Topic: Dilemma: Global Markets vs. Local Identities (Regional Approaches)

Morning Session, Oct. 13

Osvaldo Sunkel
Mr President, Mrs Clinton, dear colleagues around the table, ladies and gentlemen,
I am, of course, deeply honoured to be in this position right now. It is a totally unexpected honour for me. It is also, I must say, a tremendous privilege to be able to speak to such a distinguished audience, including President Havel, Mrs Clinton and so many other outstanding leaders in their own fields. But I also feel it is somewhat unfair to me to have to speak after these extraordinarily brilliant, profound and inspiring statements that we have just heard. But I still have to do what I can, even if it will not be in my native tongue. I guess my remarks will be inspired, to some extent, by the fact that our colleague has not arrived yet, which seems to be an indication that globalisation sometimes doesn’t work.
As Mrs Clinton said, globalisation is a very complex subject that means all sorts of different things to different people. It depends from where you look at it – you see different things. Mr van den Broek also spoke of a crisis of complexity. This is a tremendously complex subject. It depends on whether you are an economist, whether you are a scientist, whether you are a media-man, whether you look at it from the centre or from the periphery, from the very distant periphery, from where I come. I think it is a tremendously difficult subject to cover. It reminds us of movies – you mentioned movies – movies like Rashomon by Kurosawa or Blow-up by Visconti, where the whole issue was placed in front of you as to how different things may look to different on-lookers. Anybody who pretends to know exactly what globalisation means clearly doesn’t know what he is talking about. There is a family of concepts – globalisation, mondialisation in French, which would be something like worldisation in English, transnationalisation, internalisation, imperialism, colonialism. All of these concepts refer to something that is, to some extent, similar to globalisation. Globalisation, I think, in fact includes all these other concepts. It is a sort of summing up of all these other concepts – it adds an historical dimension.
Well, confronted with this very difficult task, I propose to do the following. I will not try to define globalisation. I am one of these partial on-lookers: I come from Latin America, from a very distant periphery. I am an economist: although a sort of outcast economist, my training is as an economist. So I thought I might, so as not to take too much of your time, present to you four theses, or sort of provocative statements, if you like, as our chairman asked me to do, to try to provoke discussion and comments. My four theses are the following.
The first thesis is that globalisation has a dualistic character: there is a part of it that is a true, objective reality, but there is a part of it that is myth and ideology. My second thesis is that globalisation is a very long-term cyclical historical process; it is not something that was invented last year. My third thesis is that globalisation is unequal, partial, heterogeneous, unbalanced, and elitist. And my fourth thesis is that globalisation is a dialectical process. It has positive and negative aspects. Now let me briefly go into my four theses. Globalisation, of course, is something very real: the tremendous expansion of trade, investment, production, worldwide chains of production, communications, information, transportation, migration, tourism, travel. The world is shrinking; distance is disappearing. And there is, of course, one particular aspect that has grown out of all proportion, which is finance. It reminds me of the tale of the sorcerer’s apprentice, who let the genie out of the bottle and it has become a financial monster.
This is all real. What is also real is that this has been brought about – promoted, to some extent – by an economic policy package, which has been called “The Washington Consensus” or “New Liberalism”. The whole package of liberalisation, privatisation, deregulation, a minimal state, free-trade markets, has been required by globalisation, and it has been conducive to further globalisation. It has critics and advocates, as you mentioned, and I think there is a lot of myth and ideology in this package of economic policy. It is deemed to be beneficial for everybody. If there are problems, it is said that these are short-term problems, but in the long run everybody will be happy. It is promoted very strongly by a certain number of sources – the financial press, the international financial institutions and organisations like the IMF and the World Bank, but also private organisations, like transnational corporations. It is promoted by governments, particularly the treasurers of the governments of developed countries. It is also promoted by the economics profession, those whom Dr Kissinger yesterday called “the technical economists”, of whom I am not one, and, of course, by the media. It is presented as an either/or, black or white, sort of communism-or-freedom alternative – liberalisation versus what used to be (until a decade or a decade-and-a-half ago). Meanwhile, some are trying to regain that: the mixed economy, the social democratic approach, the social market economy approach, what is now being called the “third way” in Europe. Very deep down, I think the issue is the relationship between state, market and society. In the new liberal economic package, the market would appear to be the over-riding principle, above state and society. What I think everybody, or most of us, would like to see is society and democracy controlling the state and the state interacting in a regulatory way with the market. To end this thesis, I would suggest that at the international level, what we have is private globalisation and a public void. The present crisis is showing us that in international financial institutions, such as the G-7, there is a global crisis of govern ability, about which Mr van den Broek spoke just a minute ago. So, this is my first thesis about the dualistic character: part reality, part ideology.
My second thesis is that this is a very long-term cyclical process. There are basically two views. One, which is the conventional view, the present view of globalisation, which is a sort of Fukuyama view, sees it as a relatively recent, mechanical, cumulative, ever-expanding and accelerating trend towards a final destination, the end of history, democracy and free markets. I have a different view of this. I think we are in a historic phase, a period of rapidly accelerating globalisation, but one preceded by the contrary. After the crisis of the First and Second World Wars and the Great Depression of the 1930s, there was a shrinking, a contraction, a disappearance of the international system, which had, in fact, grown to very similar levels, conditions, structures and elements during the second half of the 19th century and the beginning of the 20th century – with Kondratieff cycles of a kind, long-term cycles. History is not mechanical. It is true, of course, that technology keeps improving all the time, but even technology appears in leaps and bounds. I believe that – right now – we are in the midst of one of these accelerating phases of globalisation which started far back, perhaps with Marco Polo going to China, with the Mediterranean civilisation’s integration, with the discovery of the New World by Columbus, and with the late 19th century’s tremendous expansion of investment, trade, immigration and finance. But I hope we are not going to see something like the crisis of 1932. I submit that this kind of historical perspective of the long-term capitalist expansionary process is a necessary way of looking at the situation. It is illuminating. It puts the present in historical perspective. It dampens, somewhat, both our positive and negative expectations. Let me just remind you that more than 100 years after the invention of electricity and the telephone, an enormous majority of the world’s population still remains with no access to it and therefore obviously would not be able to benefit from the Internet.
My third thesis is that globalisation is an unequal, partial, heterogeneous, unbalanced and elitist process. I’d like to suggest that there are two dimensions to it: there is a widening of globalisation and there is a deepening of globalisation. There is a widening in two senses – there is territorial expansion, the capitalist globalising process is expanding territorially into the former communist/socialist countries of Eastern Europe, the former USSR, and a very large part of the world, where it is creating new, quite different kinds of class societies with increased private wealth and a decline in public support of the middle and working classes, in the best of cases increasing total output, but with more inequality, albeit more democracy. But there is also another kind of territorial expansion, which is the incorporation of frontier areas of underdeveloped countries that had a semi- or pre-capitalistic set-up, which is now being developed and expanded tremendously with the incorporation of these new frontier areas, new resources, but also with the displacement of people, destruction of natural resources and heightened inequality. What is more interesting, perhaps, is the process of the deepening of capitalist globalisation, which means the deepening of an individualistic, utilitarian and competitive capitalist culture. And this is happening everywhere. It means, I am afraid, a discriminatory process between those that have the assets – the capabilities, the abilities, the willingness – to get access to the globalisation process and those others that do not have and are, therefore, bypassed or displaced. This applies to individuals, to enterprises, to sectors of production, to regions within a country, to whole countries and even to whole continents and, to some extent, this is happening with Africa. Incorporation and exclusion are economic, social, political and cultural phenomena, and I was saying that these are elitist phenomena because, as Mr van den Broek already said, over the past 20 years or so the world has increased and become more unequal during this globalisation process. About two-thirds of the world’s population gets only 5-6 per cent of the GNP – they are obviously excluded. The richest 20 per cent get 95 per cent of the world’s income – they are obviously included in the process of globalisation; and these 20 per cent are mostly in developed countries, but there are also the elites in underdeveloped countries, which are incorporated into the globalisation process. There is a third aspect of this, which I would like to mention, which is a contradiction between symbolic and material globalisation. Symbolic globalisation is the incorporation into the world mass-media consumer civilisation. But the means to materialise this incorporation are lacking for the tremendous majority of the world’s population.
My fourth thesis, very briefly, is that globalisation is a dialectical process in the sense of Marx’s dialectic – the replacement of one mode of production by another mode of production – and this is a relative process. It’s a complex, relative process in the sense of Schumpeter’s cycles of creation and destruction, or the idea developed by my special guru, Carl Polanyi, who also comes from this part of the world. He developed this idea about the individualistic, competitive, monetary marketisation of societies, disrupting the system of social reciprocity that existed in those societies and giving rise, through this disruption, to what he called a social response, which he called “the double movement”, a reaction to what was happening in societies. So, I think what we are witnessing, seeing, looking at, is transnational integration, national disintegration, weakening of the nation-state; re-integration efforts, based on the civil society; responses – local, community, religious-wise, region-wise, ethnic – based on traditions, on cities; and, fourthly, exclusion, marginalisation. I happened to read a recent book by Professor Etzioni before coming here and I think he has a marvellous image of the problem of national identity and globalisation in his idea that nation-states are mosaics of sub-cultural identities. This mosaic of sub-cultural identities is, I think, being torn asunder by the globalisation process, in a weakening framework of nation-states. The outcome would, of course, depend on the relative strength of the disintegration process and the relative strength of the nation-state.
Ladies and gentlemen, if you think that these four theses have some truth in them, some value, I suggest that Forum 2000 Conferences could make a real contribution to:
1) separate reality from myth and ideology;
2) place the globalisation process in historical perspective;
3) suggest effective measures to lessen the unfairness of this process; and,
4) lessen the impact of the weakening of the nation-state through improving democracy, while allowing a pluralistic mosaic of sub-national cultures.
Thank you very much.

Jiří Musil
Thank you, Professor Sunkel, for your clear, compact statement. Before we proceed, I should like, first of all, to excuse Mr van den Broek. He has an important meeting – I assume, in Brussels. We now have time to react to the address of Mrs Clinton. I am inviting those who are interested in discussing her ideas... Well, there is Mr Karan Singh.

