Ronald Munck *
Globalization and Democracy:
A New “Great Transformation”?
Annals of the American Academy Political and Social Science
581, May 2002, 10-21.
The relationship between democracy and development is (re)considered to set the scene for the pressing contemporary issue of how globalization might affect democracy and vice versa. To move beyond simplistic binary oppositions, we turn to the work of Karl Polanyi who famously posited a dual movement of market expansion on one hand matched by increasing social control over it on the other hand. We see how globalization, at one and the same time, creates a growing process of social exclusion within and between nations but also the social movements that will contest it and seek to democratize it.
* Ronaldo Munck is a professor of political sociology and director of the Globalization and Social Exclusion Unit (www.gseu.org.uk) at the University of Liverpool. He is a founding executive member of the Global Studies Association (www.mmu.ac.uk/gsa), which is committed to pursuing relevant research on globalization and its discontents. He has written widely on labor, development, and Latin American issues, including most recently the collections Labour Worldwide in the Era of Globalization ( Palgrave), Critical Development Theory: Contributions to a New Paradigm (Zed Books), and Cultural Politics in Latin America (coedited with Anny Brooksbank-Jones) ( Palgrave). He has recently published Marx @2000 (Zed Books) and is now working on a study of how globalization has affected social exclusion both within and between countries.
The extent to which globalization has hindered or assisted democratization is a major issue of the day, whether for social and political thinkers, policy makers, or concerned citizens. The various articles in this issue of The Annals address diverse aspects of theory and practice, range from the general to the specific, and add up, I hope, to a serious contribution to the debates. My own contribution here aims to provide an overall theoretical context and raises some pertinent questions. In the first instance, I relate the globalization and democracy debate to an earlier one on capitalism and democracy (addressed in Munck 1994) that I believe is still relevant today. In the second place, I introduce the main arguments around globalization as a negative and as a positive factor in relation to democratization. Finally, I turn to an old, yet increasingly influential, argument by Karl Polanyi who, in his postwar classic The Great Transformation (Polanyi 1957) argued that there was a “double movement” at work globally, of market expansion on one hand and of social control of it on the other hand.
Development and democracy are clearly two very slippery (labile) terms that are crying out to be unpacked (deconstructed). They are words that take on different meanings in conflicting political discourses. These are words but also clearly sites of a discursive ambiguity. Precisely because of their centrality in political discourse, their meaning and belonging are so contested. They are floating signifiers waiting to be appropriated by different social and political forces that will give them this meaning. Arjun Appadurai, in his influential analysis of the various “scapes” at play in the process(es) of globalization, referred to how the “globally variable synaesthesia” (the stimulation of a mental sense impression relating to one sense by the stimulation of another) of the political and ideological “ideoscope” of democracy “has clearly become a master term” (Appadurai 1996, 37). Thus, democracy can be seen to be at the center of a whole variety of ideoscopes; for example, we could argue the process now known as globalization. What Appadurai directed us to is the complexity and fluidity of the globalization/democracy interrelationships, the profusion of meanings, and what Appadurai referred to as “ever new terminological kaleidoscopes” (Appadurai 1996, 37). Having established that the theoretical terrain is not simple and unilinear, we now need to move toward some clarification.
If we turn to the empirical level, the relationship between democracy and development seems relatively straightforward. In a recent major empirical survey of these relationships, Adam Przeworski and colleagues did not find “a shred of evidence that democracy need be sacrificed on the altar of development” (Przeworski et al. 2000, 271). That is to say, the once fashionable notion that dictatorships, or at least authoritarian regimes, were necessary to force development now seems definitively disproven. Przeworski et al. went on to argue for “inde-
terminacy” with regard to the political context of development: “Political regimes have no impact on the growth of total income when countries are observed across the entire spectrum of conditions” (Przeworski et al. 2000, 270). Democracies do not receive any less investment than nondemocracies even in poor countries. Yet this study does not argue either that democracy is good for development. The prognosis is a fairly pessimistic one, finding that there is little any government can do to produce development in poor countries.
