Unpacking the global arena

Knowledge brokering01 Jun 2010

David Sogge is the Board Secretary of the Transnational Institute in Amsterdam.

The Broker poses some good questions. Let’s take the first one: “Should the global arena be one of the main basic units of analysis…?” The question is almost rhetorical, the answer being of course, “Yes ! What’s the alternative?”

At the same time, the term “global arena” needs unpacking. Cosmopolitan social strata and interest blocs are indeed emerging at global levels; hence talk of a “North” in the “South”. Policies affecting millions are continually shaped and broadcast via global institutions, networks of CEOs, military chieftains, experts, etc. Many of these bodies go about their business in obscure corners of the global policy universe. Behind closed doors. They appear to float free of national public politics. That leads us to feel powerless: “Oh no, they’re at it again! But there’s nothing we can do!”

At the same time our national policy elites can shrug their shoulders and tell us (after asserting their best intentions, deep concern and perhaps even moral outrage) that “There’s nothing we can do either. It’s at global levels and beyond our powers”. Alternatively, they pass over the matter in silence. Wheeling out the “global arena” in these ways can be a useful political dodge, a convenient frame for what British political economist David Chandler and others call a strategy of avoidance of political responsibility.

Let’s take an example. The American economist Dean Baker is among a handful of observers who have long called attention to the fact that far more capital is departing lower-income countries than is going in. Like water flowing uphill. Just last week he wrote:

“In normal times capital is supposed to flow from wealthy countries with large amounts of capital, like the United States and the European countries, to the developing countries who need capital to fuel their development. Due to the failure of the IMF to establish a workable system of international finance, the flows went in the opposite direction in a huge way. The world’s poor were sending their capital to the United States because the IMF gave them little choice. It is important to be clear about the responsibility of the central bankers and the IMF for this totally preventable disaster. The first reason is accountability…”

Accountability? Here is where international banking, a part of the “global arena” seeming to float far beyond public reach, in fact has some national political anchors. IMF operations are overseen by its Executive Board, in which the Netherlands has one of the 24 seats. For steering that powerful, select position, our Ministers of Finance and the Presidents of our central bank are, in principle, held to account.

Now, given the factual basis, and seriousness, of the charge that Baker and others level at the IMF, we might have expected in the Netherlands some calling of our public authorities to account. Or at the very least, some mention of them and their performance in the WRR report. But there is none. Nor is there any evidence that the WRR researchers looked into this or interviewed anyone from any ministry of finance or central bank, including our own. They’ve applied the silent treatment. Here, then, is a case of avoidance, a flight from responsibility, even when figures accountable for what goes on in the “global arena” are just around the corner.