Karan Singh
Thank you. I would like to take up two points made by Mrs Clinton in her impressive address. The one refers to the images that are dominating human consciousness as we enter the 21st century. I spoke about this yesterday and you are quite right: it is astounding how images of death, destruction and dinosaurs seem to be our obsessions. In Independence Day, you find all your institutions blown sky-high; in Titanic, a symbol par excellence of the hubris of the human race sinks beneath the waves and everybody seems to celebrate it. You have Titanic dinner parties and Titanic menus. There is a curious and morbid fascination with death and disaster. Is it a symbol that we are the new Titanic? Or that America or England is the new Titanic, rich with materialism that is heading inexorably towards disaster? I would like to raise this point, Mrs Clinton, because you were very perceptive to have raised it. Carl Gustav Jung, one of the most creative thinkers of this century, talks about the negative archetypes that very often dominate human consciousness and I think what we need is countervailing images, healing images, images that are holistic. For example, I can give you a beautiful example from my own culture in the modern world, that photograph of planet Earth taken from outer space, that beautiful photograph, the most beautiful ever taken, that shows our world as it really is, a tiny speck of light and life against the vast, unending masses of outer space, so beautiful and yet so fragile, and on that we can superimpose healing images. Or the image, for example, of the great Hindu goddess Mahalakshmi, seated on a white lotus. The lotus is born in the darkness of the underworld but comes out clear and glistening. She is seated on it, richly caparisoned, her eyes are like lotus petals, which are the most beautiful shape for a woman’s eyes, and she holds lotus flowers in her hands. As you know, the lotus sleeps in the darkness; in the darkness of ignorance, the human psyche sleeps. But when the sun of wisdom rises, the lotus also unfolds, and she is being bathed on either side by six tusked elephants, who are pouring ambrosia over her from golden jars. That is a healing image. We need countervailing images against this terrible negativity that we find, the horror and the violence. That’s my point number one.
The second point, Mrs Clinton. Your image of the three-legged stool is a very appropriate one – government, economy and civil society. However, the question is: what sort of human being will sit on that three-legged stool? Will the man or the woman who is sitting on that stool be full of hatred and jealousy and disharmony and anger? Or, will he or she have risen to contact the higher self? Will he or she be aware of what Francis Thompson said in one of his beautiful poems, if you remember, “The angels keep thou ancient places/ Turn but a stone, and start a wing!/ ’Tis ye, ’tis your estranged faces/ That miss the many-splendoured thing.” Will the person seated on the stool be in touch with the many splendoured light of the spirit and the soul? Thank you, Mrs. Clinton.

Jiří Musil
Thank you very much. I propose to take four questions. I think it’s Weiming Tu and then Tomáš Baťa.

Weiming Tu
In 1989, a meeting was held in Europe on civil society in Western Europe, and the consensus of the scholars in Europe was that the civil society in America is the most vibrant. This is, of course, very much discussed in de Tocqueville’s vision of democracy in America. In comparative politics, most of us learn that in America society is stronger than the state, whereas, of course, in many of the East Asian countries the state is stronger than society. There is no question about the fact that civil society is vibrant and important in America.
In 1995, I attended the social summit in Copenhagen as a guest of the United Nations. Three major issues were discussed: social disintegration, poverty and unemployment. These were great global issues. But the American mass media, a good representative of the civil society, didn’t pay attention to any of those issues discussed in Copenhagen, because America, at the time, was obsessed with the so-called “trial of the century”. Therefore, the civil society in this connection could be obsessed with one particular issue at the expense of the global vision, which is the narrow-minded parochial view of American society. It is, in this sense, a negative feature. Since the Second World War, America has been teaching civilisation to many countries and unless America – which is my adopted country – becomes a learning civilisation, it is not possible for America to assume leadership. I would like to hear your comments on this. Thank you.

Jiří Musil
I am extremely sorry, but I have just been informed that Mrs Clinton has to leave in a few minutes. Please, do understand, I have to ask you now to react to only these two remarks, but we can then continue, having you in mind, and thus your presence will be prolonged. Can I ask you, please?

Hillary Clinton
Well, I’m sorry but I’d love to hear the other two comments. Maybe we could hear them very quickly. Would that be possible if you have two other speakers? Or shall I just...

Jiří Musil
I don’t know if you decide or your people decide about your movements.

Hillary Clinton
That sums it up very well, whether I decide or my people decide. It’s one of the mixed blessings of being in public life, certainly in America.
Let me first respond to Mr Weiming Tu because I think you expressed very well one of the principal challenges that the United States faces, and one that certainly has an impact, not only in our country but around the world. It is the case that the civil society in the United States was recognised as being a critical component of our entire social structure as early as the first decades of the 19th century by de Tocqueville, and he talked about the habits of the heart, which really nurture democratic citizenship and involvement.
There has always been a tremendous tension among the three legs of the stool in the United States. One of our continuing challenges is to create a balance among the various power centres in the United States, whether it is within our government (among our three branches of government), or among the economy, the government and civil society. I don’t think that de Tocqueville or anyone, until relatively recently, could have even imagined, let alone predicted, the extraordinary role that the mass media would play in shaping public opinion and impacting on civil society, in particular. It is, I believe, a very serious issue for any society, but particularly for the United States at this time.
Mr Weiming Tu is absolutely right that the coverage of difficult problems that require patience and fortitude is practically non-existent in the United States. The coverage of international affairs in our mass media is very limited. There is such an obsession with the immediate and with the kind of event, or personality, that will satisfy people in the short run that I think we are doing a great disservice to ourselves by not providing more information in a continuing way, so that citizens can have at least the opportunity of knowing more about what is going on and making decisions for themselves based on more detailed information. I didn’t mention it in my remarks, but I do think that the role of the mass media is something that we have to give more serious thought to in my country and, increasingly, around the world. It is extremely difficult for government, or for civil society, to function effectively if, on the one hand, there is either insufficient information about difficult decisions with which citizens are confronted or if, on the other hand, the information that is provided actually undermines civil society and governmental effectiveness.
I don’t have any solution in mind, but America certainly needs to become, in your words, a learning civilisation in order to see better ourselves, and understand what we must do to maintain our strong civil society and our cohesive nation-state, going into the future. It is something I’ve spent a lot of time thinking about because, if we don’t come to grips with the impact of the mass media on civil society, and its impact on effective governance in democracy, I believe it will become increasingly difficult to deal with any of the problems of globalisation that Professor Sunkel so eloquently described. So, I share your concern. I certainly know that my husband and others are attempting to break through the wall of the mass media to be able to communicate directly with people with information that is pertinent to their daily lives and also helpful for them to make decisions.
Let me just add one other example. Several of you, last night, mentioned to me your hope and your concern that the United States will take effective action with respect to the environmental challenges coming out of Kyoto. That is a perfect example of how difficult it is, in our country, to obtain a consensus about action that should be taken. It is not a subject that gets a lot of coverage in our country, and it is a subject about which special interests have very strong feelings and in connection with which they use the mass media to manipulate public opinion. We have a great challenge, in our democracy, to navigate between the mass media and very powerful special interests to create a space for the citizenry to get adequate information in order to be able to make good decisions. Winston Churchill once said about America that it’s a land where people take a very long time, and do nearly everything wrong before they make the right decision. There is that kind of historical characteristic of ours that we do – kind of – stumble along until we get it right.
Finally, Mr Singh, I thought that your remarks were beautifully eloquent. I don’t know how we get those countervailing healing images through the mass media. We have to create alternatives, and perhaps the explosion of the media will give us the chance to have more channels of information conveying images to people. But, certainly, if the mass media is still largely distributed from America, we have a big challenge ahead of us to transform those negative dramatic images into something that can help people envision a more positive future. It is also an issue that I am very concerned about and, since people are affected, and are, to some extent, determined in their images of themselves and others, by what is occurring in the mass media, it is another issue to which we must pay very close attention, because if, in your metaphor, the person sitting on the stool is to be someone who is a positive person, it is difficult to imagine how to be positive if you are the subject of constant consumer-oriented driven messages, and negative messages. That’s very difficult for people to overcome. So we have a big job ahead of us in that, but I thank you for your beautiful language in describing that challenge.

Jiří Musil
I have just been informed by Mrs Clinton’s people that she may continue. Nevertheless, I would like to ask you to be succinct and short and go on, please, Gareth Evans.

Gareth Evans
My question is really just an extension of Weiming Tu’s, but you may wish to comment further on it. It seems to me that a bigger problem than getting Americans to imagine the future is getting Americans, and in particular the American Congress, to imagine a world beyond the borders of the United States and we’re seeing a current demonstration of their reluctance, which we spoke about around this table yesterday, to support not only the extension of funding for the IMF, but also the contribution to the UN and fast-track trade negotiations, which are critical in advancing the economic governance cause.
The extraordinary thing in all of this is that there does seem to be a disjunction between what the Congress is doing and saying and how they’re acting, and the way in which the American people, when tested in opinion polls, react to a lot of these issues. There is a mounting body of evidence that they are sensitive to, and interested in, the UN and global governance issues, and would be supportive of action being taken by the Administration, action the Administration wants to take to advance those particular causes.
I guess the short question is: what on earth can be done about this disjunction? What can be done to cut across this extraordinarily parochial preoccupation of this key element in the American governance system, the Congress, and actually get a better resolution of these issues? Is it just a matter of changing the political funding rules, or the political action committees, and so on? Is that the key to it, or is there something even more fundamental that can be done to turn around that particular critically difficult part of political culture, which is not just a problem for the United States, but a problem for all the rest of us who are so dependent on US leadership, if these issues are to be tackled?

Jiří Musil
Thank you very much. Now Mr Tomáš Baťa.

Tomáš Baťa
Mrs Clinton, those of us who were inspired by your address in Davos last January have been inspired again. Congratulations.
You mentioned the importance of the civic society. A global civic society, of course, needs also global rule of law. How can business help to create an environment under which the United States might re-consider its negative attitude towards the creation of an International Criminal Court? Thank you.

