Marquette University e-Publications@Marquette Economics Faculty Research and Publications Economics, Department of 1-1-2001 Introduction to Guiding Global Order: G8 Governance in the Twenty First Century John J. Kirton University of Toronto Joseph P. Daniels Marquette University, [email protected] Andreas Freytag University of Cologne Accepted version. "Introduction," in Guiding Global Order: G8 Governance in the Twenty-First Century. Eds. John J. Kirton, Joseph P. Daniels, and Andreas Freytag. Aldershot, ENG: Ashgate, 2001: 1-18. Publisher Link. © 2001 Ashgate. Used with permission. 1 Introduction By John J. Kirton, Joseph P. Daniels, and Andreas Freytag The June 1999 G7 and G8 Summit in Cologne, Germany, marked the end of the first quarter century of the operation of this unique international institution. Far more importantly, it set the stage for the much more ambitious and effective form of global governance that the G7/8 system is called upon to provide to meet the heightened challenges that the twenty-first century brings. The Cologne Summit's outline of a blueprint for reforming the international financial system pointed to a much more transparent, domestically intrusive, internationally inclusive, and effective regime for governing global finance in an era of intense globalisation. The Summit's landmark achievement -the Cologne Debt Initiative -marked a significant step forward in an II-year effort to relieve the debts of the world's poorest countries. In doing so, it highlighted the additional obstacles these countries face if they are to integrate into the global economy in a way that secures sustainable and widely shared growth. The Cologne Summit's decisive role in successfully ending the war to liberate Kosovo and in mobilising the reconstruction effort to secure a genuine, multiethnic democracy foreshadowed the new demands faced by G8 members and others for major military and humanitarian intervention efforts on a global scale and for rebuilding domestic societies and polities to accord with evolving global norms. And in several other fields, from multilateral trade to education and the environment, the Cologne Summit set the direction for the major international regime-building exercises that shape global order today. Beneath these individual achievements there lies a more profound change in the intellectual core and legitimate processes for shaping and managing global order in the coming era. What might be called the new 'Cologne consensus' marked the end of an unchallenged two-decade-long agreement on neoliberal principles as a guide to global and international governance and a shift toward a more socially sensitive and inclusive approach to globalisation. Whether this is a real and enduring change -and, if so, whether it is one for good or for bad -is the subject of analysis and debate in the policy world, among scholars, and in this book. Moreover, as affirmed by the presence of many thousands of citizens who came to Cologne to call for the relief of the debt of the poorest, the 1999 Cologne Summit marked a major escalation of the demand for the more effective influence and direct inclusion of civil society in the emerging centres of global governance. Furthermore, the creation of the new G20, and subsequent calls by the 1999 G8 chair Gerhard Schroeder and the 2000 chair, Japanese prime minister Keizo Obuchi, for China to participate in the G8 Summit demonstrated a broadening effort to expand Kirton, Daniels, Freytag 1 the G7/8's inclusiveness and representativeness, and thus the legitimacy of the global order it guided. These historic achievements at Cologne, as carried forward to and through the July 2000 Okinawa G7/8 Summit, point to a future that will by no means unfold inevitably or easily. Indeed, the task of constructing a stronger, more modem, more socially sensitive international financial system remains a slow, complex, cumbersome and still highly contested project. The post-Cologne difficulties in constructing a tolerant civil society in Kosovo, in maintaining respect for human rights in Russia amidst the ongoing conflict in Chechnya, in including China in the network of G7/8 governance, and in launching a new Millennium Round of multilateral trade negotiations clearly demonstrate how much of a struggle it will be to insert new principles and processes into well-entrenched patterns of governance. The depth and difficulty of the challenge have been dramatically highlighted by the disruptions from civil society actors to the long-established procedures of global governance at the November/December 1999 ministerial meeting of the World Trade Organization (WTO) in Seattle and subsequent gatherings in 2000 of the United Nations Conference on Trade and Development (UNCTAD) in Bangkok, the World Economic Forum in Davos, and the International Monetary Fund (IMF), World Bank, and G7 finance ministers in Washington and Prague. The accomplishments of Cologne must thus be evaluated and built upon in response to this formidable set of voices, and their challenge to the