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Globalisation Between Market and Democracy
Prof.dr. HENDRIK OPDEBEECK
(University of Antwerp)
In this contribution, we intend to explore how one can prevent the dark sides of the globalisation process from leading to ever-greater ethical decay. By ethical decay, we mean specifically the threat that globalisation poses to what is referred to in the personalistic tradition as the longing for being and solidarity with the other(s). In this brief reconstruction of the core of the ongoing globalisation process, we shall take as our starting-point the text by Riccardo Petrella in the prestigious series of Grandes conférences at the Musée de la Civilisation in Québec in Canada1. The prevailing globalisation discourse manifests itself world-wide in political, socio-economic and scientific circles. It assumes both an explicative and a legitimising position vis-à-vis the globalisation process and its purpose. If one wants to put a stop to the decay of the longing for being and solidarity with the other(s), the urgency of a broader ethical (i.e. a more just) dimension in globalisation is more apparent than ever before. Of central importance here are the principles of merit and need as possible articulations of justice. Given the intrinsic logic of the merit principle, which induces a series of impermissible side-effects of globalisation, the traditional co-operation between democracy and market economy appears no longer to be able to provide guarantees for a just globalisation process. It is only through the integration of efficiency and a striving for more equality that one acquires insight into the need for appropriate global institutions.
The Discourse of Globalisation
The current globalisation of markets, enterprises and capital goes hand in hand with an ongoing revolution in information and communication technology. We need to extrapolate to what these technological developments will lead if they are allowed to pursue an autonomous course. It is claimed in the globalisation discourse, which manifests itself in all languages and via all possible media, that globalisation is an inevitability against which nothing or no-one can put up meaningful resistance. Thus, the key notion is adaptation: one appears to adjust at all levels to this process. Anyone who fails to adapt is excluded, if only on the basis of the hard rules of competition. The imperative of global competition of all against all is paramount. The new technologies are put forward as the most powerful and efficient tools for guaranteeing competition on world markets. The omnipresence of this discourse stems from the de facto economic power of the most developed nations, whereby the values and the criteria that are characteristic of the capitalist market economy are elevated to exclusive global values and criteria with regard to what is good, useful and necessary. This is apparent not merely in the economic domain, but in any possible field. Hence, the purpose of the history of contemporary society is equated to a necessary, inexorable and inevitable evolution towards a single and self-regulating global marketplace. The nations of the world have set themselves the principal task of integrating their national economies as smoothly as possible into the global economy, or at least of not imposing obstacles to this integration. Thus, they have relinquished their own political accountability. Everything is subordinated to this finality: investment policy, technological innovation, labour market policy, education, trade regulations, tax policy and—in the case of Western Europe—the process of European unification. Scientific and technology policy, including the stimulation of R&D, is one of the most striking examples of this trend. Consequently, a new alliance is formed between government and private enterprises on the free market, for the purpose of realising their common goal of a competitive integration of the national economy into the global economy.
The discourse of the inevitably integrated global market also explains how it has been possible over the past twenty years for the economic and socio-political system to experience a thorough reorientation on the basis of three principles: liberalisation of markets, deregulation of the economy, and privatisation (not only of banks and railways, but also of hospitals and schools). It is quite striking in this respect how political deregulation has made way for financial regulation. Today, finance is no longer controlled by politics, but by the money markets. This evolution has unfolded against the backdrop of an ever-greater divergence of the financial-economic and the real economic spheres. Only a small fraction of current financial transactions are aimed at the creation of real new wealth. The rest is purely speculative.
A final important characteristic of today’s globalisation process as described by, among others, Petrella is the imposition by the greatest economic powers of social, democratic and environmental clauses in the new regulation of the World Trade Organisation (WTO). These clauses concern quality of labour, human rights and environmental standards respectively. While these are undoubtedly important clauses, the question remains whether the WTO is the most appropriate body for controlling global social, democratic and environmental standards.
1. Globalisation and the Decay of Ethics
In order to ascertain whether or not the globalisation discourse described above entails a decay of ethical striving, it is worth recalling what, according to Paul Ricoeur, is the foundation of the longing for being2. The starting point for Ricoeur’s theory of ethics is his assertion that the human being constitutes an original confirmation of being, which manifests itself in endeavour and longing.