Hillary Clinton
These are two very specific questions about American public and political opinion and, given my concern about these issues, let me just address them in a wider context and then specifically.
The United States goes through periods of isolationism, as anyone who has ever studied our history could clearly see. With the collapse of the Soviet Union, the raison d’etre for much of American foreign policy seems to have disappeared in the minds of many political leaders, particularly those who were in the front line of leading the charge against communism and those who believed that the United States had to have a very strong presence in the world, in order to be able to be effective in dealing with the threat caused by the Soviet Union. We are still finding our way, redefining our position in the world and our assumption of leadership in so many areas where it is critical for the United States to take a leading role. I think Gareth Evans is right. In every poll I have ever seen, and in my own personal experience, American citizens are much more supportive of international institutions, such as the United Nations, and more willing for the United States to be engaged internationally, than many of those in Congress who adopt a much more negative view. The problem is that there is an intense minority against such involvement, and this is at the heart of much of the Republican Party’s support, and to a much lesser extent, some Democratic support. But, focusing for a minute on the Republican Party, they have in their constituency people who believe that the United Nations is invading America with black helicopters, people who believe that any kind of multilateral international action involving the United States is a sign of weakness, not of partnership and strength; and the people within their constituency who hold those views, and less extreme versions of those views, are much more intense than the general public, who favour international involvement. The general public do not vote on those issues, by and large. They would not turn out a member of Congress who did not vote for the United Nations dues, as they might if he did not vote for education funding, for example; whereas the intense minority who so often determine a politician’s fate will vote against the member of Congress in many districts around our country. So, the trick is to create the intensity and increase the awareness among the American public that their intuitive response about American engagement is something they need to take to another level, and be much more committed to, and put into the political process as one of the factors by which they judge those whom they elect.
The second issue that relates to this is that there has been, in my view, a collapse in elite opinion supporting international engagement in the United States. At the end of the Second World War, when President Truman and George Marshall and others were summoning support for the Marshall Plan, it was not popular in the country. It was unpopular, but it was understood as being very important among the American business, academic and political elite in sufficient numbers that they were able to harness public opinion to their point of view. It has been a great disappointment to me, and I mentioned this at Davos, that American business, which benefits greatly from American involvement in the world, has been so silent on so many of these issues that directly affect American leadership around the world. There was not a great outcry, for example, when the Congress first turned down IMF funding. The American business community has become more organised on that, but again, I don’t know whether they are telling members of Congress that they will not support them over that particular issue. So, the collapse of elite opinion in America has also played a negative role in creating circumstances in which passionate and extreme opinion get much more credibility than is deserved.
Thirdly, there is, among many members of Congress, a sense of unilateralism, that there is nothing for the United States to gain in being part of international and multilateral efforts, but rather it is better to just act unilaterally. That is something that the President is working very hard to try to change and to rein in, but it is a very strongly held opinion, among certain members of Congress in particular, and it has to be worked on again from two different perspectives. We have to increase public support and we have not only to change but also to harness a lead opinion in order to have an impact on members of Congress who hold these views. Finally, it’s just good old-fashioned politics in a democracy where if you have, in our system, a President of one party and a Congress of another, no matter what the President’s for, the members of Congress and the majority on the other side want to be against. Right now they’re asleep, but shortly they’ll be back trying to agree a budget for the United States, which we don’t now have, because the Republican majority in Congress has been opposed to the President’s programme. Parliamentary systems are much easier, believe me, in terms of getting something through, and even there you have a lot of problems in trying to reach consensus. But in our system, which is deliberately designed to be difficult, it is particularly difficult when there’s a President of one party and a Congress of another. I think many people, even in Europe, who are used to parliamentary systems, have a difficult time understanding why this is so hard to manoeuvre through. It is something that we are concerned about, that the President is very well aware of and that he’s been working very hard on.
Finally, with respect to the International Criminal Court, that’s another example of the difficulty of persuading Americans to be supportive of something that they believe might impact their sovereignty in any way. I must say that there is a legitimate concern on the part of the American leadership, including the Administration – because we do have so many interests around the world, we do have so many military interests around the world – about supporting such a court without appropriate safeguards that would enable the United States to feel that any kind of action by such a court would be justified with respect to American citizens. You are not going to get American support for that kind of international effort, which is regrettable. The American government will continue to support all of the war crimes efforts, whether they be in the Hague or Rwanda; and, we will continue to look for a way in which we can be part of an International Court of Criminal Justice. But it is difficult, particularly in the climate in the United States today, for the political and military leadership to feel comfortable with ceding jurisdiction and sovereignty when so many more of our people, around the world, are at risk than the citizens of any other countries, so we don’t think there is parity in the description of the court’s authority with respect to the United States. There are some legitimate concerns about that issue, which takes nothing away from the more general concerns we have about creating more of an American understanding and support for our engagement and leadership and our international co-operation.

Jiří Musil
Thank you again. I think President Havel wants to say a few words. Can I ask you?

Václav Havel
I would like to thank Mrs Clinton for taking the time and attending our Forum. I would very much like to thank her once again for her highly inspiring speech and I think that I can ask her also, on behalf of all of you, to give our regards and best wishes to her husband.

Coffee break

Tun Daim Zainuddin
Mr Chairman, ladies and gentlemen, let me express my deep appreciation to your President for inviting me to participate in Forum 2000, and to present my views as we stand at the dawn of the new millennium. We are, in fact, 15 months from that defining moment in history. This is, therefore, a time for reflection and resolution.
Let me congratulate the organisers for the choice of “Globalisation – Experiences, Instruments and Procedures” as the theme of this conference. Your choice is most appropriate given the increasing importance of globalisation in determining the course of events in the new millennium. I am confident that the deliberations of this Forum will help us to understand the diverse experiences of globalisation.
Let me first reflect on the outgoing millennium. Our successes during this millennium have been great: within the past three decades man, for the first time, left this planet to successfully land on another celestial body in our solar system; we have sought, and have been able, to give millions of people longer life and the amenities that modern medical science has brought in its wake; major colonial empires have disintegrated; millions of people gained freedom and states have attained nationhood; and communication is now virtually instantaneous, as what is happening thousand of miles away finds it way into the home via satellite television. We have truly become a “global village”, where there is much to celebrate, and there is also a lot for us to be disappointed with.
My presentation, Dilemma: Global Markets and Local Identities, has been dictated by the consideration that the emergence of global markets, as a manifestation of globalisation, has led some to believe that the development has adversely affected local identities, be it nations, communities or people. For others, a choice has to be made: either global markets or local identities. I propose to briefly discuss the emergence of global markets, then explore the effects on host communities with particular reference to the current East Asian crisis.
The history of the world is replete with examples of how trade between nations and peoples has led to the emergence of markets and the attendant birth of global markets. The colonial empires of the 18th and 19th centuries, and the commodity trade that preceded it, were in no small measure due to the quest for foreign markets. The Industrial Revolution spurred this further as the manufacturers of the West needed raw materials for their factories and markets for their finished products. Another factor that has fostered the quest for global markets has been competition among transnational corporations. Each believes that by going global it will ensure enormous profits, and that if it does not take up the challenge, rivals will. Competitiveness also meant that transnational corporations had to be frequently restructured to have the flexibility to enjoy the maximum possible economic scale and locational advantage.
The promotion of global markets has been based on a notion that there are gains for all the participating countries. It cannot be denied that the emergence of global markets has, in its own limited manner, allowed some sections of the developing world to enjoy the benefits of globalisation, the most obvious being foreign direct investment, which undoubtedly helped in some of these countries to create jobs and make the technical leap forward as well as to obtain markets for some of their products. The concept of global markets is premised on the notion that the products of developing countries will find their way to the markets of developed countries as easily as products from the developed countries find theirs to the developing countries; the reality, however, is different. On numerous occasions, non-trade issues like social causes, human rights and the environment have been used to stifle the trading capacity of developing countries.
As you are aware, since July 1997 the countries of East Asia have been in the throes of a major economic meltdown. A region whose economic performance was once hailed as a miracle is now in the midst of a recession that is likely to engulf the world. For years, we enjoyed high economic growth with our commitment to the free-market economy, which has been demonstrated by the virtual removal of all controls on capital movements. But, in a system where there are no international rules and discipline, the law of the jungle prevails. The activities of currency speculators, taking liberties because of the lack of controls, have precipitated a major financial crisis from which we are yet to recover. In the 14 months up until August 1998, we witnessed the value of our currencies fall from between 20 per cent to as much as 80 per cent, and our stock markets have lost between 20 per cent and 90 per cent of their value.
On September 1, 1998, Malaysia acted to deal with its own problems by introducing selective capital controls. We decided to undertake measures to insulate the Malaysian economy from the risks and vulnerabilities of short-term speculative capital. These measures helped us to regain monetary independence and to insulate the Malaysian economy from the prospects of further deterioration in the financial environment. Let me state here that we are not anti-market and not anti-business. We have always been a trading nation. We will continue to promote trade and foreign direct investment, because we feel these conduits are essential for global prosperity. Malaysia has a strong policy to encourage trade and investment. Tradewise, we are one of the most open economies in the world, and merchandise exports comprised 83 per cent of Gross National Product in 1997.
Globalisation demands liberalisation. Yet the opening up of the financial sector to foreign operations without the necessary preparation is a venture laden with risk. The process should be carried out at a gradual pace, in consonance with the development of capacity and institutions to deal with the forces of globalisation. The recent experience of East Asia is proof that the unplanned integration into the global economy and the pursuit of liberalisation without thorough preparation, and evaluation of the strengths and capacity of national economies, can unleash forces that can cause ruin, and wipe away, the gains of the past. Developing countries must be in a position, with appropriate domestic policies, to manage the globalisation process to their advantage.
The East Asian economies were, until recently, doing very well and were universally praised for their outstanding performance. But perhaps these countries made the error of opening up their financial sectors and operations too fast, particularly in the area of currency trade and of short-term capital. Regulations and controls that used to be much stricter were rapidly lifted, under the advice of international agencies that preached the virtues of free capital flow but neglected to warn about the danger of fickle investor sentiments. They did not stress the need first to train the local institutions in the skills of managing financial liberalisation, or the need for instituting domestic regulations. As a result, big institutional funds and players, which have mastered the arts and instruments of speculation, were able to manipulate the financial markets. The result was a massive currency devaluation, and a pull-out of funds from the stock markets and of foreign short-term loans in some of the affected countries.
The reaction of developing countries, wanting to reduce their dependence by preserving their local identities in the manner and form, as well as areas, that they deem fit and proper, should be respected. A major lesson from our experience, and that of many countries, is that global markets can play a major role in income-enhancing efforts, but that developing countries have to choose the appropriate methods, pace and manner in which they integrate with these global markets.
I have spoken at some length about global markets, the forces that move them and their benefits, as well as the desire of local and national communities to retain their identities. The question is whether the two trends are incongruous to the extent that they negate each other and one has to be sacrificed for the other, a situation which management gurus call a “zero-sum” situation, where one gains at the expense of the other. Such determination of a choice before us smacks of a lack of comprehension, and selfishness, by the parties concerned. Such a view also denies the existence of a third way, a way in which global markets can be promoted and local identities can be preserved. In other words, there can be unity in a view recognising a need for globalisation and yet maintaining diversity in local identities.
We must strive towards globalisation at a pace that will enable all to come aboard. Those who need time must be given time. Arm-twisting or intimidation of any kind is not going to work. In fact, it might bring about a backlash that will only delay the process. Let us realise that globalisation will not become a reality with the press of a button. It is a process that, almost by definition, takes time. Globalisation must be viewed as a continuum. It should contribute to global prosperity.
Malaysia is of the opinion that the way ahead in promoting global prosperity is one of partnership – a smart partnership – between those promoting globalisation and the attendant search for global markets with the retention of local identities.
Let me elaborate on the concept of “smart partnership” from the Malaysian perspective. We believe that smart partnerships can be accepted and practised at multilateral, regional, sub-regional, as well as national levels. If promoted with sincerity and co-operation, smart partnership can lead to a better collaborative mechanism based on the “win-win” formula rather than the “winner-take-all” or zero-sum game that many big powers seem to espouse.
In the context of a multilateral process involving the UN system, the need for greater representation and involvement of new nation-states, predicated on balanced needs and the interests of all countries, this can give us an equitable and durable new world economy and political order. The basis of the present arrangements has been the post-Second World War needs, which are no longer relevant. The uni-model power structure has led to many inequitable decisions, which are far from fair and just solutions. Palestine, Bosnia, Iraq and Rwanda are but clear examples of the manifestation of these iniquities, with little compassion for the suffering of the affected population. It is Malaysia’s belief that the multilateral processes must be fair in order to generate enduring solutions. For this, greater representation of the developing countries in the international decision-making and conflict-resolution process is a must.
Malaysia believes in a “prosper thy neighbour” policy. Smart partnership in the form of regional co-operation is also important in order to address common issues among neighbouring states. ASEAN has displayed a working formula for South-East Asian countries, premised on consensus and the principles of non-alignment and of non-interference in domestic affairs. These have contributed to regional stability and economic prosperity in South-East Asia, which has become a region of peace, freedom and neutrality. ASEAN does not have to delve on differences, but works for the common good for the benefit of all. In this context, several joint development projects have been undertaken by ASEAN to exploit resources surrounding common boundaries rather than pursue border disputes of no benefit to any of us.
In fact, the ASEAN spirit has also helped in bringing about sub-regional economic development through growth-triangles of neighbouring and contiguous regions. This has helped flows of resources and promoted complementarity of factors of production as well as of enterprise. To date, three growth-triangles have been established for this purpose for the common benefit of the bordering regions of Malaysia, Singapore, Indonesia, Brunei and the Philippines.
The issue of smart partnership is all the more critical at the national level. In this regard, smart partnership refers to establishing formulae for the participation and involvement of all sectors – the government, the private sector and the general population – in the wealth-creation processes. Malaysia strongly believes in growth with equity as a basis for durable, long-term social and political stability. Our New Economic Policy, formulated in 1970, brings the major races to work together in economic pursuits. It’s deeper than the shallow approach of the “Affirmative Action” programme of North America, which just provides facilities for basic needs. The disadvantaged groups must be given the fullest opportunity to develop their latent potential, especially through modern asset ownership, human resource development and entrepreneurship. Indeed, this approach will ensure greater participation and the long-term involvement of all parties concerned in the economic development processes of the country. This approach allows inter-generational social mobility in Malaysia – the children of farmers are now technocrats, professionals, entrepreneurs and businessmen. In the long run, this social engineering will help to banish forever the sense of deprivation among the disadvantaged groups and implant, instead, a sense of belonging and dignity.
My speech has dealt with several issues that have relevance to deliberations on global markets and local identities. I have commented on the growth of global markets, the development of MNCs and the impact of the currency crises on several East Asian countries. I have also ventured to suggest the need to develop smart partnership at all levels – international, regional, and national – in order to give meaning and content to economic growth and globalisation. The approaches used in Malaysia, in part by ASEAN, are our contribution to the search for new ideas to fill the agenda for the new millennium. On that note, Mr Chairman, I rest.

