Holy shit. The Fourth Estate figures it out. Of course, the answer to the question, "Omigawd! There's gonna be no nation-states, dude!", is, the same answer to the question "Egad! The Church has no more earthly power!" Which is, "So?". :-). Mort a le infame, as Voltaire used to say... Cheers, Bob Hettinga --- begin forwarded text Delivered-To: ignition-point@majordomo.pobox.com Date: Thu, 29 Oct 1998 06:41:34 -0500 From: Richard Sampson <rjsa@sprintmail.com> Organization: Unknown Organization MIME-Version: 1.0 To: "ignition-point@majordomo.pobox.com" <ignition-point@majordomo.pobox.com> Subject: IP: A nationhood under seige: Is the nation obsolete? Sender: owner-ignition-point@majordomo.pobox.com Precedence: list Reply-To: Richard Sampson <rjsa@sprintmail.com> A nationhood under seige: For 350 years, the world has been governed by the pri A nationhood under seige: For 350 years, the world has been governed by the principle of national sovereignty, but the new global economy respects no national borders, laws, or interests. Is the nation obsolete?< Three and a half centuries after the nations of the world won the power of self-rule, a new force has come along to erode that power and undermine the democratic rights of their citizens. That force is the global economy, which is relocating the economic decisions that frame the lives of citizens far beyond the reach of the voters and their voice. There's a sort of cruel historical irony here, that at the very moment when liberal democracy has finally triumphed over all rival systems of government, the power of markets - the other half of the post-Cold War triumph - has come along to leech that democracy of much of its meaning. This weekend is the 350th anniversary of the Peace of Westphalia, a treaty signed in 1648 by the Holy Roman Empire with France and Sweden and, especially, with the princes of the various German principalities. This treaty not only ended the Thirty Years' War, but also severely limited the ability of the Empire and the church of Rome to intervene in the affairs of the German principalities. In other words, Westphalia proclaimed the sovereignty of the principalities, the right of the princes to rule their territories without outside interference. This idea of sovereignty has echoed down the three and a half centuries since then and is the basis both of self-government and of international relations. Considering all the massacres, pogroms, persecutions, gulags and holocausts of the past 350 years, this principle of sovereignty leaves something to be desired. But it's what we have, the magnetic pole of the international system. More important for those lucky enough to live in democracies, Westphalia is the basis of democratic self-rule, the idea that the average citizen has a say in the decisions that affects his or her life. Somebody else may make the decisions, but citizens have the right to cast their votes and state their opinions, confident that these vote and opinions will be heard by the decisionmaker who, one way or another, must pay attention. It's this right and this confidence that are vanishing in the face of the global economy, which is the one really new thing under the sun. The reason is that democracy is national and so are its institutions. Governments are national and their power to make and enforce laws is national. The power of the vote is felt at national levels, but not beyond. But the nation-based industrial economy that underwrote the growth of democracy is being replaced by a global economy, powered by global capital markets and global communications, answering to the needs and demands of global corporations and investors who can and do ignore frontiers. In short, an extremely important part of public life _ the economy _ is going global in a way that politics and government have not, and so is moving beyond any kind of democratic control. As Americans and the rest of the world have learned in the past year, impersonal global markets can and do cast instant judgments on entire societies, dictate the spending decisions of government and unravel the social contracts that used to bind corporations with their employees and their societies. Peter Drucker, the founder of modern management, has written that we are in an ''age of social transformation,'' one of those historical eras that happen ''every few hundred years,'' when, ''within a few short decades, society rearranges itself _ its worldview; its basic values: its social and political structure: its arts: its key institutions.'' Such transformations, like the global economy itself, are not innately evil forces. Instead, they are amoral but immensely powerful movements that change civilizations. But all such movements are created by humans and potentially controllable by humans, for good or for ill. A century after the Industrial Revolution, societies tamed the economic forces generated by this revolution and turned them into the market democracy that enhanced the past 50 years of Western history. No such taming of the Global Revolution _ or even a debate on how to do it _ has begun yet. The old economy was built on a national consensus that economies exist for societies, not the other way around. Over the past half-century, the democracies created social markets _ capitalist structures that insisted the companies share the cost of citizenship. Tax laws required companies to pay their fair share to the places where they made their money. Other laws gave rights to unions, protected worker safety and the environment, and mandated good health and pension plans. Companies accepted these laws, however grudgingly, if only because it cost them no competitive edge: all their rivals, subject to the same laws, faced the same costs. Now, not only capital markets have escaped into cyberspace, beyond the reach of national regulations. There are about 50,000 global corporations who see the globe as a single market and ignore national borders and regulations. These are no longer multinationals, with most of their operations in one country but with a few foreign branches. The global economy is being driven by global corporations who see the globe as a unit. They have their headquarters in one country, research and development in others, accounting in still another, manufacturing scattered across the world, with sales wherever there are customers. These companies have gone global because, with the advent of global communications, they can. But