SASKIA SASSEN is Professor of Sociology at the University of Chicago and Centennial Visiting Professor, London School of Economics. Her most recent books are Guests and Aliens (New York: New Press, 1999) and Globalization and Its Discontents (New York: New Press, 1998). Two of her earlier books have been reissued in fully updated editions in 2000: The Global City and Cities in the World Economy. Her books have been translated into ten languages. Her edited book Cities and Their Cross-Border Networks, sponsored by the United Nations University, will appear in 2000.
Question: In Seattle, some Third World governments argued that proposed labor and environmental standards would have the effect of denying their countries needed foreign investment. Are they right? Are there ways to insure public, social investment in poorer countries if they reduce their "comparative advantage" in substandard wages, working conditions, and environmental regulation, and thus lose private investment? Do aid and debt relief offer sufficient answers?
Answer: Yes, there are ways for developing countries to obtain needed social investment while adhering to labor and environmental values, but this requires enormously innovative work and the political will to carry it through. Implementing such standards would, at least initially, raise the costs of producing goods and services for local firms and for foreign firms either directly operating there or using local subcontractors -- which is where the threat of losing competitiveness sets in. It would take a concerted effort on the part of developing countries to implement such standards, at least in those sectors that are export market oriented or in the hands of foreign firms. Capital will shun poor countries that try to maintain decent labor and environmental standards -- unless all poor countries join together to insist on the same standards. The highly developed countries have worked at such concerted efforts in order to institute a whole variety of policies that make the existence of a global capital market possible, and that secures certain guarantees for firms operating in developing countries. They made their cake and ate it. Why can't developing countries do this? (Remember OPEC in the 1970s -- it stunned the rich oil-importing countries. Too bad the money was not better used by the exporting countries.)
I think there are at least two extremely important issues here that are part of the picture. First, the lack of alternative conceptions to the neo-liberal norm for thinking about development among the leadership in the developing countries. This is in good part due to the fact that government and corporate elites in many of the developing countries are becoming integrated into the zone of prosperity that globalization produces. These elites are developing vested interests that coincide with the process of economic globalization. This alters the political landscape radically: there was a time when, in Latin America, for instance, the leadership was deeply nationalistic, against privatizing public sector firms and strongly against allowing foreign ownership. These elites were by no means devoted to the well being of their people, but they had an alternative conception that they could use to confront U.S. transnationals. That is gone among these new elites. This tells me that the leadership will have to come from somewhere else -- from various domains of activism and from social movements.
The Seattle and Washington protests were so important because they signaled that the leadership and the energy are there -- the willingness to confront and engage power and to fight for what might seem an impossible objective. They signal that it can be done; making these voices present has already had an impact on mobilizing more and more people who may have wondered how one can fight concentrated power. It has had an impact as well on many elites -- you hear more and more talk of the "problem" of inequality -- though there are of course risks of this type of discourse becoming a platitude on the part of entrenched elites.
Q: Workers in wealthier countries fear that they are losing jobs to workers in countries with lower wages and labor standards, and will lose further ground as globalization continues. Are these concerns grounded in reality? If so, are there ways to have full employment and high wages in more affluent countries without hindering the economic development of poorer countries? What is the relationship between the economic well-being of workers in wealthier countries and the living standards of workers in the Third World?
A: People in the highly developed countries need to support the efforts of less developed countries to find the way to resist the race to the bottom. From the research I have been doing on the global economy over the last 15 years I see it is constituted through multiple highly specialized cross-border institutional domains. So one way of thinking about organizing and doing political work is to unpack the global economy into these specialized domains and launch actions and do organizing and educational work inside each of them. The world of human rights activists is different from that of environmentalists, from that of first-nation people struggling for direct representation in international fora, from that of feminists struggling for certain types of women's rights. Yet the overall impact is one that goes in a shared direction. Well, we can see the same in the global economy: the world of anti-trust regulators is different from that of international arbitrators, from that of the crowd working on international accounting standards, from those working on making new law at the World Trade Organization, from the financial services firms, from the legal services firms, from the telecommunications services, and so on.
It just strikes me that we should think of organizing around the issues you raise in the first two questions on these multiple, specialized fronts, with a common objective of instituting labor standards, environmental standards, accountability standards, etc. We cannot hope to bring the concentrated system of power to its knees by engaging it from the outside so to speak, though we need to keep on doing this -- as in Washington and Seattle. We need to work also from the inside (and use all those knowledgeable lefty academics, lawyers, journalists).