Jiří Musil
Thank you very much, Tun Daim, for your succinct picture of the issues you face, which are important for all of us. Everything that happens in your country matters to all others.
Now I should like to start the panel discussion as we did yesterday, with the same rules. That means there will be four panellists who will deliver their notes. They can react, of course, to the presentation of Professor Sunkel as well as the presentation of Tun Daim. Then I’ll open the floor to others. Now can I ask Kurt Biedenkopf, the Prime Minister of Saxony, to kindly start his presentation.

Kurt Biedenkopf
Thank you Mr Chairman. As one of the panellists, I would like to add some remarks to the presentations of both Osvaldo Sunkel and Tun Daim Zainuddin. Their presentations stand for themselves and, with a few possible exceptions, I don’t really want to comment on them. I would like to address myself first as to whether global markets versus local identities presents a dilemma. I don’t think so.
Global markets and local identities are complementary dimensions of the same problem, namely the organisation of world markets and world trade. In a presentation I had the good fortune to listen to a couple of weeks ago by the chairman of one of our largest corporations, this gentleman closed his presentation by saying: “The game is global.” I answered: “Life is local, it’s not global.” Actually these two, “the game is global” and “life is local”, describe the tension – but not a dilemma.
Globalisation, as such, is not a new phenomenon. What is really new about globalisation today vis-à-vis, let’s say, globalisation in the 19th century, when there was trade all over the world, is the instantaneous form of communication. What is really new is the fact that material information has been replaced by electronic information, or as Negroponte put it, “atoms have been replaced by bits”; and, this technological revolution led and leads to a situation where two of the decisive factors of production have become instantaneously mobile, namely capital and knowledge, while the labour force, of course, has not and never will reach the same kind of mobility. It is from this discrepancy between what used to be normal international trade and what has developed today that most of the problems we are discussing result. In the centre of our globalisation discussion is the organisation of financial markets. I will mention them as one of the main problems, but I do not want to dwell on them solely.
First of all, I would like to re-state that globalisation as such is not a new phenomenon; but the quality of the dimension of complexity is quite different. Mr Sunkel pointed out the problem of complexity and I would like to concur with him.
Secondly, global markets are not the only markets. Regional markets are of tremendous importance to people. In Germany, only one-third of employees work in companies with a workforce larger than 500; one-third work in companies of 20-500; and one-third work in companies with fewer than 20 employees – and the real action is in the last group, companies with fewer than 20 employees. The very large companies, however, are the major global players. The other two segments are regional, national, or European (and we do not consider the European market to be a global market but as an integrated market). The real thing that matters in the relationship between global markets and local identities is the relationship itself. What is the relationship and how do we organise it?
Both global markets and regional identity are indispensable functions. The global financial markets are the main problem. The main problem really is that money emancipated itself from its function, namely the function to serve markets for goods and services. We have learned to develop money products. Money has become, as Henry Kissinger pointed out yesterday, a commodity in itself and this commodity can move around the world thanks to the instantaneousness of communication in a totally uncontrolled fashion. This market has also emancipated itself from practically all rules that are capable of harnessing economic processes and economic power. The need to control is therefore evident. Where do controls derive from? They do not derive from a world order; they derive from nations, nation-states and regions. That’s the area where values are developed and put into rules.
The management of complexity is another issue for which regions are indispensable, and by regions I mean nation-states, combinations of nation-states, such as the European Union, or regions within large nations, but basically nation-states. They are indispensable for the management of the complexity of world markets because this complexity can be managed only by decentralisation. The principle of subsidiarity is the main principle behind the management of high levels of complexity. The failure of the money markets, as we witness them today, is really a failure to manage complexity by not having instituted structures that would have served as barriers to uncontrolled movements.
Let me describe it with an example: take a gas truck, hauling 30 tonnes of gas. If the tank was not separated into many sections, the first braking of the truck, or turning around a corner, would lift it off the road, because the uncontrolled liquid in the large tank would have such momentum that the truck couldn’t control it. What we are witnessing today is a gigantic tank – the international financial system – without any separators that can control the movement, and allow it at the same time, under controlled conditions.
The third reason why we need a structured relationship between global markets, regions and our identities is that value systems, as I mentioned before, do not derive from a world market. They derive from regional and local societies, they are socio-cultural foundations, they are historic foundations and they are plurality. Hans Küng is one of the few who has directed his scientific, as well as his political, interest towards putting together these two things in the latest book he published, where he addresses the question of: where do we derive the ethical and moral standards that are needed to structure world markets in such a way that they harness uncontrolled economic power and movement?
Another aspect of the need to support regions and their identities is that basic faculties that are required for the worldwide management of complexity are produced and supplied by regions. Of course, the most important faculty to operate highly complex international systems, such as the global market, is knowledge. Knowledge is not produced on a worldwide basis. Knowledge is produced in regions, in nations, in school systems, in systems of higher learning, in universities. In Germany, in particular, it’s not even the nation-state but the Länder that are responsible for the production of that most scarce resource in today’s world, namely knowledge; and it is exactly this production of knowledge, as the scarcest resource, that is produced on a regional level. It will not be produced on a worldwide level for a long time to come and, as far as I am concerned, it’s not even desirable to produce it on a worldwide level. It’s desirable to produce it within the social, cultural and historical context in which people live.
A second indispensable function of the region for world markets, as well as world peace or living together in this world, as well as a civil society, is the maintenance of, development of, and responsibility for cultural resources. Markets are a very important thing, but people do not stop in markets. Their environment, the condition of their lives, is much more expansive, and cultural resources are one important aspect.
The social systems that prevent people from falling victim to uncontrolled economic forces are another aspect that can be produced only in the regional context. Even within the European Union, we find it very difficult to organise a standardised social system. We are looking for plurality, and plurality requires regions to carry this plurality. To sum it up, regions are the main source, if not the only source – and I would remind you as to how I defined regions – for the development of the non-economic factors making up human society, its elements and the base for civil society. Civil society is viable as a concept, as well as a reality, only in the cultural, political and economic framework of the regions. Without this foundation, there will be no beneficial global markets.
Finally, I would like to say – among many other things that should be said – that globalisation of the economy will destroy the world economic network if economic forces are not harnessed by a common value system, expressed by rules governing economic behaviour. This is one of the most important consequences we learned from development in the 19th century. To me, it has always been very impressive that the anti-trust law in the United States was not argued for according to economic considerations, but it was considered necessary in order to keep private monopoly from infringing freedom. The basic idea was that uncontrolled economic forces, for which you cannot blame the market but a lack of control and order, endanger freedom, human rights and the stability of societies. As Henry Kissinger pointed out yesterday, and in the conversation that we had afterwards, it is unacceptable that we organise a society in which you gain profit by destroying the stability of regions. If this is allowed to happen, then sooner or later the global market – as expressed in this consequence of financial markets as a typical expression of globalisation – will become unacceptable; and if it becomes unacceptable, the legitimacy of markets as a system of co-ordination will disappear, and that will be to the disadvantage of everybody, because there is no comparable substitute to the organisation of trade through the market process. So, regulation in this sense, harnessing economic power, controlling the mobility of capital, is to the benefit of globalisation, not to its disadvantage. To sum it all up, I think that – without regional vitality – global markets are not viable in the long run as a network of international co-operation from which we can all derive benefits. Thank you, Mr Chairman.

Jiří Musil
Thank you very much indeed for your very balanced perspective on the globalisation process. I appreciate the fact that you saw it in such a balanced way, not diabolising the process of globalisation, looking at it also from a positive side, and at the same knowing the risks; and, you are right that the title of the session, where the word “dilemma” is used, is not quite the best one, but we wanted to make it more alive.
Now I should like to invite Amitai Etzioni, a well-known – world-known – sociologist. Please, the floor is yours.

