A critique of global capitalism by David Korten.
{googleads left} NR: Today you have become a critic of the corporations and the current economic structure, but at one time you were working for traditional institutions, so what was it that made you change your mind to such a great extent?
David Korten: The thing that brought about the change was really becoming aware of the fact that development was not working. You go through many development projects and you see that they are not working. It is easy to say that this is something particular about this project. But then I began to realize that this is a typical experience and nobody was saying, "Hey it's not working".
I then began looking not only at the development projects but becoming aware that in the places where I was living people were not moving out of poverty and misery. And I saw the gradual destruction of cultures and the environment. I started asking, "Is this just local or is it happening everywhere." As I started looking around more and at the statistics it became clear that it is happening everywhere. Not only in the low-income countries but also in the industrialized countries we are getting an increasing gap between rich and poor. More people are being pushed into economic insecurity or dire poverty, more people are on the street homeless and the environment has disintegrated. For example in my own part of the US, the northwest, when I was young there were these spectacular temperate rainforests. Today, they are clear-cut, gaping sores on the earth. Then you become aware of the inner city, the crime and social breakdown and you say this is systemic, this is not a local phenomenon. There is something wrong on a global scale and we have to determine what it is and get it out on the table or we are going to destroy ourselves with the breakdown of the eco-system and the social system.
NR: In the short run what do we "have to get out on the table?"
David Korten: The first thing is getting clear that the pursuit of economic growth, by consuming faster we will solve the problems. It is wrong. Even for the persons who have the money to consume at that level, it does not provide a fulfilling life. Secondly, fewer and fewer people are being able to consume because they are being pushed off the edge, and third it is destroying the eco system, which is the foundation of all wealth. This is a mythology.
Furthermore, this push towards economic globalization and deregulation in the name of growth is shifting decision-making power away from people to institutions, which are running totally out of control. The global financial markets and the global corporations are beholden to them. The consolidation and concentration of power is enormous and accelerating. These are institutions that are totally blind to the health of society or to the eco- system. They don't see it; it doesn't register in the market system. What these institutions are doing in pursuit of their own imperatives---which is profit, profit and more profit--is that they are restructuring the economic systems so that they are able to pass more and more of their costs on society. By hiring labor below the level of the subsistence wage, by working workers in conditions which destroy them physically, by bargaining down taxes, so that instead of paying their share of the social infrastructure they become a drain on public funds because you have to pay them subsidies. And of course in the media, the corporations, our whole process of cultural reproduction which used to be a human process growing out of peoples experience and values has now been turned over to TV, the corporations and advertisers who teach us to define ourselves in terms of symbols which fit the corporations needs and not that enhance the sense of our humanity. The two basic problems are essentially corporate and environmental.
Below this there is the issue of our spiritual alienation, which comes from the long process of the scientific revolution. Our whole philosophy of science says that consciousness is nothing but an artifact of material complexity. That is a terribly alienating philosophy because it destroys life of any possible meaning. And our whole market system and economics plays into that because it has essentially institutionalized into the culture a Hobbesian philosophy that says that only purpose of life is the pursuit of material pleasure.
NR: You have mentioned many things today and your book is a critique not only of the corporations but also of the whole economic system, so then what do you see as an alternative?
David Korten: The irony is that fundamentally what I'd like to see us move towards is a market system. It may surprise you because what we are told is that we have a market system. But what we have is a capitalist system. Which means rule by capital, by big money.
NR: So what is your concept of a market system?
David Korten: If you go back to market theory and to Adam Smith, who wasn't such a bad thinker for his time, among other things the first principle of a market economy is that buyers and sellers must be small so that no one can influence the market price. This is implicit in Adam Smith theory. One of the things which Smith and Marx agreed on is that workers should own the means of production. Smith did not actually say this explicitly as Marx did. But if you look at his writing you will see that what he was essentially advocating was a one-person firm, where the one person is the owner, the manager and the worker. Now I don't think that firms that small are practical--we need more organization than that. But it is a good direction to move.
NR: Then in your market system the size of enterprises would become smaller?
David Korten: Yes they would. Another assumption that Smith made is very interesting. In the one place of The Wealth of Nations where he mentions the " invisible hand" is a sentence where he says, because the intelligent and astute businessman will invest locally where he can tender his capital, thereby his decision to act in his own interests benefits the society because he is investing in the community and serving the needs of the community. So Adam Smith assumed that in order for the market to work properly, ownership has to be local. Those are all good market principles, which I think we should practice.
