Globalization and Social Justice

Cliff DuRand,
Morgan University

Last month we had a highly successful 9-day Workshop on AlterGlobalizations here in San Miguel de Allende. Many of you participated in some of these sessions. This event launched the founding of a Center for Global Justice to promote research and learning for a better world. We have been very critical of the kind of corporate led globalization that has become so visible in recent years. This corporate led globalization, operating under a neo-liberal philosophy, raises serious questions of social justice. To be concrete, let me give three examples that will illustrate some of the problems.

Example 1. In 1996 the State of Massachusetts passed a law preventing state agencies from buying goods or services from companies that do business with Burma. This was because of the repressive military junta that rules Burma after annulling the election of Nobel Prize winner Aung San Suu Kyi as president. However, this selective purchasing law was challenged as in violation of World Trade Organization (WTO) rules that require governments to not intervene into economic markets. As a spokesman for the European Union (EU) said, "we don't believe this kind of action is fair to the trade and investment community." [quoted in Corporate Predators: The Hunt for Mega-Profits and the Attack on Democracy by Russell Mokhiber and Robert Weissman, Common Courage Press, 1999, p. 56.] Under the banner of "free trade" the citizens of Massachusetts are forbidden from making democratic decisions about how to spend their collective money. Morality is required to leave the market alone. Under this principle, the sanctions against apartheid South Africa would have been forbidden and Nelson Mandela might still be in prison today.

Example 2. Several years ago oil companies started adding the chemical MTBE to gasoline to make it burn cleaner so as to cut down on air pollution. But it turned out that MTBE began to show up in ground water and it was discovered that it causes cancer. Now the water supply of many California cities is contaminated, as is also Lake Tahoe, once one of the purest bodies of water in the world. So the State of California decided to ban MTBE. But as it happened, this chemical is manufactured by a Canadian company called Methanex. Methanex proceeded to sue California for $970 million for the loss of anticipated profits. Under the free trade rules of NAFTA, Methanex claimed the state had interfered in its market and was thus entitled to be compensated for its loss. Here we see government being discouraged from protecting the public health and well being unless it is willing to pay a private corporation for not harming it.

Example 3. My third example comes from the eastern Caribbean. Here the small banana growers of these former colonies are supported by the European Union, which has agreed to buy their bananas at a preferential price -a kind of reparation, if you will, for years of colonial domination and slavery. However, such a preference violates the free trade rules of the WTO. The United States, acting on behalf of Central American banana producers, filed a complaint before the WTO and won the right to impose $520 million in sanctions against the EU unless it abandons its banana policy. Under WTO rules it is irrelevant that eastern Caribbean bananas are produced in a relatively more socially just way -on small farms headed mostly by women— as opposed to the Central American plantations where workers are underpaid and exposed to pesticides and where unionization efforts are routinely smashed. But why did the US take such an interest in the case? After all, the US doesn't grow bananas. Well, the Central American banana plantations are owned by Chiquita, whose CEO, Carl Lindner is a major campaign contributor to both Democratic and Republican parties. So, the US Trade Representative declared that the "US economic stake in this case is clear" — even though no US jobs are at stake. What is at stake is the livelihood of small, impoverished farmers who now may be pushed into the illegal drug trade instead.

In each of these cases I think intuitively we would agree there is an injustice: a negation of a people's democratic rights, an obstruction of government's responsibility to protect the public health, and prevention of an effort to assist the victims of past wrongs. And these injustices benefit those who are most well off - in most cases, large transnational corporations. I begin with these examples because it is easier to recognize injustice than it is to explain what justice is.

Before getting to the question of social justice though, we need to look briefly at this thing called globalization. Although the term has only recently entered our vocabulary, as a social phenomenon, globalization has been with us for some time. You might say it began in 1492 with the expansion of Europe into the New World. This began what was to become a world historical project to construct a capitalist world system. Through the exploitation of the wealth of its colonies, what had been a backward, obscure peninsula on the western edge of Asia, soon became the world's wealthiest industrial area. And the colonies, many of which were once wealthy, became impoverished. Not only that, their economic and social systems were restructured to be dependent on the developed core countries. It was this combined and uneven development between the global North and the global South that was the cardinal injustice that set the stage for what has followed.

