Investing Petrodollars in Entrepreneurs and Building Social Capital in Fragile Democracies
Elsewhere on the website, www.jimdewilde.net , there are three pieces which provide the foundation for the following essay: (1) From Durand to Ahtisaari, the New Political Cartography, which explores the challenge for international law in dealing with the post-colonial residue for border disputes and states which cannot create the domestic social capital required for building sustainable prosperity; (2) Human Rights Jurisprudence After Darfur, which looks at the role for international politics to pursue rule-of-law based liberal interventionism by means other than those which were used in Iraq; (3) Creating Value Through Entrepreneurship in Angola and Kazakhstan, which seeks to link international business thinking with the kind of capital market reform required to produce the politically-accelerated end of poverty. This piece is intended as a broad policy statement based on the three other essays/speeches and is an ongoing part of the discussion among Canadian and American foreign policy makers who are trying to work through the routes to the new multilateralism. There is much more work required on the new capital markets, the role of remittances and economic savings, much being done in international institutions. All requires we focus on capital markets that allocated resources to talented entrepreneurs within an economy protected by the rule of law. I believe that demonstration effects work, and that the international community has to focus on Sri Lanka and Somali with the same energy devoted to Iraq and Afghanistan in order to create positive precedents. I also believe that academic institutions have to bring together case studies of proponents of human rights and the rule of law in a framework which emphasizes their interconnectedness. Reason is the universal language which trumps the cacophony of Babel.
The resurgent Taliban is financed by money obtained from the mature opium crops, now five years after the overthrow of the poppy-destroying Taliban.
The 1909 treaty between the British Empire and the Kingdom of Siam is now the cause of a crisis in the rise of Muslim fundamentalism in the southern Thai provinces of Pattani, Yala and Narathiwat. The treaty did not involve the participation of the ethnic Malays who were “ceded” by the colonial power to Thailand.
These problems were anticipated. There was simply no mechanism to deal with them. The framework of international politics lacked mechanisms for acting. Ad hoc coalitions either failed or succeeded in situations like Kosovo, Sierra Leone, Rwanda and now Darfur, Somalia, southern Thailand. Like the great Gonalez Inarritu film, Babel, we are now living in an interconnected world and sometimes are only vaguely aware of the interconnectedness. A century-old treaty between the Siamese and the British can have ripples through the global community. The reality of opium markets in Central Asia can affect the security system on which North Americans depend and put our Canadian soldiers at greater risk in Afghanistan. This is the beginning of our new multilateralism, in an interconnected world with many players, not a superpower-organized chess game structured for strategic negotiations.
The convergence of international crises in 2006 has underlined the need for this new multilateralism in the world. The next generation of U.S. political decision-makers seems to understand that the era of unilateral action is now over. One hopes that the lessons learned include that there is no U.S. monopoly on expanding the global rule of law and that in many instances, U.S. involvement can be counterproductive. One of the great strengths of the U.S. is reflected in its economy. There is restless energy, constant innovation and capacity for self-renewal, an engineering-driven approach to problem-solving and technological solutions. These qualities do not always work in international politics. As a result, the rest of the world tends to look at a different track record, a failure to read historical patterns and a frequent confusion of nationalism with a threat to global order. The challenge for the world is how to prepare for 2008 while managing the international system until then with the lame duck Bush Presidency. Canadian foreign policy has to focus on this challenge. The discussion of what is required for a new practical and democratic multilateralism to take place needs to begin now.
There are at least four great opportunities for innovation in the international arena that can be begun while we are experiencing a long overdue renewal of ideas in London, Paris and Washington as well as in Ottawa:
(i) The new multilateralism can create global capital markets that ensure energy revenues are used to create the conditions for entrepreneurial growth in emerging markets: To ensure that oil revenues are reinvested in sustainable development and rule-of-law based entrepreneurial growth in the regions from where the oil came. It is a truism that oil has been a curse in most of the world outside of Norway and Alberta. Now is the opportunity to design a political economy of oil which transforms oil revenues in the Gulf of Guinea and Central Asia into entrepreneurial capital. If oil revenues were converted into productive capital and pensions, it would transform the African and central Asian economies. It has to be done by an innovative rule of law to create efficient long term capital market activities.