However, at a conceptual level, the relationship between democracy and development is anything but straightforward. While there seems to be a certain elective affinity between democracy and development, we must beware of what Guillermo O’Donnell (1973) called the “universalistic fallacy,” which sees this positive correlation operating in all places at all times. The relationship between these two elements, democracy and development, remains effectively a “black box” (Rueschemeyer, Stephens, and Stephens 1992, 32) where the precise causal relationship remains unclear. While the relationship is indeed a contingent one, we could argue, as Francesco Weffort (1990) did, that “democracy is the only path to modernity” (p. 39), at least if the latter is taken to mean something more than simple economic growth. So from earlier debates about whether development led to democracy, we have moved onto the terrain of democracy as a prerequisite for modernization. While there are no necessary or absolute correlations between democracy and development, we can argue on a normative basis that democracy and development can constitute a virtuous circle and should go hand and hand.
This brief excursus back to the democracy and development debates serves as an introduction to the theme of democracy and globalization. We can posit that globalization represents, if nothing else, a significant worldwide development of capitalism. The development project, which dominated post-World War II history of the “West and the rest,” at some stage of the 1980s gave way to what we can call the globalization project. As Leslie Sklair (2000) put it, “a transnational capitalist class based on the transnational corporations is emerging that is more or less in control of the processes of globalization” (p. 5). So if globalization is a sociopolitical project, what are its sociopolitical effects in terms of democratization? We should probably first have to accept that there is no simple one-to-one relationship; rather it should be seen as contingent and, probably, contradictory. There are, however, two main sets of arguments that we can consider separately for the purposes of presentation. On one hand, we have the arguments around globalization’s deleterious effect on democracy worldwide. On the other hand, we develop the argument that globalization may open doors as well as close them and, at least potentially, creates new prospects for democracy.
There now seems to be fairly widespread consensus that globalization (read economic internationalization) undermines, subverts, or sets limits on democracy (read liberal democracy). For Scholte (2000b), summing up a rather more nuanced argument, the bottom line is that “globalization has undermined conventional liberal democracy, with its focus on national self-determination through a territorial state” (p. 261). We are referring here to a particular, historical, and Western conception of liberal democracy, national territory and sovereignty. For Anthony McGrew (1997b), thinking along similar “transformationalist” lines about globalization, “accelerating global and regional interconnectedness poses distinct challenges to liberal democratic forms of governance” (p. 12). So here also the challenges of globalization to democracy are seen as specific; in other words, what is being placed in question by globalization is the traditional form of national territorial sovereignty. The new flows of globalization, be they those of the financial markets or those of transnational crime syndicates, can easily bypass the traditional national modes of regulation. In essence then, what globalization problematizes is the elective affinity between liberal democracy and the sovereign nation state of the Westphalian order.
It is not hard to show, against the prophets of globalization as an irreversible and positive advance for humankind, that the international extension of market principles will not automatically foster democracy. Markets = democracy only in the simplest of neoliberal economics textbooks, and even their representatiives on Earth, such as the World Bank, now recognize the limitations for capitalism of global free market liberalism (see World Bank 2000). Growing consumer choice (in the North) simply cannot be equated with democratic citizenship. It is now increasingly recognized that globalization has not affected all equally and has, rather, led to an increase in social exclusion both within and between nations (see Woods 2000). The notion that the new mass shareholders in the privatized public utilities or the part-time amateur investors in the stock market represent an extension of democracy is even more off the mark. Global financial markets, as key participant observer George Soros (1998) belatedly recognized, “are inherently unstable and there are social needs that cannot be met by giving market forces free rein... the current state of affairs is unsound and unsustainable” (p. xx). It is clear that it is what Soros called “market fundamentalism” that has rendered global capitalism unsustainable. The move beyond the so-called Washington consensus that has underpinned neoliberal globalization has already begun - albeit hesitantly and to a large extent behind closed doors - in the corridors of power.
Another area where globalization could be seen to further democracy is in relation to the new electronic communications. On the back cover of a recent book, Communities in Cyberspace, we read, “In cyberspace,
communication and co-ordination are cheap, fast and global. With powerful new tools for interacting and organising in the hands of millions of people world-wide, what kinds of social spaces and groups, are people creating?” (Smith and Kollock 1999, back cover). In brief, will the Internet lead to self-governance, and does it represent a durable democratic revolution worldwide? Even enthusiasts for the Net find they must temper their arguments after the first flush of enthusiasm in the 1980s. Whatever their origins (often shrouded in myth), electronic communications do not today represent a simple democratic project (notwithstanding its contestatory potential) but, rather, a capitalist one. The very uneven worldwide spread of the so-called World Wide Web might make us hesitant to embrace enthusiastic Northern-centered arguments for it as vanguard of democracy. Essentially, if global communications (and the new, if already faltering, e-commerce) are part of a global “free” market, their democratic potential will necessarily be constrained.
