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(PROGRESS) Sharing: A Natural Law of Economy

Sharing: A Natural Law of Economy

by Rajesh Makwana
June, 2007
Whilst the world economy continues to globalise market forces, the basic needs of humanity are still not being met, with an estimated 50,000 people dying each day, having been denied access to essential resources. In 1948, the General Assembly of the United Nations adopted the Universal Declaration of Human Rights. All member states absolutely agreed that the universal provision of adequate food, water, housing, healthcare, education, political participation and employment must be the priority of all governments. After 59 years we may well have landed on the moon, created cyber technology and witnessed an information revolution, but around half the world still doesn’t have access to essential resources such as clean water, adequate food and basic medicines.

Clearly a fundamental shift in national and international social and economic policy is long overdue. Ensuring that people are not living in perpetual poverty or dying needlessly is both a moral and economic necessity for all nations. Not only would this reduce population growth but, given the level of global interdependency, any increase in human capital in any part of the world can significantly increase global prosperity.

The Need to Restructure the Global Economy

Addressing these issues at a fundamental level requires a restructuring of the global economy and a reframing of our values and priorities. By replacing the competitive interest of market forces with cooperation and sharing as a fundamental organisation and distributive process, the ‘operating system’ upon which the international economy is organised can lead to a sustainable world based on social and economic justice, thereby leading to peaceful international relations.

Sharing those resources which are essential to life - currently denied to 40 percent of the world population - can rapidly reduce poverty and inequality.

Sharing resources can also address the key economic issues of our time such as the excessive power of corporations and market forces, outdated neoliberal policy, a defunct IMF/World Bank, a biased free-trade regime, and stagnant international aid efforts. Sharing, in essence, favours the whole and not the part.

Disclaimer

Sharing is a simple word, yet sharing essential resources will require a significant restructuring of the global economy which inevitably presents a daunting challenge.

There are some crucial assumptions that must be accepted if the international community are to consider sharing as a serious alternative to competition over key resources without being dissuaded by the sheer scale of the task ahead;

The single most important task for all governments must be to eradicate poverty, create greater equality, ensure environmental sustainability and guarantee that basic human rights and needs are secured – FOR ALL PEOPLE.

The present international political and economic architecture is unsustainable and unable to secure basic human rights. It must be restructured according to more humane values.
It is only from this position that we can move forward and propose how to create a better world.

When considering ‘sharing’ as a mechanism for organising the global economy, it is important to emphasise the universal and human qualities of the principle of sharing. Unlike socialism, capitalism or communism, sharing is not an ideology or an ‘ism’, and certainly not a concept which can give rise to a rigid set of beliefs and doctrines.

What is Sharing?

Sharing simply means ‘having in common’ or ‘using something jointly with others’, a natural human behaviour that is applied daily in the lives of most people. We all accept the need to share space, responsibilities and food on a family and community basis, but neglect to recognise that the same basic principle of sharing must be followed on an international basis.

Examples of sharing on a national and international scale include:

The Marshall Plan

After World War II, US Secretary of State George C. Marshall initiated a mammoth four-year program of aid for a devastated Europe experiencing extreme poverty, hunger and economic stagnation. The results were unprecedented. Europe quickly recovered and the positive political and economic ramifications for both the US and Europe are still observable. The Marshall Plan was an important example of how sharing resources, in this case financial resources, could benefit all parties.

Venezuela

Sharing can also be seen as an economic process in Latin America. Venezuela shares its oil with a number of other countries in the region, such as Bolivia and Cuba. Countries like Cuba, in return, provide the majority of doctors that work in Venezuela. Obviously sharing in this way reinforces political relationships and good will between the nations involved.

But sharing is not necessarily undertaken as a form of exchange. Venezuela also shares its oil farther afield with the poor in the US. Cuba, which boasts an excellent domestic healthcare system, is well known for sending medical staff all over the developing world. In fact they have a medical army of greater numbers than the World Health Organization.

The Welfare State

National welfare systems can also be interpreted as systems of sharing. Society pools its resources, through taxation, to ensure that education, healthcare, housing and unemployment benefits are available to all. In this way, society creates a social safety net to ensure that the basic rights and needs of the population are met.