What Ricoeur means by original confirmation of being is the act whereby we are placed in existence, which precedes our thinking, acting and feeling, and underpins and guides them, but which is never given to us and can therefore never be beheld. One could, therefore, regard this original confirmation of being as an act of freedom; the basis of what we are and what there is for us to be. So Ricoeur wishes to lay bare the human being’s longing for being, in order to help him or her acquire a more adequate degree of self-understanding. This is the only way that a more authentic (co)existence can be attained that transcends alienation3. Ethics thus enables us to identify the meaningful history of our longing for being. Clearly, then, the notion of freedom is central to Ricoeur’s theory of ethics.
Certainly in the light of the constantly developing free market economy within the globalisation process—as a kind of structural anchoring of the central ethical concept of freedom—Ricoeur’s perspective is extremely interesting. Note, however, that the notion of freedom is not so easily grasped. Therefore, reflection is required on its concrete expressions or manifestations. The above hermeneutics of the globalisation process ties in with this interpretative process.
Significantly, evil (as contested by the anti-globalist movements) is not equally original as the act of freedom. According to Ricoeur, it is however the case that evil and freedom elucidate one another and, indeed, that evil not only mutilates ethical striving at individual level, but also within the structures by which we operate. Ricoeur formulates this very clearly when he asserts that there is a specific evil of the institution, i.e. the evil of objectification that one encounters in all forms of organisation. In the distribution of labour, for example, it assumes the subtle shape of drudgery, which slowly takes possession of hyper-specialised and monotonous work in industry. The erosion of the right to meaningful employment in the globalisation process ties in with this view entirely. Those in charge of our economy are calling louder and louder that it is no longer possible to provide full employment, let alone meaningful and qualitative employment. In the European Union alone, there are close to 20 million unemployed. World-wide, the number is estimated at around one billion. Fundamentally, what is at issue is that people are no longer regarded as individuals, but as a human resource, comparable to natural, technological and financial resources. If the cost of labour becomes too great, workers are made redundant and they are replaced with another economic resource, such as a machine. The evil within the globalisation process is therefore an unfathomable manifestation of freedom that makes freedom itself unattainable, and that immediately restricts our ethical striving.
2. Globalisation as a Threat to Solidarity
If the starting point of ethics is the free human being as a longing and striving for being, then one only attains actual ethical existence through the encounter with the other4. This recognition of the other as a person at once entails an obligation. The freedom with which everything started, including on the free market of the globalisation process, is also recognised in the other person.
Of fundamental importance here is that Ricoeur extends this intersubjectivity to the whole world through the process of norms and laws. He renounces individualist ethics, because man is not merely an individual, but constitutes various levels of the ‘we’, which are embedded in the totality of structures and institutions. In this respect, Ricoeur’s ethics is reminiscent of the ideas of such personalists as J. Maritain and E. Mounier5, to whom the person as an individual and a collective entity is the norm.
Considered in this context, Petrella’s warning that globalisation is increasingly threatening solidarity between the ‘I’ and the ‘other(s)’ is of great importance. He asserts that the phenomenon of growing poverty is not only an indication of the negation of the solidarity principle in the welfare state, but also of the negation of citizenship. Indeed, it is increasingly argued that citizenship does not imply social rights of the other. In the world’s richest country, the United States, 1 in 5 people are living in poverty. In the European Union, the proportion is about 1 in 6, but in the UK it is as high as 1 in 4. This also manifests itself in an unequal income distribution. In the US, 1% of the population possesses 40% of the national wealth. This unequal distribution of wealth is manifesting itself in the emergence of more and more private neighbourhoods in cities, where the rich can cut themselves off from the other(s), and enjoy extra protection against violence and crime. It is also striking that technology is one of the principal factors in the dynamics of social exclusion. With respect to work, for example, one sees how difficult it often is for the unemployed to re-enter the labour market, since the greatest possible number of jobs are being made redundant through technology.
Moreover, the present economy is increasingly making us lose our sense of being, working and living together with the other. In the light of the global competitive struggle, solidarity has become an obstacle and an unbearable cost for enterprises. This is partly why the value of the common interest is being lost. Priority is given to individual careers (‘my education’), to individual survival strategies (‘my job and income’) and to individual possessions (‘my home, my car’) as fundamental and irreplaceable expressions of freedom. Sight is lost of the other. The logic of economic competition is made into the obligatory logic of society as a whole, which inevitably results in a victory of the one over the other, or, if you will, in the exclusion of the one by the other. Particularly the less developed countries are worse off for the process of globalisation. A mere 15% of global direct investment is not intended for the most developed economies.
