RM Issue #040124

Wednesday, January 21 2004
World Inc.

by Paul Harris

You’ve probably heard the expression that the more things change, the more they remain the same. It may be a piece of folk wisdom and it may ring true in some circumstances but a more apt description of life in the 21st century is that the more things change, the more they regress.

Consider the unbridled glee with which so much of the world is rapidly deteriorating to a situation that resembles the 19th century. And not the good parts of the 19th century. At a time in mankind’s journey to, well, wherever it is that we’re all going to end up, a time when we have the resources, the skills, the abilities to eliminate most of the world’s ills, we choose to revert to a happier and gentler time when the barons of finance ruled everything and the rest of us be damned.

We cheerfully elect government after government all round the world of people who wouldn’t know their brass from their oboe but who surely know how to be the lickspittles of corporations. We have allowed ourselves to be conned into believing that what is good for business is good for society, rather than the other way round; our governments have sold us down the proverbial river and have permitted the rape of resources that properly belong to the people; and we have accepted the rule of merchants whose only goal is to make sure they get our money.

Globalization, in its modern incarnation, has been coming at us now for more than thirty years because it’s about that long ago that it first grabbed hold of a national government. Not that it matters who started it, but it turns out it was the Chilean government. It has proved to be a rapidly spreading virus and it has all but supplanted democracy.

Democracy is not about abstract ideas and idealism; it is an extremely complex and concrete reality. It is about constantly seeking, selecting, refining, and developing practical options for achieving the common good. The modern world has developed what we call democracy today in less than 300 years and we developed it within the concept of the nation state. While nation states may not have been the best thing since the Garden of Eden, the positive thing we were developing was the idea of the citizen. And that citizen had as her goal the attainment of the common good. With the advent of globalized economies and globalized rule, the power of nations (and thus their citizens) has been taken away. And that weakens and all but obliterates democracy.

On a superficial level, we can all agree there is more democracy now than there ever has been. There have never been so many countries that describe themselves as democratic but the reality is we have seen a steady diminution and weakening of the democratic dream.

Consider this. The most powerful force possessed by an individual citizen is his own government because there are no other institutions or mechanisms that the individual can lay claim to as being his. Because in a democracy, the individual IS the government; we are NEVER General Motors or Microsoft Krupp Steel, or —forgive me for this — Taco Bell. Why are we all so willing to give away the only real power we have without getting anything in return?

One of the most insidious postures of those who favour globalization, who favour following the ‘business’ model of social management, is the destruction of our governments. It begins with the broad statement that government is too big, that government shouldn’t be involved in things such as water and energy production because those really can be managed better by private enterprises. Government shouldn’t be involved in providing low-cost housing or day care or health care because those are all managed with greater efficiency by the private sector. So we buy into this argument and begin the process of stripping from ourselves our power to manage society. We turn ourselves over to corporations who don’t care a fiddler’s fig about whether we get the best society we can have, because they care only about generating an extra few pennies for their shareholders.

The amazing thing is that we do this willingly. We cheerfully choose to have artificial limits put on the only real power we have to order our lives. It seems that we do this because we have been convinced that government is the enemy of the people, despite our constant crowing that our governments are of, by, and for the people. If government is the enemy of the people, then we are accepting that we are also the enemy since we are the government.

Governments everywhere — I’ll accept the common perception here — are grossly bureaucratic. And that is certainly a problem. But fixing that problem does not require that we simply throw away the government. It requires that we fix it. Attacking the problem by saying that ‘government is bureaucracy and bureaucracy is the enemy and therefore government is the 'enemy’ misses the point and invites something far worse.

Social philosopher John Ralston Saul states that the twentieth century has seen an explosion in all types of management and we have altered our public education systems to produce managers of every sort. Some of those managers end up in government and others in business, but they have essentially the same skill sets. Saul suggests as well that the problem of managerial dead weight is far greater in the private sector than in government. He says: “… one of the key reasons that the private sector has been unable to revive and reinvent itself over the last two decades has been a lack of creativity brought on by a managerial rather than a creative owner-based leadership. …the cost of the managerial superstructure is now far too heavy for the producing substructure. The managers are weighing the economy down.” And we are selling out our governments (that is, ourselves) to this model?

It is na?ve in the extreme for those leading the fight against government to suggest that society will be reinvigorated by smaller government, or that society will be better served when the government (that is, the people) no longer own the rights to their most basic needs such as water, electricity, heat. People become so obsessed about hating the government that they lose sight of the fact that it is they who are the government, and that this is the only social force in their lives over which they can exercise real control. If you eliminate control of your government, you are left with a Hobson’s Choice — rule by whomever is the toughest overlord, or reversion to the law of the jungle.

Over those 300 or so years that we developed our modern democracies, we have made many advances for the common good. It has taken us only a few years to begin seriously dismantling it. Democracies are led by people, not corporations. Charles Lewis, founder in the United States of the Center for Public Integrity, wrote: “The real powers that be in this country are not on any ballot. And they are accountable to no one.” Although he was referring to the U.S., it is no different in Canada or any of the other alleged democracies.

