Category Archives: Crisis Response

Konflikt durch Klimawandel

(am 15.8. in der Internetausgabe der Wiener Zeitung veröffentlicht)

Die heurigen Gewitter, Überflutungen, Murenabgänge und Trockenheiten zeigen auch dem verbohrtesten Österreicher, dass die Folgen des Klimawandels auch bei uns angekommen sind. Das eklatante Beispiel der Probleme der Autoindustrie durch Dieselabgasskandal, vor allem in Deutschland, das sich so lange als „Vosprung durch Technik“ und „umweltbewußtes Fahren“ als Grün-Techniknation No.1 berühmte, zeigt auch den Autoliebhaberinnen, dass es nicht nur um das ferne Abschmelzen von Grönlandeis, die Gletscherschmelze und Probleme in Afrika und Asien geht, sondern dass der Klimawandel tatsächlich uns alle betrifft, und zwar zunehmend massiv.

Die Politik steht dem, trotz der Selbstbelobigung wegen des Pariser Klimaabkommens, weitgehend hilflos, ja vielfach als Komplizin gegenüber. Beispiele gefällig? Die steuerliche Bevorzugung von Dieseltreibstoff, die dazu geführt hat, dass in Deutschland und Österreich die Hälfte der neu zugelassenen Fahrzeuge Dieselantrieb haben, und damit mit Stickoxiden und Feinstaub nicht nur Kleinkinder in ihren Kinderwägen auf Auspuffhöhe, sondern alle Stadtbewohner gesundheitlich schädigen. Oder die Tatsache, dass ein früherer deutscher Bundeskanzler Lobbyist der Öl- und Gasindustrie ist, dass ein früherer deutscher Verkehrsminister Cheflobbyist der Autoindustrie geworden ist, dass auch in Österreich Politiker fast aller Parteien ihre schützende Hand, vollgestopft mit Subventionen, über die Autoindustrie und deren Verbrennungsmotorenmanie halten, gestützt durch Medien aller Art, die mit Autobeilagen und bevorzugten TV-Übertragungen von Auto- und Motorradrennen ebenfalls zu Lobbyisten dieser die Städte veröden lassenden Technologie geworden sind. Oder das fast einhellige Urteil der österreichischen Politiker, das Urteil des Verwaltungsgerichtes gegen die 3. Startbahn in Schwechat anzugreifen.

Erst ein Gericht hat in Stuttgart die Politik zum Handeln aufgefordert, nämlich aufgrund der Umweltverschmutzung selektive Fahrverbote, vor allem für alte Dieselmotoren zu erlassen, um die Bevölkerung zu schützen, Gericht hat die 3. Startbahn (vorläufig) verboten, nicht die Politik.

Bei all den genannten Beispielen wird immer wieder das Arbeitsplatzargument dafür herangezogen, dass im Zweifelsfall wirtschaftlichen Interessen vor jenen für eine bessere Umwelt der Vorzug gegeben werden müsse. Diese letzten Entwicklungen sollten jenen die Augen öffnen, die meinen, man könne alle potenziellen Konflikte zwischen Ökologie, Ökonomie und Sozialem in „Synergien“ verwandeln; man könne also ohne Verhaltensänderungen, hauptsächlich mit technischen Lösungen (zB „Geo-Engineering“) den Lebensstil der reichen Länder weiterführen. Auch wenn dieser „Lebensstil“, diese Art zu wirtschaften und zu leben, nicht genau jene Klima- und Umweltprobleme hervorgerufen hätte, unter denen wir alle zunehmend leiden.

Die Politik ahnt diese gravierenden Konflikte – und versteckt sich bisher. Seien es Verteilungskonflikte, wo man „einigen etwas wegnehmen muss, um anderen mehr geben zu können“, seien es Umweltkonflikte, wo es um andere Siedlungsformen, anderes Mobilitäts- und Wohnverhalten, Konsumänderungen, ja vielleicht um das Schlachten der heiligen Kuh „Wirtschaftswachstum“ (in der bisherigen Form) gehen muss – all diesen umwälzenden Entscheidungen geht die Politik aus dem Weg, um nicht „die Finanzmärkte“ zu beunruhigen, um nicht das „scheue Reh“ Kapital zu vergrätzen, um nicht die satten Bürgerinnen und Bürger aufzurütteln.

Wir müssen uns – im Sinne einer Sicherstellung der längerfristigen Zukunft – vermehrt grundsätzlichen Fragen und Entscheidungen stellen. Den Kopf unter das Kopfkissen zu stecken, löst die Probleme nicht. Die Schönredner unter den Politikern, die uns eine heile Welt von „weiter so wie bisher“ vorgaukeln wollen, sollten wir in diese schöne heile Welt schicken und sie von jenen ablösen lassen, die uns reinen Wein über die Probleme einschenken, Lösungsoptionen mit uns diskutieren und auch konfliktträchtige Entscheidungen vorbereiten – und diese dann umsetzen. Mehr von allem und Weiter so wie bisher geht nicht mehr. Die Wahrheit ist uns zumutbar

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Vorsprung durch Technik?

