November 20, 2009
By Brendan Smith and Jeremy Brecher
When world leaders meet in Seattle after Thanksgiving for the “pre-millennial” session of the World Trade Organization, many will sincerely believe that there is no alternative to the present direction of globalization. But all over the world, activists and scholars associated with environmental, religious, labor, and other social movements have in fact been developing such alternatives.
A group of progressive members of Congress, NGOs, trade unionists, and expert advisors have recently helped draft the Global Sustainable Development Resolution, incorporating many ideas drawn from this international dialogue.
The Resolution assumes that the common people of the world share profound common interests. It seeks international cooperation to control out-of-control global corporations, capital, and markets.
The Resolution is designed to help unify disparate groups that are deeply concerned about the impact of globalization on the environment, labor, poverty, democracy, and human rights by integrating their concerns into a common program. It seeks to address in an integrated way the economic needs of the worlds’ people and the need to protect and restore the environment, and the needs of people in both first and third worlds.
The Resolution assumes that global corporations and markets require global regulation, but that a primary goal of such regulation should be to make it possible for people in local communities around the world to control their own economic lives. It tries to integrate the desire for local and national autonomy and diversity with the need to control global forces and actors.
The Resolution lays out a pathway for reconstructing the global economy. It assumes the program cannot be separated from the process of realizing it. It is designed to strengthen, not to replace, efforts to change the global economy by action in civil society.
Goals: Current policy seems to be guided by the theory that the more international trade and investment is better — whatever the consequences. Under the resolution, policy goals are defined, instead, in terms of what people really need:
- reducing the threat of financial volatility and meltdown
- democracy at every level from the local to the global
- human rights for all people
- environmental sustainability worldwide
- economic advancement of the most oppressed and exploited groups
Initiating Dialogue: So far, the global economy has been designed by small elites meeting closed negotiating sessions and corporate boardrooms. The Resolution proposes a U.S. Commission on Globalization and parallel Commissions around the world to develop the broadest possible dialogue the future of the global economy. It also proposes a Global Economy Truth Commission to investigate abuses in the use of international funds and abuses of power by international financial institutions.
Global Sustainable Development Agreement: A series of Bretton Woods-type conferences, with representation of civil society, will make recommendations for and initiate negotiation of a Global Sustainable Development Agreement.
Global Sustainable Development Financial Strategy: These negotiations will formulate a strategy to counter those aspects of the global financial system that make it more difficult for communities, regions, and countries to pursue sustainable development. The purpose of this strategy is to restructure the international financial system to avoid global recessions, protect the environment, ensure full employment, reverse the polarization of wealth and poverty, and support the efforts of polities at all levels to mobilize and coordinate their economic resources.
The financial strategy will provide an alternative to the “new financial architecture” being proposed by the IMF, World Bank, G-7, and U.S. Treasury. It will:
- encourage economic policies based on domestic economic growth and development, not domestic austerity in the interest of export-led growth.
- encourage the major industrial countries to coordinate their economic policies to stimulate domestic demand and prevent global deflation.
- help countries adjust currency exchange rates without competitive devaluations.
- develop means for assuring global liquidity, such as an expansion of the system of Special Drawing Rights.
- reduce the flows of destabilizing short-term capital by the adoption of capital controls as necessary.
- establish standards for and oversee the regulation of banks and non-bank financial institutions by national and international regulatory authorities.
- encourage the shift of financial resources from speculation to sustainable development that is useful and environmentally positive, such as community development and targeted investment for small- and medium-sized businesses and farmers.
- establish a tax on foreign currency transactions — known as a “Tobin tax” — to reduce the volume of 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.
- create public international investment funds to meet human and environmental needs and ensure adequate global demand by channeling funds into sustainable long-term investment.
- develop international institutions to perform functions of monetary regulation that are currently performed inadequately by national central banks, such as a system of internationally coordinated minimum reserve requirements on the consolidated global balance sheets of all financial firms.
Reform of International Financial Institutions: The IMF the World Bank, and other International Financial Institutions will be required to reorient their programs from the imposition of austerity and destructive forms of development to support for labor rights, environmental protection, rising living standards, and encouragement for small and medium-sized local enterprises. The IMF will terminate all activities except those fulfilling its original mandate of addressing short-term external trade imbalances.
Debt Reduction: Under the Resolution, the wealthy countries will write off the debts of the most impoverished countries by the end of the year 2000. A permanent insolvency mechanism will be established for adjusting the debts of highly indebted nations.
Checks on Unaccountable Corporate Power: To help establish public control and citizen sovereignty over global corporations and reduce their ability to evade local, state, and national law, the Resolution calls for a binding Code of Conduct for Transnational Corporations which includes regulation of labor, environmental, investment, and social behavior. In addition, corporations incorporated and/or operating in the U.S. would be held liable in U.S. courts for harms caused abroad.
Reform of International Trade Agreements: WTO, NAFTA, and all other agreements regulating international trade would be renegotiated to reorient trade and investment to be means to just and sustainable development.
Critics of the WTO have wisely called for a round of evaluation and reconsideration. These proposals indicate the kinds of alternatives that ought to be on the table
[note: The full text of the Global Sustainable Development Resolution can be found on the Internet at www.house.gov/bernie/legislation/imf/global.html. The original co-sponsors include Reps. Sanders, Brown, McKinney, Kusinich, Evans, DeFasio, and Lee.]