(ii) The new multilateralism can create a framework for a global rule of law which manages many of the latent disputes that impede the development of successful institutions around the world: As an outgrowth of the work being done on human rights commissions and the debate about who is a terrorist and who is a freedom fighter, we need to approach the issues which have been swept under many rugs for two generations – the issues of post-colonial boundaries which were implemented without the consent of the governed. A new multilateralism has to deal not only with questions of morality and international law towards Kurds and Burmese, Tamils and Afro-Sudanese but with all the unresolved disputes of colonialism which make coherent politics and dynamic growth impossible and now threaten the international system. The trials in Sierra Leone will take a significant step towards documenting this, but the future of Baluchistan, Kurdistan, Somaliland and a hundred other “border disputes” or post-colonial failed or weak states will test the international system for the next few decades. An attempt to establish a rule of law framework to correct colonial arbitrariness (the Durand line between Pakistan and Afghanistan) would go a long way towards reducing the number of future Iraqs. For those of us who would like to increase the rule-of-law based international system, there are some possible first steps. How is Somaliland different from Slovenia? Or Northern Cyprus. To make the rule of law the guiding principle for dispute resolution, we need some clarity (and debate) on these “theoretical” issues. If the answer is an invocation of realpolitik, then at least we would know where we stand.
(iii) The new multilateralism can start the redesign of the institutions of international harmonization and economic management replacing the post-1945 frameworks with management cultures and mandates appropriate to the digital age: The institutions of international governance have been in need of an overhaul for a long time. A Security Council permanent membership and a G-8 which is more reflective of the global realities of 2006 would go a long way toward creating a new dynamic in the international system. One is repeatedly struck by the quality of officials working in international agencies. The problem is threat they have few buttons to push. The more China, India, Brazil and Russia are engaged in international problem-solving, the more likely we are to have effective international institutions. In the new era, it is essential that Brazil (or Indonesia, Malaysia, Kazakhstan for that matter) be challenged to play a role in places like Darfur. It is also essential that the redesigned international institutions represent those countries with a demonstrated commitment to the rule of law. The image of human rights abusers on the UN Human Rights Commission did almost as much damage to the credibility of the UN as its demonstrated weakness in ending the killing fields of Rwanda or Darfur.
(iv) The new multilateralism can understand the “wisdom of crowds” approach to data collection and commentary on the internet is already creating new networks for political action. This is case law for the 21st Century. From the Finnish role in the resolution of the Aceh-Indonesia disputes to continuing attempts to resolve through UN mediators Cameroon-Nigerian border disputes, the Sri Lanka civil war, the Ethiopia-Eritrea border disputes, we are creating a set of precedents and prototypes. In themselves, this case law will be a building block for the next generation of political activists, increasingly conscious of the global precedents and inspirations. This gives us the chance to help the next generation explore ways to design interconnectedness and navigate interdependencies. As in so many other areas of public policy, the simple existence of the internet creates the possibility of designing new approaches to the way we view international law. Law students can collect data about individuals in Darfur and document land use, migration patterns and economic geography in the Eritrea-Ethiopia border area. Knowledge does not in itself set us free, but it does create options and amplifies the demonstration effect of shared comparative experiences. The era of web-organized information provides opportunities to pool strategies, to build collaborative networks and promote prototypes of political innovation.
For Americans, many believed in the recent past that unilateral response was required because there was no credible multilateral option. A renewed multilateralism opens the possibility that American security can be more effectively pursued by other means. By pushing the issues of global capital market reform, fixing the negative residues of colonialism and acknowledging we need serious institutional redesign in the machinery of international law, international decision-makers can set the stage for the construction of this more effective multilateralism.
For U.S. political leaders, the challenge is to create the credibility for this new multilateralism. The challenge for the next generation of U.S. Democrats, in particular, is to show that their ability to build a new multilateralism increases the real security of Americans living in Sante Fe, Denver and Cincinnati. It could allow the U.S. to step back from the need to be a global police actor, a role it has played unwillingly and poorly, simply because there was no multilateral alternative.
For Canadians, the effort to fix multilateralism has collateral . Too often, our position on international affairs involves an abstract invocation of “multilateralism” without acknowledging that there is no multilateral capacity to do anything. Our foreign policy too often looks as though we are enamored with process-oriented multilateral frameworks and have lost focus on the things they were intended to accomplish. By setting our foreign policy priority on fixing the multilateral process, we actually do something useful within our capacities. This will enhance our credibility and provide some concrete steps to “punching above our weight”.
In Canada, our multicultural framework provides us with a potential, as yet unrealized, to link with hubs in Dubai, Singapore, Taipei, Shenzhen, Bangalore and Kuala Lumpur to build a very different model of a 21st Century knowledge-intensive competitive economy. To do this, we need to become a global leader in issues like the empowerment of women, the key to economic development, astutely recognized in many of the recent Nobel Peace Prize awards. We need to earn credibility by playing a strategic and focused role in places like Somalia and Sri Lanka, the way the Finns have done in Kosovo and Aceh. This requires that we consciously tap the creative energies of those new Canadians who have adopted Canada’s democratic framework to advance global agendas. We see this next generation of multilingual, globally-oriented talent in all political parties in Canada. This strengthens our hand in building a new multilateralism. Our foreign policy agenda needs to link this talent to the practical issues of building a new multilateralism.
