Red Herring: Terrorism and the challenge to globalization.

[mean-green at hushmail.com]

[Another glimmer of hope as even some of the mainstream business press is venturing beyond simple patriotic flag waving.  Posted in its entirety as its not online.]

Terrorism and the challenge to globalization.

BY PETER SCHWARTZ

THE CATASTROPHIC, evil attacks on the United States are the result of deep grievances held by violent factions of radical Islamic movements. But within hours of the World Trade Center's collapse, many voices that have been raised in opposition to globalization were arguing that the attacks were the result of the American drive for global political and economic hegemony. Is there really a connection here? The question is not whether there is some grand conspiracy. Rather, the question is whether the events of September ii are part of the same story as the challenge to globalization. If so, what does it portend?

There are several good arguments that the answer is yes, there is a bigger story that ties together fanatic Islamists and World Trade Organization protesters. Both are challenging American power, and both are opposed to American global dominance of culture, economics, and politics. But there are different interpretations of the opposition to globalization.

The globalization debate is really about the power of global corporations, argues Paul Hawken, cofounder of gardening retailer Smith & Hawken, and an active participant in Seattle's anti﷓WTO demonstrations. In his forthcoming book, Uprising, he suggests that a loose network of worldwide organizations is attempting to limit global entities' power to dominate, exploit, and sometimes corrupt societies. These network groups are not opposed to trade, private enterprise, or modernization; they just want these pursuits on terms that recognize certain values. They are repelled by violence. Still, they believe global companies hurt, more than help, people, and that poverty and corporate tyranny fertilize the soil from which fanaticism grows.

Kevin Kelly, the former executive editor of Wired magazine and the author of Out of Control: The New Biology of A4acleines,Social Systems and the Economic World (Perseus, i995),suggests that radical Islam could come to play a role similar to that of Communism. The Communist movement around the world served to organize opposition to Western capitalism and give hope to the oppressed, however misplaced. Today in the Islamic world, America is seen as the source of poverty and powerlessness, while radical Islam is seen as the strongest opponent of American power, and the source of an alternative vision of better life. For American citizens, the violent extreme of radical Islam has become, like Communism before it, the nightmare that organizes our darkest fears.

The United States calls itself the land of freedom and democracy, but, argues Benjamin Barber, author of Jihad vs. McWorld: How Globalism and Tribalism are Reshaping the World (Ballantine Books, t996), it supports an often oppressive and undemocratic international order. Institutions like the International Monetary Fund, the World Bank, and the WTO all function behind closed doors, where the United States and its brethren control the world economy. America has opposed efforts to increase transparency of the system and broaden participation in it. The U.S. government has opposed several new treaties covering issues like global climate change, war crimes, and even biological weapons. Many who challenge American power see the country as reserving democracy and freedom for itself.

If these interpretations of political reality are valid, we can glimpse where the geopolitical future may be headed. If radical Islam is the new Communism, we may be in for a long and ugly war. This scenario involves a world of perpetual conflict with no winners. As atrocities on both sides feed on each other, the dividing lines become deeper and wider in an ever more﷓terrible cycle of violence.

If Mr. Hawken and Mr. Barber are right, there are at least two possibilities. In the best of all possible worlds, democratic governance would begin to emerge globally. Existing institutions would become more transparent and democratic. New institutions would be created to better regulate common elements like the air and the oceans, and to establish appropriate global rules of behavior for corporations.

But one has no trouble imagining another scenario, in which the United States refuses to surrender any sovereignty and acts unilaterally in its own interests. In such a rogue superpower scenario, the reception for U.S. companies around the world will become chilly indeed, as the world lines up to resist American hegemony. Sympathy for any new horrors inflicted upon the United States will be very limited, and cheers will be heard in Paris and Rome, as well as in the back streets of Gaza and Karachi.

PETER ScHwaarz, chairman of the Global Business Network, is also a partner at the venture capital firm Alta Partners. Previously he headed scenario planning for Royal Dutch/Shell in London. Write to letters at redherring.com.