Business as usual is not an option Business as usual is not an option


Speech at the Chinese World Economic Forum, Kuala Lumpur  November, 3.  2011.  Pierre Calame is President of the Charles Leopold Mayer Foundation.

My introduction could be summarized in two sentences in fact. We have made a long way over the past twenty years but the way ahead will be much longer and much harder. And considering the global crisis we are presently facing and that everybody perceives, until now we have walked, but now we’ll have to run. And to run we need a great ambition and a global strategy. That is what I would like to share with you.


So let us look at the past and the long way we have yet made. I have been involved with social economy for quite a long time, and I remember twenty years from now it was over-institutionalised. It was an old movement, a lot of so-called umbrella institutions meeting together, ignoring the others, and pretendind they were presenting something innovative.


The second characteristic at that time was the belief that legal status – one man one vote – or the non-profit legal status were enough to be relevant and enough to be innovative—which should be proved! I remember, when we were discussing that with trade unions, they would say “When we are confronted with work conflicts among salaries and the organization, we could see that either non-profit organisations or social enterprises are not doing better with their salaries, finally, than the classical ones.” So the illusion that it was enough to be different, to do different things in status, was strong at that time.


Third characteristic, the movement was extremely fragmented. I remember, even for the Fair Trade movement, the links between Asia, Africa and Europe were very weak. Everybody was doing it in its own way. There was a juxtaposition of people dealing with social enterprises, people dealing with microfinance, people dealing with fair trade, and so on and so forth. And there was sometimes the belief, and unfortunately it’s sometimes here yet, that there were magical solutions. I’ve been involved in microcredit for twenty-five years, but I could see the moment, when the international institutions discovered the interest of micro credit, they thought that everything was solved about poverty because we had micro-credit. Even the quantitative assessments of the importance of social economy might be questioned. The promoters of social economy would say : look, in Europe for example, every consumer is part, from health insurance to bank, of social economy. But they would not add that these consumers not even know, they are part of social economy because the fact is that the social economy would not make the real difference. All the same, solidarity economy often claim it is innovative but this claim is not enough to be actually innovative. We have to demonstrate that. Unfortunately the demonstration is very poor, because the exchange of experience would not exist. Can we pretend that the legal status is enough to be innovative? That was the situation twenty years ago.


And also the illusion that we are gaining ground, we are progressing. But listen, the “Rochdale principles” is from 1844. If we had made such huge progress, if we were a tide, overwhelming capitalism, somebody would know it! Somebody would know it in the end. And look at our farmers’ cooperatives: our farmer cooperatives have been a huge social progress at one time. But what have famers’ cooperatives become? Sellers of pesticides, that’s the way they make their living, that’s the reality. And which is in Europe the leader for GMO? markets? It is the farmer cooperatives limagrain, fighting against the mutualisation of farmers’ seeds. That’s the reality we are facing, the gap between the thing we pretended to be, and the fact of what we are really.


Now, what is the move we made over the last twenty years? First of all there has been a real renewal of the social and solidarity economy world with a new generation, with new blood, with new vision, more future oriented, new countries getting in. Second, a real internationalisation of the movement, connections of every kind, and de-sectorization, and we can see that in this wonderful forum, fair trade, finance, social enterprises, are now together to try to share their experience and to think where we are going in the future. Even the issues of social economy were totally cut from the ecological movement. I remember of the first World Social Forum. The issue of social economy was totally absent. And I would like to recall the role that Philippe Amouroux, lot of you knew, did to help people go together. Little by little we saw that at the World Social Forum, the issues on economics were not any more fighting the multinational companies but also promoting a solidarity economy.


That has been the real progresses over the last twenty years. And look at what happened during these last months. There has been in France what they have called the Estates General of social and solidarity economy, a real momentum for people working together, 400 proposals, documents shared, where you could see the social, intellectual, and I would say spiritual dynamics of the movement. Then, the International forum of social and solidarity economy just ended in Montreal. More than 60 countries were there, with an incredible enthusiasm of sharing experience and showing new ways. And now, we have this ASEF. Nobody would ever imagine, when we started some years ago, that it would be at that stage now.


So, we are really now in a new dynamics, new intellectual dynamics. Solidarity Economy is no more considered being. Hence, a new recognition from the public authorities a marginal issue. It is a key issue for social development, it is a key issue for territories. Last but not least, we can assess the vitality of emerging countries reflecting the new role of Asia.