(Unter dem Titel: Deutsches Auto, österreichisches Problem in der Zeitschrift Falter 32/17 etwas verändert veröffentlicht)

Die Skandale reißen nicht ab: zuerst die Dieselmanipulationen, die in den USA zu sehr hohen Kosten führen. VW ist bisher zu Strafen und Kompensationen von 22 Mrd € verurteilt worden. Jetzt der Kartellverdacht gegen die deutschen Autohersteller und Bosch: diese hätten zulasten ihrer Käufer und der Umwelt seit 1990 verbotene Absprachen getroffen, die nicht nur – wie sie behaupten – die Technologieführerschaft Deutschland befestigt hat, sondern zu kostensparenden gemeinsamen Einsparungen geführt hätten. Es geht unter anderem um die Größe jener Tanks, mit denen Harnstoff die Dieselabgase weitgehend neutralisieren kann. Geschädigt sind Umwelt und KäuferInnen.

Die noch zu erwartenden Strafen und die unzulänglichen Versuche der Hersteller, in Europa durch Software das Problem aus der Welt zu schaffen, wiegen angesichts der Entwicklungen auf dem globalen Mobilitätsmarkt weniger als der Imageverlust und der Nachholbedarf bei elektrischen und selbstfahrenden Autos. Endlich erkennt die internationale Gemeinschaft, dass es angesichts der Umweltprobleme, der Staus, der Verödung ganzer Städte durch geparkte und im Schneckentempo kriechende Autos nicht weiter um Autobesitz gehen kann, sondern um „Mobilitätsdienstleistungen“, also: wie komme ich am besten – und im gesamtgesellschaftlichen Sinne schonendsten Weg – von hier nach dort. Wir kennen die alte Diskussion um öffentlichen versus privaten Verkehr, aber jetzt sehen wir riesige Umwälzungen (v.a.in den USA, in China, in Korea) mit Elektrofahrzeugen und mit„autonomem“ Fahren. Carsharing war hier nur ein Anfang. Bei diesen Entwicklungen hinkt die Hochtechnologienation Deutschland, deren Autoindustrie der ganze Stolz ihrer Politiker ist, hinten nach, weil sie auf die Optimierung von Verbrennungsmotoren gesetzt hat.

Durch die Strafen und die Rückstellungen wird bereits jetzt die Investitionstätigkeit deutscher Autofirmen eingeschränkt. Der Einbruch ihrer Börsenkurse, der das sinkende Vertrauen der Investoren anzeigt, tut sein übriges. Die deutsche Politik, voran Bayern, aber auch die Bundesregierung, hat bisher ihre schützende Hand über die Autoindustrie gehalten. Das geht nicht mehr. Das kürzliche Gerichtsurteil, dass Stuttgart (alte) Dieselautos verbieten muss, die Ankündigung von Volvo, in 2 Jahren nur mehr Elektroautos zu bauen, die Ansage Großbritanniens und Frankreichs, ab 2040 Diesel- und Benzinautos zu verbieten, Verbote einzelner Städte – all dies muss die deutsche Autoindustrie alarmieren. Ein etwaiges Verbot von Verbrennungsmotoren ab 2030 würde dort 320.000 Arbeitsplätze gefährden. Deutschland, das seine Reputation als Technologieführer zu verlieren droht, gerät gegenüber seinen internationalen Konkurrenten ganz massiv in Nachteil. Viele der neuesten Entwicklungen kommen nicht von den traditionellen Autobauern und Tesla, sondern von „betriebsfremden“ Newcomern wie Google, Amazon, Microsoft und Alibaba. Deutschlands Leitindustrie ist für diese Zukunft schlecht gerüstet.

Und Österreich? Unsere Fahrzeugindustrie generiert jährlich etwa 14 Mrd € an Umsatz und beschäftigt 30.000 MitarbeiterInnen. Ein massiver Marktanteilsverlust von Deutschland im globalen Mobilitätsmarkt würde auch Österreich, das besonders stark auf Dieselmotoren setzt (BMW-Werk in Steyr, AVL-List in Graz) schwer treffen. Eine öffentliche Diskussion darüber, wie mit dieser prekären Lage umzugehen ist, fehlt. Die schützende Hand der Politik über die Verbrennungsmotoren-Industrie erweist sich als Innovationsbremse: die niedrigere Mineralölsteuer für Dieseltreibstoff, die Förderung von Verbrennungsmotoren-Standorten, alles mit der Argumentation der sonst bedrohten Arbeitsplätze, hat die Firmen fehlgelenkt. Sie haben Technologien in einem Bereich optimiert, der keine Zukunft hat. Auf die Warner hat man nicht gehört.

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12 Steps Towards “Fair” Globalization

 

New Globalization“

Today‘s globalization, (largely unhindered cross-border flows of goods and services, financial services, investments and persons) has increased and changed form since the liberalization of capital flows („Big Bang“) in the early 1980s. Richard Baldwin (2016) adds that this „new globalization“ or „Hyper-Globalization“ is characterized by the importance of knowledge flows across borders. These made possible a different business model from previous times, because it makes it profitable to create „value chains“ across borders in order to cost-efficiently produce products and services. A new division of labor across the globe is the result, where multinational corporations locate and source components according to the location‘s cost advantages, resource availability, and know-how. Globalized finance helps to eliminate previously existing barriers.

