1. The Windows Man 

Fortunato Costa

Macau, 6/December/1997

[ Master's Degree Project of European Law ]

[ Professor Doutor Miguel Poiares MADURO ]

1.1 Globalization?
 

Nature is Global in every sense.
Is there a political or economic frontier for a bird? In fact, at the very beginig Man had no barriers, only the Family concept like in many basic animal formats... but, today, even that is becoming upside down.

For centuries Man made casttles, frontiers and barriers, of any kind, to protect himself against animals, nature and other Man.
One day, He found that it was alone, inside its 'Black Box'. And He decided to open one window, later two...

... and again the Spiral in motion...

 
Power will always exist. It is a form of potential energy. And can have many forms: financial, political, legislative, military, force, atomic, electrical, ...
Nature clearly proves that potential difference is a pure fact.
As a result, there are men (individuals, or organizations, or countries) with much more power than others.

Social Justice must protect the less powerful entities of nature from the more powerful ones.

Is this a pure energectical problem? What is the reaction of nature when there are large potential differences?
 

2.1 Globalization Definition
 

* NO: Deep Economic (political) Integration.
* NO: Globalization is a process to reduce economic borders.
* HOW: Uniformity in Economic policies worldwide, and 'regulatory competition'? Yes! But how?
* NO: Globalization is a condition that magnifies forces to break down barriers.
 

* 'Deep Integration' as a negative effect on public policies and programs: full employment, workers rights,
Health care, social welfare, ... Why?
* Limit the fiscal and monetary policies.
* Difficult to raise taxes.
* Difficult to lower labor standards and wages.
* Difficult to stay competitive.
* Social dumping

*The Euro-pessimists:
* 'Embedded Liberalism' created by the Bretton Woods agreement (School), 'golden age' 1950-1973.
* Europe will weaken social policies of the member states... and undermines the social welfare.
* The European union supra-national institutions will lack social policy.
* In North America 'The International Forum on Globalization' to protect threats to economy, environment, communities, human rights, equity, and democracy.
 

'Nostalgia and Resistance' is important but we must move on to deep integration.
NO: Globalization is not a disease... we must go on and look for great efficiency.
How about Equity?
NO: Can we have Social Protection after Globalization?
 

Can you guess the Future by reading old books? May be...

Three ways:
* Globalization is a new utopia that will spread to all world.
* 'Nostalgia and rhetoric of resistance' deeply pessimistic about the fate of social democracy.
* Understanding of the positive aspects of economic globalization and a critical appraisal of its social costs.
HOW: Global Commitments to social equity, and international problem-solving. Pragmatism and realistic politics. Reinvent national, regional and global Governance to accomodate globalization and social equity and cohesion.
 

A new political/economic paradigm... nobody knows exactly what to do.
But man is good on solving this types of problems: ZERO DECISION, let's wait and see...
 

3.1 Global Utopia

* Neo-liberals welcome globalization.
* Less government, no barriers mean perfect markets, so more efficient allocations.
* More efficiency and maximization of welfare.
* Welfare benifits promised by an international division of labor based on comparative advantadges.
* NO: Global capital market will discipline the nations and ensure markets are not distorced.
* Capital will flow wherever returns are highest.
* NO: Markets will provide all the social pretection needed.
 

(i) Embedded Liberalism:
* Domestic laissez-faire, state intervention, delink from world economy.
* With Free Capital Movements & Footless Firms, governments could not use interest rates or taxes to promote employment or pay the welfare.
* So, governments have been acting as capital transaction buffers between local and international economies. They were still able to secure the welfare benefits.
* Exchange rates served as key buffers.
* NO: The system was protecting the social welfare.
* Up to the 70's it was a "virtuous circle". But, we had marginalized countries...

(ii) The end of embedded liberalism:
* Capital mobility & footless firms increased the dispersal of production, have created difficulties to state regulations.
* Mexican crisis, now the Asian crisis are a proof of the weakness of national economies to capital fast flows.
* markets (Multi-nationals) are now much stronger than the majority of states financial power.
* No more full employment concepts.
* Price stabiliby become more important than full employment (significant unemployment).
* NO: Competitiveness is the "Golden Rule", every country is trying to produce "Economic Global Warriors" to win the global economic Battle.
* NO: So states are cutting, and using, social welfare funds to maximize efficiency.
* New international division of labor, dispersed manufecturers through out the World seeking for low labor cost countries.
* The states are trying their best to atract capital investors.
* Can embedded liberalism go on?
 

* HOW: Supply side measures as the primary means to ensure social equity.
* HOW: high wages maintaining competition and social welfare.

*@: Both are theorycal dreams, or short time methodologies because everybody is trying to make the same: The New Economic Global Warriors. And at the end the states that, NOW, have more power will be the winners!!!

* NO: Wolfgang Streeck, German sociologist, Welfare Plan - even he believes Europe will not care enouph. Just because the World is not only Europe...