3. Globalisation and the Need for Adequate Global Institutions
When a free individual enters into an ethical existence through the encounter with the other, he or she can only do so by mediation of institutions. A third moment is required, i.e. a neutral term, an institution. Hence, the threat that the globalisation process poses to the longing for being and solidarity with the other(s) increasingly necessitates an appropriate global institution. An institution consists in a set of rules for acts in social life, whereby everyone can realise their freedom without impairing that of others. It is within the framework of existing institutions that human beings act. These institutions are not detached from value judgements—as in the discourse of globalisation—so that they are already qualified ethically and, as such, can either bring forth freedom or not.
In this context, Petrella points out that globalisation, with its drive towards liberalisation, deregulation and privatisation, has drastically reduced the significance of public power as an institutionalisation of freedom. This finds expression in, for example, the waning influence of parliament. Government is increasingly giving in to the demands imposed by the often-aggressive markets. The most detrimental aspect of this evolution is that, because of the growing tendency on the part of national economies to adapt to the global economy, the public authorities have failed to develop a global political authority; on the contrary, this international integration actually enhances private power at global level. This is also true at European level. The more the member states apply the principles of liberalisation, deregulation and privatisation, the further they appear to remove themselves from developing a federal European power. The fundamental question here is what is meaningful freedom?
Ethical mediation must ultimately be beneficial to the human person if one is to avoid bureaucratic stalemate. Indeed, the very purpose of institutions is that they should serve people. If not, institutions are entirely meaningless. Certainly in the light of the globalisation process, the big question is whether specific ethical rules need to be established at institutional level, as it is difficult to extend those from the interpersonal sphere to institutions. This explains the great significance of justice as an institutional tool that allows different freedoms to co-exist. Following in the footsteps of Aristotle, Ricoeur further elaborates this assertion by underlying the connection between justice and equality. However one interprets equality, it means to institutions what care-for-the-other or solicitude means to interpersonal relationships.
4. Justice Criteria
Justice has always been a moral characteristic whereby people grant others, with inner self-evidence, whatever they have a right to.
Justice relates not only to property, commodities and finance, but to all values that people must realise with and for each other, including safety, health, marriage, education, truth, freedom and life itself. In fact, it concerns a broad range of issues, much like those raised by the anti-globalist movement.
The 18th-century philosopher David Hume refers to four circumstances that make justice indispensable in our society6. First, the individual is required to co-operate with others in order to satisfy his personal needs. Surviving as an isolated individual is impossible. Second, the extent of man’s benevolence is limited, so individuals are quickly inclined to claim everything for themselves, without taking account of the other. Third, goods are scarce, so that conventions are required that establish right of property. Finally, all human beings have more or less the same basic needs. Satisfying these needs presupposes a reasonable distribution. Otherwise one will be reduced to inhumanity, as the anti-globalist movement again argues forcefully.
This brings us to the confrontation between justice and excessive economic power, as in the present globalisation context. Abuse of economic power at the level of communal justice is manifest in exploitation, consumer manipulation and market monopolies among other things. But economic power also plays a role in legal justice. Examples that spring to mind are various forms of tax evasion and the bypassing of government by, among others, multinational corporations. The issue of globalisation also comes into play in the field of distributive justice, which is concerned with a reasonable or equitable distribution of scarce commodities.
There are two important principles of distributive justice in the economic domain, i.e. ‘grant everyone their share according to merit’ and ‘grant everyone their share according to their needs.’ These two principles not only typify the age-old tension between liberalism and socialism, or between capitalism and communism, but, as will become apparent, they also shed light on the origin of injustice in the present globalisation process.
The notion of merit has different meanings. It can refer to a performance or a responsibility, as well as to a mental effort. The principle ‘grant everyone their share according to merit’ always refers to the past, as merit is inevitably based on assets such as talent, skills or knowledge, all of which were acquired (unequally) in the past. Consequently, this criterion tends towards inequality.
An example that springs to mind in the context of globalisation is the important aspect of income distribution. This is almost a reflection of the inherently unequal distribution of, for example, intelligence among the population. As the globalisation logic attributes such a central role to earnings, one obviously aims at increasing economic output quantitatively and qualitatively by stimulating performance with a view to realising the greatest possible utility.
As regards the second important principle, i.e. distributive justice by ‘granting everyone their share in accordance with their needs’, this refers to the most essential needs of human beings. These needs are inherent in ‘being human,’ and they include the need for food, clothing, housing etc. If one interprets justice in the sense of granting to the other whatever the other is entitled to, then this second principle may offer a guarantee for realising more social justice.
On condition, that is, that one considers intrinsic basic needs that are a genuine prerequisite for a dignified human existence.