The implementation of agreements such as NAFTA also constructs a zone that can be entered to launch actions that are different from those that the creators of the institutional framework intended. In fact, I could say that after years of not knowing how to handle it, U.S. labor has now found a way to engage in joint efforts with workers in Mexico within the framework of NAFTA.
Q: Is "protectionism" sometimes justified? By richer countries? Poorer countries?
A: That is a tough one. I think we need a better understanding of what made protectionism work and for whom. It worked to bring about an expanded middle class and empowered working class because the mode of economic growth was deeply embedded in the necessity of internal mass consumption: the wages and salaries of workers mattered for economic growth. Today, this has changed: intermediary consumption has become enormously important (that is, firm-to-firm buying); luxury niche markets are increasingly important for final consumption; and finance has created a mode of wealth production that does not really need the large masses of workers. So I am not sure that under current conditions protectionism would have the positive effects it had in the 40s, 50s, and 60s in the U.S., for example, or in some of the Latin American countries.
Second, protectionism and that particular form of economic growth left many people out -- we know that was the case for many African-Americans and whites in the U.S. -- and it benefited women less than men, etc. And it enriched a limited number of capitalists enormously. So we need to find alternatives to protectionism. Also, protectionism is too deeply intertwined with the national, and I am not so keen on strengthening the national. On the contrary. I think that thinking/acting across borders, partly disembedding identity from the national, all of this is important for the new era that we are entering. The national state produced war, refugees, exclusions, fanaticisms moving men and boys to go kill other men and boys. . . . There has got to be a better formula.
We need to repossess our states and use them as administrative capacities rather than nation-states.
Q: How can economic growth and development be pursued without further damage to the environment? Can existing environmental damage be reversed in ways that are compatible with economic expansion?
A: This is a complicated, difficult question. I would like to refer readers here to a new Encyclopedia for Sustainable Development I am co-editing with Peter Marcotullio, which has contributions from over 100 researchers and specialists from around the world. This is a multifaceted issue with many different angles and combinations of possibilities, and no one country or situation provides the definitive answer. An example of the kind of answer that is possible is the fact that many cities in rich countries have succeeded in improving their air quality even as they have a growing number of cars.
Q: How realistic is it to envision effective international regulation of corporations and investors to ensure protection of labor and the environment? Even if you think it is unrealistic, is it politically useful to demand such regulation as a way to raise consciousness and project a long-term progressive alternative to the status quo? Are there any dangers to making demands on corporate-dominated governments to involve themselves, even in economic support, for Third World countries? Are there ways to raise demands for support to the Third World that avoid those dangers?
A: Yes, I believe international regulation can be effective, but it will take work and inventing new instruments -- legal, administrative, etc. But then, capital had to do a lot of inventing of new instruments to reconstitute itself as global capital. There is work to be done. And yes, we must demand such regulation. Look at the activities of students against sweatshops: over 30 universities have now signed on to the anti- sweatshop effort. This is a good example of a specialized focus: the initial effort is to get universities to regulate the production of apparel that will carry the label of the university to ensure that no sweatshops are involved. This is a micro-site in each case, but through strategic alliances it becomes a multi-site effort. This is happening in many domains. It is grassroots globalization and grassroots regulatory work. It is one element in the picture. Legislatures and judiciaries are also enormously important.
Q: Should progressives and the left campaign for the reform of the IMF, the World Bank, and the World Trade Organization, or fight for their abolition?
A: I used to think we should abolish the whole bunch. But I have changed my mind on this. Having done so much research on the new private systems of "justice" and governance that global capital is inventing and instituting, I have come to see that we must keep supranational organizations going. But they have got to become more representative, democratic, accountable, etc. That is what this current struggle is about. I think there is great potential here. Because the World Trade Organization is supranational, 132 ministers of trade met in Seattle and WTO could become a target for protest. If it were a private system of governance, this could not have happened -- and believe me, there are multiple private systems of governance that are being instituted as we speak. And we have no access to them. One of our efforts must be to get the current supranational institutions that you and I pay for to be responsive in a far more direct way to mechanisms for representation of a far broader range of claims than is the case today.
Contents of No. 29