Another, more fundamental reason for political confrontation is that the reigning dogma of globalization has failed, visibly and catastrophically, for developing countries (and less obviously for some wealthy nations, too). A decade ago, when the globalizing forces were accelerating, strategists at major multinationals used to talk ambitiously about the "big emerging markets"--the five countries with the greatest promise for investment and growth. The Clinton Administration picked up the "BEM" line and made a half-baked economic policy of courting those nations: China, India, Mexico, Brazil and Indonesia.

Three of them have since been mangled by globalization. Mexico fell off the list in 1995 when the peso collapsed and the Salinas "miracle" was exposed as a fraud. Indonesia's prospects were smashed by financial crisis in 1997. Through no fault of its own, Brazil was brought down the following year by the financiers' panic that swept around the world, randomly collapsing currencies and economies. In each instance, Washington and Wall Street blamed "crony capitalism" or incorrect management of national finances for the failures. These explanations became far less persuasive after the United States encountered the same disorders--the scandals of corrupt corporate accounting and a rising tide of foreign indebtedness.

For developing countries, the boom-bust experience taught a searing lesson: The center cannot be trusted to run things or to provide sound economic advice. Argentina followed the rigid discipline of the Washington Consensus more faithfully than any other Latin economy. Yet its policies also failed, in 2001, and plunged the country into devastating recession, discrediting the US orthodoxy. Nations large and small are now united in the need to escape the "golden straitjacket," as pundit Thomas Friedman called it. The trick is doing this without offending the world's only superpower or losing entry to its largest consumer market.

Lula's grand ambitions illustrate the historic obstacles. Uniting South American nations in a common cause, if not a fully developed federation, is a very old dream, championed 200 years ago by Simón Bolívar. But his campaign was centered in the northern colonies of Spain, not Portuguese-speaking Brazil. Given the history of continental conflicts, the first step may be at best only a modest platform for trade cooperation and joint public works. A "United States of South America" will remain a distant dream.

Lula's global coalition seems off to a more promising start, and if China joins, it will have impressive muscle. This idea, however, has also failed before. The movement of nonaligned nations during the cold war never formulated a robust ideological alternative beyond declaring they were in neither the Soviet nor the US camp. Brazil never joined, though it sent representatives to the meetings. Most nations merely used nonalignment as a bargaining chip with the two rival superpowers. Some countries cleverly managed to win aid and arms deals from both. The same pressures to cut a separate deal with the big boys will test the new formation.

In any case, the center is not holding. India is trying to organize a Southeast Asia trading zone. China and Japan have made similar noises. American and European leaders denounce freelance alliance-building by Lula and others on grounds that it will balkanize the "one world" trading system into many potentially protectionist blocs. But this is deeply hypocritical, because Washington and Brussels are themselves doing dozens of such side deals with smaller nations and regions.

The fundamental problem is that global economic integration cannot proceed with stability under the undemocratic canopy of the WTO, which is designed to serve multinational commerce and investment but not the aspirations of national cultures, economic equity or human values. Events are making clear that the WTO cannot enforce its own commandments, nor can it reform itself. The world, in a sense, is stuck halfway between global governance and the nation-states. Nothing illustrates this better than the current flap over steel, with the United States caught between the demands of its national producers, who want tariffs, and the WTO, which, pressed by European steel-producing nations, has ruled such tariffs illegal. Most nations are too weak to defend their interests while standing alone, yet joining the global system makes them subservient to the powerful few with colonialist appetites.

The future of globalization may actually become more equitable if nations first accept the need for intermediate organizations like regional trading blocs, which can experiment with home-grown development strategies and collaborate on how to synthesize economic goals with social imperatives. Governments would gain greater proximity to the decision-making, but so would citizens with diverse views of how the future should look. The WTO would perhaps continue to exist, but its stalemated condition would not halt the possibilities for progress.

The more localized context would seem to be a better laboratory for advancing global reforms like labor rights, environmental values and democratic self-government. The global-justice movement would have to rethink its strategy, but could achieve far more tangible results in regional settings, instead of the negative victories of blocking the multinational agenda at the WTO. If the US government were not so beholden to the multinationals, its diplomats might see Lula's initiatives as a great opening for a different kind of FTAA--a chance to work out mutual terms for advancing social goals and economic development in tandem. As it is, Washington is using its power unilaterally to discredit and destroy this visionary leader. Americans might ask themselves: Is that really in our long-term national interest?

• « Previous
• 1
• 2
• 3
• 4

• Get The Nation at home (and online!) for 75 cents a week!
• If you like this article, consider making a donation to The Nation.