This „new globalization“ has also changed the previously existing balance of (political) power between workers, capital and the state by giving multinational corporations (MNC) previously unknown access to capital and political influence (Rothschild 2005). It also creates a new division in every country between large corporations – which yield political influence by being able to threaten „exit“ (Hirschmann 1970) if their conditions for no or light regulation and first-class infrastructure are not met – and the large number of medium and small-scale enterprises which need protection from the state in order to uphold competition, prevent oligopoly and to promote exports. As during the past 40 years the influence of organized labor has been reduced, MNC are able to influence and prevent rules and regulations which might threaten their profitability. They prefer a „flat earth“ without impediments to their global investment decisions (Rothschild 2009). Thus, a major power shift has occurred between the decades after World War II, when there was a relative balance of power between (organized) labor, capital and the state. Today, large corporations have captured the state (Altzinger 2017) and can play workers from different locations against each other.

The resulting long-term stagnation of real wages in the OECD countries, the increase in income and wealth inequality (Piketty 2014, Milanovic 2016), the increased pressure and labor flexibility on working conditions, have promoted the loss of confidence of large parts of the populations in OECD countries in their governments, their „elites“. The election and activities of D. Trump in the US, the Brexit vote in Great Britain, the rise of right-wing „populist“ parties in many European countries – all these are results of these changes in technology and the concomitant „new globalization“ (Rodrik 2016, 2017). A pervasive sense of existential insecurity, fear about the future and resistance to change are the result. Their exploitation by populist politicians threaten society‘s cohesiveness.

While the rising power of MNC, many of which are able to avoid paying (their fair of) taxes in their home countries (Zucman 2016), threatens the very existence of the global order and has reduced the power of regulation of nation states, populist politicians extol the virtues of exactly this nation state („America first“; Russian expansionism; „take back control“,etc.). While rational argument would call for global regulation of MNC (and thus globalization), since national regulation has decreased, previous attempts of establishing effective global governance (UNO, G-7, G-20) are effectively being dismantled, and more and more countries „go it on their own“ (Bayer 2017). In the meantime, populations distrust established political institutions and parties, sometimes hoping and supporting „strong men“ or political movements (5 Stelle, FPÖ, AfD, Front National, etc.) which promise „easy solutions“, disregarding the complexity and especially the inter-relatedness of economic ties. The failure of establishing globally accepted governance structures gives way to the stronger setting the rules, at the expense of global society. This asymmetric power structure threatens not only the liberal global order which extolled free trade, but also the cohesiveness of national societies, and thus political stability.

Single Market as „Super TTIP“

The EU Single Market is probably the „role model“ of this new globalization, if at a regional level. Its basic premise of the „Four Freedoms“ (unfettered movement of capital, finance, goods and labor across EU borders) has been called „TTIP on steroids“ by R. Baldwin (2016b). By TTIP is meant the Trans-Atlantic Trade and Investment Partnership which was negotiated between the EU and the US for a number of years, and has recently been stalled, in Europe because of large protests by citizens, in the US because of the President‘s „America First“ agenda. Many of the new trade agreements between the EU and a number of countries (Canada, Japan, Korea, among them) likewise go far beyond „traditional“ trade agreements which were mainly concerned with removing tariffs and quotas. Now they also atttempt to reduce non-tariff barriers, i.e. technical and quality regulations on goods (and services), promote cross-border investment and install grievance and arbitration mechanisms outside countries‘ judicial systems. Critics claim that they unilaterally benefit the profitability of large corporations, threaten labor conditions and jobs, lead to a race-to-the-bottom with respect to health and phytosanitary as well as environmental regulations, and threaten national and regional identities under the guise of promoting trade and lowering costs. National governments only recently have begun to take the backlash against these agreements – seen as the epitomy of globalization – seriously. However, still the U.S. President wants trade agreements which benefit America, the EU continues along this path with a number of trade agreements in the pipeline, Asian countries are attempting to revive TPP (Trans-Pacific Trade Agreement) without the US, while at the same time the relevant global institutions, in this case the World Trade Organizations, are left to languish.

The Positive Side of Globalization

Foreign trade is one of the mainstays of economic betterment. After World War II trade has expanded approximately twice as fast as world GDP, benefitting many countries and their citizens, if in an unequal manner. The „new“ globalization, if left unregulated, however has reached limits of acceptability in the OECD countries. The point is not to stop trading across borders, but to spread its benefits to all countries and to all citizens – without further endangering the vulnerable environment.

Globalization cannot be reversed. Cost advantages in three areas are of essence and will also in the future drive aspects of globalization: Transport costs have already reached a new low: inclusion of the damages done to the environment would increase costs and lead to more localized production; Costs for the transmission of ideas have decreased by means of new information and communications technologies. More can be expected; The third component, the costs of outsourcing persons with knowhow, which today are still high and hold the owners of know-how close to headquarters, will only change significantly once artificial intelligence makes these persons‘ local presence obsolete – and will then lead to a new level of globalization (Baldwin 2016). But even if globalization cannot be reversed, it can be regulated in such a way as to benefit all people, instead of only large corporations (Rodrik 2016).