By refocusing Canadian foreign policy around the building of an effective multilateralism, Canadians can make a significant contribution to global security. Canadian foreign policy can play a role with other non-colonial western nations (e.g. Finland, Norway) whose perspective is different from the Americans and European powers. We are at an early stage in this new process. History will organize the calendar as: 1945-1989, the Cold War, 1989-2006, managing a globalization led by technology, the internet and satellite communication. Then the period from 2006-20xx, which will be defined by how successful we are in building a rule-of-law based multilateralism from here onwards.
When the Durand Line meets Globalization – Creating Successful States and Building Social Capital in the 21st Century
Ethnic conflict within artificially constructed geographical boundaries is now one of the most important topics of international politics. We cannot and should not redraw every boundary, but we had better start thinking about these issues. They already impede economic development and block strategies for eliminating poverty. We need the case law to show that law can compensate for the political cartography of colonialism and that legitimate grievances will be addressed because we want to create a framework of global rule of law. We want to create viable states and avoid the 21st Century specter of Somalia, Iraq and Afghanistan, the collision of globalization and post-colonial political cartography.
In 1893, Sir Mortimer Durand arbitrarily decided the border between Afghanistan and Pakistan. There was of course no referendum on its political acceptability to anyone who lived there. The borders that were decided in European capitals define the globalizing post-colonial world of today.
In the 21st Century, former Finnish President Martti Ahtisaari successfully negotiated between the Aceh Independence movement and the Indonesian government a workable arrangement. This achievement which many thought would win the participants the Nobel Peace Prize was the beginning of a new process of political cartography and dealing with the residue of colonialism. From Durand to Ahtisaari, the international community is moving in the right direction.
But when the Durand Lines of the post-colonial world meet the contemporary realities of globalization, so-called “failed states” erupt into global security issues.
Many of the present crises in the world are in significant part problems of political cartography. This is even more the case of some of the crises we can anticipate which are often labeled the crisis of “failed states”. In the next decade, the global community will have to address (among other zones) the questions of Baluchistan, the Fergana Valley in Uzbekistan, and the northeast African borders. When the Durand Line meets globalization, brushfires can become volcanoes. Instead of marginalizing the areas trouble spots, globalization has brought all our histories home to us. One of the challenges of the 21st Century is to deal with the residue of colonialism which limits the development of effective states and capital markets.
The significance of failed states goes beyond the issues of terrorism, although that will drive the international security discussion. The epidemiology of disease from viruses in Africa to avian flu emphasizes the importance of functioning institutions on a global basis. In Angola, the need to curtail the spread of viruses has made the poor institution-building and dysfunctional cartography of Portuguese colonialism intensely relevant. The global community has a stake in a well-functioning Angolan state and health bureaucracy. The global community needs an effective Angolan state with the capacity to monitor virus transmission, deliver health care infrastructure and record the traditional medicines which ameliorated these problems in the past.
In the post-9/11 world we live in, there is an appropriate world-wide condemnation and enforcement of all activities that are rebellions against recognized authority. The behaviour of Chechens, Tamil Tigers, and private militias in Congo or Somalia is correctly labeled as unacceptable by the community of international law. However, for this stated rule of law to be credible internationally, the next generation of foreign policy makers must attempt to provide a framework for resolution and or management of all the Durand lines which clutter the world map. These residues of colonialism frequently stop the development of “social capital” or effective government required to generate the preconditions for sustainable prosperity in emerging economies. Realpolitik ensures that the global community will focus on “crises”, but international law can attempt to have an early detection system for emerging zones of conflict. We can only acknowledge that and push for a political cartography that, in the best traditions of utilitarianism creates the greatest good for the greatest number and removes as many failed states from the global map as is possible. This required diplomatic negotiation like Aceh and also political imagination in the construction of new state structures, like Catalonia or, increasingly, Kurdistan.
We are now in an era where the value system of what Tony Appiah calls “liberal cosmopolitanism” is in clash with simplifiers or fundamentalists, from Beirut to Kansas. All places are afflicted by fundamentalisms that are deliberately simplistic responses to the complexity of our time. The consequences of this response to globalization in a world where there are hundreds of Durand lines and political institutions that fail to create social capital are increasingly serious.
“Liberal cosmopolitans” have to accept the reality that in failed states and communities, it is extremely difficult to build “social capital” when politics is about the full-time mediation of geographical disputes between communities. The great successes of liberal cosmopolitan building of social capital, e.g. the Indian Congress Party, are not easily exportable models. In the post-Cold War era, the examples of Slovenian or Estonian democracy-building are more typical. These regimes, both successful, were significantly propelled by a liberated nationalism that was channeled towards democracy. The South Korean model of economic growth and social liberalism is a similarly fusion of a traditional nationalism required for survival channeled into a growth oriented and socially liberal agenda. These have proven to be the more frequent models for creating new areas in the global economy defined by their acceptance of the rule of law and their capacity to channel social capital into the preconditions for sustainable prosperity.