The impetus for sharing must be altruistic, but this is not to say that there will be no mutual benefit involved. Sharing occurs as a result of an acceptance of unity or solidarity – whether between people or between nations. Importantly, sharing also has the potential of creating that same sense of unity and solidarity, in this way becoming a self-reinforcing process.

Sadly, when we look at a nation’s relationship with the wider international community, the principle of sharing is disregarded. Given the increasingly interdependent nature of the world and the globalised systems of commerce and finance, the welfare of numerous low income countries depend directly on the economically dominant nations. Yet there is no global safety net to protect poor people in these low income countries from dying of hunger, let alone provide any unemployment benefits.

Why is it that we accept access to medicine and social assistance as a fundamental right in most European countries, but we are not prepared to help create such a system on a world scale where it can benefit those who need it even more than we do? On the contrary, the global economy is exacerbating inequality and poverty.

There are, of course, a number of reasons for this. Most obviously, there is no global governance structure to coordinate such a world welfare system. The closest we have to world government is the UN system, which is sadly not provided with the necessary resources and power to enforce its humanitarian mandate.

The other reason is the nature of the global political and economic ideologies and priorities that govern the globalization process. The only truly international institutions we have are based on competitive self-interest and concerned with globalising profitable markets, as expressed through market forces. With these values as organizing principles, the sense of global unity that is a prerequisite to cooperation and sharing is unlikely to ever be established.

Sharing as an Organizing Principle in the Global Economy

The process of privatisation is at the heart of the market system. The privatisation and enclosure of common resources since the Middle Ages has steadily increased in tandem with commercialization, reaching its zenith with the enforcement of corporate intellectual property rights over forms of life such as plant species.

Apart from our global ecological system, shared resources include all creations of nature including land (and those resources land contains), water and sources of energy. The concept of the global commons can be extended to include the creations of society, particularly if these creations can be deemed necessary to meet basic human requirements – such as information about disease eradication and heath care; and technologies, such as water purification devices or communication equipment. These resources should not be permitted to be monopolized exclusively by private interests with a view only to profiteering.

Most importantly, if the world is to cooperate to ensure basic human needs are provided, it is imperative that common resources are cooperatively owned by the global public and do not fall under national interests. Without this affirmation of international unity, confrontation between nations over resources will continue. Given the uneven distribution of certain resources around the world, without an international shared ownership agreement it would be difficult to ensure basic needs are secured globally.

Rich Countries Must Learn to Live Simply

In order to share the world’s resources, rich countries must make the sacrifice of learning how to live a simpler, more sustainable lifestyle, so that ‘others may simply live’. The economic and frugal use of those resources which are essential to life is a preliminary condition that a donor country, wishing to share its resources with the international community, must abide by. Many environmental organisations and NGOs like the Centre for the Advancement of the Steady State Economy (CASSE) have been advocating a similar position for many years.

In addition, sharing efficiently will necessesatate a redistribution of existing resources. Countries with a greater endowment of a resource must redistribute a portion of their endowment to a country where that same resource in under supplied.

Even though there is enough food produced in the world to provide 4.3 pounds of food for every man, woman and child every day, it isdisproportionately distributed - or simply wasted - by the developed world.

Over-consumption in general, although common in wealthy countries, does little to increase wellbeing of the population whilst seriously damaging the environment through the resultant CO2 emissions. Corporations have been the main beneficiaries of over-production and over-consumption, yet even their security is now threatened by the potential environmental, social, political and financial impacts which are the natural outcomes of such one-sided excess. These factors are expected to eventually catalyse public demand for change, even in wealthy countries.

Over-consuming countries like the United States must take the lead in creating the necessary change in the political, economic and social fabric of the world. They must actively redistribute the fruits of their production and contribute their expertise and labour to ensure that resources can be shared effectively. Government intervention under international mandates will be necessary to facilitate this process.

Organising Global Redistribution and Sharing Networks

It is the international community which collectively should determine which resources are essential for meeting basic human needs and must therefore be shared globally. Once decided, the sharing – or redistribution – of these resources would need to be coordinated in a logical and democratic manner.

