Multinational Monitor

MAR/APR 2009
VOL 30 No. 2


A New Life for the IMF: Capitalizing on Crisis
by Robert Weissman


Burden of Proof: The Precautionary Principle
an interview with Peter Montague

A Carbon-Free Future
an interview with Arjun Makhijani

Green Stimulus
an interview with Robert Pollin

The Green Chemistry Revolution
an interview with Paul Anastas

A Bias to the Local: The Subsidiarity Principle
an interview with Jerry Mander


Behind the Lines

Big Ideas to Save the Planet

The Front
Global Job Meltdown - Prosecution Prognosis

The Lawrence Summers Memorial Award

Greed At a Glance

Commercial Alert

Names In the News


A Bias to the Local: The Subsidiarity Principle

An Interview with Jerry Mander

Jerry Mander is founder of the International Forum on Globalization. He is also program director for the Foundation for Deep Ecology and a senior fellow at Public Media Center. He most recently edited the book Alternatives to Economic Globalization (2004).

Multinational Monitor: What is subsidiarity?

Jerry Mander: Subsidiarity is the term many of us employ to describe an essential aspect of the current anti-globalization movement: the effort to bring real economic and political power as close to the local as is practical and feasible. Where the currently dominant globalization system tries to diminish the power of the local, the regional, even the national, and move all power to centralized global mega-institutions far away from affected communities, "subsidiarity" tries to stimulate the opposite. It seeks to build a bias in all governing systems, operating systems and rules to favor the local - or as close to the local as possible.

Of course, certain functions can't be fully localized. If you're going to try to keep the ocean from being polluted, or to take concerted action on climate change, you need international agreements. But the decisions about what should be globalized and what should not be must be on a case-to-case basis; the roots of power should be invested in the local whenever it can be.

MM: Do you think about subsidiarity as applied to primarily political governing institutions or to economic models?

Mander: Both. We need to try to bring all operating systems - energy, transportation, manufacturing, agriculture, finance - as near to the local level as is practical in individual cases.

Right now, we see this tendency growing all over the world, as communities are attempting to regain control of local resources like water or forests, or fishing resources, or minerals or to reverse the prior trends toward corporate, industrial monocultural agriculture systems and food distribution.

This latter effort is particularly far along, as energy costs make the export-oriented, energy intensive industrial food system increasingly non-viable, and more than a little absurd. Growing food on one continent and shipping it across oceans to another continent, when it could as well be grown in the local community is madness at both ends of that equation. High shipping costs, and scarce energy, not to mention the negative effects on local communities, make operating on a macro-industrial scale economically unfeasible.

Of course not every community can supply all of its own food. But for both ecological reasons, as well as reasons of local economic sustainability, many communities are trying to be as self sufficient as possible, producing whatever they can locally, and only then seeking to augment supplies from elsewhere in their own region, or as nearby as possible.

Again, the point is to trend toward the local. Sometimes by "local" we really mean "regional" or even national; but the idea is to move as much toward the local and away from the global as possible.

Agriculture and food systems are certainly not the only examples of this, as we see in the emphasis toward creation of new local energy resources, control of local water systems, retention of local mineral and biodiversity resources of all kinds, and the renewed effort to take control of the rules of corporate activity and finance.

MM: What are the arguments for subsidiarity beyond avoiding the economic and environmental costs of international transport? Why should subsidiarity be a governing principle for global politics and the global economy?