Power and Regulation

A strategy to rein in globalization encounters more than just technical problems. It involves a power struggle, in order to re-establish the tri-partite balance of power between labor, capital and state (Rothschild 2015, Brand 2017). Without being naive, this requires the „people“, as workers and consumers, as providers of taxes and family services, as the nucleus of society, to step up and challenge the lobbying and real power of the multinational corporations and their influence on the state. In many instances, civil society in all its formations, has attempted to regain power, and has been partially successful at the local and sometimes national levels. While this assumes that „the people“ have homogeneous interests, in reality populations are also split into various views-of-the-world and the ensuing positions. But before tackling these „internal divisions“ it would be important to step up to get governments to once more pursue the interests of the „99 percent“.

12 Steps

Abstracting from the power question, the following steps could make globalization more acceptable to workers and consumers, because if successful citizens would see that they can benefit from it. These steps are also designed to make globalization pursue sustainability objectives, thus combining economic, social and environmental benefits in an even way.

1. Take stock of existing trade and investment and migration regimes with a view to analyze social and environmental effects. This analysis needs to be accomplished both at a national and a global level. Effects need to be analyzed also according to income levels, social effects and which interest groups benefit or suffer losses.

2. Each country‘s and region‘s economic policy decisions should be based on a regular consultation and dialogue with social partners and non-governmental organizations, with a view to find the desired foreign involvement of the economy and society. Effects on labor markets, social transfers, health and environment should be discussed. This should be the basis for economic policy and foreign trade and investment decisions. In effect, this may lead to lower foreign exposure than today – without leading to misplaced autarky ideas or undue protectionism. Considerations must go far beyond what businesses call „Standortpolitik“ – gaining competitive advantage over foreign rivals and leading to a run on corporate tax rates and putting environmental and social concerns under pressure. Not only defensive policies must be considered, but a broad spectrum of training, labor market, innovation, social and environmental policy measures are necessary to prepare the population for further globalization – and make it more palatable.

3. The domestic market of the EU (at present 508 Mill people and 16 trill $ GDP) is large enough to compensate for some lost export opportunities mentioned above. The aim of the EU must be to improve social cohesion, public health, environmental situation, in short increase the wellbeing of their populations and remain „competitive“ also on the cost side. Some outsourced component productions can be repatriated, barriers can and should be erected against predatory and potentially politically motivated mergers and acquisitions by foreign state-related companies. The existing mechanisms within the EU to compensate for such losses need to be strengthened.

4. Further active strategies to promote globalization need to give equal weight to environmental and social concerns, as to economic ones. Close inclusion of civil society into decision-making can reduce the negative (perceived or real) effects of further globalization. They also strengthen democracy. The general interests of society need to trump interests of those groups that have up to now one-sidedly profited from globalization.

5. Since the internal structures of global supply chains are not known to public regulators, multinational corporations need to be fully transparent about what is produced where, which costs arise where, where which social and environmental effects occur and where they pay how much in taxes. Such binding regulations must be effected at the EU level, single-country regulations can easily be subverted.

6. As well as tax transparency and the establishment of minimum corporate tax rates, corporations must be made committed to follow strict corporate social responsibility rules. Existing voluntary rules are not sufficient. Society as stakeholder must trump narrow shareholder value activity.

7. When trade agreements are concluded between countries/regions with very different levels of income and social and environmental standards, protective mechanisms, e.g. like those used to hedge against foreign exchange fluctuations, need to be installed.

One possibility would be to force enterprises which outsource components to pay part of their cost savings into a fund from which both new employment and training for those who lost their job could be financed, but also labor relations, income and social protection for the host country could be improved. A higher taxation of profit could also contribute to this fund.

During gobalization the share of labor in OECD countries has fallen significantly (Milanovic 2016). This calls for a very basic discussion on how the gains from globalization should be divided and how taxation of global companies should be levied. OECD and IMF have begun to make efforts to propose international rules, but much more will be needed to revert to a fairer distribution of income.

8. The downward escalation of corporate tax rates – argued by individual states as necessary to maintain „competitiveness“ of the location needs to be stopped. Transfer pricing, low or zero tax rates, storing profits and tax havens – all these need to stop. The best way to achieve this would be to reverse the burden of proof, i.e. enterprises would have to prove that they have paid appropriate taxes where the economic activity occurred. An international body, akin to the Basle Committee, should ascertain the fairness of local acquisition of firms regimes and prevent competitive bidding by offering unfair benefits to investing companies.

9. The dogma that markets in less developed countries need to be opened to foreign competition needs to be qualified as a development strategy. Effects of market access on local (small) producers, especially in the food sector, on local handicraft production on small and medium-sized enterprises, on national and cultural customs need to make way for more autonomous development paths which also accept traditional „infant industry“ arguments as legitimate.