Amitai Etzioni
Thank you very much, Mr Chairman. I greatly appreciate the opportunity to join the discussion of this important Forum.
When you think about preparing yourself for the opportunity to join such a discussion, you face an obvious choice. You can choose a safe subject: I could talk to you about the importance of the civic society; about the importance of volunteering; about community; and I doubt it would trouble many of you. I could speak in favour of all these subjects from the depth of my heart, but I felt a different calling today and I’d like to do something much more difficult. I’d like to see if I can – I am not sure I can – put a slightly different topic on the table, one which will require not only your indulgence and your tolerance, but your guidance. It’s a subject I myself am struggling with, but I think it badly needs discussion.
I’d like to argue that a civil society, a civic society, which is very, very important, is not good enough, that we have to add to it another concept, that of the “good society”. Often when you argue for ‘B’, people think you are against ‘A’, so I want to make it clear enough, as strong as I can, that I am all in favour: I think civil society is essential, but it’s not enough. What I’d like to talk about is what is missing in the concept of civil society.
A good society, as I see it, is a society that fosters virtues, that recognises certain shared values and is concerned about the institutional processes that ensure that the members of society are nobler or better than they would be otherwise. It contrasts itself with two other positions. One is the “liberal society”, in the classical liberal sense, which maintains that there should be no shared conception of the good, that each person should formulate her or his own notion of the good, and then – in order to have shared public policies – they either use nose-counting or democratic voting or the marketplace to sort out a course, but there should be no judgment involved. The opposite extreme is that of the “good state”, in which the state uses its powers to impose its values on its citizens in a way we saw in the past not far from here, and we still see in other parts of the world.
I want to talk about a third thing: not a free-for-all, in which there are no virtues we seek to foster, to encourage, nor a society in which the government forces values; but something which arises out of what I may call the “moral dialogue”. There are those who have argued in the past – mention was made of Habermas, and the same would hold true for Bruce Ackerman in the United States – that all we need is reasoned deliberations. That’s kind of an extension of the notion of Enlightenment – that we come to meetings like this and we use facts and logic only to sort out our future and our course.
Given much more time, I would show in fine detail that it is not quite possible; that we need to engage each others values in conversation; that conversations about values are possible and not hopeless; but let me just say very quickly, as a kind of vague, simple proof of my point, that even the notion of a “civil society” is itself a value judgment. And so, when we say to each other with great confidence, correctly, that we should bring up people to be tolerant, to be civil to each other, to volunteer to join civic associations and all the other things we mean by that, we are obviously fostering a certain vision of what a “good society” should look like, and there are other values we surely want to foster.
Again, just to give you another quick, and relatively non-controversial, example, in the United States 88 per cent of the children go to public schools, which are not supposed to teach any values; they are supposed to be “value-neutral”. Our left-liberal people fear that the schools are going to teach religion, and our religious people fear that the schools are going to teach liberalism. I’m not sure the teachers always follow the rules, but the public school mandate is not to teach values. But if you go to anyone in the first grade or the third grade in a primary school, the youngest children – aged six or nine or whatever – you see that they are very thoroughly indoctrinated in the value of the environment. They are taught, preached, exercised, sent to measure the pollution, dip into the rivers and test water, and by the time they get to high school they have enormous respect for our stewardship of Mother Earth. That is not something they are born with, and it’s certainly not a neutral subject. Indeed, in the last generation, it was not on our list of values. They are taught again and again, and it’s obviously of great merit that to discriminate against people of different backgrounds or different gender is unacceptable, and I could go on and list the values they need to be taught and not taught. In the end, there are really only two ways of thinking about it. Either we have hidden value agendas, which are not openly discussed and openly examined and not accounted for, or we bring them before forums like this so that we can discuss them with each other and see if we can reach a new shared understanding, locally, and – in our common moment – globally.
Now, when I say that we should have more dialogue, I often ask the following question. It might be possible in a small group – maybe in a neighbourhood, maybe in a community – but can you imagine a moral dialogue in a society that has 260 million people? How could that possibly take place? The simple empirical fact is that as a society – not just as a community, a large society, continent, part of a sub-continent society – we have more dialogue all the time. Not only do we have the dialogue but, while we are in the middle of it, things often look hopeless and we scream at one another; and if you come five or ten years later, you see something very important: we’ve moved forward, not always in the direction I’d like to see, but we do reach a new shared understanding and, most important, we have already changed our behaviour while we have been having these moral dialogues.
Let me quickly give you some examples. I’ve already mentioned the environment. In the 1950s, at least in the United States, any notion of a moral commitment to the environment was not on the map. It was just not...sure, somebody had written a book about it, but as far as a nation, the country, was concerned, it was not an issue at all. People would dump things into the water and into the air without any thought that it was any issue at all. Then, as the story goes, Rachel Carson put the agenda on the national table, in a book known as Silent Spring, and we had an Earth Day, demonstrations, discussions, the kind of drama we need in order to raise awareness, and we had a billion hours of conversation over bars and coffee-tables and in meetings, radio shows, on television; and out of that a new shared understanding has arisen. We still argue at the margins; have big debates about spotted owls and things like this; but I do not know a single American – of whatever persuasion, right, left or centre – who wants to go back to the 1950s. It means we all share a basic commitment now to our environment. It certainly is not enough, but it is certainly different from what it was in 1950s. Most important, as we discuss it, we change our behaviour. President Nixon, of all people, established the Environmental Protection Agency; we engage in a lot of voluntary recycling; I am not saying we turned virtuous, I am just arguing that as a result we became better than we would have been otherwise.
I could give you many more examples but let me just give you two very quickly. My friend, Betty Frieden, wrote a book in 1963 called The Feminine Mystique, which changed our lives forever. It started an enormous debate, a very difficult debate, about the relationship between men and women, between the genders. Again, it was a very difficult debate. We are far from having resolved it but we’ve moved forward – we can argue about exactly how much. We changed our understanding of how men and women should relate to each other, and we changed many of our laws and many of our habits. You are, of course, familiar with our debate about the way we mistreated our African Americans.
Let me move on here and say: more dialogues are possible. While we are in them, they look messy and disorderly, but in the end they lead to a new shared understanding and, most important, to a change in the habits of our heart. I want to contrast it most strongly with any notion that the government can come and impose values. We tried that once or twice with disastrous results. Surely we are all familiar with the attempt to prohibit the consumption of alcohol. The result was, first of all, an enormous amount of corruption, very little observation of the law prohibiting alcohol, and a law which was unsustainable: the law was repealed, and there was little public support for it.
Let me give you a more extreme example. We have laws against the use of certain drugs and narcotics, cocaine and things like this. Well, we have people in places where they are surrounded with machine guns and barbed wire, and they are locked in, 24 hours a day, seven days a week. We call them prisons. About half a million people are in prison because they use drugs, and we have not been able to stop the dealing of drugs inside prisons. It gives you a feeling of what it would take to try, through the government, to impose this kind of solution. My argument is that a “good society” is not one that relies on the government to impose morality; it’s one that arises out of moral dialogue.
Let me come to the most difficult point, and the last one, and I am sure my colleague, Professor Küng, is going to come back to this subject. I believe we are engaged in a global moral dialogue, and yes – like national or societal dialogues – it occasionally looks like screaming and shouting and insulting each other. In effect, we are engaging in a very important and useful moral dialogue, which gradually, with difficulties, leads to a new shared understanding and, most important, to a change of behaviour.
When we, in the West, criticise China and Singapore for their treatment of individual rights, occasionally they get angry with us, and occasionally they tell us to mind our own business, and that we should respect our elders more, and that we should worry more about social harmony. When we talk about rights, they talk about responsibilities, and you know what’s happening? Again, if I had more time I would love to document it in fine print. We are both learning from each other: we have become much more sensitive to the charges of social and moral disorder; we have become much more sensitive to the way we treat our elder citizens; and again, very gradually – both ideologically and politically – Singapore, China, some intellectuals, some political leaders, are beginning to say: “You know what! We can find in our own tradition respect for individual dignity and we can start to talk political rights maybe later.” But we are moving to a shared code – I don’t mean this in the legal sense – of rights and responsibility, of individual dignity and concern for social harmony. Now, I use the Asian and the Western to save time, but we have a similar dialogue with Islam and with other cultures. But let me close by saying: I realise that I provoke here, by arguing that we should not simply be neutral; I realise that people who suffered from totalitarianism, and I am one them, are very wary of any notion of a shared concept of the good; but in the long run there is no greater danger, there is no social situation that is more inviting to totalitarian interventions than that which is a moral vacuum. Thank you very much.

Jiří Musil
Thank you very much, Amitai Etzioni. I am sure that there will be many people who would like to respond to your presentation. Now I should like to invite Mr Weiming Tu, who is a historian and a philosopher. The floor is yours.

Weiming Tu
I have learned a great deal from the wise and thought-provoking presentations and comments of the four previous speakers. My comment is intended to link the urgent concerns of global capitalism to the main theme of the conference.
Let me begin with a dogmatic judgment. The market economy may be desirable or unstoppable or irreversible, but the market society could be disastrous. The naive belief that human beings are rational animals, motivated by self-interest to maximise their profits in a free market adjudicated by law – while an imagined premise for economic thinking – is quite inadequate for, and even detrimental to, the idea of community as variously understood: the community as family, community as school, as company, as church, society, nation, let alone global community. Complex modern societies must try to integrate globalisation with regional, national and local identities. Simply put, there’s no time to elaborate on any of these points: we need to cumulate economic capital, but at the same time we need also to cumulate social capital. The civil society cannot survive, let alone become vibrant, without communication, conversation, dialogue, debates, and an exchange of ideas. It cannot be quantified and, in some sense, cannot be evident through the market process.
In addition to technical competence, we also need to foster cultural competence – not just the cultural competence of survival, but the aspirations of a societal norm, societal good. We need to treat language not just as an instrument but also as an important symbolic system for self-understanding and for self-expression. The commitment to language learning, and by implication the learning of many of the great values embedded in that language, cannot be easily calculated in economic terms. In addition to cognitive intelligence, and this is becoming the main strength of major universities, modern universities, under the influence of the modern West, we also need to cultivate ethical intelligence, in addition to emotional intelligence. Without ethical intelligence, the expansion of cognitive intelligence is simply not enough.
In addition to material conditions, we need to pay attention to spiritual values. We are quite seasoned in the modern enlightenment spirit of underscoring values of liberty, of rationality, of law, of rights, and of the idea of the dignity of the person as an individual. These are certainly not only American or European values, these are global values, universal values. But at the same time we also need to cultivate distributive justice, the sense of equality, sympathy and empathy, the idea of ritual, the ritual of non-verbal communication, ritual or rite: also, duty-consciousness and the sense of responsibility.
In the Confucian tradition, with which I am particularly familiar, there is a simple belief that those people who are truly powerful, or influential, and have more access to goods, information or ideas, ought to be more obligated, ought to be more duty-bound, for the well-being of society as a whole. Therefore, they are obliged to show not just their rationality in calculating self-interest in terms of instrumental rationality, but communicative rationality and sympathy, and to try to understand the needs of the oppressed, of the silent, of the marginalised. The “person” is certainly an individual with dignity, but “person” is always the centre of relationships; and, as a centre of the emphasis on the dignity of the “person” as relationships, we come to the importance of inter-dependency and inter-connectedness.
It is in this sense, I think, that this Forum seems to suggest the emergence of a communal critical self-awareness among an increasing number of people. I simply characterise these people as “public intellectuals” – meaning a combination of statesmen and philosophers, a combination of realists and idealists – people who are deeply concerned about the state of the world or the human condition. A certain kind of pragmatic idealism is imbued in this particular type of communal critical consciousness. A “public intellectual” is a person who is politically concerned, socially engaged, culturally sensitive and informed and, hopefully, spiritually musical, a person with some vision and mission. Normally, we associate the idea of the intellectual with academic communities; but academic communities are ivory towers. They certainly should reside in the mass media, so that the mass media is not simply a kind of privatised domain in service of the market economy. They should be able to voice the concerns of the global community as a whole. There are, hopefully, “public intellectuals” in the mass media. There are also “public intellectuals” in government. The intellectual is not simply a critic of politics; he can be deeply involved with polity and be able to rise above simple political considerations. “Public intellectuals” should be in the business community, including those who are in charge of the multinational corporations, but more in the medium or small industries, social organisations of various kinds, in social movements, especially environmental movements, feminist movements, religious pluralistic movements, human rights advocates and, of course, in religion.
It is in this sense that the “public intellectuals” should be able to help us to address many of the issues occasioned by the globalising forces and the need to change not simply how we do things, but to change, in a very deep sense, the mind-set, the mentality and the attitude. For example, a great deal of change has already happened. Professor Etzioni pointed out our relationship to the environment. We can learn from, say, native Americans that the Earth is not only a gift that we inherit from our ancestors but also a promise entrusted by us to future generations.
The human is, hopefully, a guardian, a steward, a collaborator, indeed a co-creator, of the cosmic process. In the tradition I am familiar with, there are four dimensions of the human condition that need to be taken into consideration in our understanding of the interplay between globality and local identities: the question of the self, of community, of nature and of heaven. They are integrated, interrelated, inseparable. A fruitful interaction between the self and community – of course, community as variously understood – a sustainable, harmonious relationship between the human species as a whole and nature, how to go beyond the anthropocentric mind-set that has persisted ever since the Enlightenment. And of course, there is also the possibility of mutuality or mutual responsiveness between the human heart and mind, and the way of heaven.
Let me conclude with an example of Japan’s situation. I consider Japan to be very much a silent participant in this deliberation. My knowledge about Japan is very limited, but I simply want to use Japan as a way of understanding the complexity of these issues. Historically, Japan has been very successful in integrating major ethical religious traditions exported from outside into the Japanese consciousness. They have been successful in domesticating Confucianism from China to become an integral part of the Japanese consciousness. They have also been successful in integrating, or domesticating, Mahayana Buddhism from India into Japanese consciousness. Since the Meiji restoration of 1868, they have been trying hard and quite successfully in many ways, to try to domesticate the modern West, the Enlightenment mentality. And yet what’s confronted in Japan is an interplay between Westernisation, modernisation, and now globalisation with localisation. They have been able to face the challenge of various forms of Westernisation, modernisation and globalisation, without losing their own local identity – in the tea ceremony, or in Zen practice, in the Shinto sensitivity to beauty, to other kinds of human relatedness. And yet Japan is now confronted with three challenges. In addition to localisation and globalisation, they have to become regionalised, in other words they face re-Asianisation, a return to Asia. Fukuzawa Yukichi talked about the national mission of Japan to leave Asia, to join the West. Now Japan is part of G-7, and has clearly demonstrated a form of modernity that is very much under the influence of the modern West and yet significantly different. This particular form of modernity suggests that all the primordial ties we have talked about – ethnicity, gender, language, land, class, age and faith – will have to be integrated in the globalising project, as well as how to negotiate not just globalisation and localisation, but globalisation, localisation and also re-Asianisation, to establish fruitful relationships with Korea, with China, with ASEAN countries and so forth. It is a major challenge, not just an intellectual challenge, not just an economic challenge. It is a spiritual challenge as well.
Now if Japan symbolises a form of modernity deeply under the influence of the West, and yet significantly different, it suggests the possibility of the modernising process assuming different cultural forms. There is a possibility of the East Asian form of modernity, South-East Asian, South Asian, Latin American, Central European and African. In this sense of the globalising process assuming different cultural forms, mutual references become very, very important. For this reason, I believe that in America, if society is not going to evolve into a learning society again, simply a teaching society, like many of the other major empires of the modern world, America will decline. It is in this particular sense that I think the idea of the “public intellectual” – I would say every one of us, whether we like it or not – is condemned or obligated to play that role of articulating that sense of common ground for further reflection. Thank you.