We may also consider a particular social group, namely, the world’s workers, to consider whether globalization hinders or facilitates democracy. Charles Tilly (1995) was nothing if not forthright in his article on the topic, titled “Globalization Threatens Labour’s Rights” (p. 1). Tilly traces back the origins of labor rights to the mid-nineteenth century in western Europe. These rights were seen by Tilly to have been established through struggles with sovereign states and came to be guaranteed by the modern nation-state through labor legislation and so on. Both citizenship and democracy came to depend on these rights, and in a real sense we can say that democracy was in essence a labor democracy, so central was the worker question. Now, from the mid-twentieth century onward, economic internationalization has, for Tilly, undermined nation-states and hence “their capacity to pursue effective social policies, including the enforcement of workers’ rights” (p. 16). If democratic rights are embedded in states, their decline inevitably undermines democracy. In brief, Tilly argued that “globalization threatens established rights of labour through its undermining of state capacity to guarantee these rights” (p. 4). The case is powerful but, I believe, one sided and therefore not a basis on which to build a strategy for social transformation.
As a way of moving into the next section, I would like to argue against Tilly (1995) while accepting the gist of much of what he said and, certainly, the spirit in which he argued. What I see in Tilly is a seamless argument that does not allow any space for contradiction. I wonder whether we can really state categorically that “as states decline, so do workers rights” or “almost everywhere, organised labour is in retreat” (p. 21). In contrast to this view, however, it is now widely recognized (see, e.g., Moody 1997) that the impact of globalization on workers worldwide has brought about a profound process of rethinking and reorganizing within labor on a global scale, with even the once remote and conservative International Congress of Free Trade Unions advocating such
radical measures as a global social movement unionism to counter capitalist globalization. Labor is not everywhere in retreat, and worker’s rights, though undercut by neo-liberalism, are continuously and vigorously fought for across the world. While on one hand it does not allow for contradictory tendencies, Tilly’s analysis is also itself ultimately contradictory as, for example, when he argued that “if workers are to enjoy collective rights in the new world order, they will have to invent new strategies at the scale of international capital” (p. 21), because the argument remains an abstract one insofar as Tilly can see no openings for democracy under globalization. It is also, in my view, ultimately contradictory because the obvious strategic response in terms of his negative and inherently nation-statist analysis would be to argue that the various national labor movements should simply be seeking to strengthen their respective nation-states so as to thus strengthen labor rights. My argument is simply that we should accept that globalization may open doors for contestation as well as close off certain more traditional avenues. Nor should we forget that we cannot move back to a traditional terrain of struggle when history has moved on.
Today, outside of the more fervent antiglobalization ranks, few analysts would deny that globalization may have positive effects for democratization as well as negative ones. Scholte (2000a) noted cautiously in this regard that while “the new geography has to date made governance less democratic,” on the other hand, “contemporary globalization has [emphasis added] encouraged some innovations in democratic practices” (p. 263, order of argument reversed). What we again see here is that it is the particular form of globalization that has led to a democratic deficit. Thus, alternative or stronger modes of regulation could conceivably make globalization more democracy friendly. Anthony McGrew (1997a) also argued the positive case for globalization: “contrary to these developments [the negative features of globalization discussed in the previous section] globalization is also associated with processes of political empowerment and democratization” (p. 238). This means that we cannot really posit a unilateral or simple meaning to the globalization-democracy relationships. All we can be certain of is that the new concepts of a global politics and a global democracy draw into question received notions of the economy, politics, society, culture, and international relations.
In Argentina, the human rights campaigners against the military dictatorship had a slogan stating that “the defense of human dignity knows no boundaries” (cf. Beetham 1998). General Pinochet found that national sovereignty was no defense when the British law lords decided that he should answer abroad for abuses of human rights committed in Chile. What is important to note, as Anthony McGrew (1995) argued in relation to this topic, is that “the extent to which the traditional
notions of sovereign political space and political community are being reconstituted by the nature of the international human rights regime and the activities of transnational social movements in the human rights domain” (p. 46). The key word here is “reconstituted” because nation-states are being reconfigured and not eliminated in the new global democracy. There is now a transnational democratic terrain infinitely more developed than when the United Nations was formed (cf. Archibugi, Balduni, and Donati 2000). Certainly this global democracy is uneven in its extension across the world, and it would be naïve to argue for the immediate coming of a new cosmopolitan democracy (cf. arguments in Archibugi and Held 1995 and the more critical piece by Zolo 2000). The democratic terrain is simply more complex in the era of globalization.