5. The Failure of the Mixed Market Economy
Certainly in business circles where people are sensitive to criticism of globalisation, it is usually claimed that it is impossible to realise both principles of justice in the economy. The application of both the principle ‘grant everyone their share on account of merit’ and that of ‘grant everyone their share on the basis of their needs’ would result in a short circuit, if only because the merit principle creates inequality while the needs principle does the opposite. The anti-globalist movement tends to argue in favour of the needs criterion. This in itself is no problem according to proponents of globalisation, but the latter also claim that those same anti-globalists wrongfully accuse the free market of not applying the needs principle and overemphasising merit and pay according to work. They argue that the anti-globalists tend to lose sight of the fact that the market economy is based on the performance criterion rather than the needs criterion. Consequently, they denounce familiar economic power mechanisms: they reject excessive economic competition, propose rather drastic redistributive measures, criticise multinationals, disapprove of the stimulation of consumerism (through advertising), deplore the substitution of capital for labour, and suspect the market of wanting to reduce humans to the status of slaves of commodities. Therefore, in the eyes of the anti-globalists at least, it is justified to give the state more of a carte blanche.
The traditional proponents of globalisation argue that, if one does want to take into account both the merit and the needs principle, without imposing these criteria on either the economy or globalisation, then it is essential that the economy and politics should be made to function as efficiently as possible. For this reason, they defend free competition and true democracy, claiming that they serve the general interest. The merit issue is resolved on the basis of the free (i.e. economic) market mechanism, while the needs problem is approached from the perspective of democratic (i.e. political) decision-making. The general interest objective realised in this manner brings forth the greatest possible degree of justice.
According to the champions of globalisation, this at once shows that human self-interest, to which the profit principle is so often equated, is not entirely negative; on the contrary, self-interest may be the very foundation of the general interest. However, if this mechanism is to be sustainable and not lead to collective self-destruction, then moral characteristics such as sympathy and solidarity, mutual trust and justice are required. Self-interest and the general interest would then complement each other in much the same way as two buttresses carry the vaulting in a cathedral.
Globalisation and justice, self-interest and general interest, the merit principle and the needs principle, free competition and true democracy. According to the proponents of globalisation, each of these pairs can be combined most effectively in a mixed market economy, as this system allows one to reconcile the production issue (cf. efficiency) with the distributive issue, where satisfying basic needs is of primary importance. Indeed, a public authority is necessary in order to guarantee that the degree of private power within a national community remains within the general interest.
6. An Ethical Dimension in Globalisation
While a mixed market economy would appear to offer a logical solution to the tension between globalisation and justice, the question remains whether this partition between (economic) efficiency and (democratic) justice, or between globalisation and ethics, is justifiable in this day and age. After all, the merit principle that is central to the economy not only causes inequality, it also stimulates economic growth and progress, unlike the needs principle, which tends to restrict growth. However, in recent years serious side effects have been occurring in relation to economic progress. It is apparent from the emergence of the anti-globalist movement, that there is growing awareness of the end to growth and progress. It has become very clear that, if the industrialised Western countries want to avoid undermining themselves, the emphasis in economic growth needs to shift from quantitative to qualitative growth. One needs to abandon the traditional concept of growth, as it results not only in a disproportionate appropriation of scarce resources but also in irreversible damage to the environment. This conception is contrary to the policies pursued in many Western countries. All too often, economic growth is seen as the prime objective, to be achieved by a market that is unimpeded by government. Thus the most pressing problems facing the world today are transferred unscrupulously to the environment, to the third and fourth worlds, and to the quality of inter-human relationships. The question ‘What is the sense of it all?’ resounds loudly in Seattle, Genoa and Laken.
Indeed, in this manner, economic power enters the triangle of profit, progress and needs, rather than merely confronting the issue of justice. Goudzwaard7 has long asserted that, in the iron law of so-called economic and technological progress, which forces everything and everyone to constantly adapt, we have discovered the secret we were searching for. In an economic order where progress occupies a central place, wielding of power can indeed develop in only one direction: that of ever-greater productivity increase and a matching standard of living. This compelling force can apparently afford to neglect the negative power effects of globalisation (third world, unemployment, environmental degradation…).