Now if you look at trade theory, the most fundamental assumption of comparative advantage is that capital is national, that capital cannot move across national borders. What we have now is an economic system in which there are no borders and capital is all over the place. So technically we are not even talking about trade and trade theory, as it is classically defined. It has no bearing because it is talking about a world that has nothing to do with the world that really exists. So, if we really had national economies which trade theory assumes, with national capital, there is also an assumption that trade is balanced, so that countries are not creating debts. That is also a good principle and we should implement it. Trade should be balanced and we should take measures to balance it. That means that one country doesn't end up owning the assets of another country and stripping them off.
NR: Let's get back to the question of growth. Do you think that there can be a society without growth? What is your conception of the kind of growth that could exist in a future society?
David Korten: The interesting thing is that why do we feel there is a compulsive need for growth?
NR: I could give one example of how growth might be needed in a society. When we want to provide incentives for people and society then there must change. There will always be some kinds of technological innovations, for example computers today. Thus there will always be some kind of change and also growth. Today we sometimes say that the developing world shouldn't be like us, but they also want to use the machines that we are using. So if we say, "No growth" does this mean that they should not have any aspiration to improve their standard of living, and for us does "no growth" mean that we will become static and always remain as we are today?
David Korten: We are already consuming so much in our society that it is interfering with our ability to live. So I see no reason why it is advantageous to grow just because we compulsively feel that progress is defined in terms of consuming. I love computers, mine is now out dated after one years use, and I have nothing against that technology. But if I was asked which was more important to me, having a new computer which runs faster and I can download faster or to put that creative energy and those resources into figuring out how to insure that every person in this world gets an adequate diet, there would be no question in my mind that the adequate diet comes first. That is not growth. Growth is not determined purely by monetary and financial values. Primarily what we are finding is that people who are monitoring the Gross Domestic Product (GDP) are reconstructing the figures in a number of countries and finding that many of the industrial countries where there has been much growth, the quality of the life has been declining, almost mirroring the growth.
NR: Maybe it is a question of how we define growth.
David Korten: I think the whole issue reflects our condition, in which we believe that progress means growth and that if we do not have growth awful things will happen and if we do have it all our problems will be solved. I can tell you why growth is an imperative in our system but it doesn't have anything to do with improving the quality of our life. My view is that we should focus our attention on what things do we need more of so that people can live better. So OK, if we do not have enough housing, then we should decide how many houses do we need and how can we organize the economy to produce them. If people are not getting an adequate diet, then we cannot tolerate that in a civilized society so what do we need to do to get a decent meal, and not giving it to them but seeing that everybody has the possibility of creating a decent livelihood through their labor. If we do that, and focus on the needs and the things which will make our lives more satisfying, then if the numbers the economists like to look at go up, then OK that doesn't bother me, but if they go down, then that doesn't bother me either.
Another side of the growth issue is the way in which we use the eco-system's output. That's basically fixed. We can find ways to use it more efficiently but we cannot exceed the limits of what the earth will sustain without breaking down the most valuable productive system, which we have, so that is decapitalizing nature and that's disastrous. We have got to live in balance with those environmental systems. This gets into a values area, and I believe as the most powerful species on the earth we also have a stewardship responsibility to the other species. That we basically have to assume responsibility for the life of our planet that's our maturing process that we have to go through. If we can find to more efficiently use that sustainable capacity, which also maintains the balance of life, then fine but we have got to stay within those limits. We are using that capacity to produce a lot of destructive stuff and my favorite example is the automobile which is probably the most socially and environmental technology that we humans have. We need to learn to organize our space and our lives so that we radically reduce our dependence on the automobile. Then we can improve our lives and at the same time we are saving resources, which can be used to make sure that other people have enough to eat, and have their basic needs met.
NR: You mentioned the spiritual alienation of the current system. What is your concept spirituality in human life and does it have any place in social transformation?
David Korten: Well I think it's fundamental in terms of the culture shift, which I think is taking place towards an integral culture. An integral culture is where we learn to achieve a balance between our inner and outer life, between our masculine and feminine sides, and between our loyalty to our place and community and our sense of internationalism. My place, my community is important but not against the rest of the world because it is my place and I honor the place of other peoples and their commitment to their own culture. I'll fight to help them protect the integrity of their own culture and place but I expect them to fight to help protect the integrity of my place.
