Published in the Spring 2001 issue of EGA Updates
Quarterly newsletter of the Environmental Grantmakers Association
This gathering was for me a very exciting moment. In my long association with the foundation community, it is the first time I've seen such willingness to question the system that produces the concentrations of wealth that at once make foundations possible and create many of the problems to which foundation grant making is directed. It signals a move to a deeper level of analysis essential to a coherent grant making approach to corporate globalization--a defining issue of our time.
As reflected in the briefing presentations, civil society organizations have developed campaigns addressing a daunting inventory of problems spawned by corporate globalization. Many campaigns focus on the misdeeds of specific corporations such as Nike, Rio Tinto, Starbucks, or Citigroup; global public agencies such as the World Trade Organization, the World Bank, and the International Monetary Fund; and international trade agreements such as NAFTA, FTAA, and GATS. Sometimes the issues center on wages, working conditions, and the rights of workers to organize. Other times they involve environmental issues such as global warming, the destruction of farms and fisheries, genetic modification or invasive species. Still other campaigns deal with the privatization of water, education, health, intellectual property, culture, and prisons. Then there are campaigns dealing with financial speculation, Third World debt, structural adjustment, poverty, police violence, and electoral reform.
These campaigns are important to slow the damage and contribute to public education on the larger issues. There is an urgent need to support the groups working on them both in the United States and abroad. Yet it is also true that the variety of the issues and organizations involved presents a serious challenge to foundations that recognize the seriousness of the problems, yet wish to maintain a strategic focus in their grant making.
It is helpful in this regard to recognize that each of the bewildering array of problems addressed by these individual campaigns can be traced to a common source--a failure of governance. The institutions to which human societies have yielded the power to set economic and political priorities are making decisions that place private financial interests ahead of the larger interests of people and planet. More specifically, the processes of economic globalization have shifted the power to govern from people and democratically elected governments to financial markets and global corporations that are blind to the social and environmental consequences of their actions. A democracy of people is being replaced by a democracy of money that disregards life-values.
Though sometimes venal and short-sighted, humans are complex living beings with a substantial capacity for wisdom and compassion. By design, publicly traded, limited liability corporations and the financial markets to which they are accountable have a single-minded focus on short-term financial returns that overrides all other values. As expressed by the world's most famous hedge fund manager, George Soros, in his recent book Open Society (p. 161):
To put it bluntly, democracy and corporate globalization are mutually exclusive conditions; as are short-term financial values and long-term life values. To have democratic societies aligned with the needs of life, the powers of governance must reside in people and communities and must be exercised through institutions grounded in the principles of economic and political democracy. On the economic front, this means replacing economies dominated by mega-corporations accountable to distant absentee owners with economies comprised of human-scale, stakeholder owned enterprises accountable to real people and responsive to the self-defined needs of their customers--all basic characteristics of real market economies."Publicly owned companies are single-purpose organizations--their purpose is to make money. The tougher the competition, the less they can afford to deviate. Those in charge may be well-intentioned and upright citizens, but their room for maneuver is strictly circumscribed by the position they occupy. They are duty-bound to uphold the interests of the company. If they think that cigarettes are unhealthy or that fostering civil war to obtain mining concessions is unconscionable, they ought to quite their jobs. Their place will be taken by people who are willing to carry on."
It is ironic that those who challenge corporate globalization are angrily dismissed by corporate globalists as radical extremists. Most of the protest leaders are committed to creating functioning democracies, locally rooted rule-based market economies, and ethical cultures--all rock solid, conservative, mainstream American values. The radical fringe in this contest consists of those who in the pursuit of self-interest and an extremist ideology work to replace democracies of people with democracies of money, self-organizing markets with centrally planned corporate economies, and spiritually grounded ethical cultures with cultures of greed and materialism. The work of this radical fringe of corporate globalists is leading toward a world in which a dozen or so mega-corporations accountable only to their shareholders will control the access of people everywhere to money, food, water, and health care; they will dictate laws, decide what children will be taught in school, and control access to news and information.
The institutional leaders in this attack on American values are U.S. based corporations and the U.S. government. They are backed by the Bretton Woods institutions (the World Bank, the IMF, and the WTO) and the full force of the U.S. military. Thomas Friedman, a New York Times foreign correspondent and one of corporate globalization most ardent boosters argues that:
The hidden hand of the market will never work without a hidden fist. McDonald's cannot flourish without McDonnell Douglas, the designer of the U.S. Air Force F-15. And the hidden fist that keeps the world safe for Silicon Valley's technologies to flourish is called the U.S. Army, Air Force, Navy, and Marine Corps.
My thirty years as a development worker in the Third World led me to the conclusion that as American citizens, our foremost obligation to the world is to stop this assault at its source through the democratic transformation of our own political and economic institutions in solidarity with people everywhere who are working to democratize relations of power and bring social and environmental values to the forefront of the policy agenda. An essential part of this task is to create public awareness that there are alternatives and that change is possible. It is to this end that I wrote The Post-Corporate World: Life After Capitalism, and have chosen to devote so much of my energy to the Positive Futures Network, publishers of YES! magazine.
The following are illustrative of the important proactive initiatives that may merit support by U.S. foundations seeking a strategic approach to dealing with root causes of the destructive consequences of corporate globalization.
The social and environmental crisis created by the shift of governance power to unaccountable global financial markets and corporations is a wake-up call for humanity. It brings us face-to-face with an unprecedented creative challenge to rethink our values and democratize our institutions to create a world that works for all people and the whole of life. The fact that a globalizing civil society is embracing this challenge creates an opportunity for philanthropic foundations to engage a deep rethinking of their purposes and strategies.