And what it is that has followed has been a global system of continuing and ever deepening inequalities between the North and the South, as well as within each country. Just after World War II George Kennan, Director of Policy Planning of the US Department of State, observed:

"We have 50 percent of the world's wealth, but only 6.3 percent of its population…. In this situation we cannot fail to be the object of envy and resentment. Our real task in the coming period is to devise a pattern of relationships which will allow us to maintain this position of disparity." [Department of State, Policy Planning Study (PPS) 23 Foreign Relations of the United States (FRUS), 1948, vol. 1 (part 2), February 24, 1948, p. 23.]

This has been the cardinal principle of US policy for over a half century now. In spite of all the talk about helping to lift the underdeveloped world out of its poverty, in fact US policy has maintained global disparities. What was called development aid has aimed to keep underdeveloped countries in the economic orbit of the US to the benefit of US corporations. In so doing, their dependency has been increased and the economic gap has widened. Of the 100 largest economies in the world today, 51 are corporations, the other 49 are countries. The combined sales of the 200 largest corporations is greater than the combined economies of all but 10 countries and 18 times the annual incomes of the 1.2 billion poorest people in the world (24% of the world's population). [William Tabb, The Amoral Elephant, Monthly Review Press, 2001, p. 148.]

This widening global inequality has accelerated due to the neo-liberal economic policies imposed on the South by the World Bank, IMF and WTO. Whereas many states of the South, under popular pressures, had once adopted policies promoting national development and social welfare, now many of them are required to yield to market forces that favor transnational corporations, turning a deaf ear to the pleas of their own populations. Pope John Paul II, speaking in Havana, Cuba, attacked this neoliberal philosophy "which subordinates the human person to blind market forces and conditions the development of peoples to those forces."

A prime example is Mexico. Here the state had once favored national capital and promoted a kind of paternalistic welfare state under the PRI. But beginning in the 1980s, Harvard trained MBA's schooled in the principles of neo-liberal economics, began to turn Mexico toward export oriented policies and privatized major sectors of the economy. This enriched their cronies at the expense of the people and opened up the country to US corporations against which Mexican firms could not compete. The result is what Enrique Dussel Peter has aptly called a polarized country. [Enrique Dussel Peter, Polarizing Mexico: The Impact of Liberalization Strategy, Lynne Reinner, 2000.]

This brings us at last to the question of social justice. Let me ask here a philosopher's question: What is justice? If we look at the Latin etymology of the word, its root meaning is a joining or fitting together. As philosopher Milton Fisk puts it, "justice joins or fits together the persons, groups, or principles that stand in opposition in a conflict situation." [Milton Fisk, The State and Justice: An Essay in Political Theory, Cambridge University Press, 1989, p. 74.] As Fisk points out, the function of the state is to maintain the existing social order, and especially the existing economic order. Where there is a conflict between economic interests, that means that the state must favor the interests of the dominant group or class. The state is not neutral in a class divided society or a divided world. However, there are limits placed on it by the need to maintain enough legitimacy so as to be able to govern. It must balance the interests of the dominant class with those of the dominated classes; it must limit the benefits and the losses of these two groups. It is thus that an official justice arises.

How much the state has to yield to the interests of the dominated classes depends on how active the popular classes are in their struggle. Their interests require a stronger limit on the benefits to the dominant class and on the losses they themselves incur. Thus they represent a more radical justice than the state will concede, unless forced to do so by popular struggle. As Frederick Douglas reminds us, power concedes nothing without a demand. When there is no demand, the state reverts to its default position favoring the interests of the dominant class.

That is exactly what has happened domestically in our country, and many others as well, over the last 30 years. And that is what has happened on the global stage as well. There has been a three decade waning of class politics that has made possible a shift of state policies toward neo-liberalism that favors the transnational corporations. This has meant a lifting of the limits states previously placed on the losses suffered by the dominated classes, both in the rich core countries and the poor peripheral ones.