One of the most interesting debates to flow out of this new terrain is around the nature, or even existence, of global civil society. It seems easier to define what civil society is not - it is neither the state nor the market - than what it is, given the proliferations of meanings and political intentions behind them. For Scholte (2000a), “civil society exists when people make concerted efforts through voluntary associations to mould rules - both official, formal, legal arrangements and informal social contracts” (p. 175). Within this diversity we find old bodies such as the International Red Cross, truly uncivil elements such as transnational criminal syndicates, and the various nongovernmental organizations, community movements, and pressure groups that go under the label of “new social movements.” That these have acquired a grater transnational prominence in recent decades seems incontrovertible - we need only think of the international environmental movement(s). However, while not denying that global civil society can lead to empowerment, we should not confuse wishes with reality and should recognize that it is a fairly recent phenomenon and one not immune to the democratic deficit critique itself.
In relation to labor as transnational social agent, we can certainly note changes in the past decade or so, which point in more optimistic directions than Tilly’s (1995) somber scenario. At every level from the suprastate International Congress of Free Trade Unions to the local union, passing through various regional and subregional levels, labor is responding to the new transnational capitalism (see Munck 2002 for details). Albeit with a delay of around a decade, labor is reconstituting as a social movement and seeking more adequate strategies for the new dispensation as set by capitalist globalization. While some strategists still seek to prioritize the national level against the global level of action (surely the two are not incompatible?), the transnational arena is becoming increasingly important for this particular old/new social actor. What is of great significance is a recent move toward understanding global as transnational but also as universal following Amartya Sen’s
(2000) clear defense of global labor rights: “A truly global approach need not see human beings only as (or even primarily as) citizens of particular countries... The increasingly globalised world economy calls for a similarly globalised approach to basic ethics and political and social procedures.” (p. 127).
Even if we cannot say that globalization is good for democracy (to the extent that we can say it is bad for democracy), we can argue that is has transformed the democratic terrain. While the realist school of international relations may deride global democracy as impractical, they cannot fail to address the growing issues around global governance. The growing buzzword, even in the corridors of power, is the need for life “after competition” (see Group of Lisbon 1995). Global governance is based on national states but accepts a terrain beyond them, the transnational space. This is a space dominated by the giant transnational corporations but also populated by the growing transnational social movements. Democracy in the era of globalization must now include a transnational element. At this level, there is now a clearly perceived need to achieve a greater degree of social (and political) control over the forces of economic internationalization. Democratizing global governance will, arguably, be one of the major tasks in the century now opening up, and its impact will be felt at the global, national, regional, and local levels because globalization impacts everywhere.
Karl Polanyi (1957) wrote at the midpoint of the past century about the great transformation that led to England’s industrial revolution in the nineteenth century. Yet it can also be argued (see Goldfrank 1990) that the great transformation in fact referred to the cataclysmic institutional transformation after the 1930s. In their different ways, the New Deal in the United States, Nazism in Germany, and Stalinism in the Soviet Union were examples of the double movement that Polanyi saw as the means whereby social control could be established over unregulated market mechanisms. In terms of our object of analysis here - the conflictual and multidirectional relationship between globalization and democratization - Polanyi’s problematic of the 1950s may well inspire and provide direction (and historical context) to our inquiries in the first decade of the new century. To begin with, we may start with Polanyi’s definition of the “double movement”:
It can be personified as the action of two organising principles in society... The one was the principle of economic liberalism, aiming at the establishment of a self-regulating market... using largely laissez-faire and free trade as its methods; the other was the principle of social protection aiming at the conservation of man and nature... using protective legislation, restrictive associations, and other instruments of intervention as its methods. (P. 132)
In translating Polanyi from mid-twentieth century to early twenty-
first century, we could begin with the notion of globalization, which if nothing else represents the worldwide application of laissez-faire principles. Polanyi wrote for the nineteenth century that “markets spread all over the face of the globe and the amount of goods involved grew to unbelievable proportions” (p. 76); this is doubly true today, even for those who believe that globalization is only a tendency and that what we are witnessing is mainly internationalization. Yet - and this is why Polanyi is so contemporary - the countermovement(s) through which society protects itself are equally inevitable in the long term. Wherever there was, as with the industrial revolution or now with the globalization revolution, “an unparalleled momentum to the mechanism of markets,” there was also “a deep-seated movement [that] sprang into being to resist the pernicious effects of a market-controlled economy” (p. 76). As distinct from both liberalism and orthodox Marxism, Polanyi argued that this double movement was “the one comprehensive feature in the history of the age” (p. 76) and thus opens up a new research agenda for the era of globalization and its discontents we are living through now.