Mander: It all starts from the fact that the globalization model, which portrayed itself at Bretton Woods and since as a panacea to solve all economic programs in the world - and bring peace as well - has turned out not to live up to its advertising. Its perpetrators proclaimed it would bring a rising tide that lifts all boats, but in fact it only lifted yachts. After a half century of voracious globalization, there is a greater gap between rich and poor among countries and within them than ever before, and arguably equally important, it has brought an unprecedented ecological crisis, which is also a factor in the global financial crisis. At IFG we call it a "triple crisis": climate change, peak oil and global resource depletion - water, forests, arable soils, minerals, fish in the seas, coral reefs, etc. All of this is intrinsic to an economic model that depends on ever more resources to feed its need for hyper growth, and ever more consumption, waste and industrial expansion while ignoring the ecological limits of a finite planet. They need that kind of growth to attract investments, to fund their high salaries, and to keep functioning on a global level. This kind of expansion was possible during the late 1900s when the global resource supply was still abundant, inexpensive and accessible. But no longer. The planet cannot sustain a voracious global corporate economic growth model that ignores the carrying capacities of the planet.

The global financial collapse is no more important than the ecological collapse, of which climate change is the most famous element at the moment, but there are many that I've described that are going to be very, very important. Water is probably going to turn out to be more important than energy. And as I mentioned, food systems are also going to turn out to be crucially important; in fact, they are already crucially important in many parts of the world.

The whole globalized model is a farce. All of its basic premises are not operable. It can't sustain itself and is going to fail, no matter if activists spend all our time on the beach. However, if that's so, it's still very prudent to start talking about what models are going to survive and what kinds of models do make sense in a future world of a changed climate, depleted energy resources and depleted resources in general. Subsidiarity - moving in the direction of local control, and away from long-distance transport systems, export-oriented economic systems, centrally controlled financial systems and centrally controlled corporate systems - is a fundamental principle to adjust to the inevitable changes we face.

Another point: a lot of people have started to accept that the fossil fuel economy is over, or is going to be over, or needs to be over. But they hang onto the idea that alternative energy systems are going to substitute - that all we need to do is get a really good collection of alternative energy systems, like solar, wind, biomass, biofuels, hydro, etc., and we can keep operating society in the way that it now operates, which is to say at a global, industrial scale, similar to what we now have.

But no matter how you look at it, you're going to have a lowering of gross industrial throughput and gross energy use in the world, which means a lowering of productive capacity in the world, less international trade opportunity, and more attempts to decentralize economic activity and move toward the local. The only fundamental solution is going to be conservation.

MM: You offer a critique of current global economic arrangements. Why does it follow that the local arrangements are less polluting, less resource intensive and less exploitative? Is that inherently so?

Mander: In certain very important ways, yes. The whole idea of globalization is to maximize long-distance trade and large-scale export oriented industrial production, which means a maximization of resource development, industrial output - whether material goods or monocultural agricultural production - and long-distance shipping, and distribution. Each of those activities inherently have direct impact on the environment: maximum exploitation of resources, maximum impacts on energy supplies, probable increases in pollution and waste, and, in the case of agriculture, energy-intensive monocultural uses of the land that are likely to increase soil and water pollution and degradations. All of that is inherent in large-scale export-oriented trade.

Now, locally controlled and operated systems can also be highly negative in environmental terms, but they are less inherently so. If the goals of a local economic system are mainly to satisfy and sustain local needs and values - for example, if food systems are primarily designed with labor-intensive, diverse crop production to satisfy local markets rather than export markets - then you have immediately eliminated a lot of energy and chemical inputs, and saved a lot of energy devoted to transportation.

Of course, you may still have some horrible local practices in individual cases, but those are not intrinsic to a local system, unlike a global system which requires continuous excess production for export markets.

Neither does localization automatically produce rational democratic forms, and there are certainly plenty of examples of the opposite, as we've seen in many parts of the world. But you're far more likely to get democracy on a local level than on the global level, where the ruling institutions are corporate-based and operating on a scale of values that begin and end with maximum production and profit via a globalized system that is intrinsically indifferent to the carrying capacity of the planet.

MM: Why is that? If the problem is corporate control of the forests, why is the answer local democracy rather than global democracy, and why is local democracy more likely?