Example 4. Let me illustrate this with a fourth example, this time from Bolivia. The issue was the privatization of water. In 1999 the municipal water system in Cochabamba, Bolivia was bought by Aguas del Tunari, a subsidiary of San Francisco based Bechtel Corporation. Bechtel implemented massive price hikes. Families earning a minimum wage of $60 per month faced water bills of $20 per month overnight. Rate increases of 100 percent were the most common, while increases of as much as 300 percent were reported around the city. Water was so expensive that many, particularly the poorest users, were forced to do without. After attempts at discussion with both the company and the government fell on deaf ears, the citizens rose in organized protest, eventually shutting down the city with a general strike. The Bolivian government defended Bechtel's right to privatize the water with deadly force - killing at least one 17 year-old boy and wounding hundreds more. But the people would not back down and the government was eventually forced to cancel Bechtel's contract and Bolivias president was forced out of office. Not to be undone by the will of a mere half million people, Bechtel responded with a $25 million lawsuit for lost profits in a case still pending at a World Bank court. [http://www.corpwatch.org]

This illustrates Fisk's claims about justice quite concretely. The state's official justice protected the property rights of the powerful. Against this a mobilized people asserted a radical justice that succeeded in shifting the balance of losses and gains between themselves and, in this case, a wealthy transnational corporation. The popular concept of justice asserted the common interest in having something so essential to life as drinking water made affordable to even the poorest.

Now let's apply this principle to the great global divide between the North and the South. The official justice is that put forth by transnational institutions like the WTO, IMF and World Bank and defended by the imperial power of the U.S. government and political elites that hold state power in many countries of the South. It is a concept of justice that promotes the interests of transnational corporations over all else, while claiming that neo-liberal policies will eventually benefit all as prosperity trickles down the economic scale. At first many believed this promise. But now a quarter century of neo-liberal globalization has only made a few richer while the popular classes have found themselves falling further and further behind. It is that reality that has resulted in growing protests against corporate led globalization. More radical concepts of justice are emerging as popular classes search for alternative forms of globalization that will benefit them.

We often hear thinkers speak of justice as involving equality. While this might be an ideal justice, this concept leads many to conclude that justice is not possible. That is why Fisk bases his theory of justice in actual historical conditions. Justice conceived of as a balance between losses and gains between two unequal groups may not result in equality or ideal justice, but it does move, however modestly, in that direction.

Let me conclude with one additional question. Are the people of the U.S. willing to accept even a modest reduction in the global inequality between the North and the South when it might cost them? How much of our vaunted standard of living are we willing to give up to help the world's poor, to promote global justice? The conventional wisdom says, "not much." Yet the facts suggest otherwise, as ethicist Peter Singer has pointed out in his book One World [Yale University Press, 2002, pp. 180-185.] If we look at the proportion of the Gross National Product (GDP) that the U.S. gives in development aid, our government ranks last among developed nations. Years ago the United Nations set a target for development aid of 0.7% of GDP. A few countries have met or surpassed this goal -Denmark, The Netherlands, Norway and Sweden. But the U.S. gave only 0.10% of its GDP, one seventh of the target. Even if you include private, non-governmental aid, the U.S. still only gives 0.14% of its GDP, still leaving it in last place.

Yet a large majority of the U.S. public says we are spending too much on foreign aid and that it should be cut. But when several studies asked how much of the federal budget (not the GDP) they thought was going to foreign aid, the median estimate ranged from 15% to 20%. Even those with post-graduate education, and presumably better informed, said 8%. The correct answer is less than 1%. People wildly overestimate how generous their government is in aiding the global South.

But what is most surprising and encouraging in these polls is that when people were asked what an appropriate percentage should be for foreign aid, they said 10%. That is beyond the wildest dreams of most foreign aid advocates. While that would still not meet the UN target, it suggests that the people of the richest country in the world are far more altruistic than their government; it shows that they are prepared to accept a step toward a more radical global justice than their political leaders are. There is reason for hope in the fact that our people do not share George Kennan's goal of maintaining global disparities of wealth. Our challenge is to educate the people concerning the facts so that their generous and kind hearted spirit can be set free from the corporate-serving leadership that fetters and misdirects it to support of global injustice. Only then will people be able to "give until it feels good." It will be the cries for social justice from the global South that will set us free.

This talk was given at the Unitarian-Universalist Fellowship in San Miguel de Allende, September 19, 2004

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