Jiří Musil
Thank you very much for your rich presentation. I personally liked your term, “pragmatic idealists”. I think we definitely need such people.
Now we are slowly approaching the last. We have one speaker, and that’s a student of law, Divvya Rajagopalan. She is, as I said, a student of law, one of the participants of our Students’ Forum 2000. I am very happy that we have a representative of the Students’ Forum here with us. The floor is yours.

Divvya S. Rajagopalan
Thank you so much, Professor Musil. As a student delegate, among so many distinguished people, I am very nervous. However, I would like to throw some perspective on what globalisation means, and what it is causing us young people to do and to believe.
To us, globalisation leaves in its wake a very fierce and competitive market, which is twice as large, maybe even ten times as large, as we expected our world to be. There is no healthy competition any more; it’s the survival of the fittest. In our world, everything has a brand now: local markets demand a global brand and global markets demand a global brand. No longer is a local qualification from a local identity enough. For example, universities – it’s not enough anymore to just graduate from, say, the University of Delhi, especially when someone from a more international university comes and has a better chance. As a result, a whole spectrum of values and morality changes a bit, because we need to push and fight our way through to actually succeed or do anything in the world. I think it’s important to see that success here now means more of a global concept. Success is no longer measured in terms of local needs or terms. I think our global identity is not enough for us, because we need a local identity. But our local regions push us to get a more global identity. Therefore, there is a sort of imbalance as to where we stand exactly: do we pay loyalty to our local identities, or do we actually fight for a global identity? As Mrs Clinton said in the morning, we have to honour the past and imagine the future. Well, our past may not be worth honouring now, because it’s not based on values or morals. Since globalisation is unstoppable and irreversible, I think it would help if we could try and change the direction of globalisation before it’s too late and it substitutes humanisation. Thank you.

Jiří Musil
Now I will open the floor to all the participants and, if time allows us, I should open it to all who are present here. We have, I hope, some time for it. As the first speaker, I have noted Hans Küng, and then I think it was Mr Utagawa.

Hans Küng
Thank you very much, Mr Chairman. I would wholeheartedly support what my colleagues and friends, Amitai Etzioni and Weiming Tu, said about global moral dialogue, about the importance of values and, whatever they said, I don’t have to repeat that. I, as an ethicist and economist, have a rare opportunity to ask Dr Tun Daim Zainuddin a very concrete question.
I was in your country just before the crisis, together with President Herzog and an official delegation, and I have been invited to the International Confederation of Stock Exchanges. What should I tell these people? They asked me to say something about ethical standards for international financial transactions. What is already progress is that the stock exchange people are asking about this issue. What advice would you give? Should I say that the best way is to regulate markets in such a way as you do under the present government, or not? Should they introduce the Tobin tax for international transactions? What should be the ethical standards in this? Because I think it’s not only a question of economics, it’s also a question of ethics.

Jiří Musil
Thank you. Now Mr Reizo Utagawa.

Reizo Utagawa
Thank you very much, Mr Chairman. Today, the English language has gained hegemony in the process of so-called globalisation. English is one of the de facto standards in the recently globalising world. I still have some tension with it. I have a tiny clash of cultural globalisation in my heart, so allow me to take a comparative advantage to communicate with you in Japanese. I think we now have an inconvenient situation. We must translate my Japanese first into Czech, and then translate it into English. So, I am sorry for the inconvenience caused by the complicated process of interpretation. Let me switch to Japanese.
I have two professions. These two days at this conference on globalisation, I have been criticised as a member of two professions that are often criticised. I am a journalist and an economist at the same time. It is from this position that I would also like to present my own view of globalisation.
Globalisation is initiated, or triggered, by the globalisation of industry. From the beginning, it faced two problems. The first is in the financial area. The means adopted by strong countries tend to become global standards, and this inevitably greatly affects the industrialisation of the weaker countries, and the reactions to this will be very strong. That is one problem. On the other hand, various philosophers, historians, or scholars in religion would say that everything begins in industry, but industry itself cannot bring stability to the human soul. Let me say that globalisation, in fact, cannot be changed, no matter how we criticise it. It cannot be changed. It is a mega-trend. If I speak from a pragmatic point of view, the question is: how do we make globalisation something reasonable in administrative terms? The globalisation that we talk about is, as is sometimes said, a little like a destructive dinosaur – and this dinosaur should be changed into a constructive one. In finance, some results have already been achieved by the study of these problems. There have been technical problems in the sphere of finance.
The problem is that three things cannot exist at the same time: the first element of the three is free transactions of short-term capital; the second is a financial policy independent of the government or nation-state; and the third is the stability of exchange rate. These three things cannot be solved at one time. Hardly anyone was aware of this in the first stages of the globalisation of world finance.
During the crisis that occurred last summer, great progress was made in research in this area. What was that? In this triangle of contradictions, the free short-term capital transactions (one of the three points of this controversial triangle) should be put under control. This is what was proposed – that this part should be regulated. This regulation, these controls, would not stop the flow of short-term capital transactions, but would set rules for this flow. Should we give an example? Let’s take a truck, fully loaded: traffic rules should be set so that this heavy-duty truck does not get in the way of other transportation.
By implementing the outcome of the research in this area, we could try to change the hazardous dinosaur into a controllable creature. However things may be, globalisation is irreversible and, therefore, we have to make efforts to change the dinosaur into a creature that will be friendlier to humans. We will have to tame it. Thank you very much.

Jiří Musil
Thank you, as well. I do agree with you, and allow me to make one other analogy. We are probably living through a time when something new and very big has come into being and begun to function – and I’ll make an analogy to technological development. At the time when cars first started to be driven on the roads, there were probably no rules to govern the behaviour of the drivers. Slowly, due to necessity, rules were introduced to control our behaviour on the roads. I sometimes have the feeling that we are in a similar situation. We have “cars” but we do not yet have rules to manage these big, new instruments. All analogies are weak, but nevertheless...
Now I have on my list Mae-Wan Ho, and I am very glad because she is a natural scientist. The floor is yours.

Mae-Wan Ho
Thank you very much. I would like to make two points. The first is addressed to Mr Tun Daim Zainuddin’s talk.
I do not like to polarise things, but I want to ask him how he reacts to the charge that corporations have a structure that makes it necessary for them to place profit above everything else. It’s not just a question of the global market versus local identities, it’s the global market versus local livelihoods. I am talking specifically about the food corporations, which are now very actively involved in genetic engineering – bio-technology, the life industry in short. We now have a handful of corporations which are going to control not only all aspects of food production, from providing seeds to farmers to buying back their produce and so on, but also the health market and reproductive technologies through what is called “vertical integration”. These corporations are already destroying and marginalising the livelihoods of family farmers, not only in the Third World, but also in the United States and in Europe. There is now a great deal of concern in my own country, in the UK, because farmers feel they are being marginalised by the food retailer chains, the supermarkets. I would like you to address that.
My second comment: I would like to agree with all the wise remarks that have been made. As a scientist, I want – most of all – people to stop teaching the falsehood that science is neutral and value-free, because in contemporary Western science, in quantum physics, we know now that at a very fundamental level the observer and the observed are mutually entangled, that we actually participate in our knowledge. How we know is very, very important. We must know with great sensitivity, in order to produce a profound and authentic knowledge. If we continue to know with violence, then we will produce a very violent society. I think we are robbing our present generation of the capacity to be inspired not just by great art and great music, but by great deeds of humanitarian concerns, great acts of courage and altruism – and I think the most valuable gift we can leave to the younger generation is to protect our value system as human beings, and that includes our dreams and ideals. Thank you.