longstanding essentials of neoliberal orthodoxy and state sovereignty. The challenge is to create a more inclusive, legitimate, and socially safeguarded consensus at the core of the emerging global order. The Approach Guiding Global Order addresses this ongoing struggle to define a new socially safeguarded and more legitimate and inclusive global order for the twenty-first century. It can be taken for granted that this goal is shared by most citizens, politicians, and analysts, whether they are economists or political scientists and regardless of what epistemic, professional, or national community they come from. There are, however, very different opinions about the best or even possible way to achieve this goal. This book adds to the existing literature and debate over this 'best way', since two general opposing views of the Cologne consensus have flourished, and are represented at the core of this work. Political scientists generally welcome this change because they see the large and beneficial potential of both nation-states and global governance to improve the social situation of the people via co-operative political action. Moreover, they are sceptical about whether the Kirton, Daniels, Freytag 2 market will solve the distribution problem properly. In other words, they see a contradiction between neoliberal economic policy and social cohesion. The empirical evidence thus far cannot allow one to reject this view entirely. In contrast, economists are generally more optimistic. They tend to argue that the open markets and nondiscrimination brought by globalisation will add to social cohesion. To start with, they would question the view that there have been two decades of unchallenged agreement on neoliberal principles. As for liberal policy, much of it seems to be lip service from politicians, rather than the practical realisation of liberalism in economic policy. In addition, economists, in particular those trained in political economy, have less trust of governments than political scientists. These two opposing views, collected in one book examining the current challenges of G8 and global governance, can be very useful for both groups. Although they deal with the same topic and agree on the same eventual goal, political and economic scholars often do not understand each other. This makes it awkward for satisfactory discourse and thus difficult for an analytic consensus to emerge that is relevant to policy. The debate on global governance can greatly improve if people better understand each other's analyses and priorities. There is much to be learned. It is to be hoped that Guiding Global Order will contribute to this learning process, and thus in a small way fulfil the commitment contained in the Cologne Summit's charter on life-long learning. This dialectical approach does have its shortcomings, however. The most obvious is that many pure political scientists or economists might be offended by the other discipline's contributions. Nevertheless, costs remain the exception rather than the rule. Beginning with the Cologne Summit of June 1999, the book explores the extent to which the emerging global order at the beginning of the twenty-first century is, should be, and can be marked by a major shift toward a new consensus that gives widely shared prosperity, social and environmental safeguards, and greater inclusiveness and representation an equal place with raw growth, market liberalisation, and managerial efficiency. To do so, it considers the changes taking place across a broad spectrum of the major issues dealt with by the G7/8 at the Cologne Summit and on the road to and through the Kyushu-Okinawa Summit of July 2000. This spectrum ranges from the high politics of winning the war in Kosovo to the low politics of international macroeconomic policy co-ordination and debt relief. Moreover, Guiding Global Order looks outward at the expansion of the G7/8 system through the advent of new international institutions such as the G20, through a closer association with the emerging major power of China, and with the centre of supranational governance in the European Union (EU). In each case, this work conducts several tasks. First, it examines the steps forward made Kirton, Daniels, Freytag 3 at Cologne and the extent to which they represent major changes in new and innovative directions, as opposed to marginal advances or reversions to an older status quo. Second, it explores the underlying causes of the new directions set by Cologne and on this basis offers judgements as to their future course and cadence. Third, it critically assesses the quality of those major decisions and subsequent directions to determine if the Cologne consensus will be effective in accomplishing its ambitious targets or if more radical reform is required. Fourth, it judges how adequate these evolving new principles and processes in global governance will be in addressing the challenges brought by the rapidly changing world of the twenty-first century and what new paths and policies are still required in response.