In view of the negative effects of growth, as articulated in the dynamics of globalisation, striking a balance between democracy and market economy (i.e. the mixed market economy) is no longer a guarantee for realising a just globalisation. Due to the intrinsic logic of the merit principle, which not only induces inequality and economic growth, but also impermissible power effects, the boundaries of globalisation call into question whether this exclusive principle is sufficient in the economic field, let alone acceptable. Consequently, more and more people are calling for a broader ethical dimension in globalisation (rather than ethical decay). This way, one can prevent that the one-sided merit principle continues to occupy a central position in the globalisation process. It is striking that these calls are now heard right up to the highest levels. Participatory justice is considered to be of the utmost importance. One goes beyond the two principles of distributive justice and abandons the (dualistic) opposition between the individual and the community in order to arrive at a shared responsibility and involvement at national and international level.
7. A Global Social Contract
The concept of a global social contract is thus an important elaboration of the concern with institutionalising more equality besides efficiency. Petrella quite rightly asserts that the essential challenge for the global economy lies not so much in the integration and adaptation of the national economies to the world economy. It lies in adequately determining the principles and rules within the institutions that are required to provide the world’s population with its basic needs in terms of food, housing, energy, health, education, transport and employment. The central question is, in other words, how can one achieve global wealth rather than predominantly private wealth at a global level? Or how can one assume responsibility in true solidarity instead of developing one-sided competition?8
The main difficulty in realising a global social contract is, however, the virtual lack of a global political system that can shoulder the responsibility of protecting the general interest.
Clearly, politics needs to assure the survival of the community, all the more so if its future is under considerable threat. This acceptance of responsibility implies caring for the most brittle, the most threatened thinkable. With this we have arrived at the philosophy of E. Levinas: we are ultimately responsible for the other(s), without thoughts of reciprocity and without room for calculus. The purely reciprocal recognition between people is however transcended in order that everyone would assert himself in individuality, which is in fact the starting point for Ricoeur’s ethical genesis. According to Levinas the egocentric longing for being of the self is only transcended when the ‘I’ is obliged to do so, and, more in particular, when it responds positively to the appeal of the Face of the Other9. When Ricoeur discusses the recognition of the other, there would appear to be a certain ambiguity. Indeed, one can restrict oneself without questioning oneself, without insight into the arbitrariness of the own (despotic) longing for being. The auto-limitation is founded upon the narrow base of the war of all against all or the threat that the other poses to one’s own freedom. The self does not (yet) perceive its own egocentrism as unworthy of a human being. Thus, it would appear that Ricoeur runs the risk of reaching a dead end at the level of well-understood reciprocal interest. This is probably due to his perception of the other as an alter ego: alter certainly, but still an ego. But meanwhile an ego-centric globalised society has been established, which in social, economic, financial and legal terms takes the shape of egocentrically organised political structures at national, international and global level. It would appear that precisely these structures are called into question by the anti-globalist movement today.
Notes
[1] R. Petrella, Écueils de la mondialisation. Urgence d’un nouveau contrat social, Montréal, Éditions Fides, 1997. Other treatises on globalisation in the same vein as Petrella include F. Buelens, Globalisation and the Nation-State, Cheltenham, Elgar, 1999; W. Derkse e.a. (eds), In Quest of Humanity in a Globalising World, Leende, Damon, 2000; J. Scholte, Globalization. A Critical Introduction, Basingstoke, Palgrave, 2000; N. Hertz, The Silent Takeover. Global Capitalism and the Death of Democracy, London, William Heinemann, 2001; N. Klein, No Logo. Taking Aim at the Brand Bullies, Toronto, Knopf Canada, 2000 and I. Ramonet, Géopolitique du chaos, Paris, Editions Galilée, 1997.
2 For a more extensive overview of Paul Ricoeur’s ethics, see H. Opdebeeck (ed.), The Problem of the Foundation of Ethics, Leuven, Peeters, 2000.
3 Compare with E. Weil, Philosophie politique, Paris, Vrin, 1956.
4 P. Ricoeur, Soi-même comme un autre, Paris, Seuil, 1990, pp. 212-213.
5 E. Mounier, Révolution personnaliste et communautaire, Paris, Aubier, 1935.
6 D. Hume, A Treatise of Human Nature, Oxford, Clarendon Press, 1978.
7 B. Goudzwaard & H. de Lange, Beyond Poverty and Affluence. Toward an Economy of Care, WCC Publications, Geneva, 1995, p. 92.
8 It is clear that R. Petrella is on the same wavelength here as J. Rawls, A Theory of Justice, Cambridge, Mass., Belknap Press of Harvard University Press, 1971.
9 F.i. E. Levinas, Autrement qu’être ou au-delà de l’essence, La Haye, Martinus Nijhoff, 1974.