There is also, a recognition from the academic world. I think in many countries now, in the universities you can find specific training about social entrepreneurship or things like that. We have also seen a connection, even if it’s not perfect, with the ecological movement that we can see through fair trade, organic farming and supply chains. We have privileged now the sharing of concrete experiences instead of celebrating institutions. We chose to be an alliance, that is a process, and not a new institution. We insist on building processes, agreeing on objectives, agreeing on an ethics, agreeing on the way to do and to proceed, and I would tell my admiration for the Asian alliance for solidarity economy. That is the way we have been progressing for the last twenty years, and I think we can have some pride for the progress we have made.


Now, I come to my second point, which will not be as positive, the long way ahead and the need to run, and not to walk.


The new elected president of the Brazilian republic, Dilma Rousseff, recently addressed the UN general assembly and said “Now, there is a convergence of crises, ecological crisis, financial crisis, social crisis, and economic crisis. And we should take that as an opportunity, because now we understand that it is a systemic crisis.” But at the same moment I was reading on internet what was said about the international forum on social economy, and I would see the comment “Social economy does not pretend to replace the normal economy, just to complement”. Okay, but therefore the question is: confronted to a systemic crisis, has solidarity and social economy real answers to bring to the world? And that unfortunately is less clear.


I looked at the different documents which had been prepared, for example in the perspective of Rio+20, by the solidarity economy movements, and I’m struck by the gap between the statements and the solutions. Statements are very comprehensive, often very dull, but are the solutions visionary enough? Are the solutions comprehensive enough? I question that. Presently, it has become clear that the Washington consensus has failed. Are we going to replace it by a Rockdale consensus? Definitely not. It is the Beijing consensus which is taking the lead! That is: a strong centralized state with a long term investment in extensive development. These are the answers which are put on the table. So, we have to open new perspectives.


I would like to propose for the discussion during these three days, three concrete perspectives. The first one is: don’t let Rio+20 fail. Already most of you know that in June 2012 there will be the Earth summit, for the 20th anniversary of the first Summit in Rio. Like it or not, it is the unique opportunity, for the international community, for the global society, to discuss about solutions facing the global crisis. It is the unique opportunity we have at hand. Unfortunately, Rio+20 is right now scheduled to fail. Why?


First of all, it is the last event of a long series of failures of international negotiations. Over the last 15 years, consensus conferences have taken the place of UN negotiations. And what does it mean, consensus conferences? It means that every major country has a veto right. That means that international negotiation is just about bargaining between so-called national interests. And we go exactly nowhere. We go exactly nowhere, why? Because the gap has been widening between the way that dialogue is organised in the international community, dominated by diplomacy which relates to the 17th century, creating so-called nationals interest in confronting, while there is a global society rising but no place to discuss our common issues. Because we never acknowledged, at the international level, the consequences of our interdependence. We say our leaders are accountable, but to whom are they accountable? To their voters. But all our actions, have impacts beyond national borders. And the same with companies, they are accountable. Okay, they are accountable to their shareholders, and to the national laws, but their impacts go much beyond these borders. So, because the international community has not addressed the issue of our interdependence, all the international negotiations are going to fail.


The second reason of failure is that the big leaders will not come at this conference. They were not interested in showing that they have not respected their commitments taken twenty years ago. So what happened? They have agreed upon a restrictive agenda. Who can tell me what is the “green” economy? They replace one magical word, “sustainable development”, by another one, “green economy”, thinking that because we put together things which are contradictory “green” and “economy”, the contradiction is solved. That’s magical thought, right? And when the Conference will take place, the big leaders will think about the Greek default, the sovereign debt, the global recession, the international finance systemic crisis, who will care about environmental imbalance, who will care about the green economy? Nobody!


And the third reason of failure is that civil society will be there. Will be there? When? How? Who will represent it? The kinds of global organisation, they will have their flags to protest, to try and enter the conference room, then there will be the police with their shields, like it happened in Perth at the recent common wealth conference. They will say “we are the real people” but they are not the real people. Because there is no representation of the global society right now. Right?


So three reasons of failure. We cannot accept Rio+20 to fail. Because people are feeling more and more powerlessness, they see that their leaders are not dealing with the future issues, they see that the crisis is growing and the statements are getting duller and duller, but we don’t move about that. We can change the failure into a success. And the way to do it, first of all, is to put on the agenda a Charter of universal responsibility which deals with interdependence, which acknowledges the fact that economic and political leaders are responsible not only towards their electors or shareholders, but are responsible towards all the people they impact. Because who is responsible for the destruction of Bangladesh? The sea level is rising. No one. The rich countries will give pocket money for climate refugees, and no one will be responsible for the destruction of all a society. That’s the reality. If we don’t change it, if we don’t create new international law, we will not move on our global issues.