(i) The Positive Vision:
* To foster neo-industrial patterns of production to remain competitive.
* Diversified quality production, flexible specialization
* NO: Maintaining high wages due to quality, can sustain social equity.
* SECRETS: High skilled flexible workforce, sophisticated technology, even on IT. Training, good education. Of courses everybody is already trying that...
* MUST: The Neo-industrial strategy can work to reduce the impact of globalization on social welfare and equity and focus on the Institutional Conditions necessary for neo-industrialism.

(ii) The Legal Foundations of Neo-industrialism:
* NO: Important institutional preconditions are needed to regulate competitiveness.
* NO: Institutional arrangements to convince companies to go for high wages, better legal environments.
* The Legal Foudation of neo-industrialism is needed. But the EU cannot (??) create the legal framework basis.

(iii) The Exo-Skelton
* The neo-industrialism requires a hard, formal, public legal "Exo-Skelton".
* Mandatory legal rules and a strong role of the state are the basis of Good neo-industrialism. Some legal aspects, the Streeck Exo-Skelton:
- Garantee effective unions;
-NO: Require industry-level and uniform wages;
- Mandate co-determination from boardroom to shop floor;
-NO: Guarantee long-term job security;
- Ensure regular training;
- Provide for effective dialogue between capital and workers with the state as a regulator.

* @ Competition Regulation is more important than everything.
* @ Permanent training and very good education.
* @ Strong regulation on welfare company obligations.
* @ Protect Strongly the Basic Foundamental rights: very low, low, costs for basic food, for social housing, for health services and very high quality EDUCATION.
* @ Teachers must be considerer the most important people in Society (I am not a teacher...).

(iv)
An alternative approach-neo-industrialism via soft law, contract, regional government, and private governance.
* There are some cases of neo-industrial excellence, and this accurred in countries without neo-industrial legal skeltons. So, even the local municipal support can have an important role...

(v)
Conclusion: Neo-industrial in one market?
* NO: If Europe can implement a legal-institutional framework that dream will be possible.
* NO: Why Streeck does not think that Europe is going to implement it??? Does he believe in what he is praying? I don't think so...

* @ Competition Regulation is more important than everything.
* @ Permanent training and very good education.
* @ Strong regulation on welfare company obligations.
* @ Protect Strongly the Basic Foundamental rights: very low, low, costs for basic food, for social housing, for health services and very high quality EDUCATION.
* @ Teachers must be considerer the most important people in Society.
 

* Social Justice after Globalization???
* The Social Europe, a Union wide regime. There is an open debate about it.

4.1 The need for a "Regime"

* NO: There is a need to make a complex framework to sustain the neo-industrialism

* Yes! This the way to go... There is an enormous need to have a supra-national regimes for coordination of social (welfare, safety, health, education) national policies.
* Please, no regimes...

* What must the Union do to ensure that the conditions for neo-industrialism are preserved and spread throughout Europe?

* Can an intergovernamental regime provide needed support, or are supra-national or truly arrangements necessary?

* Is the Union structurally and constitutionally capable of performing such functions?

* How likely is it that the union will take the necessary measures in the near future?

* How to colect money from companies/business to pay the Social Welfare?

(i)
Éuropessimism
Streeck in fact is the key of Euro-pessimism... or may be it is a strategy to impose its ideas?!

(ii)
Euro-optimism
Positive thinking is the best way when we don't know what is going to happen.
But, but, but... it is time to concentrate already on the Social problems that we already have!!!
 

* Difficulties to create social regimes for social protection.
* Streeck has no strategy at all,  but he explained well the German case.
* The enormous differences between the poorest and richest countries in Europe will make things even more difficult.

* IT IS NOT ONLY THE POLICAL NEEDS THAT WILL MAKE THINGS CHANGE... THE ECONOMIC 'MONSTERS' ARE SOMETIMES MANIPULATING THE POLITICAL POWER...
 

Governments must concentrate, exclusively, on the Social Justice of their country citizens. And in legal frameworks to make the private organizations to pay that Social Justice 100%...
Even if these firms are operating directly from Mars.

 
This Presentation was a clear example of Globalization and Social InJustice.
Globalization because it was made directly on the Internet and presented online to our Macau International European Studies Institute (IEEM) Master's students and European Law teacher, and at the same time, could, AND CAN, be seen worldwide over the NET.
On the other side it was pure Social Injustice, because my other two coleagues - TONI, from mainland Popular Republic of China and SIMON, from Macau Statistics Department - did not have the same resources as me to make their presentations on the same topic. In fact they used the whiteboard and paper to present their work, and I used a overhead projector with a computer connected online to the Internet.
Does this mean that my presentation was better than them? No! Of course not!!
So, let me congratulate you two guys (Simon and Toni), forever, for the nice and great presentations you have made.

 
Thank you Professor Miguel Maduro.