10. The dogma of free capital flows which affords (largely anonymous) capital markets the role of assessing individual countries‘ developments and policies must give way to a global financial policy which is driven by the interests of all of society. International financial institutions must accept that stability of investment relations have to have precedence before the short-term interests of financial investors. National banks must become accountable to national and global society.

11. Forthcoming trade agreements (Baghwati has called the likes of TTIP and TTP „non-trade agreements“) are positive insofar as they further reduce tariff barriers and quotas, but must refrain from levelling standards (Rodrik 2016). This is especially true for trade agreements between countries and regions with very different cultural traditions, since elimination of culturally important standards especially threatens citizens‘ identity and thus trust in the political system. Inclusion of direct investment requires renewed discussion, especially with respect to foreign takeovers of basic social and economic infrastructure. Dispute resolution mechanisms need to be publicly legitimated and integrated into existing legal systems.

12. From a global perspective, and especially concerning less developed countries, elimination of patent protection could reduce some of the excesses of modern globalization. It would promote know-how transfer from more into less developed countries, would reduce exorbitant costs of pharmaceuticals for some of the ravaging diseases and could speed up the development process. It would need to be accompanied by mechanisms producing positive incentives for further pharma (and other) research benefitting mankind where health reasons require it most strongly.

Conclusion

Unfettered globalization has created fear and insecurity because of its uneven effects on income distribution, the deterioration of the environment and the pressure of the liberal welfare state. It threatens the cohesiveness of societies, sows distrust into the political process and leads to xenophobic and protectionist tendencies exploited by populist politicians. It has reduced the regulatory power of nation states to a minimum, without this gap being filled by global governance structures. If left to itself, globalization will lead to a „winner-takes-all“ situation where large and strong enterprises reap all the benefits of globalization, at the expense of social cohesion, the welfare of citizens and the environment. But globalization can be reined in and benefit citizens rather than corporations, if:

– a socially-based economic and foreign trade policy gives equal weight so economic, social and environmental considerations

– the gains from trade and foreign investment are redistributed to those whose jobs have been lost and to the host countries‘ social and labor market improvements

– the fight against tax dodging by large corporations is taken seriously, such that taxes are paid where the economic activity occurs

– differences between regions of standards are seen as part of cultural and historical identities and thus protected from international competition, rather than being seen as non-tariff barriers to trade

– in international negotiations and institutions, the interests of less developed countries are given adequate weight, irrespective of their size and economic development.

Such steps go beyond technical solutions and will require a fierce power struggle. Vested interests in the present system by large multinational corporations and large developed countries need to be tackled to the benefit of global society at large.

Literature:

Altzinger Wilhelm, Globalisierung, Verteilung und Demokratie: Gibt es eine Transformation zum patrimonialen Kapitalismus? In: “Jahrbuch Normative und institutionelle Grundfragen der Ökonomik”  · Band 16 –  Kapitalismus, Globalisierung, Demokratie, Martin Held, Gisela Kubon-Gilke, Richard Sturn (Hg.); Metropolis-Verlag (in print)

Baldwin Richard, The Great Convergence. Information Technology and the New Globalization, Harvard University Press, Cambridge, Nov. 2016

Bayer Kurt (2016). Digitalization, Mode of Production and Working Conditions – A Primer, https://kurtbayer.wordpress.com/2016/09/17/digitalization-mode-of-production-and-working-conditions-a-primer, 17.9.2016

Bayer Kurt, Giner-Reichl Irene (Hg), Entwicklungspolitik 2030. Auf dem Weg zur Nachhaltigkeit, Manz, Wien 2017.

Bayer Kurt. Wie könnte „Gute Globalisierung“ aussehen? Wirtschaft und Gesellschaft 43, 2, 2017, Wien

Brand Ulrich, Wissen Markus. Imperiale Lebensweise, oekom, München 2017

Bürger Hans, Rothschild Kurt. Wie die Wirtschaft die Welt bewegt, lesethek, Wien 2009.

Hirschman Albert. Exit, Voice and Loyalty. Harvard University Press, Cambridge, Mass., 1970.

Milanovic, Branko. Global Inequality: A New Approach for the Age of Globalization, Belknap Press, Harvard 2016.

Rodrik, Dani (2016a). From Hyperglobalization to Sensible Globalization, Sept. 16, 2016, www.rodrik.typepad.com.

Rodrik, Dani. (2016b). Don’t Cry Over Dead Trade Agreements, Project Syndicate, Dec. 8, 2016, https://www.project-syndicate.org/commentary/no-mourning-dead-trade-agreements-by-dani-rodrik-2016-12

Rodrik, Dani, Populism and the Economics of Globalization, #23559 (IFM ITI POL) http://papers.nber.org/papers/W23559?utm_campaign=ntw&utm_medium=email&utm_source=ntw

Rothschild Kurt, New Worlds – New Approaches. A Note on future Research Strategies, Kyklos 58/3, 2005

Zucman, Gabriel, Taxing Across Borders: racking Personal Wealth and Corporate Profits, Journal of Economic Perspectives 28/4, 2014.