Second point, we have to refuse the agenda of green economy. This is just a bone given to chew for the dogs. The reality is we have a global crisis, we have to discuss about a global change of our development model. That’s the only possible agenda. Therefore you have to tell to your government, “Now, you have to change the agenda, we are tired with discussing with stupid things”.


And, last but not least, we should conceive a way to bring the global society together, all the stakeholders. Because we say we are a family but where is the table where the family discusses its common issues? Nowhere. So this is the burning short-term issue turning Rio+20 from failure to success.


Second issue is, now the social economy has to get involved in a comprehensive thinking about an alternative model. Stop thinking you are a complement to the classical economy, try and think what you can bring, not only you, but a lot of others, to the thinking of what will the next model be, based on which vision of the world.


Definitely the kind of vision of the world which we promoted in the name of efficiency is no more adapted to the coming century. But now, we have to work on what are the levers for the big transition? And we need to be focused on these levers.


The first lever is about territories: I think a lot of people in the social economy have understood that they had a specific connection to territories, with the local. But we need to go further. We need to understand why territories will be the pivotal of the economy of the twenty first century, what I call the Oeconomy in my book. We need to think territories in new ways. Not just local authorities, not just small action, but thinking of territories as major actors for the next century. So we need to make a theoretical effort.


The second point is about global supply chains. Social and solidarity economy talks a lot about short links between producers and consumers. It is nice, but it doesn’t go very far, to be honest. In a country like mine, if you look for example at the energy costs of food, you will discover that the travel costs, transportation costs are marginal compared to the energy cost of an intensive industrial agriculture. So you should not identify solidarity economy and local. We need to bring a new vision of global supply chains. There will be no sustainable society without global supply chains. Now how do you address this issue, what are your proposals? What kind of negotiations do you propose to deal with that?


Third point is the articulation of different levels of governance of production and consumption. It’s clear that we cannot think of the economy just like one world single market with just competitive advantage going from everywhere. We have to think of different levels of production and consumption. But are our operational tools, like currency, right now do not allow us to articulate these different levels ? Certainly not. There is a breakthrough about governance which took years but now happens: understanding that the key issue for governance is multi-level governance. No one single issue can be solved at one level anymore. We have to think how articulate all those levels of governance. This is the case for economy. We have to think hard how we would conceive the alternative model as a way to articulate the different levels of exchange. Indeed we need new tools, otherwise it’s only lip service to what should be done. And there is hard, tough work in front of us to do that.


Fourth example, currency. Our leaders have become completely schizophrenic. Take this example of 2009 and of the big leaders of the world. They rushed to G20 to discuss how to avoid global recession, how to launch a new wave of consumption, to avoid social problems. Then they would rush to Copenhagen. “How to stop consumption to save the planet?” Then they would rush to the next G20, “How to avoid global recession?” And so on and so forth.


Where are we going? Where are we heading at? With schizophrenia. Now we have to ask ourselves. Is it a real contradiction that our leaders are facing? Is it an absolute contradiction or is it due to the tools we use to manage our society? The answer is: we to the tools we use. Because we use the same currency to pay what should be spared and what should be spent, that’s fossile energy on one side and human work on the other side. With our present conception of currency we just cannot separate them. Hence, the contradiction. But if you think that we are not any more in the 17th century, at a time when there was no other mean than metal currency, we can now create a multi- dimensional currency.


Some do it in the local social economy with local money but it’s just a starting point. How to move from that to a visionary approach to currency? And put it in the debate at the university.


And last but not least, how for a movement of solidarity economy, to be strategic? How to adopt a strategy for systemic changes? You know what is systemic change? Everybody understands that it is something where it’s not enough to move one piece to move the whole system. It’s like a Rubik’s Cube, systemic change. Each and every part is easy to match, the problem is to get all the parts together. So our movement has to be strategical about thinking of systemic change. I think we’re all in a situation to invent a new alternative under the condition that we spend more time to think. In 2009, Paul Krugman, the economy Nobel Prize, wrote in the New York Times “Conventional thinking is much more resistant than vested interests.” We always think as if it were only about pushing the dominant interest and making a place for the poor. That conventional thinking is much more resistant.


So strategic change is about changing the concepts. It’s about changing the institutional framework. If we look at the status of the present company, it’s inherited from the Renaissance, from the 16th century. Do you really think that this status is fit to address production and consumption in the 21st century? My answer is no. But what to put in place? You have to think about it. We need to build global alliances. We have done the first step, internationalize the solidarity economy movement. Now we need to build broader alliances to invent the new model.



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