in the process, they have left behind their old home and its laws. Too often, companies now pay taxes and wages where the rates are lowest and the laws loosest. In many countries, environmental or benefits regulations are nonexistent. Many other countries are willing to waive them for companies that will invest there. In this atmosphere, businesses argue they can no longer afford the social costs imposed on them by society, when their rivals may be operating halfway around the world, in a place where the average wage is $1 per day and environmental laws don't exist. Either, they say, they must be allowed to break the social contract, busting unions and negotiating easier regulations and dumping health and pension plans, or they must go abroad themselves. Often they do both. Good jobs go away and the ones that are left somehow pay less, are more unstable and are less likely to come equipped with pension or health plans. Wolfgang Reinicke, a senior economist at the World Bank, has written that this is an attack on ''internal sovereignty,'' the ability of an elected government to really govern. The laws remain intact, but the ability to enforce them disappears. Government exists but its effectiveness and efficiency are eroded. The economy rolls on, but the public's ability to insist that it benefit society is eroded. Elections are held and votes counted, but the power of that vote to promote particular policies wobbles and wanes. The economic rights won by citizens over the centuries, from collective bargaining to decent wages to job stability to pensions, often depending on the power of national governments to enforce them. As this power withers, so do the rights. Small wonder that government is held in such low esteem these days and politics derided. A government that cannot enforce its own laws is a government fit only for scandals and other sideshows. The main event is going on somewhere else, and neither Washington nor its subjects knows where it is. There oughta be a law, a global one replacing the national laws and bringing this economy back under democratic control. In fact, there are laws, lots of them, with more being written every day, but the voters aren't being asked to help write them. Around the world, bureaucrats, experts, lawyers and lobbyists are writing a new web of global regulations, on stock markets, accounting, banking, investment, even auto safety and drug trials. These talks aren't exactly secret but the government isn't going out of its way to publicize them. They are highly technical and, frankly, pretty boring. But they're important. They're writing the rule book for the 21st Century. New global tax laws haven't been written yet, and environmental or labor regulations are barely a gleam in a bureaucrat's eye. But they'll be written someday, if only because the global economy otherwise will be a jungle. But when they are written, they'll look a lot like the regulations already framed. That is, they will be technical exercises, focused on efficiency and the well-being of corporations, not on democracy or the public health. Nations and corporations have different interests. Nations want to raise the living standards of their citizens, while corporations want to raise their profits. The glory of the past 50 years rests on the creation of the social market, with the drive of capitalism tempered by the needs of society, enabling both to thrive. This 20th-Century thrust has focused on the rights of citizens, as individuals or as classes. The new rule-making focuses on the safety and efficiency of markets and corporations. They are making the world more secure and predictable for investment and trade, which is vital for the creation of an honest market. But it caters to the needs of global actors, not the folks at home. De-regulation nationally is being replaced with re-regulation globally. But in the process, governments are giving away power from national bodies to global institutions. But governments exist by democratic sufferance. These global bodies do not. The growth of the global economy requires global governance. But increasingly, as Reinicke has written, this is turning into ''governance without government,'' public functions wielded by bodies with no public control. Pat Buchanan, the commentator and onetime presidential candidate, has called for a ''new economic nationalism'' that, essentially, calls for derailing the global economy with barriers on trade, limits on immigration and an all-around isolationism that, apart from its basic selfishness, is a national solution to a global problem and, hence, futile. The right answer is to recognize that the global economy exists and won't go away, and to tame and temper it with a new social market, composed of new laws and rules in which the public, for a change, has a voice. For a start, the government should never negotiate new global rules that supersede national rules without making a sort of democratic impact statement on what this will mean to the rights of citizens. This is a ''new economic internationalism'' in which American democratic institutions would cooperate with the democratic institutions of other countries to recapture the sovereignty of both. (This is an adaptation of the Richard W. Leopold Annual Lecture that R.C. Longworth, a Chicago Tribune senior writer, delivered at Northwestern University this month.) KRT PERSPECTIVE is a forum for essays by staff writers from contributing papers. (c) 1998, Chicago Tribune. -0- Visit the Chicago Tribune on America Online (keyword: Tribune) or the Internet Tribune at http://www.chicago.tribune.com/ Distributed by Knight Ridder/Tribune Information Services. AP-NY-10-28-98 0611EST< -0- By R.C. Longworth Chicago Tribune News provided by COMTEX. [!COMMUNITY] [!FINANCE] [!WALL+STREET] [ACCOUNTING] [BANKING] [BOOK] [CONTRACT] [DEMOCRACY] [ECONOMY] [ENVIRONMENT] [FRANCE] [GOVERNMENT] [HEALTH] [IMMIGRATION] [INVESTMENT] [KNS] [LABOR] [MANUFACTURING] [MARKET] [MONEY] [NEWS] [NEWSGRID] [POLITICS] [RATES] [REGULATIONS] [RESEARCH] [SALES] [STANDARDS] [SWEDEN] [TAXES] [TRADE] [TREATY] [UNIONS] [USA] [WAR] [WASHINGTON] [WORLD+BANK] -- ----------------------- NOTE: In accordance with Title 17 U.S.C. section 107, this material is distributed without profit or payment to those who have expressed a prior interest in receiving this information for non-profit research and educational purposes only. 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