able to demand access to the markets or resources of weaker and less affluent countries against their will and interests.
Nor will any corporation have such rights. If a corporation wishes to do business in a jurisdiction other than the one in which it is chartered it should be required to apply for a charter in that country subject to its charter requirements, laws, and taxes. The most pressing restraint on Southern countries is their lack of control over their own economic resources, their inability to determine their own economic priorities, and the intellectual property rights monopolies of transnational corporations that limit their access to essential technologies.
This has important implications for the institutions of global governance. The IFG report notes that we have only one world, but we currently have two separate and competing systems of global governance. One — the Bretton Woods System — is closed, undemocratic, and serves financiers and corporations. The other— the UN system is relatively more open and democratic and is largely aligned with the interests of people and planet. The report calls for dismantling or decommissioning the Bretton Woods institutions — the World Bank, the IMF, and the WTO — and replacing them with new institutions under the United Nations with mandates exactly the opposite of the institutions they will replace.
In the place of a World Bank coaxing Southern countries into ever deeper international debt and dependency, we call for the creation of a UN International Insolvency Court responsible for helping countries work their way out of international debt — including an orderly repudiation of odious debts that were not legitimately contracted — which would include most World Bank and IMF loans. In the place of an IMF that prohibits countries from exercising essential oversight over the flow of goods and money across their borders, the IFG calls for a UN International Finance Agency to help countries put in place mechanisms to maintain balance and stability in their international financial relationships. Instead of a World Trade Organization preventing governments from holding corporations accountable to the public interest, we propose a UN Organization for Corporate Accountability to work with citizens groups and nation states to break up concentrations of corporate power and hold all corporations with operations in more than one country to a high standard of public accountability.
Unfortunately, the UN leadership is opening its chambers to increasing corporate influence and control though mechanisms like the Global Compact — threatening the UN’s credibility and viability as a life serving alternative to the Bretton Woods institutions. The corporate intrusion must be steadfastly resisted.
These are frightening times. They are also exciting times. Never before in human history have "we the people" of the world had the opportunity to join in a conscious, collective effort to intentionally rethink and recreate the whole of human society to create a world of peace and justice for all. This is the work of this conference. It is our time to lead. We, the people of the world, are the one’s we’ve been waiting for.