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Global crisis, global reform

By Peter McMahon - posted Monday, 24 September 2012


There is growing debate about the current global economic and environmental crisis and the need for the fundamental reform of global civilisation. A number of books, articles and blogs have appeared discussing the crisis and forecasting a century of low growth, cascading problems and potential civilisational collapse. The crisis is usually identified in terms of the failure of increasingly financially determined capitalism but also in relation to emerging environmental limits to growth.

In response to this crisis, a plethora of views are emerging that are orientated towards identifying the basis of a new and more sustainable global civilisation. This article is a contribution to that debate.

Firstly, let us identify the essential problems that constitute the global crisis. There is the global economic crisis that segued out of the global financial crisis beginning in 2008: the bottom line is that almost everywhere both economies and governments are drowning in debt that cannot be repaid under normal circumstances. This problem is already taking on serious social and political dimensions as witnessed by the rise of extremist politics in many countries, including in Europe and the US.

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The second aspect is the environmental crisis, of which global warming, peak 'everything' and loss of biodiversity are perhaps the best known issues. Basically, our phenomenally productive mass-industrial civilisation is using up such high levels of resources, generating so much waste and displacing so many natural systems it is beginning to hit physical limits.

These limits include the atmosphere, oceans and land as their capacity to provide raw materials and soak up wastes fast diminishes. Pollution, including carbon pollution and increasingly toxic industrial products, has become a primary problem at a global level. The availability of resources like oil and fresh water, and even arable land itself, is also facing critical limitations.

To deal with these and associated threats, the argument goes, we need to completely reform the way we do things as a civilisation. Tinkering at the edges just won't cut it.

The core themes of reformist ideas are these: the need to revitalise democracy; the need to more effectively mediate international disputes and create a genuine global governance structure; and the need to control transnational corporations and global finance markets. In other words, to radically transform or entirely replace the major institutions of late modernity.

The main underlying thinking behind most constructive criticism of the current global civilisation is that core institutional structures and arrangements have outworn their usefulness and need replacing. These institutions include the sovereign nation-state, the large business corporation and unfettered global finance markets.

The nation-state, which has been in large part undermined over the last few decades by the rise of the transnational corporation and global finance market, is exhibiting two main problems. Internally, it is losing credence due to what has been termed the 'crisis of democracy'. That is, national populations do not see national governments as being credible and they increasingly fail to participate in the democratic process. Voter apathy and the loss of support for major parties are aspects of this. The result is governments increasingly prone to capture by vested interests ruling over increasingly disengaged and apathetic populations.

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The second problem is that in an age when most of the important influences on modern life are global, the nation-state is no longer the best institution to deal with global issues. There has been a realisation of the limits of national scale organisation for centuries, most clearly displayed in the tendency to engage in warfare. The League of Nations and the United Nations were both attempts to reconstruct sovereignty at a supernational level and so minimise the resort to war.

Not only do they not cooperate well enough, nation-states still prepare to go to war with each other. Current military spending is around a trillion and a half dollars, around 2.6% of global domestic product. Up 50% since 2001, this activity costs $236 per person. Ending global military completion would unleash vast amounts of resources (the Pentagon is the largest single user of oil) and people that could be put to productive use.

Climate change is the classic global problem: fossil fuel-based energy burned anywhere contributes to heating everywhere. Despite global consensus about the basic science, resulting in the UN-sponsored International Panel on Climate Change (IPCC), nation-states have been slow in collaborating to deal with the causes. There have arisen structural conflicts, such as the richer, more developed countries versus poorer countries, but all in all the problem remains national governments putting short term national interests over longer term global needs. As far as fixing global warming goes, almost all governments are trying to get away with being free-riders, undermining the credibility of all.

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About the Author

Dr Peter McMahon has worked in a number of jobs including in politics at local, state and federal level. He has also taught Australian studies, politics and political economy at university level, and until recently he taught sustainable development at Murdoch University. He has been published in various newspapers, journals and magazines in Australia and has written a short history of economic development and sustainability in Western Australia. His book Global Control: Information Technology and Globalisation was published in the UK in 2002. He is now an independent researcher and writer on issues related to global change.

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