At present, the United Nations, although flawed and impotent, is the only body which could serve as the coordinators of a global system of sharing. With an international membership and humanitarian charter, the UN system is clearly the only international body with the experience and resources to address global economic reform.

It would be necessary to create an additional body within the UN responsible for coordinating the pooling and sharing of global resources to meet the basic needs of the global public. For the time being we may call such a body the ‘UN Council for Resource Sharing (UNCRS)’.

The UNCRS would set up and coordinate a Global Sharing Network (GSN), a computerised system that acts upon information from governments around the world. The GSN would measure the changing levels of excess production in each country and then calculate how much of any resource a country is able to redistribute to another.

National governments would work closely with the UNCRS in order to provide up-to-date information about:

(a) which essential resources are available to share through the GSN;
(b) which resources the public are in need of; and

(c) the location of these relative excesses and insufficiencies.

The national government would be responsible for ensuring resources are distributed appropriately within the country, a task that the GSN would facilitate.
Networks of civil society and community groups could monitor resource levels locally and regionally to feedback information to the GSN. Members of the community could be encouraged to form local and regional assemblies to ensure the basic needs of the public are accurately represented. They could also assist in the distribution of resources received from other regions or countries. Local and regional assembly structures of this kind would also enable genuine political participation to become a reality.

How Sharing Can Benefit the Developing World

Sharing essential resources could quite simply allow some 50,000 people to live who will otherwise continue to die needlessly every day. Through the Global Sharing Network and the coordinated activity of NGOs and civil society groups, whole villages could receive enough food, water and medicine to ensure their survival.

Providing the necessary infrastructure, expertise, labour and technology would also be part of this process, to be shared by all those countries which can contribute. The necessary resources for hospitals, educational facilities and housing would also follow. The majority of these resources would be transferred from where they are in excess in the global north to where they are most urgently required in the global south.

The process of sharing basic resources in this way is a direct route to economic development. This system would ensure a ‘bottom up’ development controlled by those most affected, and not an imposed ‘top-down’ process. Financial aid would no longer be provided to corrupt governments who could squander it or use it to repay debt. Strengthening local communities in this way will empower and enable them to become self-sufficient which is likely to have significant impacts on social and political cohesion.

How Sharing Can Affect the Global Economy

Implementing a system of sharing would have significant impact on international trade, finance and development, and thereby directly affect the activities of the WTO, IMF and World Bank.

International Trade

A system of sharing would mean that the majority of commodities and goods that are currently traded would instead be cooperatively owned and distributed by the global public through the UNCRS. Such resources would include energy supplies and the provision of utilities such as water, essential agricultural produce required for food, cotton for clothing, essential healthcare services, equipment and medication, essential knowledge and technology and resources for providing education. As a result, international trade in commodities and their derivatives will be significantly reduced and confined to non-essential goods.

Sharing will ensure that essential domestic needs are largely met at the local level, reducing dependency on foreign imports of essential goods. As a consequence, there would be less need for developing countries to agree to prohibitive trade agreements, whether multilateral or bilateral. This will free the population to develop their own industry and economy.

Decommissioning the WTO

Agreements relating to remaining international trade should, where necessary, be democratically agreed through the UN Conference on Trade and Development (UNCTAD). The remaining international trade, under the auspices of UNCTAD, should utilise an inherently balanced mechanism of fair trade such as the International Clearing Union (ICU) proposed by John Maynard Keynes at the Bretton Woods Conference in 1944. The combination of these factors will allow the WTO to be progressively dismantled over a period of time.

International Finance

Sharing essential resources instead of trading them will mean that these resources are divorced from financial markets. This will have a significant impact on these markets, dramatically reducing the amount of stock and financial derivatives related to the stocks that are traded.

This in itself will help to reduce the global financial instability that many economists and analysts believe will, sooner or later, result in an international financial crisis and economic meltdown.

Sharing resources will also mean that developing nations will require less foreign exchange in reserve as they will be purchasing fewer goods from abroad. The lack of foreign exchange is a key reason developing countries turn to the IMF for loans, which in turn leads to crippling debt.

Decommissioning the IMF

A new UN based Finance Organisation could lend money and provide the necessary expertise in a pro-development manner without crippling interest rates and without corporate or political influence. It would then be feasible for the IMF to be gradually dismantled; its sizeable assets and gold reserves can be applied to the UNCRS and UN development projects.

