Problem: Globalization has shattered the economic structures of the nations.
Solution: The new global economic system should serve the material, intellectual, and spiritual needs of all humanity.
A WORLD ECONOMY
The most important themes in the vision of future economy are (1) that the economies of the world will become one global economy serving the material, intellectual, and spiritual needs of all humanity; and (2) that the underlying force deriving the economy will be spiritual or, in secular terms, ethical.
From the beginning of civilization right up until recent times agriculture has completely dominated the vast majority of the economies of the world. Agriculture could normally meet local needs for food, clothing, and shelter , and consequently communities were largely self-subsisting. There was, therefore, little incentive to have contact with other communities. This tendency to isolationism was reinforced by inefficient and slow systems of transport, by language barriers, and by the sheer risk of travel over long distances even when peace was enforced by mighty empires such as those of Rome and China.
The general picture of the economies of the world over several thousand years began to change with the Renaissance and the rise of Europe. Over a period of three centuries (from the fifteenth to the eighteenth), Europe established contact with most parts of the world. These contacts were vastly strengthened in the nineteenth century by the improved systems of communication of the industrial revolution, systems which were fast, had increased capacity for bulk cargo and for cargo that hitherto would have deteriorated en route: the fast sailship, the steamship, the refrigerator ship, the telegraph.
In the following decades, the trend towards a world economy was the integration of national economies into one system. There are at least two other important dimensions to this process. The first of these is some acknowledgement that the economies of the world are divided by extremes of wealth and poverty and that it is in the interest of all that poverty should be eliminated and further, the distribution of wealth should be more equitable. The great regions of the world, promoting the idea of humanity being one family, have always shown concern for the poor and encouraged charity.
Initially, the move towards a more equitable society was essentially confined to arrangements within each nation, but since the Second World War growing attention has been given to the need for greater equity among the nations. The founders of United Nations (UN) recognized that one of the major flaws with the preceding League of Nations has been lack of sufficient attention to the underlying causes of war: whole nations in poverty and widespread violation of basic human rights.
The third dimension to the evolving global economy is the growing acknowledgement that in physical terms that economy is an integral part of the natural environment and that there will be enormous costs for all if this fact is ignored. The vested interests have resisted practical action to protect the environment, and many were persuaded at first that it meant anti-growth and anti-development. The main initial thrust to protect the environment was within national communities, but increasingly it is recognized that environmental problems do not stop at national boundaries.
The evolution of the economies of the world shows that there is an overriding trend towards their integration into one global system and that this has been paralleled by growing spiritual imperatives with regard to the need first to integrate all peoples into the economy so as to abolish the division caused by extremes of wealth and poverty, and second to integrate them into global ecological system. I would suggest it is of vital importance that we, individually and collectively, accept these historical trends and act to smooth their further evolution rather than attempt to oppose them.
The important economic issues on world agenda should include all the three dimensions of the world economy:
Among the issues concerning further integration of national economies into a real world economy are:
* Extension of the effort to reduce trade barriers to include the agricultural and service sectors, and strengthening of means for enforcing the terms of liberal trade arrangements;
* Stabilization of currency relationships so as to reduce monetary risks in international commerce, with the ultimate goal of a unified currency system managed by a world authority;
* Greater coordination of national monetary and fiscal policies so as to reduce the risk of world recession, on the one hand, and world inflation, on the other;
* Development of international law for the regulation of transnational and global corporations so as to prevent possible abuse of monopoly, exploitation of employees in different countries, avoidance of fair taxation, and environmental regulations, etc. Among the issues concerning further reduction of extremes of wealth and poverty are:
* Should the real goal be true equality of opportunity rather than direct greater equality of wealth regardless of effort?
* How best to ensure that reduction in poverty continues while pursuing policies to make the economy more efficient through such means as reducing the public sector, decentralization, deregulation and increased competition, lower and less progressive taxation (all policies that are being pursued in varying degrees in socialist as well as capitalist countries). Experience so far suggests that, in the short run at least, such policies are INCREASING the number who are impoverished.
* Can the problem be solved by changing the welfare state so that it is more targeted to benefit the poor, by greater emphasis on training, by encouraging dispersal of wealth through taxation of inheritance according to the recipient rather than the donor, greater use of profit sharing, and by elimination of racial and sexual discrimination in employment?
* How best can we convert the phenomenon of an aging, static population in rich countries into an asset rather than liability?