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The End of Global Governance

The G-20 Summit in Hamburg has confirmed what I had diagnosed already earlier: The pretense of the G-20 to act as the major institution of global governance has shown to be greatly exaggerated. Already before the re-nationalization issues exhibited by the US election, the Brexit referendum, Polish and Hungarian behavior in the EU, and many other more recent manifestations, the G-20 could never legitimately speak „for the world“, since its composition was restricted to the 20 „most systemically relevant countries“. What about the small ones, the poor ones, the ones not large enough to be deemed (by whom??) systemically important? They have not conveyed a mandate to the G-20. True, 20 is better than 7 – but it is not enough, especially given the fact that all actions of the included 20 largest economies have spillover effects on many other countries: Who speaks for them? A number of analysts, myself included (see Bayer 2007 and 2017) have made suggestions to make the G-20 more representative, to give them legitimacy – but this has not happened.

But crying over spilt milk is of no use. The conduct of the Hamburg summit has shown that the major value of this meeting was to provide opportunity for some of these leaders to have bilateral meetings, or meetings in small groups – all outside, or in the fringes of the G-20 meeting itself. To provide such a venue is not without value – but it has nothing to do with the pretense of „global governance“, since in these meetings each country impresses on its „partner“ its own interests and negotiates a bilateral „deal“ – often to the detriment of the countries not present.

The official communiqué shows the paucity of joint results: a confirmation to further engage in trade and cross-border investment („free and fair“ – whatever that may mean!), a 19-member commitment to pursue the Paris Agenda, a commitment to „digitize“ all citizens, and a commitment to combat terrorism. In this light the horrendous damage inflicted on Hamburg‘s streets and police was even more out-of-order than this despicable nihilistic violence requires condemnation.

The „spin“ that these leaders give in their respective press conferences about their meetings (including the official one) has little to do with „truth“. Everybody attempts to show to the press and her citizens that they forcefully deposited the points close to the hearts of their voters. It is interesting to not that the US President did not hold a press conference, thus giving his first-met counterpart Russia the opportunity to declare that he (Putin) has convinced Trump that Russia had not interfered with the recent US election and that Trump had accepted this. Even Trump‘s following twitterisms did not deny that. It may well be that Trump can twitter tough statements when in his familiar Trump Tower surroundings, but that this self-declared dealmaker wilts like a daisy when facing clever and cunning counterparts in person.

It may be good news that Trump and Putin agreed on some kind of ceasefire in a small part of Syria. But given the amount of global problems, many of which Merkel had put on the G-20 Agenda, this is a poor outcome. The interests of the G-20 (and of many other countries not represented) are as diverse as ever. The spirit of cooperation with a view to jointly tackle the pressing global problems has vanished – if it ever existed. The withdrawal of the US as champion of the „free world“ has encouraged all countries to also primarily pursue their own interests: „My country first“ – and to hell (Hambug-related pun intended!) with everybody else. Angela Merkel and Emanuel Macron may, one more reluctant than the other, dream of global cooperation. The Hamburg G-20 Summit has not been able to provide it. It will not come from any of the existing institutions, it will not come from the EU (in spite of its much-touted trade deal with Japan), it will not come from China. Citizens, wake up!

 

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The G-20: Global “Governor” or Photo Opp.?

On July 7/8, 2017 Hamburg hosts the next G-20 Summit. Germany, and especially Angela Merkel, has put a lot of resources into its preparation (there is an election looming in September): under the heading „Shaping an Interconnected World“ Merkel will attempt to bring some issues of global significance forward, including stability of growth and the financial system, the fight against climate change, inclusive growth, migration, and a number more. As is usual in this format, the agenda of such a summit is the result of ongoing discussions during summits, enriched by national priorities. During the run up to this summit it has become clear that Angela Merkel is attempting to re-establish the G-20 (under German leadership) as the most significant global governance institution, in this sense re-awakening memories of 2008 when under British leadership the G-20 heads of state established themselves as the one global forum ready to combat the incipient economic and financial crisis. At that time there were hopes (also by this writer) that the sense of joint concern and cooperation would lead to better coordination of global economic and social governance.

As has variously been documented, this sense of communality – if it was real at that time – has disappeared during the last 9 years. Today, international media see the bilateral meetings of heads-of-state which will occur at the side of the G-20 meeting in Hamburg as the events with major significance: Putin-Trump, Putin-Xi, Trump-Xi, Modi-Xi, Merkel – …., Macron – ……, Erdogan – ….., etc. The actual joint summit meeting of the 20 heads of state, the EU, the international financial institutions, the OECD, they all will  be reduced to a sideshow.

The world certainly could use an effective, representative global governance architecture. The grip of the Bretton Woods Institutions (IMF, World Bank, WTO) has started to slip, emerging countries created their own structures, the spirit of acting jointly to combat global problems is vaning, competition and vying for supremacy seems king. Not that a strong governance institution is desirable independent of the objectives it pursues. The „Western“ states should be aware that their global dominance, their economic model has severely been damaged as a role model, not least by the recent financial crisis. The strong emergence of China, India, Brazil and others must give way to their interests being iven equal weight.