That also relates to the spiritual dimension. I really resonate to the idea that we must learn to see the face of God in every person and being. And that what spirituality is about is essentially recognizing the unity of the spirit of life and the consciousness. The whole idea of competition then becomes ridiculous because we are competing against ourselves and that we must honor this integral connection of life and that moving to that recognition is part of our own evolutionary step of moving to a higher level of consciousness and understanding.
NR: When discussing the economy you paint the picture of a kind of local economy, which is controlled by the local people. What would be the steps to bring this about and in what kind of time frame would you see such a change happening?
David Korten: There are many steps and lots of people are taking those steps. As the global economy trashes more and more communities, there are organized efforts to resist it and people are thinking about how to recover and how to revive both the local economy and ecosystem. That is one level. I think there is enormous need for education, to get out on the table the kind of things we have been talking about today. We have had enough of this nonsense about globalization and free markets. We need to all be engaged in thinking about what values are important and what kind of world we want to live in and what kind of communities do we have, what kind of relationship do we want with our families? Then what do we have to do to begin constructing that within our own locality, but at the same time the political conscious so that we recognize the relationship between that and issues like trade treaties (NAFTA, GATT etc). At the global level it is very interesting to see the juxtaposition between corporate rights and human rights. The activity in terms of international treaties is about defining and guaranteeing corporate rights, and it runs directly contrary to the rights of persons. We need to reverse that process in terms of international treaties so that these agreements are built not around protecting the rights of alien institutions but rather about protecting the rights of self-determination of people to decide what kind of economic life they are going to have and how they are going to use their resources for the maximum benefit of people.
NR: In one your talks here you stated quite provocatively that communism has collapsed and we can also expect capitalism to collapse. What do you mean by that and in what time are you talking about?
David Korten: They are both fatally flawed systems in that they are both focused on material consumption as the index of progress. And they are driven by growth. They both have disastrous environmental records. They both suffer from spiritual alienation--they are both totally materialistic. They both center on unaccountable, centralized bureaucratic institutions that produce an unaccountable ruling elite. So you begin to look at a lot of fundamental similarities. They both suffer from the same internal contradictions. The capitalist system has just been a bit more adept at controlling the world's resources to maintain a sick system. But it is obviously destroying itself. It is almost as if the capitalist leaders got together and said, "We have to do something to fulfill the Marxist prophecy."
NR: Do you remain an optimist about the process of change, or do you see it as a long, arduous process?
David Korten: I don't think we have much time. We are coming into a time what systems theorists call "overshoot." We are so rapidly destroying the fabric of society and the regenerative capacities of the ecosystem. That what happens is just like with global warming and the best example is the ozone hole. We put everything in the atmosphere and by the time that we have irrefutable evidence that it is causing an ozone hole and it is a threat to life, it is too late to do anything. In these conditions of potential overshoot we have got to use our intelligence to anticipate and exercise the precautionary principle. In my view, if in the next few years we have not made a breakthrough in terms of consciousness where there is a general recognition that the path we are on is not only failing but is also disastrous, and if we don't start getting on with our innovation and a serious process of learning how to do things differently, then we will be in a position where more and more people will become so desperate that the only issue is, 'How do I live tomorrow?' and not 'How do I create a system which will allow me to live to the day after?'
NR: What are you doing to change this consciousness? I know that you are quite enthusiastic about different ventures that you are involved in?
David Korten: I use every opportunity I can with groups that can hear and be multipliers to communicate the message. One of the initiatives that I am most excited about is the Positive Futures Network, which publishes Yes, a Journal of Positive Futures. It is a small fledgling enterprise but what we are trying to do is build an organization and a publication which will help people see that there really are alternatives and deep and fundamental and profound culture shift taking place around the world and that there are all kinds of initiatives underway by citizens which are creating the building blocks of a new society, consistent with new values. This is a source of hope; it is in sense advertising that there is an opportunity and also communicating the message that every individual has not only the opportunity but also the obligation to join in creating a better world.
This article was published in New Renaissance, Vol. 7, No. 3, and the interview was made in May 1996 at the Society for International Development's Conference on Globalization in Santiago de Compostella, Spain