Jiří Musil
Thank you very much indeed. Now I should like to ask Gareth Evans, please.

Gareth Evans
Thank you, Mr Chairman. My question to Tun Daim is a very delicate one, and one that he may not wish to answer, but I don’t think I can pass up the opportunity to ask it.
Tun Daim, you’re very well aware that all around the world there’s been a great deal of concern about the recent arrest, detention (under the Internal Security Act) and prosecution of former Deputy Prime Minister, Anwar Ibrahim. His arrest and detention have achieved a particular poignancy because he is someone who is widely perceived as – in terms of what we have been discussing this morning – a public intellectual, someone who has been an advocate of the good society, in the sense that he has wrestled with the question of universal versus Asian values and so on; indeed, he is someone who might be described as a pragmatic idealist. It is, I think, a fair question to ask you: how are we to react to that, not only friends of Anwar, but friends of Malaysia, because it’s a very difficult position that Malaysia has now found itself in as a result of taking this particular course of action?
A slightly easier variation on that question is the extent to which part of the background to these events might have involved very significant policy differences in terms of the appropriate reaction to the international economic, or the Asian economic, crisis by Malaysia. To what extent do you feel able to describe the nature of those policy differences? As you put the case this morning very lucidly, it does seem that Malaysia’s position is one of continued, very strong support of international trade and foreign direct investment and for the economic policies that go with that, and indeed all you’ve really been seeking to do is something that many people would agree to be legitimate, and that is insulate the economy at this difficult time from some of the more volatile short-term speculative capital flows that have been so destructive in Malaysia and elsewhere.
Is it the case that there was a policy difference around that particular issue of dealing in this way with the short-term capital flows, or was the policy difference rather more substantial than that? I think this is more than just a matter of purely internal concern for aficionados. The response of Malaysia to economic events is something that has been a critical part of the tapestry of responses around the region, and international perceptions of the credibility, or otherwise, of that response have a significance not only for the perception of Malaysia, but also for the degree of confidence the rest of the world has in the capacity of South-east Asian countries, generally, to pull themselves out of this particular hole. So you may, or may not, wish to comment on the first part of the question, but certainly on the economic policy differences, it would be very helpful to get a closer read-out of those competing arguments and how they are resolved internally.

Jiří Musil
Thank you very much for your questions. I shall ask Mr Tun Daim to answer at the end. Let us continue now. Krishan Kumar...

Krishan Kumar
Well, this is a critical, rather than a constructive, comment. I rather hesitate to break the inspirational mood, but I want to make this point because it’s figured so much in our discussions today.
I am referring here to the concept of “civil society” and what we might mean by it. Mrs Clinton made it the centre, more or less, of her talk; it’s been referred to by Kurt Biedenkopf; and I think Amitai Etzioni’s hesitation between “civil society” and “civic society” is symptomatic of the kind of vagueness that surrounds this term and lessens its usefulness.
It seems to me that we really don’t need it. It’s an old term. It was around in the late 18th and the early 19th centuries and it disappeared from the political vocabulary for most of the 19th century until it was revived by the Marxist, Antonio Gramsci, at the beginning of this century. It really only came back into use in this part of Europe as a kind of rallying cry by some of the intellectuals around Solidarity and certain other members of the Civic Forum movement. It made sense, in the context of this part of the world, to use that as a kind of slogan. It had great persuasive force, it had great polemical force; but it is entirely unclear what it refers to.
I’m impressed, for instance, by the fact that you can read the whole of Alexis de Tocqueville’s Democracy in America – which was referred to this morning – a work that gives a wonderful picture of American society in all these dimensions, and de Tocqueville does not feel the need to use the word “civil society” once. I’ve been through the book very carefully and there is no mention of “civil society” in de Tocqueville. We have terms like democracy, citizenship, constitutionalism, human rights, which all seem to me to have a much more respectable kind of tradition, a much stronger conceptual vocabulary around them, a whole series of institutional aspects to them, much more helpful in trying to realise the goals of what most people mean by this concept of “civil society”. We’ve discussed the various meanings of globalisation; we’ve agreed that they are diverse; but it seems to me that in many ways globalisation is a model of precision compared with the uses that are made of “civil society”. It really has become a kind of mantra: everybody thinks we want it; it’s very good, it’s like a fine wine; but I don’t think anybody actually has a very clear notion of how you achieve it.
It was interesting that Mrs Clinton was able to separate the various points in her address – “civil society” and democracy – as if these were somehow separate things. There was “civil society” on one side, and there was “democracy” on the other. But what was this “civil society” that was separable from democracy? How do you achieve “civil society” except through the institutions of constitutionalism, citizenship, democracy, and so on? It just seems to me that we have latched on to a term that makes us feel good, but it doesn’t really seem to have much conceptual purchase on what we need to do.

Jiří Musil
Thank you very much. I am in an extremely difficult position because I would like to object. Maybe there will be time for it, but I have to say one thing. You said that Mrs Clinton used the term “democracy”. If I heard correctly, she mentioned three parts of society – economy, government and “civil society” – in describing her view of the structure of modern societies. She simply put it in these terms, if I am right.
We shall definitely return to that, Krishan. Your point is very important and I am pleased that we have started to discuss these things. We now have Ashis Nandy, and then Mr Etzioni wants to react to you and I think our friend, Mr Biedenkopf, wants to say something. So let us go on with Ashis Nandy.

Ashis Nandy
I have a small question relating to a large issue, vis-à-vis Professor Tun Daim Zainuddin, and another set of two questions for Weiming Tu. The first to Mr Tun Daim Zainuddin.
Would you like to speculate, when you respond to Gareth Evans’s question, as to whether the East Asian economic crisis would have been at least more bearable or more manageable, if the institutions of participatory democracy had been stronger in some of the countries involved? I’m asking you to speculate not only in the context of Malaysia, but South-east Asia in general.
As far as Weiming Tu’s intervention goes, I must start by drawing a distinction between our positions: he is a pragmatic idealist, I am a non-pragmatic realist. As a non-pragmatic realist, I would like to ask you why there is this attempt constantly to adjust to globalisation, as if it was something God-given or permanent, as if there was not even a touch of transience to it. Why can’t globalisation adjust to us? I say this because after very sensitively listing a set of concerns that should involve all of us – empathy, right, distributive justice, duty and dignity – you afterwards added that there are global values – rationality primarily amongst them – and, somehow, we have to adjust to those values. This might have some eternal truth but we must affirm that rationality is not a philosopher’s tome. It doesn’t give us a solution to anything. In fact, we are living in times when rationality, particularly conventional rationality and “crackpot realism” (which goes by the name of rationality), has itself become a menace to human survival. I can give you many instances but, I shall just give a small one: In the past 50 years, India has built, within its borders, 1,500 large dams that have displaced, according to one estimate, 22 million people, more than double the population of the Czech Republic. They didn’t build these dams in the name of any religious fundamentalist position. They built them in the name of rationality, and I think many groups, many movements, including the three you specifically mentioned – the environmental movement, the feminist movement and the human rights movement – emerged specifically from that challenge to the conventional, dominant form of rationality, which I would like to call “crackpot realism” of a certain kind. It is by rebelling against that rationality that they try to define themselves.
This partly relates to the whole issue of the sources of human violence and human suffering in the century that is about to come to an end, in the sense that much of the suffering in recent decades has come not from crusades or from the Jihad, but from a very calculated, rationally calculated, form of violence, almost as a by-product of the Enlightenment vision.

Jiří Musil
Thanks. Amitai Etzioni...

Amitai Etzioni
I just want to first offer my congratulations for the notion that the conversation doesn’t always have to be so celebratory that we cannot discuss differences. It is a wonderful distinction of the “civil society” that it allows a “civil” dialogue. I do need to defend the concept. With emphasis on the second word, the notion of society, the notion that is, as Mrs Clinton said, where we live, economy is a means, the government is a means, but the source of meaning is the social realm. The other very important concepts that have been introduced – democracy and constitutionalism – belong to the political realm, and to the realm of the law. Again, and this is extremely important, they in no way exhaust our relationship to one another as neighbours, as friends, as members of the community, as members of voluntary associations, as members of society. Even if for a moment we – and I would not tolerate that for more than a second – put away the word “civil” or “civic”, we would certainly need to be concerned about the term “society”.
Once we have that, then we must talk about what kind of society it ought to be. It is very much a society in which we want dialogue with one another in a civil manner. That’s where “civil” comes in, that’s the light definition of the civil society as a dialogue rather than a Kulturkampf or a culture war. The other word, “civic”, refers to the need, which de Tocqueville described extremely well without saying the word itself, to ensure government and citizen the best protection. Again, I am repeating textbooks here. A rich fabric of institutions protects the individual from the state. Whatever totalitarianism there was, whatever its nature, it’s not accidental that the first thing it attacked was that fabric, that in the end the individual cannot be, unless he is anchored. I am just repeating elementary stuff to justify the need for a society that is civil and civic, before we talk about good society.

Jiří Musil
Thank you. Now, Kurt Biedenkopf…

Kurt Biedenkopf
Thank you, Mr Chairman, just two brief remarks.
The first is to the second presentation. The question was asked: why should we adapt to globalisation and not ask globalisation to adapt to us? I think we are doing that. Of course, when we call for regulation, when we call for domestication of economic forces, when we call for rules, we’re trying to change the process of globalisation to fit our value systems. As I listen to the discussion and to the various remarks, all of which I find very enlightening, I’m increasingly wondering whether we can approach the problem of globalisation in a deductive manner. I would prefer to approach it in an inductive manner, namely starting from the facts. That sometimes seems to me to be a problem that we assume everybody knows what we mean when we use a word, and this leads me to the “civil society”.
In the German context, we are discussing “civic society” or “civil society”. I’m not differentiating these two now for purposes of further debate. We are discussing this in the context of a very basic question, one which is neither answered by human rights, nor by democracy, nor by the separation of powers, nor by all the other institutional arrangements that you were referring to, Mr Kumar. We are discussing it on the basis of how much responsibility the individual bears for the basic risks of life, for handling his own community connections, etc.; and to what extent the state, or the government, is responsible for the individual. To what extent is a paternalistic state, and to what extent is the individual, the dominating structural element of society?
This is not answered by the question of democracy. Both can be democracies. You can have a very overpowering paternalistic state but still allow people to vote freely and secretly, and elect their representatives on the basis of free voting. Or you can have a very different, much more open situation, where the individual is the governing structure or principle of the society, and we look upon the “civic society” as one where the individual, the responsible individual, is both responsible for himself and for the functioning of major aspects of the society in which he lives, including important social aspects – social now in the sense of social systems, not of society. We find the term “civil society” a very important one.

Jiří Musil
Thanks. Before we continue, as I promised I would like to know if there are people in the audience who would like to react. I really want to open it, to have a forum. Weiming Tu.