The idea that any democratic society could be led by economics or by self-interest demotes the citizenry and its civilization to little more than a decoration. We have engaged in a form of unconscious suicide by allowing these enormously important powers to escape from our hands into the international arena where they are beyond our reach. We didn’t even ask for any sort of recompense for what we have given up.

Another part of the disease which seems to have afflicted us is the rush to deregulate everything. As a citizen of Canada, I am personally regulated up to my eyebrows. And so are many of the local businesses around me. But the international players which operate in Canada do so without even a hint that they should be controlled or constrained. In that regard, Canada is no different than any of the Western democracies because we have all bought into those international trade agreements whose sole purpose was to make our governments, that is the people, irrelevant.

Part of the deregulation movement has been to satisfy the worldwide taste for “free trade”. Western civilizations have known for 3,000 years that in order to have prosperity you have to have extremely strict, but straightforward, regulations which will bring the kind of stability and long-term competition that can generate that prosperity. We know very well that without those regulations we get horrible boom and bust cycles which end up in terrible depressions.

From searching the online databases of Forbes Magazine, the Globe & Mail Report on Business, and the Wall Street Journal, I have learned the following: five firms control 50% of the global markets in aerospace, electronic components, automobiles, airlines, and steel; five firms control about 70% of consumer durables; five control about 40% of oil, personal computers and media. There are 200 companies which represent about 28% of the world’s GDP and less than 1% of the world’s workforce. Even conservative capitalists should be horrified to realize that so much production is in the hands of people who provide so few jobs because it’s that production which should provide the wages that people can use to consume those products. You don’t have to be a leftist to see how dangerous this is.

And the scariest statistic — 51% of the largest economies in the world are companies, not countries.

Now, isn’t all of this a good thing? Isn’t it true that countries who trade together don’t go to war with each other? The answers are ‘no’ and ‘no’. Most of the wars throughout history have been the result of trade disputes. I’m not going to list them all here, if you paid any attention when you were in school you know I’m right about this. What we are leading to now is war over the inability to control trade. When my country and your country are being savaged by some corporation that is in some third country over which neither of us has any control, how are we going to solve the problem? War. It’s the easiest answer to the frustration of being irrelevant. You can’t go to war against some corporation, so you do it with your neighbour (preferably in his country so yours doesn’t get messed up too much).

Since 1945, we have put in place massive numbers of treaties between nations but the only ones which are really binding are the economic ones. Effectively, we have taken economic power out of the control of nations and placed it at the international level where it is beyond the control of any of us.

Societies have shapes. Ideally, diamond-shaped is what most democracies would hope to be; a little bit of rich at the top, a little bit of poor-that-you’re-always-trying-to-deal-with at the bottom, and most everyone else in the middle. The pure capitalist model of the 19th century was a pyramid with a concentration of enormous wealth at the top rapidly dropping off to huge poverty at the bottom. By allowing business to take on the leadership role in our countries, we are moving away from the diamond and headed straight for the pyramid. We are moving away from the social victory that democracy brought us and heading straight back toward disaster.

Proponents of globalization and ‘free trade’ accept the premise that markets are self-regulating. They are not, they never have been, they never will be. We have thousands of years of history to prove that to us. Advanced societies understand that they prosper and progress by engaging in trade and by doing so in as diversified a way as possible. But in order to do that effectively they need to have some kind of industrial development policy. For 3,000 years societies have had industrial policies, trade policies, regulations. No sophisticated society in the history of the world has existed without an industrial policy.

But we have moved rapidly to dismantle the policies, the agreements between nations, and give them over to the corporations who will be the only beneficiaries. We have moved to make governments irrelevant without having any sense that we are also making ourselves irrelevant.

In other words, we have achieved, or are close to, a point where democracy no longer matters. Government can and should equal the practical expression of the common good. Without reversal of this mindless worship at the tomb of the unknown shareholder, we might as well surrender right now. For democracy to survive, the people, by exercising their control of their governments, need to stop and get their heads out of the sand long enough to see where we’re going.

Democracy was built on the nation state and every power that is removed from the nation state without the granting of some compensating international power for the citizenry, is anti-democratic. As a minimum, we need to work out an international control to force taxation on corporations. Fifty or so years ago, corporations in most developed nations paid somewhere in the vicinity of 40-50% of a nation’s total tax grab. Today, they pay about 6-7%. That’s why we can’t afford education, health care, assistance for the disadvantaged that all our governments are taking away from us. This is not a left-wing argument: every decent conservative economist of the past 150 years believed that you had to tax the real sources of wealth in order to fund the real necessities of the democratic state.

Democracy requires putting economics into a subsidiary position. That is the best recipe for stable prosperity. And iIt is the best recipe for restoring democracy.

----
Paul Harris is self-employed as a consultant providing businesses with the tools and expertise to reintegrate their sick or injured employees into the workplace. Canadian businesses can reach him at paul@working-solutions.ca. He has traveled extensively in what is usually known as "the Third World" and has an abiding interest in history, social justice, morality and, well, just about everything. Paul is also a freelance writer and can be reached at paul@escritoire.ca. He lives in Canada.