Mander: At best what we have achieved in the U.S. system of corporate-driven representative democracy is semi-democracy, and of course the scale of the system is also a major factor. The bigger the system's operating scale, the greater the influence and persuasive powers of large-scale special interests will likely be, making it far more difficult to approach a true democracy where individual and community voices, and alternative values, can be heard and heeded. Size matters.

I think you are far more likely to achieve engaged participatory democracy within smaller political units where local voices are actually heard. And I think you are far more likely, if not guaranteed - there are also ample examples of dreadful local values - to get rational decisions. I go along with E.F. Schumacher [author of Small is Beautiful] on that point.

So is a "global democracy" even achievable? The great one-world democratic vision that was touted a few generations ago? So far it has been giant global economic institutions - from global corporations to the IMF, World Bank and WTO, as well as the militaries of the largest, richest powers - who have become the primary expressions of "global governance," and it may be a kind of utopianism to believe that, at least in a capitalist framework, that is likely to change. We all still have hopes for that, but even the United Nations has got to be assessed as only minimally successful at bringing the voices of the majority of countries and peoples forward in a meaningful way.

You do get some international agreements which act in the common interest - human rights values, laws of the sea and exploration, some environmental agreements, etc. And there is a desperate need for effective global action right now, for example in the runup to the Copenhagen climate talks.

But as to which is the more utopian - local democracy or global - well, the answer is not so clear, but on most environmental and economic matters I think local systems have fewer pitfalls.

Another important angle on all this of course is to define how we create a path toward equity on a global level, something that is at least theoretically far easier on a local level. Any plan that proposes subsidiarity must also address the questions of equity.

MM: How does the principle of subsidiarity relate to the question of equity?

Mander: We certainly cannot favor any system of localization which sustains the current status quo, where the richest countries and corporations control most of the world's resources, and the countries that are essentially occupied by global corporations do not get benefit from their own inherent wealth. In a situation of growing resource scarcity, it will not be sufficient to withdraw into isolated enclaves of very rich and very poor, especially since so much of the wealth has been essentially stolen from the poorer countries' resource base. Obviously some plan for a more equitable "democratic" redistribution of resources is crucial to whatever solutions are devised.

The solution is obviously some kind of effective redistribution of wealth and resources. That is a place where there is urgent need for international agreements about what exactly is a level of sufficiency and then a plan to achieve it. Then, the parts of the world that have been bloated and over-consuming and living way above standards of sufficiency will have to take a lump of the surplus and pass it to countries and people living below sufficiency. That, along with technology transfers, can enable them to achieve continued incremental growth, while we get to decline incrementally, and eventually something closer to an equitable balance is achieved. That's what they used to call "contraction and convergence" which is a term that has lost its panache, but may still be the only possibility in a resource-deprived world.

One more addendum, on the question of "sufficiency." There is fairly extensive research about what levels of consumption are needed for personal happiness. What the research basically says is, if you live below a certain standard where you don't have sufficient food, or clothing, or shelter, or your kids don't have education, you don't have healthcare, you don't have some degree of security, you're probably not happy.

If you get up to the level of sufficiency where those things I just mentioned are basically taken care of, you feel pretty good. (Environmental health and cultural vibrancy are also part of the equation.) If you get a little bit above that level of "sufficiency," you feel really good because you have a bit of a margin.

But then, as you continue to increase your pile of commodities and your income and so on, there is a diminishing return on your happiness and feelings of contentment in life. Happiness actually declines at the highest levels, because you spend so much time getting stuff and taking care of business that you are alienated to a higher degree.

So, the ideal level is what we might call "sufficiency-plus." Not a very high consumption level, actually. It could be universally achieved at the current level of resource availability in the world, even at the present level of population, but only if it's not all dominated by a small percent of countries and people of the world, and a higher degree of "global democracy" is achieved.

MM: What about concerns that local governing systems are frequently highly oppressive, especially against women?