Weiming Tu
First, a very short remark to Professor Kumar. “Civil” is contrasted with “military”, contrasted with “official”, contrasted with “violent”. There are two conditions for any vibrant civil society to exist: one is relatively independent centres of influence and power, independent of the state; and then, each centre has ready access to the state and the influencing of it. If you have that, you have a “civil society” If you don’t, you don’t have one, and a “civil society” is a pre-condition for a vibrant democracy.
I very much appreciate Professor Nandy’s remark because I’m very sympathetic to what he just said. I want to note that this is not a polite remark. Ever since 1995, when we began a conversation at the Centre for the Study of Developing Societies, I’ve been thinking about this whole question of how we go beyond the Enlightenment mentality. As your remark clearly indicates, if we don’t go beyond the Enlightenment mentality in terms of instrumental rationality, social engineering, a kind of mentality linked to a notion of scientism, we are not able to go beyond the current situation. The Chinese case is particularly relevant. China has been deeply immersed in this scientistic notion about changing the world. China didn’t take part in the Conference in Stockholm and didn’t sign the preamble. China believed that human rationality was all that was needed for changing the environment, and the situation is disastrous. For the past 10 or 15 years, I’ve been trying to argue that China will have to take India as an important reference for society because, if China does, China will begin to appreciate cultural resources, like Mahayana Buddhism, religious Taoism and the religious dimensions of Confucianism. Then the mentality would be able to deal with minorities such as the Tibetan minority more effectively. It is a very complicated procedure.
So, I totally agree with your idea to confront this kind of mentality. But I also think I need to remind you of the importance of realising the current situation and responding to that. Thank you.

Jiří Musil
Now I have another gentleman from the panel who wants to say, I hope, a few words. Ivan Gabal...

Ivan Gabal
One remark on the question of civil society. I think we can see, in Europe, that nationalism, or ethnic intolerance, is increasing under regular democratic standards, regimes, governments. So, I think it’s clear, from post-communist countries, that free elections and an independent judiciary are just not enough to keep a standard civil environment. That’s one remark.
I have one question to Mr Biedenkopf. I very much appreciated your stress on local, cultural and civic resources, cultural capital etc. However, we feel here, in societies under transition, the enormous pressure of economic changes, our cultural resources are heavily tested after being destroyed by many years of non-democratic regimes and lack of education. My question is: what was the German experience in the re-united new Länder of Germany, and in what way did you build up local cultural resources, identities, refreshing all that was destroyed by the decades of communism?

Jiří Musil
Thank you. I am extremely sorry. There will probably be no time now to answer. There will be another occasion. Now we have five minutes for three people. Please no speeches, no statements...

Jan Křižka
I would like to support the road to co-existence with the dinosaur, in the sense that the dinosaur, together with us, should contribute to improve this world. We should be able to control what the dinosaur does in our service. I see this as a kind of road to responsibility for all of us, for what we do in this world.

Karl Hahn
My name is Karl Hahn. I would like to take the floor for the reason that all of my life I have done nothing but “globalising” as an executive of the automobile industry; and, in doing so, I brought capital and know-how to various places of the world. We brought our German expertise, for instance, apprentice-training systems, we enhanced universities, we brought our foundations. This is just as background to my question.
After all the good we have done in the various continents and countries, what we feel we have lost at home is the understanding of the process of globalisation by our people. Why don’t our people follow us and our reasonable politicians? They don’t have the educational basis. We talk about education in terms of job creation, job security, to be ready technically for this world. But in most European countries we have not done anything whatsoever to prepare our schools, our masses, to be intelligent citizens, in order to give politicians a chance to explain, to understand the world we live in.
I could go on and on for a long time, but the sentence you hear from Germans all the time – and reactions have given us the results of it – is: “I do not understand this world anymore, and our teachers do not understand the world, and our schooling system is inadequate for this world we live in, and we are not coping with it at the grassroots level.”

Jiří Musil
Thank you very much, Mr Hahn. I think it was an important remark. I am now extremely sorry, I have to follow rules. I should like to invite you, Professor Sunkel, to answer.

Osvaldo Sunkel
Well, I haven’t really been asked any question, but I do have a lot of answers to the unanswered questions. I’d just like to make one point. Please allow me five minutes or so for it.
Several of the speakers have talked about the irreversible, unstoppable, unregulatable dinosaur. Globalisation is somehow absolutely unmanageable. We have to accept that there is nothing to be done about it. It’s a cataclysm that has fallen upon us and there is absolutely nothing to do about it except adapt to it. I am sorry, but I tried to say something in my first thesis that I think is appropriate to this incredibly fatalistic kind of attitude.
Globalisation has two components. It has an intrinsic dynamic, which is fundamentally technology-based, market-based, etc., which is, to a very large extent, very difficult to handle; but, it has a second, very fundamental component, which is economic policy to favour that kind of process. International financial institutions, the economics profession, the international financial press, the governments of the developed countries – this is a structure of power that is imposing policies, favouring policies; and policies are changeable. So you have, as I said, a dualistic process, a process that is partly very difficult to handle. You will obviously not be able to handle anything at all if you do not recognise that this is composed, on the one hand, of a historic process, which is very difficult to handle; but, on the other hand, there is an ideology that is pushing it, favouring it, promoting it, financing it.
Let me try to be very specific. I thought somebody would ask me, since I come from Chile: “Doesn’t your statement contradict the Chilean experience?” Chile has, according to the world international press, a sort of pro-globalisation policy and has been a very successful country. I’d like to, very concretely, give you an example of how you can partially control, to some extent regulate, the globalisation process if you want to. If you know how to do it, and if you have a national constituency that wants you to do it, this is very simple. We moved from the Pinochet regime, which was a market über alles economic policy regime, to a democratic regime in 1990, and let me just give you some examples of the changes in policy that allowed us to somewhat domesticate the dinosaur.
1) First of all, we introduced regulatory policies over private monopolies that had been created by the privatisation of state enterprises. These enterprises had become dinosaurs, and they have now become controlled by the state.
2) We introduced labour legislation, which had been completely abolished during the Pinochet regime in order to give markets flexibility. We introduced labour legislation that allowed a certain degree of flexibility but at the same time avoided brutal exploitation.
3) We introduced tax reform that allowed us to increase and change the structure of government expenditure in order to introduce new anti-poverty programmes.
4) We introduced decentralisation, regionalisation, capital provision for regional governments in order to decentralise, to regionalise, to redistribute power in the country.
5) We introduced environmental and natural resource preserving policies, which were absolutely absent during the Pinochet regime.
6) We promoted Latin American integration, Chilean integration into the MERCOSUR, the regional common market, which has allowed us to have a larger voice in international, particularly inter-Latin American, affairs.
7) Finally – there are some more but these are the most important aspects – we introduced controls on short-term movements of international financial capital.
All hell broke loose when we did these things. Everybody in the international financial community and in the local international financial and transnational corporate and local corporate community was totally set against all these measures. But the President, who was elected, President Alywin who came here last year, was elected with almost a two-thirds majority of the Chilean population. He was able, and the present President is very well able too, to pass these things through the Congress, in spite of fanatic opposition from the local community, from almost all the economists, from the IMF, from the World Bank, from the US Treasury. We were able to do this. So, why can’t the world do something similar? I totally agree with the presentation Mr Biedenkopf made, in the sense that this monster is partly a monster and partly a Hollywood film about a monster. We have to control Spielberg. Thank you very much.

Jiří Musil
Thank you, as well. Now, it’s your turn, sir.

Tun Daim Zainuddin
Thank you. I’ll answer Mr Küng first. Mr. Küng asked me about the stock exchange in Kuala Lumpur. For a long time, Mr Küng, the Kuala Lumpur stock exchange and the Singapore stock exchange were twin stock exchanges. In other words, if you have a counter in Kuala Lumpur, it could be traded in Singapore. By 1991, we had split. When we split, we expected only counters in Kuala Lumpur to be traded in Kuala Lumpur, and those in Singapore to be traded in Singapore. But Singapore came up with what we term as a black market; in other words, our counters could be traded in Singapore. People can trade Malaysian counters issued in Kuala Lumpur as those in Singapore, and they could arbitrage if they wanted to. So, if prices in Singapore are lower, they can buy and sell in Kuala Lumpur at a higher price. Only this year did we manage to stop it – after so much damage had been done. At the height of the boom, the market cap was 900 billion ringgit, but during the crisis it came down to 240 billion – a loss of 660 billion. That’s a huge loss, we have a deflation of 660 billion ringgit.
Similarly, when the currency traders attacked our currencies in South Asia, our per capita income came down from $5,000 to $2,000. We lost $60 billion in purchasing power. Malaysia alone lost something like 1 trillion ringgit. That’s a huge loss. But all the same, we welcome foreigners to invest in Malaysia, except that now we have introduced what Chile has introduced. For short-term capital, you must not withdraw for a period of one year. You are welcome to invest. I hope that satisfied your question.
The second question regarded co-operation in the food business. Of course, in a free-market the only interest is in making profits, and that’s something we cannot stop. Even the free market is not perfect, but that’s the way it operates. In the case of Malaysia, we have said we will not open up our markets until we are ready. We will insist on an equal playing field, because we think that the small and medium-sized industries also have a role to play and, until they are ready, they should be protected.
The third question came from Mr Evans of Australia. Let me be very clear to you, Mr Evans. There are no policy differences between the Prime Minister and his Deputy. We really have been thinking of a fixed exchange-rate for the past 8 months. We met every morning, the Prime Minister, the Deputy Prime Minister and me, as economic adviser and also as executive director of the National Economic Asian Council, to formulate policies to revive the economy. There are no policy differences on the economy.
Anwar was arrested for offences committed under criminal law in Malaysia. Strictly, I should not discuss this matter. As you are fully aware, it is sub judice. Also, on the request of Anwar’s lawyer, a gag has been imposed by the court, so that no statements regarding this case should be made, nor discussed in public. However, I will try to overcome that. Hopefully, I will not be charged with contempt.
There are two issues here. Anwar was holding unlawful assemblies throughout the country, and he was allowed to do it without a police permit. But the moment he started to incite people to riot – and riot there was – he was arrested. He is challenging this in court, and his case is coming up for habeas corpus on the 24th. Under the penal code, he asked for bail and bail was refused by the court. He could appeal if he wanted to, because our system, like the Australian system, is independent and he is free to appeal to the highest authority. I hope I have made this thing clear, unless you want further clarification. Thank you.
On whether I should speculate, Mr Nandy, on the question as to whether more democracy would have enabled us to manage the economic crises better, my answer is that different countries define democracy differently. In the case of Malaysia, we’ve had elections since 1985, in the case of Singapore since 1954. But, if we look at whether we manage democracy better, then under the present circumstances China has done far better than most of us in South-east Asia. Thank you.

Jiří Musil
Thank you very much. Before we close this session, I should like to invite you this evening to a special theatrical performance for the participants of the conference. It’s called Sweet Theresienstadt. It’s a very peculiar approach to Theresienstadt – to those of you who do not know what I mean, to the Jewish ghetto/concentration camp during the war. It starts at 8 o’clock. All information needed is at the information desk downstairs. I invite you for an unusual, special kind of theatre performance. I wish you a chance to relax a bit.
We’ll start, according to the programme, at 3 p.m. with a session of environmental issues. Thank you very much and I should like to thank you, the main speakers.