Development Aid and the World Bank

Unlike existing development finance provided by the World Bank, sharing would not constitute a loan or incur a debt. It would be necessary for the UNCRS to work closely in conjunction with existing UN development agencies and international NGOs to ensure that development occurs in an effective, sustainable and efficient manner.

Over time, the World Bank will be rendered largely redundant and any remaining development projects can be administered through the United Nations Economic and Social Council (ECOSOC) and UN Development Program (UNDP). The World Bank can then be progressively dismantled.

Corporations and Market Forces

In a global economy where essential resources are shared, the primary objective would not be commerce, trade liberalisation or economic growth, but the production and global distribution of all resources that are essential to life.

As these resources will be shared, commercial interests would have no direct influence on this aspect of the global economy. Corporations would operate within this new global framework to serve the remaining economic, industrial and technological needs of society.

The removal of essential goods and services from the existing commercial trading structure does not require abolishing the market based approach to commerce altogether. To the contrary - the two models can coexist to form a modern global economy.

At the local level, it is the enterprising initiative of small businesses that allows communities to interact economically and enrich each others lives socially. Local business, whether small farms, shops, market stalls or local services are the cornerstone of society around the world and their activity must be strengthened.

The United Nations

The UN is the only global institution that is in a position to coordinate a global framework for economic reform and implement a system of sharing. If this is the case, the UN system will have to be reformed and strengthened significantly.

In particular the Economic and Social Council and UN Conference on Trade and Development would gradually resume their initial mandate of regulating the global economy – i.e. trade and finance, and the role of the UN Development Program will be essential in targeting development efforts and would also be greatly strengthened.

As mentioned above, once these UN agencies are effective, the WTO, World Bank and IMF can be gradually decommissioned. The establishment of new UN agencies to coordinate the sharing of resources and develop networks for redistribution would be an integral part of any new system of sharing.

What Will Sharing Mean for International Relations

There is no doubt that replacing the competitive self interest that exists between nations and upon which the global economy is based, alongside a cooperative system of sharing resources, will lead to more harmonious international relations.

People in developing countries will be directly aided by the ‘richer’ nations in their regions and across the world, a process that will likely create much goodwill and tolerance between and within each country. In this sense, sharing resources presents a better foreign policy tool than the forceful acquisition and conflicts over resources that are the hallmarks of the modern world.

As marginalisation decreases in the developing would, the urge to terrorise and fight against the dominant powers will most likely subside to a large extent.

It is also possible that the new altruistic ethos that sharing can encourage, particularly in ‘donor’ countries, will have a beneficial effect on social consciousness and fill the void in community relations and purpose that has grown alongside commercialisation.

The mutual benefit of sharing will be best realised once the developing world are living healthily and in a self sustaining manner. At this stage, international trade and exchange is likely to increase significantly as development proceeds and societies share their cultural inheritance.

Sharing in the way described is essentially a democratic and participatory process. Once economic and social justice has been achieved, these democratic structures can be utilised to further a nation’s integration into a democratic global community. A representative global governance structure may be a much needed side-effect of this process.

A Campaign for Global Economic Reform

The role of any campaign for sharing the world’s resources is not to dictate the terms of reform but to direct attention to what needs reforming and to propose alternatives.

Sharing provides that alternative, allowing resource allocation to occur cooperatively under the democratic guidance of the global public and entirely for their benefit. Sharing creates efficiency, not through the market mechanism, but through the reduction of over-consumption and resource depletion.

Sharing also lessens competition and promotes cooperation between nations. Most importantly, sharing can rapidly relieve poverty and reduce inequality.

Economists have long known about the antagonism between the market and the environment yet stick to the ‘market mantra’ for lack of an alternative. If the global community is serious about creating a sustainable economy and ending poverty, a system of sharing essential resources is an intensely practical and humane alternative.

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Rajesh Makwana is the Director of Share The World’s Resources (www.stwr.net), an NGO campaigning for global economic and social justice.

Labels: ECONOMY, GOVERNANCE, PROGRESS.ORG

posted by MrK @ 10:52 PM