Mander: I think you are alluding to the many instances of clear human rights violations among local communities and cultures - anything from genital mutilations, to other gender related or religious freedom issues, to local dictatorships, and the like. There is no way I would want to deny the existence of these problems on a local level. But it is not as if similar and other related human rights problems are not rampant on national and global levels. You have only to ask the people of Nigeria about the behavior of oil companies on their traditional lands, or peoples in the Amazon or Bolivia about the rights that have been denied them by global economic powers. I fully support global instruments and actions that try to mitigate these things, including the UN Declaration on Human Rights and the more recent, and very powerful and radical UN Declaration on the Rights of Indigenous Peoples. We certainly need to have these kinds of international agreements and standards, that can even be applied at local levels wherever possible. There are also local wars of various kinds that quickly become threats to the larger world, whether in the Amazon jungles, or in Somalia or Israel-Palestine, or Pakistan-India. There is no end to such "local" problems, and there have to be responsive international institutions to help deal with these.

Subsidiarity - that is, moving power toward the local - doesn't solve that problem, or exacerbate it. It does help empower local communities who seek to sustain their economic and sometimes cultural rights, and resources, and it will go a long way to easing global energy and resource pressures. Anyway, "subsidiarity" is really more of a concept, a guiding principle, than it is a set of specific rules and procedures.

But certainly international systems need to be sustained. The UN Declarations I mentioned are two of those that can help sustain international human rights standards even where economic power moves further toward the local.

MM: You may say localization is inevitable, but on the other hand there is still a huge amount of momentum driving toward more corporate globalization and concentration of power. What are approaches to start reversing the trend through intentional human action?

Mander: A couple of years ago the International Forum on Globalization published a Manifesto on Global Economic Transitions; Toward Economies of Sustainability, Equity, Sufficiency and Peace. It contains dozens of ideas and examples of this transitioning process, already ongoing. There's a long list of steps you can take and rules you can make about the activities of corporations, investment, trade and globalization institutions, local economic development, governance, individual actions, etc.

For example, we favor less long distance trade rather than more; less movement of capital in and out of communities - greater focus on local finance institutions; less privatization of the public commons and public services; rapid transitions to local energy systems and operating systems especially in agriculture; greater re-ruralization; and much greater controls over corporate activity. These include site-here-to-sell-here policies for manufacturing, banking and other services; community participation on corporate boards; strict limits on capital flight; ending tax policies that favor big corporations and sometimes encourage or facilitate off-shoring; preferential treatment for local investors; and limits on expatriation of profits; and many more.

In any case I think the long-term trends are clear. Globalized economics are running up against a wall now, based upon the limitations of nature and the limitations of the planet. Part of the financial crisis is even rooted in that. As resources become ever-more limited, capitalist economic activity has moved toward non-material, virtual economic activity - money buying money, or money buying financial instruments to where that has become by far the major factor in economic growth, GDP, and the creation of the tragic bubble economy that is now collapsing. All of that activity needs to be discouraged in future, and a "real" economy encouraged to satisfy the true needs of communities, while also protecting nature.

In any case, the opportunities for amassing great wealth through large-scale corporate activity are much less now than they were just 30 years ago when you had resource abundance and globalized free trade and investment. It's all collapsing, as is the dream of corporate globalization.

Governments don't have any idea of what to do about it. President Obama, who in most respects I really love, continues to speak about a "recovery plan" that is rooted in reviving rapid economic growth, fueled by the continued domination of banks and large corporations, all of that to achieve more "housing starts," more automobile sales and production, more retail consumption and more trade, all at a time when we really need the opposite. Someone needs to tell him that all that is soon over, and he needs to get going on a plan B.

I think it would be more prudent for him to set up a commission to study the possibility that high levels of growth are not going to come back and shouldn't come back, given the global environmental crisis. The future path is going to be toward powering down, with less material throughput, less energy throughput, lower levels of economic activity, localization of most economic activity and the shifting (shall we say "return?") of a lot of resources from the presently overconsumptive world to the underconsumptive.


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