For Polanyi (1957), a major characteristic of the market society was that it had become “disembedded” socially; that is to say it was uprooted or divorced from its social and political institutions. What a disembedded and self-regulating market economy produces in people is insecurity and social anxiety. Protective counter-movements by society and the state must also seek to block the total disembedding of the market through re-embedding it through state intervention and social legislation. Of course, in the era of globalization, that re-embedding will also occur at an international level to be effective, even more than was the case in the 1930s. As well as re-embedding, what occurs, or should occur, is decommodification of the factors of production and in particular that peculiar commodity, labor. Polanyi revealed in his seemingly naïve assumption that “labour is only another name for a human activity which goes with life itself... .The commodity description of labour... is entirely fictitious” (p. 72), which he followed with the argument that to see social legislation or trade unions as not having interfered with the mobility of labor is “to imply that those institutions have entirely failed in their purpose, which was exactly that of interfering with the laws of supply and demand in respect to human labour and removing it from the orbit of the market” (p.1771).
What this argument is leading up to is a well-grounded understanding of globalization and democracy in terms of a double movement akin to that described and analyzed by Polanyi (1957). Stephen Gill (1995) has argued persuasively that Polanyi’s double movement can be seen as a metaphor for the “socio-political forces which wish to assert more democratic control over political life” (p. 67). In this way, Polanyi can be seen as a theorist of counterhegemonic movements, a tradition given its founding statements by Antonio Gramsci and renewed today in the critical globalization
studies. Of course, this can take various forms, from those who work mainly within the parameters of globalization to achieve some degree of regulation (with many critical globalizers now joining this camp), to the antiglobalizers in the streets by Seattle, through the various permutations in between, where most of the contributors to this volume are indeed situated.
The double movement at the heart of the great transformation(s) points us toward the issue of agency. Both orthodox Marxists and the globalists tend to collapse tendencies - toward self-regulating markets and globalization - into essences. The necessary countermovements of regulation, decommodification, and re-embedding provide us with a less necessitarian view of the world. Contemporary countermovements will, in all likelihood, not lead to a revival of the post-World War II settlement and social contract, because the world has indeed gone through a great transformation since the collapse of socialism and the acceleration of capitalist globalization. Undoubtedly, new global social modes of regulation will emerge. What is certain is that Polanyi, as a precursor of the theory of radical democracy, would be looking to ordinary people for democratic alternatives to current forms of globalization. Polanyi, judging from his anthropological work (see Dalton 1971), would also be attuned to the new politics of postdevelopment and its stress on indigenous cultures and on the overriding need for sustainability as a necessary criteria for any plausible development model, which an unrestricted globalization project is clearly unable to meet.
In conclusion, I believe that Polanyi (1957) helps us get back to basics. We need to examine coolly whether a global democracy is possible (see Gorg and Hirsch 1998) and then whether it is desirable. In spite of sporadic enthusiasm for the United Nations as potential world government, in the era of globalization, very little indicates that this is a realistic option. We do, however, need to recognize that the dynamics of globalization seem to be outstripping the ability of its political shell to achieve stable governance. New forms of governance at a global level are emerging and are likely to be extended both horizontally and vertically. Nor should we ignore the very real potential that globalization - as a social and cultural process as much as an economic one - has to generate new relations and new forms of community at a transnational level. This is likely to be a more complex and messy process than a simple extension of liberal Western democratic norms as seems implicit in the various calls for a cosmopolitan democracy. The world is speeding up, but the political process is now beginning to catch up.
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