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Tuesday, November 25, 1997
"World Vision for the 21St Century"
DEVELOPMENT AND PEACE
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Summit Council for World Peace
November 25, 1997
I am particularly pleased to present this panel on economic reform as part of the « World Vision for the 21st Century », because I believe economic development will be such a fundamental international issue in the next Century, and that the time now is ripe for considering a new approach to international economic development as a tool also for striving towards the real peace: domestic social peace within each country.
While a few pockets of resistance -notably China- remain, the end of the Soviet Union meant the end of the clash between two competing economic ideologies which differ in virtually every material respect. For nearly a half Century following World War II, the choice for most emerging nations was to adopt either a communist model based on central planning and state ownership of the means of production, or a capitalist model based on the free market theories. Development assistance by industrialized countries was driven by the adoption of one model or the other by the recipient. Thankfully, that economic ideological warfare is over and the market model has won. But I would argue that the world’s industrialized economies now, must be very cautious and alert in their moves to institutionalize the free market model everywhere in the developing world. In the absence of a competing ideology to contrast and oppose, free marketers need to adopt a new, "bottom-up" approach to development.
By a bottom-up approach, I mean to suggest that consumers and workers, often overlapping groups, must be given the opportunity to participate in, own and control the means of production, particularly companies and industries so huge that they dominate the social and political life as well as economic life of a nation and control major infrastructure development. Just as America has championed the concept of "participatory democracy" around the world, so now must she provide leadership in supporting the concept of "participatory development" in both the Second World of the former communist countries and the Third World of emerging nations.
In the Cold War period, the easy pattern for donor countries was to make funds available to the government of the day in a developing country and be done with it. However, there are grave dangers in continuing this practice, or in encouraging the creation of capitalist elites in developing countries, as a means toward ensuring that capitalism takes root and holds.
What we are seeing in many places around the world in newly emerging capitalist economies, including Africa, Asia even Eastern Europe and in Russia itself is a phenomenon I see also in my own country of Lebanon: the emergence of what I might call an "economic oligarchy". In many countries, if we are not careful, we will find that we have merely substituted one form of repression or dictatorship for another.
Although Lebanon has a long and proud history of devotion to free market economics, there still are vital sectors of the economy which have been under government control. But in the rush to privatize especially such basic and essential enterprises as utilities, airports and roads in the infrastructure sector, too often the state is selling these industries to a small group of people, many times comprised of government leaders and officials themselves, who have little or no thought of the people, only their own political advantage and financial gain. Once these enterprises are in the hands of such an economic oligarchy, there is no evidence the new owners are motivated by the public good in their policies. To the contrary, our experience has been that greed, not human welfare, has become the greatest motivating factor in decision-making.
If the U.S. and other donor countries, in partnership with the governments of their aid recipients, and related international institutions, do not formulate and implement policies which will lead to participatory economies in the developing world, I predict we will see in the 21st Century a type of warfare which will pit worker and consumer against the economic oligarchies which by that time will control not only the means of production but the very lives of the people.
It is crucial that donor countries take the lead in devising imaginative and creative policies in this regard because the governments of the developing countries simply do not have the means by themselves to control the emerging economic oligarchies. It is the only way we can ensure that we have « Development and Peace ».
It has been my experience that there are mechanisms already in place which will assist us in the achievement of a new approach towards « Development and Peace », mechanisms which will provide avenues for consumers and workers to become owners of the means of production. This broad-based ownership can be accomplished through sound government policies designed to achieve this goal combined with outside international assistance such as provided by the International Finance Corporation (FIC) within the World Bank, which offers know-how and financial backing. In this era « globalization » in every sector, and through mechanisms like the GATT for instance, it is possible to invent ways and means capable to regulate the phenomenon of free market without oppressing the poor and middle class in the developing economy.
It is up to us, as international leaders and thinkers, to reflect on how to improve our governmental structures through enlightened policies which lead toward this objective. We also must exert our influence on international institutions to adopt this new approach.
Peace, for me, is not just the cessation of military hostilities between opposing armies or the end of political strife between competing parties. It also means building a social order which avoids social unrest between haves and have-nots. It means creating an atmosphere of trust and harmony between workers an owner. It means giving the average person the right not only to exist in society but to empower him by giving him a tangible stake in his own economic well-being and future. Such an economic stake provides an incentive to take an active part in the improvement of the society.
As our deliberations proceed here to day, I hope we can engage in a discussion of how we can begin to move toward designing new policies which will lead to peace and development in the 21st century. Otherwise the New World Order will be nothing at all like that envisioned by George Bush. Rather, we will be sowing the seeds of a new class warfare which will be more dangerous and devastating than any classical military conflict and will be far more difficult to end.
Our challenge is to adopt strategies which will make our 21St century decision-making for more participatory than it is today. The next century of this achievement or we will have failed.