In the runup to the Hamburg summit John Kirton, head of the G-20 Research Group at the University of Toronto has given a positive assessment of these G-20 Meetings. He records its history which began in 1999 as a meeting of finance ministers and central bank governors of the 20 „most systemically important“ countries of the world and its elevation to the heads of state in 2008. In typical anglo-saxon fascination with measurement, he notes that up to now these heads of state have spent 22 days with each other and have published 140.426 (sic!) words of official conclusions. They have, I quote again, 1.962 exact formulated binding commitments, of which 72% have been implemented. Without me going into more quantitative detail, this report concludes that what the G-20 does, has had positive effects not only for the G-20 countries themselves, but for the wider world insofar as they promote both financial sector stability and the sharing of the fruits of globalisation by everybody. This is doubt ful, given the state of today‘s world.

Looking at the state of the world in July 2017 one could think that this evaluation refers to another world: globally, the brief spirit of cooperation has disappeared, the USA is intent to abandon its role as the „guarantor and promoter“ of post-World War II – global governance and sees its position as one to be improved at the expense of its trading „partners“; Russia is reasserting its own hegemonial role in its neighborhood and the Middle East; China sees prospects of promoting its own trade and economic and political influence in its neighborhood (South China Sea) and via its ambitious Silk road project and trading relations with resource-rich countries; Europe is struggling to maintain a semblance of unity (albeit without a global strategy) in the face of Brexit; re-establishment of national sovereignty has taken hold of many countries; in the rich countries the disaffection of the populace with their political masters has given rise to right-wing populism, as a result of massively rising inequality and fear of insecurity; financial systems have been „saved“ at high costs to taxpayers, only to keep pursuing their instability and inequality-generating activities; the fear about labor-replacing new technologies abounds; migration flows in Asia, Africa, Latin America have increased due to immiserization of large swaths of these continents‘ populations; belligerent activities threaten both civilian populations and the stability of whole regions; climate change and the massive exploitation of environmental capital threaten the world population‘s way of life – and so on. Of course, this state of affairs is not the fault of the G-20 alone, but it is more than blue-eyed to paint the Decade of G-20 Governance as a success story and to continue in this vein.

Let us see this Hamburg Summit as what it can be: a venue of 20 plus important world leaders affording the opportunity to have a number of one-and-one meetings, with the hope that some of the most glaring present faultlines of today‘s world can be ironed out. The joint summit itself will not change one iota of the precarious world situation. Maybe EU countries and China can put pressure on the US to reverse their abandoning the Paris climate accord; maybe some accord can be found to pacify the Mid-East and stem migration flows; maybe a start can be made to improve the economic situation in Africa, with a view to stem migration flows. Merkel seems to be trying, if with the wrong policy prescriptions.

But I would bet a lot on the assessment that the roots of today‘s economic and climate problems, the dominance of a self-serving financial system, the „Western“ way-of-life of exploint nature and natural resources and labor, the multinational-firm-driven mode of globalization at the expense of thes well-being of countries and people – all these will not be addressed, let alone „solved“. In this way I judge that the simultaneous presence of 20 plus world leaders in Hamburg is a missed opportunity to improve the world. It is, as its detractors say, more a photo opportunity and a posturing occasion for heads-of-state than a serious meeting towards a better global governance. Even if Angela Merkel has good intentions, the path to …..-First posturing and the renewed fight for hegemony will not let her.

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CHALLENGES TO GROWTH IN THE WEST BALKAN REGION

Attached is the powerpoint presentation which I gave as a keynote speaker on May 31, 2017 on the occasion of the Austria Connect Southeast Europe Conference in Belgrade:

 

 

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Eine Vergebene Chance

Am 19.6.2017 stellte Grame Maxton, Generalsekretär des Club of Rome seinen neuen, zusammen mit Jorgen Randers verfassten, Bericht an den Club of Rome „Ein Prozent ist genug. Mit wenig Wachstum soziale Ungleichheit, Arbeitslosigkeit und Klimawandel bekämpfen“ in der Österreichischen Nationalbank vor. Gemeinsam mit Sonja Puntscher-Riekmann von der Universität Salzburg war ich als Diskussionsredner geladen.

Maxton stellte in seinem Vortrag weniger sein Buch als die gesamte Entwicklung der Umweltsituation seit dem grundlegenden CoR-Bericht „Die Grenzen des Wachstums“ 1972 vor, präsentierte erschreckende Ergebnisse über Eisschmelze, Permafrost-Auftau und andere Umwelt- und klimaschädliche Entwicklungen und brachte die Meinung der ganz überwiegenden Wissenschafter der Welt mit viel Information zum Ausdruck, dass das in Paris vereinbarte Klimaziel, die Temperatur maximal um 2 Grad ansteigen zu lassen zum beeindruckenden Ausdruck.