The global community knows several things that it didn’t know a decade ago about nation-building, peace-making and the role of social capital in creating the conditions for sustainable prosperity. The political agenda for the next few years is going to require sorting them out and developing a global politics based on that solution. The development of a Chinese, Indian, Iranian, Brazilian, Kazakh worldview on managing globalization is a component of this and will influence whether it is to be done successfully. The world of globalization must no longer be confused with the image of spreading American cultural values. Two decades ago, Gorbachev understandably valued McDonald’s for the way it educated young workers about work ethics and productivity. Similarly, other proponents of a “flat earth” valued Wal-Mart for the way it creates an efficient distribution chain. That era of globalization is past. The next issues on the agenda are what we do with the need to create social capital and political accountability. It is important to demand of BRIC countries (and Kazakhs, South Africans and Persians) that they assume proportionate responsibility for these issues as part of the new multilateral legal system.
Let’s start with some counterfactual questions which by definition no one can answer: If the arbitrary Durand line were crossed off the map and an independent Baluchistan existed, how would the politics of south central Asia change? Would there be more security in the “northwest frontiers”? Would it be possible to create more social capital building an economy in Baluchistan instead of spending political energies on resisting influences from Lahore or Tehran?
Obviously, no one knows the answer to these questions with certainty, but we had better start thinking about them. Durandism, the making of maps which have no sense to the people living in the region has collided with globalization making the world a much less safe place and distracting us from even more important issues, e.g. eliminating global poverty. Creating viable states with successful economies and the social capital required for sustained democracy is a challenge from Slovakia to Georgia and East Timor. It is not just an issue of economic development, but of global security.
One size does not fit all, and the solutions for Malaysia are not the solutions for Pakistan, the solutions for Catalonia are not the solutions for former Biafra. Nevertheless, much of the turmoil in the world today stems from not addressing these issues. This requires imagination and flexibility. It requires creating multiple state structures that can manage the oil revenues of regions like the Gulf of Guinea. It is about redesign and innovation within our international political system. The question is how we are to manage these new realities.
First, we need to start to ask how we develop functioning institutions in countries held back by 19th and early 20th century amateur cartographers. The bias against microstates is refuted by relatively peaceful countries with internal coherence like Bahrain and Slovenia. The rule of law must work to resolve these issues. What is the rule of law on Northern Cyprus and East Timor and how does the international legal community differentiate the two cases? A little clarity here would go a long way in figuring out how to mitigate the effect of Durandism on the world of the 21st Century by creating a confidence in the coherence and potential of international law.
Second, multinational states can be made to work if they are not built on exploitative models. It is a constant balancing act in the architectural design of Canadian federalism to ensure that wealth-production is not constrained by regional politics. For multilingual and multicultural states to work effectively there must be other instruments of what Peter Katzenstein called social coherence in his analysis of Switzerland. In Switzerland, national financial institutions provide the framework in with social capital and common purpose can be shaped.
Practical problem-solving starts with finding a few success stories. Peter Galbraith and Shlomo Avineri’s belief in “three Iraqs” and building a progressive, democratic Islamic state in Kurdistan are good starting points for practical analysis. In the long term, we have to look at the legacy of the Durand line, the illegitimacy or telling people to live within borders they had no role in setting, the importance of social capital as a prerequisite for sustainable prosperity, and the insistence that whatever formula is decided from Congress Party to Slovenia, that decision is made democratically. The first step to doing this is to ensure that the rule of international law has a clarity and logic to it as we try to compensate for the effects of the Durand negative legacy without unleashing new tyrannies of parochial chauvinism and fundamentalism.
Political realism requires that every case study be understood distinctly. There are attempts to look at situations where minority rights are threatened systematically as in the MAR project, which is a good start. We need comparative politics and case law to be able to talk about this phenomenon. We need creative political theory to define new institutional structures, post-federal and networked to international partners. Catalonia, Kosovo and Kurdistan are differentiated legal and political entities. We need different categories to deal with the aspirations and challenges of Baluchistan, Kashmir, and Northern Cyprus for example. International law and the mobilization of social capital to eliminate poverty are not the only agenda in an era of multiple threats to our security. The role of international law is to ensure that choices are as free as is possible in a world of competing new states and absent a compelling international legal authority. A world in which young Turkish Cypriots, Shan, and Kosovars compare their role in the international economy is something offered by our networked age. When the next generation of foreign policy makers confront security issues, it would be helpful if they are not blindsided by other “Durand lines”.
The next generation requires that the skills of Ahtisaari be applied where there are many other Durand lines. We will never eliminate ethnic conflicts, but we can start to try to minimize them.