* What is the optimal model for an educational system, a key input and output of any economy? What should be the mix of sciences, arts, and ethics? What proportion of the population should have the opportunity to receive secondary and tertiary education? What role should the teacher have in society?
* What to do about the international trade in drugs that destroys the lives of millions and vastly increases the power of criminals, and yet at the same time represents for many poor countries one of the main sources of foreign currency necessary to buy vital imports?
* What to do about the economic consequences of the arms race and the international arms trade? What is euphemistically called "defense" consumes or wastes some six percent of the world's gross annual product, but at the same time, provides employment for large numbers of people;How to make international aid more effective and attractive to donor countries?
This question raises such issues as:
- Involvement of aid recipients at the grassroots level in the choice, planning, and management of their projects so that they have a real sense of ownership;
- Greater involvement of women; - Elimination of corruption in aid programs, both in donor and in recipient countries;
- The problem of continued rapid population growth in Third World countries, which aggravates food shortages, slow down efforts to reduce per capita poverty, and presents a major threat to the world's environment;
- Revival of the rural sector so as to improve the food supply and reduce the growth of the slum megalopolis; -
Ensuring that International Monitory Fund (IMF) programs to stabilize economies do not hurt the poor;
- Finding ways to relieve the international debt of the poorest countries without discouraging future international investment in these countries. Among the issues concerning the reconciliation of a growing world economy with the need to protect and strengthen the natural environment are:
- What is the most efficient and least risky approach to the energy problem: nuclear power, fossil fuel (oil, coal, gas), hydroelectric power, renewable power resources (wind, sea, sun), greater efficiency in the use of power, or a switch in the mix for goods and services in the output of the economy so that the need for power is reduced?
- How to make natural agriculture and traditional cultures as efficient as the environmentally damaging modern system based on monoculture and chemical fertilizers;
- How to manage the oceans, forests, soils, and rivers for the maximum long-term benefit of all;
- Is the Western consumer society with its present emphasis on massive use of resources to produce extravagant, disposable goods a practical or desirable model for a development strategy intended to abolish international poverty?
In considering these questions, it becomes apparent that the issue is not just a matter of moving in accordance with the tides of history. Underlying any approach to the economic agenda are some deeper philosophical questions, including at least two concerning our perceptions of what it means to be a human being.
First, we have to decide if humans are merely superior animals with interests that are essentially materialistic, or if they are distinguished from the animals by a spiritual side to their nature that yearns for the transcendental, as is the theme of religion.
Second, we have to decide if humanity is a collection of groups contending for dominance in one world, or if it is one family - another theme of religion.
With regard to human nature, it is, of course, fashionable to have a pessimistic view that humanity is essentially self-centered, greedy, selfish, and violent. But a moment's reflection show that this view is one sided. Human beings do have a spiritual side to their nature, as shown in noble actions, and an instinct for the transcendental that even the most powerful of militantly atheistic regimes have been unable to crush in seven decades of rule.
History make it clear that groups struggling for dominance are dangerous to all. To advance, indeed, to survive, we have to act as one family. If we perceive that human beings have a spiritual side to their nature, and humanity is to be one family, there are clear guidelines on how to deal with the economic agenda of the next decade.
If we are in essence spiritual beings, and then the end product of an economy should be those goods and services that help each man, woman, and child do develop their full physical, mental, and spiritual potential. This surely means an economy that puts emphasis on basic physical needs - quality food, clothing, shelter, health care, and exercise facilities - and on cultivation of the mind and spirit - education in the arts, sciences, and ethics, skills in crafts and native culture, appreciation of nature.
If we are one family, then in economics, as in politics and social affairs, the spirit of management should be cooperative and mutually supportive. Competition and striving for excellence is indeed to be encouraged, but with the purpose of maximizing service to humanity, rather than mere self-advancement. Elimination of poverty throughout the world will be of the highest priority. The cessation of war between nations would alone release large resources for the relief of poverty.
To summarize, the opportunities for the advancement of humanity by the evolving world economy are immense - greater even than those that occurred with the introduction of agriculture and with the coming of the Industrial Revolution. But to exploit these opportunities, the right decisions have to be taken, and that will to a large extend depend on the system of values that we follow.
John Huddleston is the Assistant Director at the International Monetary Fund (IMF) in Washington D.C. This partial summary is extracted by Farhang Sefidvash from an article with the same title published in the Journal of Bahá'í Studies, vol.3, no.3, 1991.