In seinem Buch macht er „marktradikales Denken“ für die gravierende Lage bei Umwelt und Sozialem verantwortlich und stellt 13 einzelne Vorschläge zur Bekämpfung der Situation vor. Da sich die Mehrzahl der Diskussionen auf diese Vorschläge konzentrierte, seien sie hier ganz kurz angeführt (S.150):

1. Verkürzung der Jahresarbeitszeit

2. Anhebung des Renteneintrittsalters

3. Neudefinition des Begriffs „bezahlte Arbeit“ (um häusliche Pflege zu inkludieren)

4. Erhöhung des Arbeitslosengeldes

5. Erhöhung der Steuern von Unternehmen und Reichen

6. Verstärkter Einsatz grüner Konjunkturpakete

7. Besteuerung fossiler Brennstoffe und faire Verteilung der Erlöse auf alle Bürger

8. Verlagerung von der Einkommensbesteuerung auf die Besteuerung von Emissionen und Rohstoffverbrauch

9. Erhöhung der Erbschaftssteuern

10. Förderung gewerkschaftlicher Organisationen

11. Beschränkung des Außenhandels

12. Förderung kleiner Familien (Geburtenkontrolle)

13. Einführung eines existenzsichernden Grundeinkommens für diejenigen, die es am dringendsten brauchen.

Ohne auf alle einzelnen Maßnahmen einzugehen, brachte ich folgende Punkte vor.

1. Es ist gut, dass es dieses Buch gibt, da es wieder einmal auf die gravierende Situation der sozialen Lage und der Umweltsituation eingeht. Da es sehr einfach geschrieben ist, kann es weite Verbreitung – auch unter Laien – finden.

2. Kritisch ist anzumerken, dass es keine „Vision“ gibt, wie wir künftig „nachhaltig“ leben sollen. Eigentlich will das Buch, welches sich primär auf die reichen OECD-Länder bezieht, nur weniger vom Gleichen, aber keinen grundlegend anderen Lebensstil. Weder wird anderes Mobilitätsverhalten angesprochen, noch etwa hauptsächlich fleischlose Ernährung (wegen des Landverbrauchs und der Methanbelastung) noch andere Raumordnung, etc. Ob wir unseren „imperialen Lebensstil“ (Ulrich Brand) so weiterleben können und sollen, der auf der Ausbeutung von Mensch und Umwelt beruht, wird nicht angesprochen, nur das „marktradikale Denken“. Letztlich bleibt im Buch das bestehende Wirtschaftssystem aufrecht.

3. Es erstaunt, dass in einem Bericht an den Club of Rome die Vorschläge sich überwiegend auf den sozialen Sektor beziehen, und nur 3 von 13 konkret auf die Umweltsituation.

4. Während ich (fast) alle der 13 Vorschläge, jeden für sich selbst, sinnvoll finde, stehen diese unabhängig nebeneinander. Es gibt keine Gesamtschau der Effekte, keine Konsistenz, ja einige widersprechen einander diametral – so etwa die Arbeitszeitverkürzung und die Anhebung des Pensionsantrittsalters, oder es werden grüne Konjunkturpakete gefordert, was das Wachstum ankurbelt – wie ist das mit dem 1%-Ziel vereinbar?

5. Abstrus erscheint mir der Vorschlag, in der reichen Welt jeder 50-jährigen Frau, die maximal ein Kind geboren hat, 80.000€ zu geben. Erstens schrumpft in der reichen Welt fast überall die Bevölkerung, dort ist also das Bevölkerungswachstum nicht das Problem, zweitens ist vollkommen unklar, wie das gegenfinanziert werden soll – wie auch bei den anderen Vorschlägen.

Insgesamt stellen sich die Vorschläge als Mischmasch aus im einzelnen möglicherweise sinnvollen Maßnahmen heraus, von denen viele Steuergeld kosten (Arbeitslosengeld, Konjunkturpakete, Geburtenkontrolle, Grundeinkommen), deren Gesamtwirkung auf Wirtschaft, Umwelt und Gesellschaft vollkommen im Nebel bleiben. Wachstumssteigerung, Wachstumsabschwächung, Schuldenabbau, höhere oder niedrigere Arbeitslosigkeit, mehr oder weniger Umweltbelastung – alles ist möglich.

Und letztlich werden die Maßnahmen als „sinnvoll“ dargestellt und suggeriert, dass sie mit Überzeugungsarbeit „leicht“ durchgesetzt werden können. Ich meine dagegen, dass wirklich nachhaltiges Wirtschaften eine tiefgreifende Transformation des Gesellschafts- und Wirtschaftssystems benötigt, die auf massive Interessenkonflikte und Verteidigung von „vested interests“ stoßen wird, auf die die Proponenten sich einstellen müssen. Jene Interessen, die die derzeitige Misere herbeigeführt haben und davon profitieren, werden diese Positionen nicht durch Überzeugungsarbeit aufgeben. Das sehen wir tagtäglich.

Ich stimme allerdings mit dem Schlusswort des Autors überein, dass sofortiges Handeln nötig ist und daher auch kleine Schritte gegangen werden müssen. Mittel- bis langfristig allerdings wird es gewaltige Dynamik und politischen Druck der Bevölkerung brauchen, um die Klima- und Sozialkatastrophe abzuwenden.

=>>Randers/Maxton: Ein Prozent ist genug. oekom-Verlag

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